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Lump sum payment counts as income for EI recipients

June 9, 2015 Teacher Welfare Staff

The 2012 modified framework agreement between the Alberta Teachers’ Association and the government provides teachers with a one-time lump sum payment of one per cent of their annual salary as set out in the collective agreement grid in effect as of Nov. 15, 2015. This lump sum payment will be paid to all teachers under contract on that date. It’s to be funded by the government and paid no later than the end of December of 2015.

If you are a teacher on leave, you are a teacher under contract and are entitled to receive this lump sum payment. However, if your leave involves receiving employment insurance benefits, the lump sum payment will be subject to clawback.

According to employment insurance regulations, the lump sum payment is considered part of earnings. If you are on maternity or parental leave the week of Nov. 15, it is your responsibility to declare the lump sum payment as earnings to Service Canada. While you are on maternity leave, Service Canada will deduct the entire amount, dollar for dollar, from your EI maternity benefits.

While you are on parental leave, earnings are deducted at a rate of 50 per cent of each dollar earned up to the point that your earnings equal 90 per cent of the weekly insured earnings used to establish the benefit rate. After this 90 per cent threshold is reached, earnings are deducted dollar for dollar from benefits. ❚


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