The annual changes in Employment Insurance premium rates affect millions of Canadian workers and employers who contribute to the EI program.
The Employment Insurance premium rates are determined through a structured process managed by the Canada Employment Insurance Commission (CEIC), which has been responsible for setting the annual rate since April 1, 2016. The CEIC announced this rate change following its actuarial yearly assessment, which forecasts program expenditures and revenues over seven years.
Understanding these changes is essential for both employers managing payroll deductions and employees planning their finances for the coming year.
What are the Employment Insurance (EI) Premium Rates for 2026?
As of January 1, 2026, The Canada Employment Insurance Commission has set the EI premium rate at $1.63 per $100 of insurable earnings for employees.
On the other hand, the employer premium, fixed at 1.4 times that amount, will be approximately $2.28 per $100 of insurable earnings.
The table below shows yearly Employment Insurance Premium Rates since 1998:
| Year | Maximum Insurable Earnings | Federal Employee Premium Rate | Federal Employer Premium Rate |
|---|---|---|---|
| 2026 | $68,900 | 1.63% | 2.282% |
| 2025 | $65,700 | 1.64% | 2.296% |
| 2024 | $63,200 | 1.66% | 2.324% |
| 2023 | $61,500 | 1.63% | 2.282% |
| 2022 | $60,300 | 1.58% | 2.212% |
| 2021 | $56,300 | 1.58% | 2.212% |
| 2020 | $54,200 | 1.58% | 2.212% |
| 2019 | $53,100 | 1.62% | 2.268% |
| 2018 | $51,700 | 1.66% | 2.324% |
| 2017 | $51,300 | 1.63% | 2.282% |
| 2016 | $50,800 | 1.88% | 2.632% |
| 2015 | $49,500 | 1.88% | 2.632% |
| 2014 | $48,600 | 1.88% | 2.632% |
| 2013 | $47,400 | 1.88% | 2.632% |
| 2012 | $45,900 | 1.83% | 2.562% |
| 2011 | $44,200 | 1.78% | 2.492% |
| 2010 | $43,200 | 1.73% | 2.422% |
| 2009 | $42,300 | 1.73% | 2.422% |
| 2008 | $41,100 | 1.73% | 2.422% |
| 2007 | $40,000 | 1.80% | 2.52% |
| 2006 | $39,000 | 1.87% | 2.618% |
| 2005 | $39,000 | 1.95% | 2.73% |
| 2004 | $39,000 | 1.98% | 2.772% |
| 2003 | $39,000 | 2.1% | 2.94% |
| 2002 | $39,000 | 2.2% | 3.08% |
| 2001 | $39,000 | 2.25% | 3.15% |
| 2000 | $39,000 | 2.4% | 3.36% |
| 1999 | $39,000 | 2.55% | 3.57% |
| 1998 | $39,000 | 2.7% | 3.78% |
For 2026, the premium rate decreased by 1 cent federally compared to the 2025 rate, which results in minor savings for both employees and employers. However, this is paired with an increase in the maximum insurable earnings threshold, as detailed below.
For residents of Quebec, the 2026 EI rate is $1.30 per $100 for employees and $1.82 per $100 for employers. The lower rate is because the province administers its own parental benefits through the Quebec Parental Insurance Plan (QPIP).
Maximum Insurable Earnings (MIE) for 2026
The Maximum Insurable Earnings (MIE) for 2026 is $68,900. This represents an increase of $3,200 (approximately 4.87%) from the 2025 level of $65,700. The MIE is the highest amount of annual earnings on which EI premiums are paid, and it also sets the ceiling for calculating EI benefits.
The MIE is indexed annually based on growth in average weekly earnings as reported by Statistics Canada. This ensures that EI coverage keeps pace with wage growth in the Canadian economy, maintaining the relative value of insured income over time.
The calculation for the 2026 MIE percentage increase was based on:
- The average weekly earnings for the 12-month period ending April 30, 2025
- Divided by the average for the 12-month period ending April 30, 2024
- This percentage increase was then multiplied by the prior year’s MIE (before rounding)
- The final result was rounded down to the nearest $100
This systematic approach ensures that EI coverage remains relevant to current wage levels in the Canadian economy.
Source: EI premium rates and maximums – canada.ca
How Much Will I Pay in EI Premiums in 2026?
