Pay Equity

July 17, 2001

Good news for anyone entitled to special 
Employment Insurance benefits

Before the passage of Bill C-2 in May this year, anyone with a net income of $48,750 or more and who received special Employment Insurance benefits (maternity, parental, sickness) had these benefits "clawed back". Current and former PSAC members who received pay equity adjustments and interest in 2000 and who also received these special benefits may have been particularly affected because their net income was higher than usual last year.

Now for the good news. As a result of changes contained in Bill C-2, these special benefits are no longer subject to the EI benefit repayment ("clawback") provisions and will not have to be repaid. The changes affect the 2000 taxation year.

Among other changes in Bill C-2, persons who received regular Employment Insurance benefits for the first time will also not be subject to the "clawback" provisions, starting in 2000.

If you have already filed your 2000 income tax return you need take no action. The Canada Customs and Revenue Agency (CCRA) is automatically reviewing all affected returns and will adjust those that are affected by the repayment changes. Notices of re-assessment and refunds should be issued starting in mid-July.

More information about these and other "clawback" changes can be found on the CCRA web site. Anyone affected by the changes, whether you have filed your 2000 tax return yet or not, should read the tax bulletin entitled Employment Insurance (EI) benefit repayment (''clawback") and the 2000 tax year on the CCRA web site. It contains more information about these and other "clawback" changes.