Published online 26 August 2010 | Nature | doi:10.1038/news.2010.429

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Taxing times for Canadian postdocs

Trainee researchers struggle to make ends meet after the government clarifies tax rules for grants.

labworkersWith taxes now biting into their wages, some Canadian postdocs are thinking of Europe, or unionization.LajosRepasi/iStockphoto

Staff, student or employee? The employment status of Canadian postdoctoral researchers remains unclear — and many are struggling with the tax issues that arise from the ambiguity.

Some of Canada's postdocs are categorized as associates with benefits, others are fellows with no employee status and, until recently, some had a tax-exempt status on a par with students. "We fall into this no-man's land," says Marianne Stanford, chair of the Canadian Association of Postdoctoral Scholars (CAPS) and a postdoctoral fellow at the Ottawa Hospital Research Institute in Ontario.

Earlier this year, the federal government put an end to the tax-free wages that some postdocs had been enjoying since 2006. "Now there's a two-tier system in labs where some of the people earning the degrees are getting more than those who already have them," says Stanford. The move was a blow to postdocs, some of whom were recruited with the promise of tax-free earnings, and who put up with the wages because they were tax-free — although many feel they're underpaid relative to their level of education.

The tax-free wage came about in 2006 when the federal government introduced tax exemption for fellowships and awards. But as the government made clear in March, the exemption was only intended to apply to students enrolled in an educational programme. In a 2009 CAPS survey of 1,200 postdocs, 23% were not paying taxes on their fellowships. Many of those were in Quebec, where the provincial government considers postdocs to be stagières, or trainees, lumping them in with students.

Faculty in training

Martin Kreiswirth, dean of graduate education at McGill University in Montreal, Quebec, says that he was surprised by the recent federal statement on postdocs' tax status. "They're not fully formed researchers. If they were, they'd be faculty members, not postdocs," he says.

"It feels like a slap in the face. All of a sudden you're Can$5,000–7,000 poorer," says David Kent, a Canadian postdoc researching blood stem cells at the Cambridge Institute for Medical Research in Cambridge, UK.

In a June letter to CAPS, the federal minister of finance, James Flaherty, compared postdoctoral fellows to articling lawyers, medical residents and trainee accountants "where there is a period of paid training at the beginning of their careers".

Stanford says that comparison is unfair, however, because of the higher starting pay and annual raises in those jobs. Medical residents are eligible for parental leave programmes, for instance, unlike most postdocs. She says that CAPS will campaign to raise the value of postdoc fellowships.

According to the CAPS survey, postdocs earn an annual average salary of Can$38,000 (US$36,000). About 10% of the 5,500 or so postdocs in Canada are supported by one of the country's three main funding agencies. The rest are compensated through their supervisors' grants and by grants from private foundations, among other ways.

The typical value of a postdoctoral fellowship from the Natural Sciences and Engineering Research Council and the Canadian Institutes of Health Research (CIHR) is Can$40,000, which has not changed since 2003. Fellowships from the Social Sciences and Humanities Research Council pay Can$38,000. For postdocs paid from CIHR grants, the minimum funding level is Can$36,750.

Funding furore

The silver lining for postdoc funding was meant to be the Banting Fellowships, a Can$45-million programme starting in 2010 that will dole out two-year fellowships worth Can$70,000 a year. But Stanford and others are not impressed1. "The fellowships deal with 2% of the postdoc population. The rest are shuffled aside," Stanford says. "The public funds would be better spent making the overall postdoctoral experience better."

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Some postdocs and graduate students nearing completion of their PhDs say that they'll leave Canada for Europe, which has better wages and benefits. For example, postdoc fellowships in Denmark can pay 445,000–525,000 kroner (Can$79,000-Can$93,000). Kent, whose work in Cambridge is funded by a Can$45,000 CIHR fellowship, had his award topped up because it didn't meet the UK institute's minimum postdoctoral salary.

Postdocs at some institutions have decided to form unions to fight their cause, such as at the University of Western Ontario in London and at McMaster University in Hamilton, Ontario, where they hope to improve their collective voice and power. Their counterparts at the University of California have done the same, where the postdoc union reached a tentative agreement with the university about their rights in July.

"There is a culture of fear to speak up when postdocs feel they are being overworked or mistreated," says Alex Diceanu, the grievance officer for McMaster's postdocs. "So much of their future career depends on that supervisor and their funding is tied to maintaining that relationship." 

  • References

    1. Kent, D. Dis. Model. Mech. In the press.

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