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Normandin Beaudry

The 2012 Social Security Programs Parameters

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There, in black and white

NB Bulletin Vol. 15 N. 1, January 2012

As in previous years, we are pleased to inform you about the parameters that will be used by the major social security programs in 2012.

The Quebec Pension Plan and the Canada Pension Plan

The Year’s Maximum Pensionable Earnings (YMPE) for 2012 is $50,100, an increase of 3.7% over the 2011 YMPE of $48,300. The basic exemption remains at the current level of $3,500, which is the level applicable since January 1st, 1998. Employee and employer contribution rates for the Quebec Pension Plan increase from 4.950% to 5.025% of contributory earnings in 2012, for an annual maximum contribution of $2,341.65. For the Canada Pension Plan, the contribution rates remain at 4.950% of contributory earnings in 2012, for an annual maximum contribution of $2,306.70. The maximum monthly retirement pension at age 65 for the Quebec Pension Plan and the Canada Pension Plan is set at $986.67 for 2012, based on the average YMPE over the last five years.

Employment Insurance

The Employment Insurance premium rate for employees in Quebec increases by $0.06 per $100 of insurable employee earnings effective January 1st, 2012. The premium rate for employees in Quebec therefore increases from $1.41 to $1.47. As for employers, they continue to contribute 1.4 times the employee rate so their premium rate will move up from approximately $1.97 to $2.06 per $100 of insurable employee earnings. These rates consider the Quebec Parental Insurance Plan (QPIP) in place since January 1st, 2006.

The Employment Insurance premium rate for employees outside Quebec will increase from $1.78 to $1.83 per $100 of insurable employee earnings for 2012 and the employers continue to contribute 1.4 times the employee rate, for a premium rate of approximately $2.56 per $100 of insurable employee earnings.

The maximum insurable earnings increase from $44,200 to $45,900 for 2012.

Employer contributions can be further reduced for those offering a salary continuation program (SCP) registered with the Employment Insurance Commission. There are four types of SCPs each offering a unique Employment Insurance premium rate reduction:

Type 1: SCP based on the accumulation of paid sick days of at least one day per month and a maximum of at least 75 days.

Type 2: SCP based on the accumulation of paid sick days of at least one day and 2/3 per month and a maximum of at least 125 days.

Type 3: SCP providing a weekly indemnity1 for at least 15 weeks.

Type 4: SCP providing a weekly indemnity1 for at least 52 weeks (this reduction is only available to employers of public and para-public sectors).


(1) Per $100 of insurable employee earnings.
(2) The reduced premium rates are applicable for one complete year. In the event a plan is registered during the year, the adjustment is prorated according to the date of registration.
(3) For Quebec employers whose employees all work in Quebec.
(4) Premium factor to be applied to the employee premium rate of $1.47 per $100 of insurable employee earnings.
(5) Premium factor to be applied to the employee premium rate of $1.83 per $100 of insurable employee earnings.

Quebec Parental Insurance Plan (QPIP)

The QPIP contribution rates for the year 2012 are 0.559% for employees, 0.782% for employers and 0.993% for self-employed workers, representing an increase of approximately 4.0% over the 2011 rates of 0.537%, 0.752% and 0.955% respectively. The maximum insurable income increases from $64,000 to $66,000 for 2012.

Régime d’assurance maladie du Québec

The current contribution rate remains unchanged for 2012. This rate is set at 4.26% of total payroll for certain public sector employers and for companies with a total payroll of more than $5 million. For companies with a total payroll of less than $1 million, the rate is set at 2.70% of total payroll. For companies which have a total payroll of more than $1 million but less than $5 million, the rate is a function of total payroll and ranges from 2.70% to 4.26% of total payroll according to the following formula:

Commission de la santé et de la sécurité du travail

The contribution rate to the Commission de la santé et de la sécurité du travail is determined according to the type of industry and, if applicable, to the claims experience. The maximum earnings for the income replacement benefit increase from $64,000 to $66,000 for 2012.

Commission des normes du travail

The current contribution rate remains unchanged for 2012, and is set at 0.08% of earnings subject to contribution. The maximum earnings subject to contribution increase from $64,000 to $66,000 for 2012.

In Quebec, the minimum hourly wage is currently at $9.65 and will be adjusted to $9.90 on May 1st, 2012.


1 The SCP weekly indemnity must be at least equal to the benefits provided by the Employment Insurance. 

 

Please feel free to contact us for additional information.

514.285.1122
 
630, René-Lévesque Blvd. West, 30th floor
Montreal, Quebec, H3B 1S6