As economy slows, Liberals push off EI reform over worries it could drive up premiums

OTTAWA –

The Liberal authorities left employment insurance coverage reform out of the federal finances this week over concern that reforming this system amid a slowing economic system may drive up premiums for staff and employers.

That’s in line with a spokesperson for Employment Minister Carla Qualtrough, who mentioned the federal authorities “remains committed to modernizing the EI system.”

“However, the current and near-term economic context caution against measures that could put pressure on EI premiums and we needed to be careful about any decision that could make it harder for workers and employers to make ends meet,” the spokesperson mentioned in an e mail.

After the final federal election, Prime Minister Justin Trudeau handed out a mandate letter that tasked Qualtrough with bringing ahead and implementing a plan to “modernize the EI system for the 21st century” by summer season 2022.

As the summer season was ending, the minister promised reform was coming quickly. “By the end of the year, you’ll know what the vision for EI is,” she mentioned in September.

There was scant hope that, a number of months into 2023, the federal finances would lastly trace on the authorities’s plans. Sure sufficient, its slender give attention to the clear economic system and well being care left different agenda objects off the desk.

The federal authorities, which is now anticipating a light recession this yr, seems to be avoiding EI reform proper now in order to not drive up the price of this system. A recession would probably include job losses. Expanding eligibility now may end in much more folks tapping into this system.

But with this newest delay, labour teams and specialists are getting impatient.

There is an extended record of complaints concerning the present construction of this system, on its eligibility necessities, financing and administrative know-how. But the central concern for staff is that too few can entry this system.

In 2021, the Liberals had campaigned on a promise to modernize EI and pledged to increase this system to cowl self-employed staff and handle gaps highlighted by the COVID-19 pandemic.

Finance Minister Chrystia Freeland signalled Thursday that broader reforms are nonetheless coming.

“My colleague Carla Qualtrough … is hard at work on broader EI improvements and that is important work that has to be done thoughtfully and carefully,” she advised reporters in Surrey, B.C.

Freeland cited two modifications to EI introduced within the finances.

One measure proposes extending a short lived change to EI launched in 2018 that will increase the variety of weeks of protection accessible to seasonal staff. The different goals to strengthen prohibitions in opposition to worker misclassification for federally regulated gig staff.

The National Council of Unemployed Workers reacted to the finances by calling on the NDP to withdraw its help of the Liberal authorities by way of the events’ supply-and-confidence settlement.

“We are fully disappointed, because the government is betraying its commitment and choosing once again the status quo,” Pierre Cere, a spokesperson for the group, mentioned in an announcement.

“In light of this situation, we are asking the NDP to withdraw its confidence in the government and for MPs to put their seats on the line over this issue.”

A member of the Canadian Employment Insurance Commission, which incorporates each labour and business voices and helps to supervise and evaluation the EI system, added to the criticism.

Pierre Laliberte, its commissioner for staff, mentioned it was “very disappointing” to see EI reform not noted of the finances.

At the very minimal, the federal authorities may have included interim measures to handle main gaps and increase entry, he mentioned. “It really is absolutely bizarre that the government would not have seen fit to at least … plug some holes here and there.”

During the pandemic, the federal government had expanded entry to the EI system through momentary measures. Those expired in September, regardless of staunch opposition from labour teams and the NDP.

Under the momentary measures, staff certified for EI primarily based on a nationwide requirement of getting labored 420 insurable employment hours, whereas staff would usually want between 420 and 700 hours relying on the regional unemployment fee. And monies paid upon a employee’s separation from a job, equivalent to severance, weren’t deducted from the advantages.

The lack of readability on the way forward for EI reform comes as many economists anticipate the Canadian economic system will enter a light recession this yr, which is anticipated to come back with some job losses.

Canadian Labour Congress president Bea Bruske mentioned implementing EI reform would assist “recession-proof” the economic system for staff by guaranteeing the social security internet can help those that face layoffs.

But Laliberte mentioned EI reform does not look like a precedence for the Liberals or NDP. Both have been extra targeted on delivering a federal dental care plan, he mentioned, regardless of well being care being below provincial jurisdiction and the EI program being a federal duty.

“It’s not sexy,” Laliberte mentioned of EI reform. “Announcing something new, like dental care — it’s glamorous, right?”

In an announcement, NDP deputy finance critic Peter Julian mentioned New Democrats are happy with what they achieved for Canadians within the finances, however they’re “not satisfied.”

“It is shameful that the Liberals failed to include EI reform in the 2023 budget as economists are warning that we’re heading into a recession,” Julian mentioned.

“New Democrats will continue to push the Liberals to reform EI and make sure no worker is left behind.”

This report by The Canadian Press was first printed April 1, 2023.