Self employed....maternity benefits?

It's becoming an all too common scenario. A woman finds her position downsized and as a result becomes self-employed. She then discovers that she is pregnant.

While in a normal job she would be able to take a maternity leave, as a self-employed worker the woman is faced with difficult choices. Can she afford to take a maternity leave without the support benefits? Will she have to look for a full-time position – something that angers the employer when he/she discovers that the new employee will soon require maternity leave – in order to acquire the need number of insured hours?

Here in Canada, if you're having a baby or adopting a child you're entitled to parental and maternity leave from your job and if you qualify, you may also receive benefits that pay you when you're caring for your child. Whether you're pregnant or thinking about getting pregnant, you'll want to figure out what sort of maternity leave you are entitled to.
In addition, the benefits paid out by the federal government through Employment Insurance (or QPIP if you live in Quebec), are crucial when thinking about the financial impact of having a baby. How long can we receive maternity and parental benefits from EI? In Canada, you can receive up to 50 weeks of maternity and parental benefits.

There are a few components to your leave you'll want to learn about-how much leave (paid or unpaid) you can take from your job, the money you might get while on leave from EI, whatever you might get through your employer on top of that (if anything), and what your partner's employer might offer if he or she takes advantage of parental leave. If you're confused about how this all works, you're not alone. Here are some of the basics you need to know and do.


Become incorporated
One option is to have someone set-up and employ you through a corporation. Incorporation will mean dealing with extra red tape and costs. For example, there is the cost of incorporation, book keeping support, and remittance deductions to be made to HRDC such as Canada Pension Plan and income taxes. However, once these factors have been established you will be able to accumulate insured work hours – hopefully enough to take a full maternity leave. The corporate structure offers an added advantage: limited personal liability.

Apply early. If you prefer to keep your self-employed status, another option is to apply early to set a start date for your claim while you still have enough insurable hours or work to qualify for your maternity leave, says Francine Blouin Wilkinson. To be eligible for maternity benefits you must first accumulate 600 insured hours of work.

So, if your baby is due in January but your insured hours will end in October, you can file a start date for your claim towards the end of October while you still have 600 insured hours of work. You will not be able to start your maternity leave until you meet HRDC's criteria, which means that you may lose several months of benefits before the baby is born, but this is better than losing the right to take a maternity/parental leave at all.

You can learn more about the QPIP and apply for QPIP benefits by accessing the QPIP online services or by calling the customer service centre (1 888 610-7727).