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Payroll 2 > Unit 7 employment insurance > Flashcards

Unit 7 employment insurance Flashcards

1
Q

Describe Employment insurance

A
  • provides temporary financial assistance to unemployed Canadians who lost their job through not fault of their own, while they look for a new one or upgrade their skills
  • also for sick, pregnant or caring for a newborn or adopted child, as well as those who have to care for a family member who is severely ill with significant risk of death or who must care for or support a critically injured or ill child
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2
Q

What are the 6 types of benefits

A
  1. employment insurance regular benefit
  2. EI maternity and parental benefits
  3. EI sickness benefits
  4. EI Compassionate care benefits
  5. EI benefits for parents of critically ill children
  6. EI fishing benefits
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3
Q

Describe EI regular benefits

A

for people who lost their job through no fault of their own

- available for , are able to work but can’t find a job

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4
Q

Describe EI Maternity and parental benefits

A
  • people who are pregnant, recently given birth, adopting a child or caring for a new born
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5
Q

Describe EI sickness benefits

A
  • unable to work because of sickness, injury or quarantine
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6
Q

Describe EI Compassionate care benefits

A
  • people who have to be away form work temporarily to provide care or support to a family member who is gravely ill with a significant risk of death
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7
Q

Describe EI for parents of critically ill children

A
  • parents who take leave from work to provide care or support their critically ill or injured child
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8
Q

Describe EI fishing benefits

A
  • support for qualifying, self-employed fishers who are actively seeking work
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9
Q

What are the employer requirements with regards to EI

A
  1. deduct EI premiums from employees insurable earnings
  2. Remit EI Deductions (employer and employee)
  3. Track insurable earnings and insurable hours by pay period for each employee
  4. Complete ROE when required using the above info
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10
Q

What is Service Canada Responsibilities with regards to EI

A
  1. Developing SIN operational policies and directives
  2. Administering the registration of SIN applicants and maintaining the register
  3. Handling requests for access to SIN info
  4. Developing and implementing investigation and control measures to detect and deter abuse of SIN
  5. working on communication strategies with the business community and general public
  6. reviewing legislation related to SIN to ensure proper provisions to administer SIN
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11
Q

Employment and Social Development what are their role in EI

A
  1. data verification reported by employers on ROE
  2. entitlement, determination and payment of benefits
  3. establishment of the annual EI rate (along with the Canadian EI commission)
  4. establishment of the annual maximum insurable earnings
  5. administration of provisions for wage-loss plans
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12
Q

What are CRA`s responsibilities with regards to EI

A
  1. determination of insurable employment
  2. Determination of insurable earnings form insurable employment
  3. The deduction and collection of premiums
  4. the keeping of books and records and their disposal
  5. the raising of assessments
  6. the determination of questions regarding payment of premiums or assessments
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13
Q

What is the penalty of you fail to remit

A
  • 3% 1 -3 days late
  • 5% 4 - 5 days late
  • 7% 6 - 7
  • 10 % more than 7 days or if no amount is remitted

generally penalties only apply to the amount you failed to remit over $500,
- however it will apply to the whole amount if you knowingly didn’t remit or under circumstances of gross negligence

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14
Q

What is the annual EI maximum

A

48,600

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15
Q

What is the EI Rate for employees

A

1.88%

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16
Q

What is the annual maximum employee premium

A

$913.68

17
Q

What is the maximum employer portion per employee

A

913.68 x 1.4 = 1,279.15

18
Q

Employment not insurable for EI

A
  1. casual employment for a purpose other than the employer`s usual business
  2. employment where the employer and the employee are not dealing with each other at arms length
  3. employment that constitutes an exchange of work or service
  4. employment of a person who controls more than 40% of the corporations shares
  5. employment in agriculture where the person receives no cash or works less than 7 days during the year
  6. employment of a person in a rescue operation
  7. employment by a gov. body as an election worker for less than 35 hrs during the year
  8. employment of a member of a religious order
19
Q

