Submission

Looking Beyond the Surface: An Indepth Review of Parental Benefits

Laurie Ann McCardle, Executive Director
Women's Network PEI
PO Box 233,
Charlottetown, PE
C1A 7K4

(902) 368-5040 by phone
(902) 368-5039 by fax
wnpei@wnpei.org by email

PREFACE

Looking Beyond the Surface: An In-Depth Review of Parental Benefits is an initiative of Women's Network PEI. The goal is to examine the current legislation on maternity and parental benefits and develop recommendations to make the benefit more equitable for all women.

Completed in 2002, Phase I focused on gender-based analysis, statistical research and a literature review of current federal parental benefits legislation in Canada. An Atlantic consultation took place whereby each province hosted focus groups comprised of a representative cross-section of women, employees, and equality-seeking women's organizations. Phase I identified that maternity and parental benefits are not equally accessible to all. The most vulnerable and marginalized women are still not eligible to access these benefits.

Phase II of the initiative focused on identifying issues of concern, looking at options from a global perspective as well as within a Canadian context and developing recommendations towards a more equitable program. Representatives from equality-seeking women's organizations across the Atlantic Provinces reviewed the issues, identified gaps in the current benefits and developed and prioritized options. These participants developed recommendations for action to reduce existing inequities in the current legislation, thereby making the benefits more accessible and equitable for all women and families.

Women's Network PEI is a not-for-profit organization that works to strengthen and support the efforts of PEI women to improve the status of women in our society. Women's Network PEI would like to acknowledge our community partners who sat on the Advisory Committee for this project:

• Women's Economic Equality Society in NS,
• Urban Core Support Network in NB,
• PEI Advisory Council on the Status of Women, PEI Interministerial Women's Secretariat, Michelle MacDonald (Community Representative), and
• Bay St. George Status of Women Council inNL.

Status of Women Canada provided funding for this project.

EXECUTIVE SUMMARY

In 1970, the federal government introduced revisions to the Unemployment Act. For the first time, maternity benefits were included, entitling women to fifteen weeks of benefits. This was a huge step forward for women's economic and social equality.

Improvements have continued, culminating in January 2001 when, among other changes, the period for maternity and parental benefits was increased to fifty weeks for eligible parents. These changes were good to a point, as they increased flexibility for women to be at home for the first year of their child's life and encouraged men to be more involved in parenting. However, restrictions on eligibility and benefits negatively impacted women. The number of women qualifying for benefits fell from 49% in 1994/1998 to 33% in 2001.

Phase I and II of our research identified gaps in both economic and social policy leading to increased numbers of women being excluded from benefits that improve women's working lives and economic status.

Eligibility:

Access to benefits under the Employment Insurance Act is not equitable for all women; for example, those with non-standard work arrangements (part-time, seasonal, contract) are less likely to be eligible for benefits than women who work full-time; 78% of those who work between 15 and 35 hours per week are women. In 2003, eligibility for individuals who worked part-time was 61.2%, compared to 97.3% of full-time workers. One third of self-employed Canadians in 2002 were women, yet they are not eligible for benefits (except fishers). Certain groups of women are less likely than others to be eligible for benefits, including the most vulnerable and marginalized in our society. These include teenaged new mothers, who often do not have work experience or lack sufficient hours to qualify for benefits; women with little education who are often not in the workforce full-time and thus are less eligible for benefits; low-income women who are least likely to qualify for EI or to be able to afford to be off work for one year; recent immigrant women, 19% of whom were not able to find employment; and women with disabilities who are less likely to work full-time when employed.

Length and Value of Benefits:

Gender inequalities in income distribution have negative impacts on women. For example, the two- week waiting period without income applies to mother-only maternity benefits, not to parental benefits when the partner may take part of the benefit. The fewer women who qualify for EI benefits, the fewer families receive the Family Supplement. Self-employed women are excluded from accessing special EI benefits such as maternity and parental benefits. The current wage replacement does little to address economic inequalities among women. For example, a small number women receive up to 97% for a full year with an employer top-up; other women get the basic 55% from EI, while many get no benefits at all. At 55%, the wage replacement rate in Canada is one of the lowest rates in both developed and developing countries. The Low-Income Cut-off (LICO) has remained at $25,921 since 1996. Women with income under $20,000 per year reduced their leave period by four months or more.

