As part of Budget 2022, the federal government recently announced that EI sickness benefits would be extended from fifteen weeks to twenty-six weeks as of December 18, 2022.
What do these changes mean:
- If your short-term disability plan integrates with EI sickness benefits, you should consider making your maximum benefit period twenty-six or twenty-seven weeks (the exact amount will depend on the length of your short-term disability elimination period).
- If you do not offer short-term disability benefits, and your plan members can claim EI sickness benefits before they can claim long-term disability, you should consider changing your elimination period to twenty-seven weeks (this covers the one-week EI wait period plus twenty-six weeks of payments).
- The changes to the EI sickness benefits do not impact the Premium Reduction Program (PRP).
If you don’t make these changes, there’s a chance your plan members will receive EI and disability benefits at the same time. When this change is in effect, you may wish to advise your plan members who receive EI sickness benefits to contact Service Canada to discuss potential impacts to their benefits.
There are still some questions we don’t have answers to, including whether changes to the long-term disability elimination period will be mandated and how short-term disability plans integrated with EI will be impacted.
Most long-term disability contracts do not contain an offset provision for EI benefit payments, so good planning is essential to ensure that an employee cannot collect EI sickness benefits and long-term disability benefits at the same time.
Please keep in mind that these changes are optional and therefore do not need to happen by a specific date. Reach out to us if you would like to:
- Adjust your short-term disability benefit period.
- Change your long-term disability elimination period.
- Learn more about how these changes may impact the cost of your benefits program.
In addition, ensure that your employees are aware of any changes you make to your benefits program and how the changes will impact them.
Contact us today if you have any questions.
