Spousal Support: It’s a Two Way Street
Belinda would boast to her colleagues how proud she was that her spouse didn’t have to work. She earned enough for the family and they lived well. Once the children were in full-day school, that song changed. Her family company was bought out and staff redundancy planning was well underway. Belinda’s encouragement of her husband to find full-time employment was falling on deaf ears. The chasm between her needing him to find suitable work to help support the family and his feeling entitled to continue to be a stay at home spouse continued to grow. Five years on, Belinda decided to separate.
Legal Obligation to be Self Sufficient
The Canadian Divorce Act applies to spouses whose marriage has broken down and reconciliation is no longer possible. One of the statutory objectives of the payment of spousal support is “in so far as is practicable, promote the self – sufficiency of each spouse within a reasonable period of time”. It is one objective of spousal support and is not structured as an obligatory ‘duty’ which shall be satisfied without question. The objective is to be met by both spouses, not only the recipient of the support. This objective is one of four in the Divorce Act to be considered and is the focus of this blog.
This objective to be financially self-sufficient is a complex consideration to be integrated with all the related information, akin to solving a jigsaw puzzle. The whole picture cannot be understood until all the economic pieces are examined. In the 10 years of their marriage, Belinda was able to work her way up the corporate ladder. Her compensation package increased. She also took advantage of the out of town advanced training programs with her spouse at home caring for young children. She increased the standard of living for the family moving from a small house to a larger custom-built home.
The Whole Picture
Belinda was able to improve the family’s well being because, in part, of her spouse’s interest in rearing the children from infancy. His caring for the children allowed Belinda the time and afforded her the opportunity to travel and work long hours knowing the children were well cared for.
If the family had opted to pay for a full-time nanny, a housekeeper, laundry person, cook, groundskeeper, and other domestic help, both spouses could have been working full time. The cost for all these domestic aides could be paid from the salaries of both spouses. For many families having a series of strangers in and out of the house is not optimum for their young children. Sometimes, a grandparent is able to step in to help out on short notice. But they too, want to enjoy this stage of their life and are content to leave the diaper duty to someone else.
As you can imagine, the work contributions by that stay at home parent are often taken for granted. Courts will look at the value added to the family by the division of domestic work accomplished by the stay at home parent who has no or limited income. Household maintenance and child management are not skills typically acknowledged or valued by the marketplace. Further, income splitting arrangements are usually on paper only. There rarely is an income flowing from the family business to the non-working spouse. Spousal RSPs remain untouched as they are earmarked for retirement.
The whole picture of spousal support begins with an entitlement to receive support. A child-free short term marriage might mean attending a two-year skills upgrading program and an easing back into the workplace funded by a limited-term spousal support arrangement. For the marriage with a couple of children, particularly young ones, and a stay at home parent with a debilitating illness, support will be of a longer duration and of a greater monthly amount. The quantum and duration of the support arrangement are often ‘toggled’ to find a suitable solution for both the payor and the recipient.
A starting list for the economic-based pieces of the puzzle requiring specific attention include:
- The standard of living: the lifestyle, luxuries, entertainment, travel
- The economic interdependency between the spouses: the working spouse paid for family expenses, personal needs of self and the other spouse, household expenses
- The length of cohabitation: living together prior to and during the marriage,
- The job market, skills, education, and any upgrading required
- Capabilities including illnesses
- The present and potential income for both spouses
- The settling of family assets and debts from which an income stream or liquid funds may be realized
Where a spouse is found to be entitled to receive support, care must be taken when assessing the amount of that support and the length of time it will be paid by the other spouse. When the children become independent and in school full time, there is an onus on the stay at home spouse to take reasonable steps to find employment. Courts often look to the wages of the coffee server in a fast-food restaurant as baseline employment a healthy capable person should be able to handle. Obviously those with higher education will be expected to take re-accreditation courses, skills upgrading programs and the like to return to the workforce. The argument that ‘I don’t want to work anymore’ is not an option. Income will be imputed if there is a refusal to work by a person who can work.
In long term relationships, there is often a merging or blending of goals and lifestyle. There isn’t a wall down the middle of the home with the income-earner living in luxury on one side and the non-working spouse living impoverished on the other side of the divider. Economic dependency is acknowledged, fostered, and sustained. There is a corresponding working spouse relying on their partner to be responsible for the home life they share. Finding a reasonable and responsible resolution between the competing interests of sharing funds and resisting sharing comes down to full and frank financial disclosure.