The 2017 budget lays out the Federal Governments plans to extend parental leave and benefits to 18 months.
New parents can now choose to take 18 months of leave at a benefits rate of 33% of their average weekly earnings, or 12 months of leave at a benefit rate of 55% of their earnings.
- Employees will be spending a much longer period of time away from work. This could be a significant operational concern if the employee is doing a very specialized job, or holds a senior position within the company.
- It will be harder for the employee to get back into the swing of things after being away for 18 months.
- Employers may need to offer retraining for the employee to return to the workplace successfully.
- Employees could return to work after the 18-month leave, work for a short period of time and then be off work again for a further 18 months in situations where they plan on having more children.
- The replacement hire would just be hitting his/her stride in the temporary position, when they would have to leave.
- Businesses which do not have the resources to backfill positions and tend to use other employee to perform the tasks of the employee on parental leave, could face pushback from staff.
- Employers who currently provide top-ups will need to decide whether they are going to increase the top-up amount.
Benefits of a longer parental leave
- Employees get to spend more time with their newborn children.
- The longer leave period will ease childcare burdens of employees.
- Employees will likely be in a happier state of mind and readier to return to the workplace after the longer leave and savings on daycare fees.
- It will likely be easier for employers to attract higher quality candidates to fill in for the employee on leave because of the longer duration of the leave.
When will changes take place?
The 18-month option is expected to begin in 2018. First there will be amendments to the Employment Insurance Act and the Canada Labour Code after which provincial legislation will have to be amended.