Employment Protection:

Worker vulnerability is greater among women, especially the self-employed and those in non-standard work arrangements. Jurisdiction for maternity and parental leave falls under both the provincial and federal governments. Women are vulnerable because provincial employment standards vary depending on where you live. Some provinces require a defined amount of continuous employment with an employer, varying from zero to twelve months of service. The inconsistencies between provincial jurisdictions result in an inequitable situation for some women. Job protection for women while on maternity and parental leave should not depend on where she lives or on her employment history or her continuous attachment to one employer.

Issues for Further Consideration:

The number of Canadian families caring for children, the elderly, and those with disabilities is increasing. The Government has recognized the importance of caring in our society by renewing its focus on children, the elderly and persons with disabilities. Canadians provide support to those of all ages, from birth to death. By examining care giving from a much broader perspective, we see a continuum of care, over the lifespan. Parents are the caregivers of our children.

In order to do the best for our children, economic and social policy must advance the needs of children. Changes to maternity and parental benefits under EI have provided mothers and fathers with increased opportunities to be at home with their children in the early, formative first year. However, the Looking Beyond the Surface initiative has identified a number of issues concerning maternity and parental benefits that would be better served through social policy.

RECOMMENDATIONS

1. Eligibility

We recommend that the federal government extend eligibility for maternity and parental benefits by allowing self-employed individuals the option to pay into the Employment Insurance program.

We recommend that the federal government extend eligibility for maternity and parental benefits by enacting a 360-hour qualification requirement, regardless of regional unemployment rates.

We recommend that the federal government extend eligibility for maternity and parental benefits by allowing an option for parents to "look back" or reach back hours over a three- to five-year period prior to the birth of a child.

2. Length and Value of Benefits

We recommend the federal government eliminate the current two-week waiting period for maternity and parental benefits.

We recommend the federal government offer an additional two weeks of paid benefits, commencing immediately when an eligible worker files a claim.

We recommend the federal government improve the wage replacement for maternity and parental benefits by increasing the weekly payable benefits from 55% of insurable earnings to 65% of insurable earnings, based on the best twelve weeks of earnings in the last three to five years.

We recommend the federal government improve the wage replacement for maternity and parental benefits by increasing the maximum insurable earnings to $57,000, indexed annually.

We recommend the federal government improve the wage replacement for maternity and parental benefits by increasing the current Family Supplement rate to 100%.

We recommend the federal government improve the wage replacement for maternity and parental benefits by increasing the Low Income Cut-Off from $25,921 to $30,000.

3. Employment Protection

We recommend the federal government undertake consultation with the provinces in order to establish national standards for employment protection as it relates to maternity and parental leave, based on best practices and gender-based analysis.

4. Issues for Further Consideration:

We recommend the federal government undertake research into a continuum-of-care model for a national caregiver strategy to meet the needs of Canadians.

EMPLOYMENT PROTECTION

Mary is a 32-year-old woman living on Prince Edward Island. She has worked at two different jobs in the last year with enough hours to qualify for EI maternity and parental benefits. She was with her current employer for only sixteen weeks before the birth of her child. Her employer is under no legal obligation to protect her job because on PEI, Mary needs to work 20 continuous weeks. If she lived in Nova Scotia, she would require 52 weeks continuous work with her employer to be eligible for job protection.

Currently, jurisdiction for job-protected maternity and parental leave falls under the federal, provincial and territorial governments. Ninety-percent of paid workers in Canada fall under employment standards legislation, with the other ten-percent covered under the Canada Labour Code.

The Canada Labour Code provides job protection for employees under federal jurisdiction. Maternity leave is currently 17 weeks, which can be combined with a parental or adoption leave of 37 weeks. In federal jurisdiction in New Brunswick, Nunavut and the Northwest Territories, the combined duration of leave may not exceed 52 weeks. Eligibility is based on six months continuous employment with the same employer.