The amount you’ll pay in EI premiums in 2026 depends on your earnings, up to the Maximum Insurable Earnings threshold of $68,900. For most Canadian workers earning at or above this threshold, the maximum annual contributions will be:
| Contributor | Premium Rate (per $100) | Maximum Annual Contribution | Difference from 2025 |
|---|---|---|---|
| Employees (outside Quebec) | $1.63 | $1,123.07 | +$45.59 |
| Employers (outside Quebec) | $2.282 | $1,572.30 | +$63.83 |
| Employees (Quebec) | $1.30 | $895.70 | +$35.03 |
| Employers (Quebec) | $1.82 | $1,253.98 | +$49.04 |
Although the premium rate has decreased for 2026, the maximum annual contributions have increased due to the higher MIE. This means workers and employers will pay more in total premiums if their earnings reach or exceed the maximum insurable amount.
As per the Employment Insurance Act, if an employee’s insurable earnings are $2,000 or less during the year, their EI premiums are fully refunded, though there is no formal basic exemption for EI as there is with the Canada Pension Plan.
Why Did the Premium Rate Decrease for 2026?
In 2026, the federal EI rate dropped by 1 cents. This change is the result of various economic factors that apply both upward and downward pressure on the 7-year break-even rate, as forecast by the Chief Actuary.
According to the 2026 Actuarial Report, the 1-cent reduction results from several key influences.
On the upward pressure side, factors include:
- A continued, though moderating, projected deficit in the EI Operating Account. A deficit requires higher future rates to ensure the account balances over the long term.
- Higher forecasted average weekly benefit payments to claimants, driven by wage inflation across the country. This increases the total expected cost of EI claims.
- Updated projections for administrative costs and program spending.
At the same time, the following elements contributed to downward pressure on the rate:
- Sustained growth in the number of Canadian workers and rising wages, which increases the total amount of premiums collected.
- The complete phasing out of temporary EI measures that were introduced in previous years, leading to lower anticipated benefit expenditures.
Ultimately, the downward pressures on the rate were slightly stronger than the upward pressures, leading to a net 1-cent reduction for 2026.
The premium rate impacts the EI account balance significantly since all employee and employer contributions are deposited into the centralized EI Operating Account. A ±1 cent change in the premium rate is estimated to impact the account balance by approximately ±$1.7 billion over the 2026 to 2032 forecast period.
How Does the Premium Reduction Program (PRP) Work?
The Premium Reduction Program (PRP) allows employers to pay reduced EI premiums if they provide their employees with qualified wage-loss plans which reduce the demand for EI special benefits, particularly sickness benefits.
There are four categories of qualified plans, each with its own rate of reduction determined annually:
| Categories | Category 1 | Category 2 | Category 3 | Category 4 |
|---|---|---|---|---|
| Premium reduction (per $100 of insurable earnings) | $0.21 | $0.38 | $0.38 | $0.42 |
In 2026, approximately 24,600 employers will be registered in the PRP, covering an estimated $414 billion in insurable earnings. These reductions will provide registered employers and their employees with approximately $1.457 billion in premium savings in 2026.
Employers must register their wage-loss plans with the program to qualify for these reductions. The categories are based on the waiting period and level of benefits provided by the employer plans, with higher reductions for more comprehensive coverage.
Source: 2026 Actuarial Report, Employment and Social Development Canada
FAQs about EI Premium Rates in Canada
Who Has to Pay Employment Insurance Premiums?
Most employees and employers pay mandatory EI premiums; however, some occupations, such as self-employed workers, are exempt from contributions. Non-arm's length employees, like spouses, may also be exempt. Additionally, employees with less than $2,000 in yearly insurable earnings receive full EI premium refunds.
Is There a Basic Exemption for EI Premiums?
No, there is no basic exemption. However, EI premiums are only deducted from insurable earnings up to the annually determined maximum insurable earnings threshold. For 2025, premiums do not need to be paid on any salary above $65,700.
How Does the EI Operating Account Function?
The EI Operating Account sits within the Consolidated Revenue Fund of Canada. All EI contributions are deposited into the Account, which is then used to fund EI benefit payments and program administration costs on an ongoing basis. This centralized account allows the system to pool contributions and expenses nationally rather than track individual balances.
The Bottom Line
Staying informed about the EI premium rate changes is essential for employers managing payroll systems and workers planning their finances. The EI program continues to evolve and remains a crucial safety net for Canadian workers, providing financial support during periods of unemployment and for specific life circumstances that require time away from work and also applies to those nearing retirement.
To learn more, check out our post: How to Qualify for EI Benefits During Retirement in Canada.
