EI & CPP Factsheet

Canadian Freelance Union members can access EI and CPP. Here’s how.

The Canadian Freelance Union represents independent contractors in media and communications across Canada.

Many members have asked how they can access traditional employment programs, such as Employment Insurance and the Canada Pension Plan. This information applies to members outside of Québec.

This tells you what you need to know, and where to look for more information.

Employment Insurance

Employment Insurance (EI) is a series of temporary benefits for workers.The regular benefits are available for workers who have lost their job through no fault of their own, for example through shortage of work, seasonal employment, or lay-offs. Independent contractors are not eligible for the regular EI benefits.

However, self-employed Canadians can access Employment Insurance (EI) special benefits by entering into an agreement, or registering, with the Canada Employment Insurance Commission.

There are six types of EI special benefits:

  • Maternity benefits
  • Parental benefits
  • Sickness benefits
  • Compassionate care benefits
  • Family Caregiver benefits for critically ill children
  • Family Caregiver benefits for critically ill adult

You can register with the Canada Employment Insurance Commission through Service Canada if you:

  • operate your own business, or if you work for a corporation but cannot access EI benefits because you control more than 40 per cent of the corporation’s voting shares; and
  • are either a Canadian citizen or a permanent resident of Canada.

The Canadian Freelance Union strongly encourages all members who work freelance to earn a majority of their income, register to be able to apply for EI special benefits. It is important to plan ahead for special benefits, since you must wait 12 months from the date of your confirmed registration before applying for EI special benefits. Once you register, you will begin making EI contributions to the Canada Employment Insurance Commission.

Regular EI benefits are paid out of contributions from both workers and employers. Because you are not eligible for regular benefits, you are not required to pay the employer portion of EI premiums. You only pay the employee portion.

Source: https://www.canada.ca/en/services/benefits/ei/ei-self-employedworkers/ eligibility.html

Canada Pension Plan

The Canada Pension Plan (CPP) provides contributors and their families with partial replacement of earnings in the case of retirement, disability or death.

With very few exceptions, every person over the age of 18 who works in Canada outside of Québec and earns more than a minimum amount ($3,500 per year) must contribute to the Canada Pension Plan (CPP). If you have an employer, you pay half the required contributions and your employer pays the other half. If you are selfemployed, you make both payments.

No matter how often you change jobs or where you work in Canada, your contributions may help you or your family become eligible for:

  • Retirement pension
  • Post-retirement benefit
  • Disability benefits
  • Benefits after a death

At the age of 70, you no longer contribute to the CPP, even if you are still working.

If you are self-employed, the maximum contribution is $5,088.60. Your contributions are based on your net business income (after expenses). You do not contribute on any other type of income, such as investment earnings. If, during a year, you contribute too much or earned less than the set minimum amount, your contributions will be refunded when you file your income taxes.

Source: https://www.canada.ca/en/services/benefits/publicpensions/cpp.html

What planned CPP enhancements mean to you

Your CPP contributions are an investment in your future, and planned enhancements to the program will help you prepare for retirement. Consider:

  • The CPP provides a secure and predictable lifelong benefit that is indexed to inflation.
  • Your retirement benefit will not be affected by stock market shocks or tied to the fortunes of any employer.
  • The CPP is a good fit for freelancers because it is not tied to any employer, as workplace pensions are.
  • As a large program with millions of contributors, the CPP is an efficient way to save. The CPP Investment Board is able to take advantage of economies of scale to deliver strong net returns. This helps ensure a secure retirement for you.
  • With regular contributions, the CPP is a simple way for you to save for retirement.
  • Planned enhancements to the CPP will improve retirement benefits for all workers, particularly younger workers.
  • Because the enhancements are being brought in over time, those just entering the workforce will benefit the most from the CPP enhancements.

Improving employment standards for independent contractors

Employers are relying more and more on precarious work, which means that more Canadians than ever are working in contract positions.

While Unifor continues to advocate for progressive labour changes that benefit all workers, the Canadian Freelance Union is an avenue for union membership for creative freelancers across the country.

Be part of the movement for decent work for all!

Health and Dental Benefits

Many workers in Canada enjoy workplace health and dental benefits plans offering coverage for themselves and their families. Independent contractors often do not have such benefits. However, the Canadian Freelance Union offers health and dental plans for community chapter members.

To see plan details, visit www.unifor.org/communitychapters