Every province and territory provides job protection for employees based on their own labour standards legislation. Protection can vary depending on where you live in Canada. In some areas, eligibility for maternity and parental benefits is dependent on a defined amount of continuous employment with an employer, which can vary from zero (in British Columbia, New Brunswick and Quebec) to 20 continuous weeks (in Newfoundland and Labrador and Prince Edward Island) to 52 continuous weeks (in Alberta, Nova Scotia and the three territories). Ironically, in some provinces a woman can be EI eligible maternity leave but is denied the associated job-protection under the applicable labour legislation. Similar circumstances apply to parental/adoption leave. Job protection should not be based on where you live, nor should it be based on a parent's employment history or continuous attachment to one employer.

[Alberta, Nova Scotia, and the three territories require 12 months of continuous service. ]

An inequitable situation for some women and families has arisen due to inconsistencies among provincial and territorial jurisdictions. People should be free to live where they choose and enjoy the benefits afforded most Canadians. Inequity in employment protection puts women who work seasonally in the Atlantic provinces at particular risk because continuity in employment is challenging in the context of seasonal work.

Recommendation #10

We recommend the federal government consult with the provinces in order to establish national standards in employment protection as it relates to maternity and parental leave, based on best practices and gender-based analysis.

Although employment standards are a provincial responsibility, the Federal Government should take the lead toward harmonizing standards across the thirteen provinces and territories, and the Canada Labour Code.

According to International Best Practices for Maternity and Parental Benefits, Sweden, Iceland, Italy, France, Norway and Luxembourg all offer job-protected leave to eligible employees.

Concluding Statements

Looking Beyond the Surface: An In-Depth Review of Parental Benefits has identified genuine concerns voiced by our friends, relatives, neighbours, and co-workers in Atlantic Canada. They are mothers who care deeply about their children and families. They are hard-working women trying to balance life at work and at home in a program that is rigid, inequitable, and out of touch with their realities. They are also the vulnerable and marginalized women who either are on the fringes of the labour force or don't participate. Maternity and parental benefits have improved over the past few years, but government can make changes to ensure the program works better for more women and their families.

Our recommendations are realistic, flexible, engendered, and equitable and focus on the health and well being of the mother and child. If we truly value the role of women as caregivers and workers, it will show in our social and economic policies.

Women who attended our focus groups asked the question, "What does having a baby to do with employment history?" The current vehicle for delivery of maternity and parental benefits is through the Federal Government Employment Insurance program, governed by economic policy. This program can be enhanced as a first measure towards creating equality. Additionally, other programs could be enhanced to better serve women under social policy.

APPENDICES

APPENDIX A - Summary of International Best Practices

APPENDIX B - Length of Maternity, Parental and Adoption Leave in Employment Standards Legislation (unpaid)

1. A number of jurisdictions allow maternity and/or parental leave (for natural or adoptive parents) to be extended under certain circumstances, such as late births or health problems of he mother or child.
2. In the federal jurisdiction, New Brunswick, Nunavut and Northwest Territories, the combined duration of maternity and parental leave may not exceed 52 weeks.
3. In the case of an employee who has taken maternity leave, the maximum parental leave is 35 weeks.
4. The Alberta legislation stipulates that there is no requirement to grant parental leave to more than one parent at a time if both parents of the child work for the same employer. In the Yukon, parents who share a parental leave cannot normally take their leave at the same time, whether or not they work for the same employer.
5. A majority of jurisdictions, namely British Columbia, Manitoba, Newfoundland and Labrador, Nova Scotia, Ontario, Quebec, Saskatchewan (with respect to parental leave), Nunavut and the Northwest Territories, permit both parents to take the full parental or adoption leave.
6. In Saskatchewan, an employee who is entitled to maternity or adoption leave may not take more than 34 weeks of parental leave.
7. In Newfoundland and Labrador, an eligible employee is entitled to 17 weeks of adoption leave, to which can be added 35 weeks of parental leave. In Saskatchewan, an eligible employee is entitled to 18 weeks of adoption leave if he or she is the adoptive parent who will be the primary caregiver; to thee 18 weeks may be added 34 weeks of parental leave. In both provinces, an eligible adoptive parent may therefore take up to 52 weeks of cumulative leave.