What Does Insurable Hours Mean?

Insurable hours are used to calculate unemployment insurance.

Insurable hours are the number of hours worked from which unemployment insurance is calculated. Insurable hours allow those with part-time jobs and seasonal work to fully participate in the unemployment insurance system. This system is used in Canada and in several European countries. Insurable hours are not used in the United States.

Insurance Hours and Unemployment

A minimum number of insurable hours are set per country to be able to collect unemployment insurance. In Canada, the number of insurable hours required to collect unemployment insurance varies from 420 to 700 hours for the prior 52-week period. In areas with higher unemployment, the number of insurable hours required is lower.

Part-Time or Commissioned Labor Insurable Hour Calculations

Those who work on commission can still earn insurable hours.

If an employee is paid on commission, insurable hours are calculated by taking her earnings for the time worked for the past 52 weeks. That total is multiplied by a value set by the nation. In Canada, the insurable earnings average is multiplied by 27.

Eligibility for Unemployment Insurance

New entrants to a work force such as immigrants and recent graduates may be required to earn more insurable hours for unemployment insurance than those laid off from a prior job. Unemployment insurance is separate from parental leave and its effect on insurable hours depends on your state or province. If someone collects unemployment insurance, he must earn the minimum number of insurable hours before he can collect unemployment insurance again.

References

• "You Asked?: Your Payroll Questions Answered"; Theo Anne Opie, Canadian Payroll Association; 2002
• "Taxing Wages 2009"; OECD Publishing; 2009
• "Arrival Survival Canada"; Naeem Cumming, Sabrina Noorani; 2006
• "OECD Economic Surveys: Canada 2004, Issue 16"; OECD; 2004
• "From UI to EI: Waging War on the Welfare State"; Georges Campeau; 2005

Resources

• "The Battle Against Exclusion"; Organisation for Economic Co-operation and Development; 1999