DEFINITION of 'Employment Insurance - EI'
An unemployment insurance program in Canada that allows individuals who have recently lost a job to receive temporary financial assistance. Employment insurance can also be extended to individuals who are unable to work because of illness or who are caring for a young child or a seriously ill family member. In additional to financial assistance, the program assists the unemployed with job search services.
BREAKING DOWN 'Employment Insurance - EI'
The Employment Insurance Act replaced the Unemployment Insurance Act in 1996. The updated scheme was designed to link unemployment benefits with wages, and to reduce penalties for those who can only find temporary work. In order to qualify for benefits, individuals must work a certain number of hours, and the length of time that benefits are provided for depends on an individual's geographic region's unemployment rate.