I got laid off yesterday Jan 26. Considering that I was given a few months package, can I go ahead to apply for EI right away or I have to wait until after the number of months my package cover?
Does anybody know the correct way to approach this?
10 replies (most recent on top)
As stated below, due to Covid they are not currently allocating your severance, meaning you can receive EI benefits immediately.
Normally, they would allocate your severance (as reported on your record of employment) as monthly income. In other words, if you received the equivalent of 6 months current salary as severance, you would have to wait 6 months to receive EI benefits.
There are also some other temporary changes which will provide maximum number of weeks EI Benefits (up to 45) due to Covid.
I am aware as I am currently receiving EI benefits even though I received a significant severance payment. I have confirmed through speaking to several Service Canada (EI) reps.
There are pros and cons.
Pro: If you find another position in the near future, you can receive EI and save your severance monies. Normally you wouldn't be eligible for EI for X months- you can effectively double dip.
Con: You need to budget in the event you do not find another position in a timely manner. Also the tax hit may be more significant as EI will be taxable at a higher rate (salary+ severance+EI all counts as income)
Hope this is helpful to anyone facing this situation.
an the formula is rubbish as there is no way a normal person could live on what they think, what's the max EI per Month, I's sure that is what they use, so you may not be eligible for EI for many years.
I was given a lump sum, with an option to put some or all of it into a group rrsp @ husky, still thinking about what to do
"how do “they” know when your severance runs out"
They know how much money you were given, and they have a formula on how long it should last.
So don't blow it all day 1 or you will be hungry
So, how do “they” know when your severance runs out? Is severance being paid monthly, and when that last payment goes through 1 or 2 years from now, then EI will kick in? Or do “they” just monitor your bank account and when all of your money runs out they turn on the EI taps? Please help me understand.
https://duttonlaw.ca/heres-how-severance-pay-affects-unemployment-benefits/
Due to Covid EI payments are immediate - whereas before you had to exhaust any severance.
Yes apply right away and benefits will not until after package runs out and your 9 months EI will start after last day of Sev pay.
Thanks everyone. I will apply right away.
Yes, you can apply now.
You can apply right away although, benefits do not start until your severance has been used up.