The Broadbent Blog


Employment Insurance under the Trudeau Liberals

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In their 2015 election platform, the Trudeau Liberals identified a number of items related to Employment Insurance (EI) that they would change: reversing the Harper EI reforms defining ‘suitable work’; reducing the waiting period for EI benefits; reducing EI premiums; introducing more flexible parental leave; providing better access to compassionate care; and increasing funding for employment and training programs managed by provinces, territories and Aboriginal labour market organizations.

One of their first actions upon assuming power in 2016 was to remove two restrictions introduced by the Harper Conservatives in 2012 that changed the definition of suitable employment and new entrants and re-entrants under the EI Act. They also reduced the waiting period for EI benefits to one week; made extra weeks of benefits available for workers in regions affected by downturns in global commodity prices; expanded work sharing agreements; and introduced new, more flexible Working While on Claim pilot projects. Funding for the federal-provincial-territorial labour market transfer agreements and the Aboriginal Skills and Employment Training Strategy was also increased.  

Budget 2017 announced a new EI caregiver benefit; more flexible EI parental benefits and maternity benefits; and better use of flexibilities within EI to allow claimants to pursue self-funded training while maintaining their EI status.

The Liberals also set up reviews and consultations to deal with specific issues. In 2016 a consultation on maternity/parental and caregiving benefits took place. Along with provincial and territorial governments, Ottawa consulted on the labour market transfer agreements, releasing in 2016 a What we Heard Summary Report from the Federal/provincial/territorial consultations on the Labour Market Transfer Agreements.  Next up was an EI Service Quality Review finalized in 2017 ─ undertaken by three Members of Parliament ─ to ensure that Canadians received the EI benefits to which they were entitled in a timely fashion. The review identified many inadequacies with how Service Canada operated, resulting in the development of a Benefits Delivery Modernization strategic plan.  

Another Harper Conservative change that the Liberals had to deal with was the Social Security Tribunal or SST. In 2012 the Conservatives disbanded the 80-odd Boards of Referees ─ composed of government, business and union representatives ─ that heard EI appeals across the country and replaced them with a centrally-managed SST that also heard appeals for Old Aged Security and the Canada Pension Plan. Implemented as a cost-cutting measure, no one was consulted on this change, not least the EI Commissioners for Workers and Employers.

As the complaints about the SST built up, in March 2017 Jean-Yves Duclos, Minister of Families, Children and Social Development, hired KPMG[1] to undertake a review of the SST to ensure that it was meeting the needs and expectations of Canadians, and to assess its fairness and transparency. Many EI stakeholders hoped that the local EI Boards of Referees might be restored as a result of the review. Given EI’s tripartite history and the value-added that business and worker representatives bring to the EI program, I also made this recommendation.

KPMG’s Review of the Social Security Tribunal released in January 2018 gave short shrift to tripartism as a core principle of EI ─ that EI is a partnership between government, business and labour ─ basing their recommendations instead on “the Government of Canada’s Open and Accountable Government principles, combined with Employment and Social Development Canada’s priorities and strategic directions”.

While acknowledging that the SST was “not meeting expectations of timeliness, fairness, accessibility and efficiency” and that “many stakeholders expressed a desire to return to the previous system”, KPMG concluded that “this would be neither practical nor recommended”.

Instead they recommended that the feds start an overhaul of the SST to take a less formal “tell your story” approach to speed up appeals and make the process less daunting for vulnerable Canadians. Minister Duclos subsequently promised to make changes through the development of “a comprehensive action plan that will focus on both long and short term improvements”.

This was not an encouraging result for the countless organizations that have for years helped individuals in their community launch an appeal when their EI benefits have been denied. Perhaps there is still hope to bring tripartism in appeals back to EI: Duclos said that changes to the SST won’t be limited to the ideas in the KPMG review, and will borrow from the previous appeals system.

All of these changes to EI over the past two years are, in essence, “tweaks” that respond to specific irritants and issues, or reflect the agenda of the Trudeau Liberals. Just over twenty years ago another Liberal federal government ─ under Jean Chrétien ─ transformed Unemployment Insurance into Employment Insurance. This was touted as “a fundamental restructuring of the system”. 

So the biggest questions in 2018 include how sound is our EI program when so many people in non-standard jobs can no longer even qualify for benefits? Can all work-family balance issues be solved through a contributory social insurance program? How can EI contribute to the upskilling of the workforce?

Many representatives of workers who attended the EI@75 forum in Toronto in October 2017 (sponsored by the Atkinson Foundation, the Mowat Centre and the Broadbent Institute) noted that “over the past twenty years EI has been gutted to the point………that many Canadians feel the program is irrelevant”. Business representatives reiterated that payroll taxes like EI are the “biggest impediment to hiring the unemployed”.

To deal with these kinds of issues a more fundamental review of EI is required, and this has also been promised by the Trudeau Liberals. Minister Duclos’ September 2016 mandate letter charges him with “undertaking a broad review of the EI system with the goal of modernizing our system of income support for unemployed workers that leaves too many workers with no unemployment insurance safety net”. So far there has been no sign of this fundamental review. Now would be a good time to get it underway, under the leadership of representatives of business and workers, as well as government.

 

 

[1] According to their website, KPMG is a Canadian leader in delivering Audit, Tax, and Advisory services, see https://home.kpmg.com/ca/en/home/about/at-a-glance.html.