Compassionate care leave

When an employee leaves for compassionate care reasons, you should follow the steps under What should you do if an employee has an interruption of earnings?.

If you decide to pay your employee an amount in addition to the amount of benefit they receive, also called top-up amounts, see the Special payments chart to find out if you have to deduct Canada Pension Plan contributions, employment insurance premiums, or income tax. You have to report the top-up amounts on your employee's T4 slip as employment income at year-end.

CPP contributions

You have to deduct CPP contributions from the top-up amounts unless they are paid under a Supplementary unemployment benefit plan (SUBP) that qualifies as a SUBP under the Income Tax Act.

EI premiums

You have to deduct EI premiums from the top-up amounts unless the following two conditions are met:

• the total amount of your payment and the EI weekly benefits combined do not exceed the employee's normal weekly gross salary; and
• your payment does not reduce any other accumulated employment benefits such as banked sick leave, vacation leave credits, or retiring allowance.

You also may not have to deduct EI premiums if you pay the top-up amounts under a SUBP under certain conditions.

Income tax

You have to deduct income tax from the top-up amounts unless they are paid under a SUBP that qualifies as a SUBP under the Income Tax Act, even if the plan is registered with Service Canada.

Reporting

Include in box 14 of the employee's T4 slip all top-up amounts paid under a SUBP, such as employer-paid maternity, parental, and compassionate care top-up amounts, whether they are registered with Service Canada or not.

Related topics

• Supplementary unemployment benefit plan (SUBP)
• Employment Insurance Compassionate care benefits
• Labour standards - Compassionate Care Leave - To find out what compassionate care leave is, who qualifies, your responsibilities as an employer, and other information.
• Information on Labour Standards No. 5A - Compassionate care leave, Part III of the Canada Labour Code (Labour Standards) - To find out what compassionate care leave is, who qualifies, your responsibilities as an employer, and other information.

Date modified:

2017-01-25