HUMA Committee Report

Recommendation 1:

The Committee recommends that:

• the government consider reducing the qualification requirement for new entrants and re-entrants from its current level of 910 hours to 700 hours. This would establish a qualification requirement based on a 35-hour week that is equal to the 20-week requirement that applied to this group prior to the EI reform.*

• the government consider restructuring the 420 to 700 hours qualification requirement to better reflect the unemployment problems experienced by seasonal workers.**

• the government consider further reducing the qualification requirement for special benefits.***

Recommendation 2:

The Committee recommends that the government consider amending the Employment Insurance Act so as to adopt a new definition of a new entrant and re-entrant that excludes individuals who can demonstrate a long attachment to the labour force. The new definition should also exclude those who receive at least one week of sickness benefits in the four-year period preceding the current two-year look-back period.

Recommendation 3:

The Committee recommends that the government consider readjusting Schedule I of the Employment Insurance Act so as to provide a maximum benefit entitlement of 50 weeks like that afforded combined maternity/parental benefits. Compared to the existing Schedule 1, consideration should be given to augmenting benefit entitlement beyond the minimum hourly qualification requirement so as to provide an additional incentive to work for a longer period of time than the minimum number of hours required to qualify for benefits. The new Schedule 1 should provide no more than a maximum increase of five additional weeks of benefits for any given combination of hours of insurable employment and regional unemployment rates. In addition, Schedule 1 should be reconfigured, to the greatest extent possible, to ameliorate the “gapper” problem.

Recommendation 4:

The Committee recommends that Human Resources Development Canada study the feasibility of providing a longer benefit period for older displaced workers who lack the skills to find new employment and for whom an investment in new skills is uneconomic.*

Recommendation 5:

The Committee recommends that:

• the government review and consider the possibility of eliminating the current divisor. We feel that there is an incentive to work extra hours by providing a longer benefit period to those who work beyond the minimum hourly qualification requirement and this incentive would be strengthened if the government were to restructure Schedule 1 of the Employment Insurance Act as discussed above.

• the government consider formally legislating the current treatment of “low earning weeks.”

Recommendation 6:

The Committee recommends that the government consider adopting the qualifying period as the new period over which earnings are averaged. Only the highest earning weeks should be included and these earnings should be averaged over a number of weeks equal to the weekly equivalent (based on a 35-hour week) of the applicable minimum hourly qualification requirement.

Recommendation 7:

The Committee recommends that the government consider increasing the current earnings threshold for an EI premium refund to $3,000 as well as consider converting this refund to a yearly basic premium exemption.

Recommendation 8:

In view of the growing incidence of self-employment in the Canadian labour market, the Committee recommends that the government consider developing a framework for extending EI coverage, both in terms of regular and special benefits, to self-employed workers.

Recommendation 9:

The Committee recommends that the government consider extending better EI coverage to workers employed in both paid and self-employment. In the event that the government does not extend coverage to self-employed workers, a premium refund should be provided to those who work in insurable employment but are unable to establish a claim because they are also self-employed.*

Recommendation 10:

The Committee recommends that:

• the government consider making more training funds available to help employers experiencing serious difficulties finding adequately skilled workers to replace those receiving maternity/parental benefits.

• the government consider offering a premium refund to employers as an incentive to provide incremental training to workers. Expenditures on this initiative should not be included in the expenditure limit referred to in section 78 of the Employment Insurance Act.

• the government consider amending section 78 of the Employment Insurance Act to require that 0.8% of estimated total insurable earnings be allocated each year to Part II Employment Benefits and Support Measures.

• the government consider amending section 58 of the Employment Insurance Act to expand access to Part II training and other Employment Benefits and Support Measures by applying a five-year look-back period to all individuals, irrespective of the type of EI benefits received during this period.

Recommendation 11:

The Committee recommends that the two-week waiting period must be eliminated for those engaged in approved training.

Recommendation 12:

We recommend that the Committee be included in the upcoming review of the premium rate-setting process and that this process include:*

• a discussion of the impact of financing EI on premium payers and the economy.

• a discussion of whether or not the government should amend the Employment Insurance Act so as to quantify the size of a real EI reserve that would be required to meet the premium rate-setting objectives contained in the current law.

• a discussion of whether or not employer-employee premiums should be equalized.

• a discussion of whether or not employers should receive a premium refund on premiums refunded to workers.

• a discussion of whether or not maximum yearly insurable earnings should be increased to $41,500 and indexed thereafter.

Recommendation 13:

The Committee recommends that:

• in its review of EI economic regions, the Canada Employment Insurance Commission should, to the greatest extent possible, distinguish between labour markets in a given locality.

• the consultations conducted by the Canada Employment Insurance Commission in its review of EI economic regions become more open and transparent.

• any future transitional measures that are adopted re the implementation of EI economic regions be applied so as to provide equal treatment for all claimants, even if it means the retroactive application of transition rules.

Recommendation 14:

The Committee recommends that:

• immediate steps be taken to implement the Auditor General’s recommendation that both the CCRA and HRDC update and implement an effective action plan that adequately deals with suspected EI fraud and abuse. In addition, the government should consider amending the Employment Insurance Act to make clearer how insurability rulings are to be made and how appeals related to these rulings are to be decided.

• HRDC EI investigators always employ respectful and ethical behaviour while conducting their investigations.

• the government consider amending section 104 of the Employment Insurance Act so that anyone who is subpoenaed or who wins their appeal to the Tax Court of Canada be reimbursed by the federal government for such expenses as travel, meals and loss of earnings.

• the government consider revisiting section 30 of the Employment Insurance Act so as to impose a less severe penalty, in certain circumstances, on those who leave employment voluntarily and who are unable to establish “just cause”.

Recommendation 15:

The Committee recommends that the government amend subsection 5(3) (and if necessary, section 5(2)(i)) of the Employment Insurance Act with a view to remove the presumption of guilt if an employer and an employee are related.

Recommendation 16:

The Committee recommends that the government return to the pre-1996 treatment of allocating undeclared earnings to weeks by repealing section 19(3) of the Employment Insurance Act and section 15(4) of the Employment Insurance Regulations.

Recommendation 17:

The Committee recommends that HRDC improve its service to Canadians, especially in terms of providing more timely, accurate and client-friendly EI services.