Can employees who earn $2,000 or less able to claim a refund for EI preimumsÉ

A

it is possible when they file their tax return

20
Q

What payments are not subject to EI

A
  1. payments made under a supplementary unemployment benefit plan (SUB)
  2. all benefits except :
    • value of board and lodging if paid cash in the period
    • all employer contributions to an employees non-locked in ` RRSP
  3. a retiring allowance or severance pay
  4. directors fees
  5. a supplement for maternity / paternal benefits
  6. an advance or loan for workers comp claims as long as it is paid back
  7. a supplement for workers comp benefits

8 a supplement for wage-loss replacement plans

21
Q

What are insurable hours for hr pay

A
  • each hour physically worked and paid during insurable employment
    • regardless if it is overtime
    • hrs are not rounded by reported as worked
22
Q

What are insurable hours for salary employees

A

number of hours is the expected hrs of work

- regardless of actual hours worked

23
Q

What are insurable hours for piece work

A

employer and employee must agree on a reasonable amount
or
insurable earnings will be divided by minimum wage with a max of 7hrs/day and 35 hrs per week

24
Q

what are insurable hours for statutory holidays

A

if you do not work = no insurable hours

however, insurable earnings still occur

25
Q

what are insurable hours for sick or vacation leave

A
  • each hour paid is an insurable hr

- If no time is taken off but vacation is paid out, then no insurable hrs are recorded

26
Q

What are insurable hours for which there are no hrs recorded

A

ie bonus

  • not usually based on time physically worked therefore no insurable hrs
  • insurable for dollars, just not hrs
27
Q

what are insurable hours for working on commission only

A
  • same rules apply as piece work

- reasonable amount would be used

28
Q

ex 1. Liz earns $1,350 per pay period. she also receives a life insurance taxable benefit valued at $25.00. since its not cash, it is not included in the calculation of EI

A

$1,350.00 x 1.88% = 25.38
employer`s portion x1.4
= 35.53

29
Q

ex2: Liz earns $1,350 per pay. she also receives a cash taxable benefit of $50.00 per pay.

A 
1,350 + 50 =1,400 
                 x 1.88%
                   26.32   (liz`s EI)
Employers x 1.4
       = 36.84
30
Q

ex 3: Liz earns $1,350 per pay. She also receives a car allowance (which is considered a CASH taxable benefit) of $450 per pay

A

1,350 + 450 = 1,800
x 1.88% = 33.84 (Lizs) employers x1.4 = 47.37

31
Q

How can an employer get an EI premium reduction

A
  • if employer provides an employee wit paid short term disability coverage for an illness or injury leave
32
Q

An income protection program like short term disability will result in whatÉ

A

will result in employees utilizing the EI program less and sometimes eliminate it all together. this relieves the strain on the program as a whole

33
Q

How do employers go about being approved for a reduction in EI premium

A

employer must prove the existence of a short term disability plan.

  • once approved for the reduction, they will use a lower rate to calculate their EI portions.
  • the savings from this would have to be shared by the employees covered by the plan (by paying the employees, providing an enhanced dental plan, group term life insurance, social activities or other benefits.)
34
Q

What is ROE

A

it is a document which employers must complete when an employee stops working and therefore experiences an interruption of earnings

35
Q

What is an interruption of earnings

A

when an employee has had or is anticipated to have seven consecutive calendar days wit no work and no insurable earnings, or when their salary falls below 60% of regular week earnings because of illness, injury, pregnancy or is providing support care for a critically ill family member

36
Q

when must an ROE be issued

A

each time an employee has an interruption of earnings (even when there is a strike or lock-out), when HRSDC (SERVICE CANDA) Requests one, when you change pay periods, there is a change in ownership, the employer declares bankruptcy or self funded employee leave occurs.

37
Q

For part time or casual employees, do you have to make an ROE after each 7 days interruption of earnings

A

no

Payroll 2 (18 decks)

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