Note: As of April 6, if you’re eligible for Employment Insurance (EI) and you haven’t yet applied for it, you should apply for the Canada Emergency Response Benefit (CERB) instead. EI regular and sickness benefits are now being merged with the CERB system.
The coronavirus pandemic has created the largest mass layoff that we’ve ever seen in Canada. About 1 million Employment Insurance (EI) claims have been filed in the past week and a half and another 4 million are expected to apply for the new Canada Emergency Response Benefit (CERB) announced Wednesday when it’s available.
If you’ve recently been laid off, or worried that you’re about to be, there’s a lot to keep up with. One big decision is whether to apply for EI or the CERB, a hard decision to make right now because the federal government is being flooded with requests, with reports of long lineups at Service Canada buildings.
Here are the questions to ask yourself and things to keep in mind to help you figure out what your best move is.
What are EI and CERB?
EI is the federal unemployment insurance program in Canada that provides temporary financial assistance. It’s paid every two weeks to people who are eligible, for a maximum of 55 percent of their insured earnings over the past year, capped at $2,292 a month. Benefits begin the week after your last day of work (there’s a one-week waiting period) and continue for a total of up to 45 weeks.
CERB is the newly streamlined coronavirus emergency benefit for people who don’t qualify for EI or choose this option instead. You can’t apply for it until the government website is up, which Prime Minister Justin Trudeau said will hopefully be on April 6. It offers $2,000 a month, retroactive to March 15, paid bi-weekly ($500 a week) for up to four months. Payments are expected to start 10 days after people submit their applications, meaning applicants won’t get paid until at least April 16.
Do you qualify for EI?
You’re probably eligible for EI if you paid into the employment insurance program, have been out of work for at least seven days in a row, and have worked the minimum number of hours (between 420 and 700 depending on where you live). You can see all the details here.
Do you qualify for the CERB?
The emergency coronavirus benefit if for anyone whose work is affected by COVID-19. If you’ve been laid off, are sick, quarantined, taking care of someone who is sick with COVID-19, or are a working parent who needs to stay home without pay to take care of kids who are sick or home because school or daycare is closed. CERB was designed for people who don’t qualify for EI but need help, including part-time employees, gig workers, and freelancers.
If you’re still working but don’t have money coming in because of COVID-19-related disruptions then you may qualify for the CERB.
How much do you make?
If you’re eligible for EI and the CERB one of the biggest considerations is which one will get you the most money. That depends on how much you make. Because EI pays a maximum of 55 percent of your income, capped at $573 per week, it’s the better choice for you if you make more than $54,200 a year before taxes.
According to Hilary Page, an employment lawyer at the Toronto-based law firm SpringLaw,, the CERB is the best choice for people on low incomes. For example, if you make $30,000 a year, under the CERB you would receive $500 a week, which is more than the $317 you would get through EI. “For low-income people, CERB gets them more money in their pocket than EI and they can still apply for EI when this is over,” she said.
How soon do you need the money?
Unfortunately, even if you applied as soon as possible, neither EI nor the CERB would get to you in time for the first of the month, which, if you’re paying rent is likely when it’s due. But of the two options, Page says the CERB will likely be delivered faster.
Under normal circumstances, it takes about 30 days to receive your benefits after you apply for EI. According to the government site, “the EI system was not designed to process the unprecedented high volume of applicants received in the past week.” With the rush of EI applications, it will probably take longer than usual—of the 1 million who have applied recently, a little more than 10 percent had been processed as of Wednesday. So you may not see that money until May.
Based on the government’s estimates though, CERB money could be in people’s bank accounts by April 16, if you apply as soon as the portal opens.
Are you out of work or working less?
If you’re still technically working a little bit, but not making enough to make ends meet, you can apply for EI or the CERB. But anything you make has to be reported and it will then be deducted from what you get from the government. For example, if you’re collecting EI and pick up a freelance shift and make $120, then that amount will be deducted from your benefit.
Page says this highlights the need for the federal government to increase the wage subsidy for small businesses. Right now, the federal government is offering to pay employers 10 percent of what a worker usually makes to help keep them on payroll. This is much lower than what several European countries are providing (the U.K. subsidy is 80 percent, Denmark 75 percent). Trudeau said there may be more announced to allow businesses to keep paying employees in the coming days.
Page says if you have the option to stay on payroll while making more than what EI or the CERB pays out, take it—there’s no waiting period, and it will be easier for both the employer and the worker when things get back to normal.
“In some cases, the employee is going to make more money on government assistance than staying at work and I think that’s a shame,” said Page. “If the government could top up salaries and keep people working instead of just paying them not to work; it could be more productive.”
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