Supplemental Unemployment Benefit Program
Overview
Employers can use a Supplemental Unemployment Benefit (SUB) plan to increase their employees’ weekly earnings when they are unemployed due to a temporary stoppage of work, training, illness, injury or quarantine.
Payments from SUB plans that are registered with Service Canada are not considered as earnings and are not deducted from EI benefits (pursuant to subsection 37(1) of the EI Regulations).
Employers who provide top-ups to maternity, parental (including adoption) or caregiving benefits (including compassionate care, family caregiver benefit for children and family caregiver benefit for adults) should refer to the Employers supplementing maternity, parental, caregiving benefits web page. These plans do not have to be registered with Service Canada.
Note:
On January 1, 2017, the Employment Insurance (EI) waiting period was reduced from 2 weeks to 1 week. It is possible that certain SUB plans registered before January 1, 2017, continue to provide payments to their employees during the 2-week EI waiting period. As such, some plans, as written, may require a payment amount in the week following the 1 week waiting period that would now exceed the allowable limit in that week.
To mitigate the impact on employers and employees, a transitional period of 4 years -from January 1, 2017, to January 2, 2021 is provided for affected SUB plans.
This allows plans of affected employers to continue to qualify as registered SUB plans while providing a period of time for these employers to adjust their plans to meet the 1 week waiting period. For employees, this prevents their EI benefits from being reduced in the week following the waiting period during the transitional period.
Basic requirements that must be met
SUB plans are registered by Service Canada through the SUB program in Bathurst, N.B. Plans must be registered before their effective date. Officers from the SUB program assess employers' SUB plans against the requirements set out in subsection 37(2) of the EI Regulations. SUB program Officers also help employers develop SUB plans that meet the requirements of the EI Regulations.
An acceptable plan is one that:
- identifies the group of employees covered and the duration of the plan
- covers a period of unemployment caused by 1 or a combination of the following:
- temporary stoppage of work,
- training,
- illness, injury or quarantine
- requires employees to apply for and be in receipt of EI benefits in order to receive payments under the plan
- requires that the combined weekly payments from the plan and the portion of the EI weekly benefit rate does not exceed 95% of the employee’s normal weekly earnings
- requires it be entirely financed by the employer
- requires that on termination, all remaining assets of the plan will be reverted to the employer or be used for payments under the plan or for its administrative costs
- requires that written notice of any change to the plan be given to Service Canada within 30 days after the effective date of the change
- provides that the employees have no vested right to payments under the plan except during a period of unemployment specified in the plan
- provides that payments in respect of guaranteed annual remuneration, deferred remuneration or severance pay will not be reduced or increased by payments received under the plan
Program guide
This guide provides detailed information about:
Contact us
For further information, contact the Supplemental Unemployment Benefit Program.
Guides and help
- Employer Guide — Automated Earnings Reporting System (AERS)
- Guide for the Supplemental Unemployment Benefit (SUB) program
- How to complete the Record of Employment (ROE) form
- Supplement to the guide “How to complete the Record of Employment (ROE) form” for all school boards
- The EI Premium Reduction Program – A guide for employers offering short-term disability plans to their employees
Related services and information
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