Losing a job during or shortly after maternity or parental leave can create significant financial uncertainty.
For some parents, that uncertainty has been compounded by an additional problem: after receiving maternity or parental Employment Insurance benefits, they were later denied some or all of the regular EI benefits they would otherwise have received following a job loss.
The Federal Court of Appeal has now ruled that this treatment violated the equality rights of a group of women under section 15 of the Canadian Charter of Rights and Freedoms.
In Chalifour-Racine et al. v. Canada (Attorney General), 2026 FCA 145, the Court found that provisions of the Employment Insurance Act limiting access to regular EI benefits after maternity and parental benefits had a discriminatory effect on women.
The ruling could have important consequences for parents across Canada who lose their employment shortly before, during, or after maternity or parental leave.
What Happened?
The case involved six women from Quebec who had all given birth and received maternity and parental benefits. Each later lost her job shortly before, during, or shortly after taking leave.
When they applied for regular EI benefits following their job losses, they were denied all or part of the benefits they otherwise would have received. For some, the problem was that they had not accumulated enough insurable hours during the applicable qualifying period because they had been away from work on maternity or parental leave.
Others had reached the maximum number of weeks of benefits available under the existing EI framework after combining maternity, parental, and regular benefits. The women argued that the result was discriminatory because their use of maternity and parental benefits reduced their access to unemployment protection after losing their jobs.
The Court Found a Sex-Based Discriminatory Effect
The challenged provisions applied to both men and women on their face. However, the Federal Court of Appeal focused on how those provisions operated in practice.
The Court noted that only women can receive maternity benefits because only women can become pregnant and give birth. It also found that women represent the majority of people receiving parental benefits and the majority of those who combine maternity and parental benefits. As a result, rules limiting the ability to combine those benefits with regular EI disproportionately affected women.
The Court concluded that the rules created a sex-based distinction and perpetuated the economic disadvantage historically associated with pregnancy and motherhood. In effect, women who took maternity and parental benefits could lose unemployment protection they had otherwise earned through their employment.
A Section 15 Charter Violation
Section 15 of the Charter guarantees equality before and under the law and equal protection and benefit of the law without discrimination, including discrimination based on sex. The Federal Court of Appeal held that denying regular EI job-loss benefits to women who had recently received maternity and parental benefits infringed those equality rights.
The Court also considered whether the discrimination could nevertheless be justified under section 1 of the Charter. It concluded that the government had not established that the infringement impaired equality rights no more than was reasonably necessary to achieve the legislative objective.
Why Maternity and Parental Benefits Created a Problem
Canada’s EI system provides different forms of benefits for different circumstances. Maternity and parental benefits are intended to provide income support following the birth or adoption of a child. Regular EI benefits generally provide income support after a qualifying loss of employment.
Under the existing system, maternity and parental benefits could affect an employee’s later entitlement to regular benefits. The Court found that, for the applicants in this case, the result was effectively that receiving maternity and parental benefits came at the expense of unemployment protection following job loss.
That was particularly significant because the women had paid into the EI system through their employment before taking leave.
The Court Did Not Immediately Change the Law
The decision is significant, but employees should understand that the challenged provisions have not simply disappeared overnight. The Federal Court of Appeal issued a declaration of invalidity but suspended that declaration for one year.
That gives Parliament time to amend the Employment Insurance Act and establish a system that complies with section 15 of the Charter. Once that one-year period expires, the applicants’ EI claims are to be reconsidered under whatever Charter-compliant legislative framework is in place at that time.
If Parliament does not amend the legislation within the year, the applicants’ claims can be determined in accordance with the Court’s declaration, and other similarly situated EI claimants may also be able to seek relief.
What Does This Mean for Employees?
For employees, particularly those taking maternity or parental leave, this decision is an important development. Employees who lose their jobs during or shortly after leave should not automatically assume that receiving maternity or parental benefits eliminates any possible entitlement to regular EI benefits.
The law in this area is now changing, and the ultimate outcome will depend on how Parliament responds to the Court’s ruling. Employees should also remember that EI entitlements are separate from employment law rights against their employer.
Depending on the circumstances, someone whose employment is terminated during or after maternity or parental leave may also have questions about:
- Termination and severance entitlements
- Wrongful dismissal
- Human rights protections
- Reprisal
- Benefits continuation
- Employment Standards Act protections
- Contractual rights
A denial of EI benefits does not determine whether the employer complied with its own legal obligations when ending the employment relationship.
What Does This Mean for Employers?
Although the case concerns the federal EI system rather than an employer’s termination obligations, it is also relevant to employers. Terminating an employee during or shortly after maternity or parental leave can create heightened legal risk.
Employers should ensure that termination decisions are based on legitimate, non-discriminatory reasons and are properly documented. Pregnancy, maternity leave, parental leave, and family status can intersect with protections under employment standards and human rights legislation. Employers should therefore carefully review termination decisions involving employees who are on leave, recently returned from leave, or preparing to take leave.
A Broader Equality Issue
The Court’s decision reflects a broader principle in Canadian equality law: legislation does not need to discriminate expressly in order to have a discriminatory effect. A rule that appears neutral may still violate equality rights if its practical impact disproportionately disadvantages a protected group.
In this case, the Court found that the EI provisions placed a disproportionate burden on women because of the relationship between pregnancy, maternity benefits, parental leave, and workforce participation.
What Happens Next?
The federal government now has one year from the declaration of invalidity to amend the law. It may also seek leave to appeal the Federal Court of Appeal’s decision to the Supreme Court of Canada. Until the legal and legislative process is complete, employees and employers should continue to monitor developments closely.
Chalifour-Racine v. Canada (Attorney General) is an important decision for parents, employees, and employers. The Federal Court of Appeal found that the EI system could not provide maternity and parental benefits in a way that disproportionately deprives women of unemployment protection when they later lose their jobs.
For employees, the decision may eventually provide greater protection following maternity or parental leave.
For employers, it reinforces the importance of carefully managing terminations involving employees who are pregnant, on leave, or recently returned from leave.
How Minken Employment Lawyers (Est. 1990) Can Help
Minken Employment Lawyers (Est. 1990) regularly advises employers and employees on maternity and parental leave, employment standards, human rights, wrongful dismissal, severance, termination rights, and workplace discrimination.
If you are an employer or an executive employee, we can help.
Contact Minken Employment Lawyers (Est. 1990) today for a confidential consultation at 905-477-7011 or contact@minken.com to connect with our team.
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Please note that this article is for informational purposes only and does not constitute legal advice or opinion.