Working While on Maternity or Parental Leave
EI maternity and parental benefits fall under the same Working While on Claim (WWC) rules as regular EI. You can work during your leave, but any earnings reduce your weekly benefit payment.
The Working While on Claim Formula
For every dollar you earn from employment:
- 50 cents is deducted from your EI benefit
- Once your earnings hit 90% of your original weekly insurable earnings, any amount above is deducted dollar for dollar
Your “threshold” is specific to you — it is 90% of your weekly insurable earnings from before you went on leave.
Example: $900/week insurable earnings (threshold = $810)
| Work earnings that week | EI deduction | EI received |
|---|---|---|
| $0 | $0 | $495 (55% of $900) |
| $200 | $100 | $395 |
| $500 | $250 | $245 |
| $810 | $405 | $90 |
| $900 | $405 + $90 = $495 | $0 |
Why Work During Parental Leave?
Many parents take on limited work during parental leave for financial reasons, to maintain client relationships (self-employed), or to fulfil notice obligations. The WWC rules allow this without completely eliminating EI.
Common examples:
- Freelancers or self-employed parents who need to respond to clients occasionally
- Contract workers who pick up a short project
- Employees working partial weeks while transitioning back
Employer Top-Up Payments: A Different Category
Employer top-up pay under a registered Supplemental Unemployment Benefit (SUB) plan is treated differently from working while on claim:
| Payment type | Impact on EI |
|---|---|
| Registered SUB plan top-up | Does NOT reduce EI |
| Working hours/freelance income | Reduces EI under WWC formula |
| Ad hoc bonus or unregistered top-up | May reduce EI — contact Service Canada |
If your employer tops up your pay informally (not through a registered plan), Service Canada may treat it as earnings.
EI Repayment: Maternity and Parental Benefits Are Exempt
Unlike regular EI, maternity and parental benefits are fully exempt from the Social Benefits Repayment. Even if your total income for the year is high, you will not owe the 30% clawback on these benefit types.
| EI benefit type | Subject to Social Benefits Repayment? |
|---|---|
| Regular EI benefits | Yes, if income > ~$65,700 |
| EI maternity benefits | No — exempt |
| EI parental benefits (standard or extended) | No — exempt |
| EI sickness benefits | No — exempt |
| Compassionate care benefits | No — exempt |
You will still owe income tax on maternity and parental benefits — they are taxable income. The exemption only applies to the repayment clawback.
Standard vs. Extended Parental Leave
The earnings rules are the same for both, but note the payment differences:
| Option | Duration | Weekly rate |
|---|---|---|
| Standard parental (shared or single) | 35 weeks | 55% of insurable earnings (max ~$695/wk) |
| Extended parental (shared or single) | 61 weeks | 33% of insurable earnings (max ~$417/wk) |
At the lower 33% rate under extended leave, you give up more relative benefit per dollar earned — so a small amount of work income has a proportionally larger impact.
Quebec (QPIP) Rules Are Different
Quebec workers receive Quebec Parental Insurance Plan (QPIP) benefits instead of federal EI maternity/parental benefits. QPIP has its own earnings rules:
- You can earn up to 25% of your weekly benefit amount without any deduction
- Earnings above that 25% are deducted dollar for dollar
- QPIP has more generous coverage and different rates than federal EI
If you are a Quebec resident, refer to the QPIP guide for specifics.
How to Report Your Earnings
If you earn money during maternity or parental leave, you must report it on your bi-weekly EI report via My Service Canada Account. Report earnings in the week the work was performed, not when you are paid.
Not reporting is the most common mistake. All work activity — including freelance, occasional consulting, and gig work — must be reported.
What counts as “earnings” for the working while on claim formula
Service Canada defines earnings broadly. Almost all sources of income from work count:
| Income type | Counts as earnings? |
|---|---|
| Employment wages | Yes |
| Self-employment income (net) | Yes |
| Freelance/contract fees | Yes |
| Tips and gratuities | Yes |
| Royalties from active work | Yes |
| Investment income | No |
| Rental income (passive) | No |
| RRSP/TFSA withdrawals | No |
| Child support received | No |
Even one-time consulting fees or a few hours of freelance work must be reported. The rule is: if money is earned through your labour, report it.
Returning to work during parental leave permanently
If you decide to return to work full-time before your parental leave ends:
- Notify Service Canada through your MSCA — your claim may be closed
- Any remaining weeks of parental entitlement are not accessible after returning to full-time employment (unless you go on another qualifying leave)
- The other parent (if receiving shared parental benefits) can continue their own entitlement unaffected
- If you only used maternity (15 weeks) and did not start parental, the parental weeks can sometimes be accessed later if a new qualifying event occurs — call Service Canada for your specific situation
Going back to work before the end of leave is common and does not affect future EI eligibility or contribution records.