Hiring costs more than the salary written in the contract. On top of what it pays the employee, the employer pays its own share of contributions, and the employment insurance share changes on January 1, 2027. Here is the exact figure, what it means on a real salary, and why the bill goes down for most employees while going up for the better paid ones.
The employer pays 1.4 times the employee's premium
Employment insurance (EI) is the federal program that pays benefits to someone who loses their job. It is funded by two premiums charged on the same salary: the employee's, withheld from their pay, and the employer's, paid on top of the salary.
The rule linking the two has not changed. The EI premium rates published by the Canada Revenue Agency state it in one line: "the employer's premium will be 1.4 times" the employee's.
In Quebec, the employee rate for 2027 is $1.29 per $100. So the employer pays 1.4 × $1.29, which is $1.806 per $100 — in practice, about $1.81. Put another way: every $100 of salary paid costs the employer $1.81 more, for EI alone.
One point of vocabulary: the premium does not apply to just any income, but to insurable earnings, meaning the part of the salary EI is calculated on. That part is capped, and the cap is the second half of the story.
The 2027 ceiling: $70,800, and $1,278.65 per employee at most
EI is not charged on the whole of a large salary. It stops at an annual ceiling called the maximum insurable earnings. According to the summary of the 2027 actuarial report on the EI premium rate, "the MIE for 2027 is $70,800."
Above that amount, neither the employee nor the employer pays another cent of EI for the year. The maximum bill is therefore known in advance, and it compares directly with 2026:
| In Quebec, per employee | 2026 | 2027 |
|---|---|---|
| Maximum insurable earnings | $68,900 | $70,800 |
| Employee rate | $1.30 / $100 | $1.29 / $100 |
| Maximum employee premium | $895.70 | $913.32 |
| Employer rate (1.4 ×) | $1.82 / $100 | $1.81 / $100 |
| Maximum employer premium | $1,253.98 | $1,278.65 |
The rate goes down, but the ceiling goes up
The result is counter-intuitive, and it is worth unpacking. The Quebec employee rate drops from $1.30 to $1.29 per $100, so the employer rate drops from $1.82 to $1.81. An employer could conclude that EI will cost less in 2027. That is true, but not for every employee.
The ceiling, meanwhile, rises: from $68,900 to $70,800, which is $1,900 more salary subject to the premium. Two opposite forces are therefore at work at the same time — a slightly lower rate, and a slightly wider base to apply it to.
The tipping point sits around $69,400 of annual salary. Below it, only the rate cut applies and the employer's bill drops slightly. Above it, the wider ceiling wins and the bill rises, by up to $24.67 more per employee.
On the employee's side, the same shift shows up on the pay stub: we worked through it in the 2027 EI premium in Quebec.
What it looks like on real salaries
The calculation is direct: take the annual gross salary, cap it at $70,800, and multiply by 1.806%.
| Annual gross salary | Employer EI 2026 | Employer EI 2027 | Difference |
|---|---|---|---|
| $30,000 | $546.00 | $541.80 | −$4.20 |
| $45,000 | $819.00 | $812.70 | −$6.30 |
| $60,000 | $1,092.00 | $1,083.60 | −$8.40 |
| $70,800 and over | $1,253.98 | $1,278.65 | +$24.67 |
For a small business with 10 employees paid $60,000, employment insurance means $10,836.00 of employer premiums over 2027. The same salary seen from the other side is what the employee actually receives once their own deductions are taken: the Quebec net salary calculator starts from the gross and gives the net.
Hiring in Quebec costs less in EI than elsewhere in Canada
Quebec has a reduced EI rate. Elsewhere in Canada, the employee rate for 2027 is $1.64 per $100, which puts the employer rate at $2.30 per $100. At the ceiling, the gap becomes concrete: $1,625.57 per employee outside Quebec, against $1,278.65 in Quebec. That is $346.92 less per employee per year.
This is not a discount. Quebec runs its own parental insurance plan, the QPIP, which replaces EI parental benefits. Quebec employers contribute to that plan separately, to Revenu Québec. The reduced EI rate is the counterpart of a premium paid elsewhere.
One trap worth knowing, because it is expensive to fix: the test is not where the employee lives, but the province of employment. The CRA payroll deductions tables are explicit: "A reduced EI rate applies when the province of employment is Quebec." Someone who lives in Quebec but works in Ontario pays the regular rate, and so does their employer.
What to check before hiring in 2027
- The January 1 switch. A January 2027 pay run calculated with the 2026 parameters ($1.82 per $100, ceiling of $68,900) will be wrong in both directions: too much premium below the ceiling, not enough above it.
- The maximum cost is known in advance. $1,278.65 per employee, full stop. A raise given to someone already earning more than $70,800 adds no EI premium at all, neither for them nor for the employer.
- The test is the province of employment. Not the employee's residence, not the head office address.
- EI is only one premium among several. The QPP, the QPIP, the Health Services Fund and the CNESST are added to it, each with its own rates and ceilings, to be checked separately.
Frequently asked questions
How much does employment insurance cost an employer in Quebec in 2027?
In 2027, the employer pays 1.4 times the employee's premium. Since the Quebec employee rate is $1.29 per $100, the employer rate is $1.806 per $100, or about $1.81. The premium stops at the ceiling of $70,800 of insurable earnings, which puts the maximum cost at $1,278.65 per employee for the year.
What are the maximum insurable earnings for 2027?
The maximum insurable earnings (MIE) for 2027 are $70,800, up from $68,900 in 2026. That is the annual salary ceiling employment insurance is calculated on: above it, neither the employee nor the employer pays any further premium for the year.
Why is the employment insurance rate lower in Quebec?
Because Quebec runs its own parental insurance plan, the QPIP, which replaces the parental benefits of employment insurance. The reduced EI rate offsets a premium paid elsewhere: in 2027, the employee rate is $1.29 per $100 in Quebec against $1.64 elsewhere in Canada, and the employer rate is $1.81 against $2.30.
Does the reduced rate depend on where the employee lives?
No. The test is the province of employment, not the province of residence. The CRA payroll deductions tables specify that the reduced rate applies when the province of employment is Quebec. Someone who lives in Quebec but works in Ontario therefore pays the regular rate, and so does their employer.
Does employment insurance cost an employer more in 2027 than in 2026?
It depends on the salary. The employer rate falls from $1.82 to $1.81 per $100, but the ceiling rises from $68,900 to $70,800. Below roughly $69,400 of annual salary, the employer's bill drops slightly; above it, the bill rises, by up to $24.67 more per employee over the year.