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How to take time off for parental leave, while being a doctor

Young couple admiring their new born child.

For doctors, it’s never easy to know the “right” time to start a family: how will you plan a pregnancy or adoption, take time off with a newborn and still care for patients and a career?

As a first step to a more stress-free parental leave, we’ve gathered tips to help you plan family finances and find balance as a physician and parent.

If you are a resident of Quebec, you’ll find all the information you need in our article Physicians in Quebec: Parental leave and benefits.

1. Tally up how to fund your time off

A combination of resources may help fund your planned parental leave, so add up all the possible options: employment insurance (EI), medical association member benefits, personal savings and your corporation’s savings.

Employment insurance: In recognition of the pandemic, there are temporary measures to help Canadians access EI. They’re effective as of September 26, 2021, for one year.

  • Self-employed physicians can receive EI special benefits for maternity and parental leave, provided you registered at least 12 months in advance and paid EI premiums. 
  • Salaried physicians can receive EI benefits for maternity and parental leave. Under the temporary measures, you need only 420 hours of work to qualify, down from the usual 600 hours.

Benefit

Claimant

Number of weeks

Maximum weekly benefit (2021)

Maternity leave

Person giving birth

Up to 15 weeks

$595

Parental leave — Standard benefits

Can be shared

Up to 40 weeks (one parent can’t receive more than 35 weeks)

$595

Parental leave — Extended benefits

Can be shared

Up to 69 weeks (one parent can’t receive more than 61 weeks)

$357

Source: EI maternity and parental benefits for 2021

As an employee, you may also qualify for supplementary payments, or “top-ups,” to employment insurance through benefit plans or collective agreements. Ask your employer.

Your medical association member benefits: Provincial and territorial medical associations across Canada offer programs for physicians taking temporary leave for the birth or adoption of a child.

  • Some treat all doctors equally, while others vary the payout depending on whether you earn fee-for-service payments or salary or have an alternative arrangement. Keep in mind that benefits may be reduced if you have income from other sources, including the EI program.
  • Consult your regional association to find how much you may be eligible for and when to apply.

Province

Number of weeks

Maximum weekly benefit (2021)

Alberta

17 weeks

$1,074

British Columbia

17 weeks

$1,000

Manitoba

20 weeks

$1,400

New Brunswick

26 weeks

$2,000

Newfoundland and Labrador

17 weeks

$1,200*

Nova Scotia

17 weeks

$1,500

Ontario

17 weeks

$1,000

Prince Edward Island

17 weeks

$1,200

Saskatchewan

20 weeks

$1,300

*In Newfoundland and Labrador, it is $1,200 per week for fee-for-service and alternative payment plans. For salaried positions, it’s a top-up to EI parental leave benefits, for a combined maximum amount of $1,200 per week.

Your personal savings: Practising physicians, like other entrepreneurs, typically need to save money to self-fund time away from work and cover baby-related expenses. One great way to save in advance is to regularly set aside a few dollars while you are still working, through automatic contributions. Instead of saving in a regular bank account, you could consider a tax-free savings account.

Your corporation’s savings: If you are an incorporated physician, you could top up savings within your corporation to draw from later on. This can help to smooth out your income between high-earning and low-earning years, including during a maternity or paternity leave. In those lower-earning years, while you are in a lower personal tax bracket, you can pay yourself from earnings that have been retained within your corporation.

2. Plan with your partner

Two parents can be more “resourceful” than one, if you coordinate benefits and financial resources as a family. Here’s how:

Divvy up leave time. If your partner or spouse is eligible for benefits under Canada’s EI program or qualifies for more generous top-ups from an employer, consider how to divide up parental leave between you for the greatest financial benefit.

Lock down your insurance. It’s a good time to review your insurance coverage, if one or both of you have life and health insurance through an employer or have bought the insurance privately. Find out what you are covered for, such as health and dental benefits, and be sure to add your child as a beneficiary.

Give your family security. If you don’t already have them, create a will and powers of attorney for personal care and property for yourself and your partner. If you already have them in place, update them. A will allows you, as parents, to name a guardian to care for your child, if anything should ever happen to you.

3. Take care of business

Whether you work solo or as part of a group, there are unique financial considerations if your practice will still need to serve patients and pay for salaries, benefits, rent and equipment costs.

Cover your practice. Take into account the cost of hiring a locum to fill in during your parental leave. Locum rates vary depending on the type of practice, location and level of responsibility.

Set your timeline. Will you be away and out of contact until a certain date, formally keep tabs on work the whole time or return gradually? Could part-time work be a possibility?

Seek innovative arrangements. With more mothers in medicine these days, research suggests that women are leading the charge to find more flexible ways of working to balance work and caregiving responsibilities, according to an article in the Canadian Medical Association Journal. For example, the article highlights one Ontario practice in which seven family doctors split a government funding package designed for six physicians — allowing all of them to spend more time with their families.

4. Explore how MD Financial Management can help

There’s more than one path to planning the details of a parental leave, and you don’t have to chart it on your own: your MD Advisor* can work out an income strategy and financial plan to prepare you and your family for that important period in your life.

An action plan for parental leave

  • Review personal financial resources, funding available through the EI program and other top-ups available.
  • Determine whether to share parental leave with your partner, if that makes sense for your lifestyle and financial needs.
  • If you are incorporated, work with your tax advisor to determine the best way to save within, and draw funds from, your corporation.
  • Revisit your financial plan once you have children to ensure you can properly protect them as your dependants.
  • Create a budget, with the help of your MD Advisor, to ensure you have adequate savings to meet your financial goals.

* MD Advisor refers to an MD Management Limited Financial Consultant or Investment Advisor (in Quebec), or an MD Private Investment Counsel Portfolio Manager.

The above information should not be construed as offering specific financial, investment, foreign or domestic taxation, legal, accounting or similar professional advice, nor is it intended to replace the advice of independent tax, accounting or legal professionals.

All data is current as of September 27, 2021 and is subject to change.