On June 20, 2024, An Act to implement certain provisions of the fall economic statement tabled in Parliament on November 21, 2023 and certain provisions of the budget tabled in Parliament on March 28, 2023, (Bill C-59) received royal assent. With the passage of this legislation, the federal government is implementing several employment/labour-related laws impacting employers and employees in the federally regulated sector and payroll across Canada.
Bill C-59 enacts the following provisions:
- A new 16-week unpaid adoption leave for employees in the federally regulated sector and a new 15-week EI adoption benefit for adoptive parents, including surrogate parents. This new leave is expected to come into force through an Order in Council. The additional week of leave considers the waiting period before receiving the EI benefit.
- A new leave of absence for pregnancy loss of up to eight weeks for employees in the federally regulated sector, with the first three days paid for those who have completed three consecutive months of continuous employment
- An expansion of bereavement leave up to 10 days for employees in the federally regulated sector in the event of the death of a child or a family member for whom they were on compassionate care or critical illness leave
- A temporary exemption from taxation for the first $10 million in capital gains realized on the sale of a business to an employee ownership trust, subject to certain conditions
- A requirement for large federally regulated pension plans to disclose the distribution of their investments by jurisdiction and asset-type per jurisdiction, and a proposal to explore removing the 30 per cent rule that restricts pension plans from holding more than 30 per cent of the voting shares of most corporations
- A removal of GST/HST on psychotherapy and counselling therapy services, making mental health services more affordable
- A prohibition on reprisal actions under the Competition Act, which protects workers from being penalized, punished, disciplined, harassed, or disadvantaged for their cooperation with the Competition Bureau during an investigation or proceeding
- A new category of corporation: Substantive Canadian-Controlled Private Corporations (SCCPCs), which are subject to the same refundable tax on investment income as CCPCs, but not entitled to the benefits available to CCPCs, such as the small business deduction and the enhanced scientific research and experimental development credits
- A clarification of the rules with respect to First Home Savings Accounts (FHSAs), which allow Canadians to save up to $40,000 in a tax-free account for the purchase of their first home
- A permission for a qualifying family member of a Registered Disability Savings Plan (RDSP) beneficiary to become a successor holder of the RDSP if the existing holder dies before 2027 and certain conditions are met
- A sharing of taxpayer information with Public Services and Procurement Canada for the purpose of delivering the Canadian Dental Care Plan, which will provide basic dental coverage to uninsured Canadians
These changes and updates will have various impacts on employers and payroll professionals, depending on their circumstances and the type of business they operate. Employers and payroll professionals should review the details of these changes and updates and ensure they comply with any new obligations or take advantage of any new opportunities they may offer.
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