Monday, July 27, 2009

Ok kids, let's learn about changes in EI

Life can throw a curve ball at anyone. Jobs are lost, sickness befalls or we decide to have children and parental leave is required. When such events occur, Canadians expect there to be a safety net. Unemployment Insurance was first introduced in Canada in 1935 to provide some relief during the Great Depression. However, this complicated piece of legislation did not become amended by the Constitution until 1940.[1] Since then, Unemployment, or Employment Insurance, has been amended many times over due to changing social values, economic trends and federal leadership. With EI qualifications becoming stricter, now more than ever we see disproportionate age and gender discrimination in Canada and fewer EI benefiters.

The turning point came in 1990 with the passing of Bill C-21. The government decided to stop all federal contribution to EI by 1993 and increase the minimum entrance requirements depending on unemployment rates in each region. “This bill collapsed the three-phase benefit structure (i.e. initial, labour force extended and regionally extended benefits) to a single phase. This modification reduced the maximum duration of benefit entitlement in all instances, except for claimants with long employment spells residing in very high unemployment regions of the country.”[2] Furthermore, they combined maternity, parental and sick benefits only allowing a maximum of 30 weeks assistance for all benefits rather than individual benefit terms. While this bill did include that either parent was allowed to take leave when a new child was born or adopted, it brought the number of EI qualifiers down from 80% to 74%. This number was further reduced by 1993’s Bill C-113 which only covered 57% of the population.[3]

After that, things did not get any easier. 1994’s Bill C-17 set up 1996’s EI reforms by manipulating the 1994 budget. At this time, coverage dropped to 51%.[4] EI legislation was further amended by the Employment Insurance Act of 1996 which drastically cut entrance requirements. The major change with this act was a shift to looking at the hours one works a year instead of the weeks in order to qualify. This is also when the Liberals decided that “Employment Insurance” is a more positive term than “Unemployment Insurance.” In 1996 Canadians saw a reduction in the duration of benefits and higher penalties for false statements. Insurance requirements now dropped to 42% in 1996 and would hit a staggering 39% by 2001.

According to the Status of Women in Canada, now approximately 32% of women and 40% of men qualify for EI. The main cause for eligibility decrease came with the transfer from “weeks” to “hours.” To qualify workers must have “between 420 and 700 hours of work, depending on the local unemployment rate.”[5] Because some women enrol in part-time employment so they can devote more family time, they have difficulty collecting the hours they need to qualify. The government fails to realize the different work patterns between men and women and accommodate each gender. Since Bill C-12 the number of hours has quadrupled for part-time workers.

Changes in EI have made it more difficult for women to achieve parity with men. For example, “in 2006-7, the average benefit for women was $298 per week compared to $360 for men.” [6] Furthermore, “in the first five years of EI, from 1996-2001, the gap in insurance protection between men and women more than doubled.”[7] Women are almost equally participating in the workforce alongside with men yet there is still a drastic difference when it comes to their qualifications and benefits. In 2003, Canadians saw some relief with the Budget Implementation Act which introduced compassionate care benefits so Canadians could take 6 weeks leave to care for a family member who is dying or very ill.

Kamloops has been facing its own challenges during the recession. On April 10, 2009, the Daily News stated that unemployment in the Thompson-Okanagan rose to 9.1% in March 2009 from only 5.9% last year. This has caused people and families to need EI more than ever before. According to Statistics Canada, that means that 24 900 workers are unemployed in and around the city. In order to qualify for EI, Kamloops workers would be required to work 560 hours in the last 52 weeks to get assistance.

With the last budget, Prime Minister Harper’s government increased the period one can collect benefits from 14 to 19 weeks. While this action is good, it has not fixed a system that is so crucial to stimulating the economy and keeping Canadians afloat during the recession. Since 1990 EI has gone through major changes but reform still needs to repair the system and make it more accessible, especially to all of those who see EI premiums deducted from their paycheques.

Labour reformers, such as the Canadian Labour Congress, are pressuring the government to “adopt a far more comprehensive approach, including the following specific reforms: provide regular benefits on the basis of 360 hours of work no matter where workers live and work in Canada; raise benefits to 60% of earnings calculated on a worker’s best 12 weeks; increase the period for which benefits can be collected to a maximum of 50 weeks from the current 41-week maximum; raise minimum wages and tax credits for low-income workers; expand support and funding for work-sharing arrangements under EI to reduce layoffs and build links to training programs, and invest part of the EI surplus in training and labour adjustment programs.”[8] The surplus that the CLC refers to is the $54 billion that the federal government has stopped investing in EI since 1993.

For some Canadians, receiving EI is the difference of not becoming homeless or taking their families to eat at food banks. Before cuts were made in the 1990s, over 70% of women and 80% of men qualified for benefits.[9] While some may criticize that reformers such as Pierre Trudeau were far too generous before the 1990s, the strict qualifications that workers struggle with now do not benefit Canadians, especially during the recession. The future of EI will continue to be reworked, re-improved and re-implemented with the advocacy and persistence of labour reformers.

[1] S. Lavender, 2009 Annotated Employment Insurance Statutes
[2] K. Kerr,, November 1999
[3] Canadian Labour Congress, Falling Unemployment Insurance Protection for Canada’s Unemployed, March 2003
[4] Canadian Labour Congress, March 2003
[5] Canadian Labour Congress, Statement to the House of Commons Standing Committee Regarding the Status of Women Study on Consequences and Effects the Current Employment Insurance (EI) Programs Have on Women, March 2009
[6] Canadian Labour Congress, March 2009
[7] Canadian Labour Congress, March 2003
[8] Guardian, Volume 27, Number 1, Spring 2009
[9] Canadian Labour Congress, March 2009

No comments:

Post a Comment