[Canada] Supplemental Unemployment Benefit Plans

If you have an employee who is currently on leave, Wave offers Canadian employers the ability to add a top-up or supplemental payment to their next pay at no extra cost.

You can use Wave to top-up your employees' employment insurance (EI) benefits during a period of unemployment due to:

  • Maternity, parental (including adoption), compassionate care, family caregiver leave
  • Temporary stoppage of work 
  • Training
  • Illness, injury or quarantine

Top-up payments made due to maternity, parental (including adoption), compassionate care, family caregiver leave

Employers who provide top-ups to maternity, parental (including adoption), compassionate care, or family caregiver benefits do not have to register their plan with Service Canada. Top-up amounts are not considered regular earnings and are not deducted from the employees’ EI benefits. Top-up amounts are still subject to Canadian Pension Plan (CPP) contributions and income taxes. Top-up payments can be paid to employees while they wait for their EI benefits.

Wave recommends keeping records to show the effective date of the plan and that the following requirements were met to prevent the amount of the top-up being deducted from the employee's EI benefits:

  • Payments are added to the employee’s EI weekly benefits and the combined amount does not exceed the employee’s normal weekly earnings from employment—100% of gross salary; and
  • Payments are not used to reduce other accumulated employment benefits such as banked sick leave, vacation leave credits, or severance pay.

Top-up payments made due to temporary stoppage of work, training, illness, injury or quarantine

Employers who provide top-ups for employees who are unemployed due to temporary stoppage of work, training, illness, injury or quarantine must register their plan with Service Canada following this guide. The plan must meet the requirement of Section 37 of the EI Regulations. Your plan must be registered prior to the date it is going into effect.  

For more information and steps on how to register your plan with Service Canada, please see Registration of a SUB Plan. Along with the registration form, you will be required to enclose a copy of your plan. Service Canada provides details on the requirements of the plan and a sample plan here

As with unregistered plans, top-up amounts are still subject to Canadian Pension Plan (CPP) contributions and income taxes are not deducted from the employees’ EI benefits.

How to add a top-up payment to an employee on leave in Wave:

  1. Under the Employees tab, select the employee who will be receiving the top-up.
  2. Under their employee profile, go to Benefits & Deductions > Add to Pay.
  3. Select a Supplemental Unemployment Benefit Plan payment from the drop-down menu and add the additional payment details.
  4. Choose whether you want the benefit to occur either every pay cheque (every pay period) or every month.
  5. Upon saving, this top-up benefit will appear on your next payroll for your employee.

The employee must be placed on leave first in order to add the supplemental family benefit.

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