Employment Insurance is a federal program funded by employee and employer premiums that provides temporary income to eligible workers who lose their jobs or take certain leaves.
EI premiums are withheld from employees' insurable earnings up to an annual maximum, with the employer paying 1.4 times the employee's premium. EI funds regular benefits for job loss and special benefits such as maternity, parental, sickness and caregiving leave.
Most owners who control their corporation are generally not eligible for EI on their own employment and may be exempt from premiums, an important point in owner-manager payroll setup. Self-employed individuals can opt into EI special benefits voluntarily but not regular benefits.
An employee has EI premiums withheld up to the yearly maximum; the employer contributes 1.4 times that amount. If the employee is later laid off, they may claim EI regular benefits based on their insurable hours.
Our certified accounting firm handles this for businesses and individuals across Canada, at fixed fees with no surprises.
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