HUMA Committee Report

The Employment Equity Act essentially assumes that inequality in the workplace originates exclusively from the behaviour of employers or, in other words, the demand side of the labour market. This is clearly not the case, an observation made by a vast majority of witnesses during our deliberations. They spoke in favour of more skill acquisition initiatives for members of designated groups. The importance of the supply‑side of the labour market in terms of employment equity is evident in the role that education and job skills play in influencing the labour market outcomes of members of designated groups. According to the findings of a recent study, visible minority workers (except for black men) who are born in Canada have comparable earnings as similarly skilled and educated white Canadian workers. This was not found to be the case for similarly educated foreign-born visible minority workers, especially men, who suffer a wage disadvantage, compared to their white Canadian-born counterparts.²⁶ To economists, this earnings gap is attributed to differences in the market value of human capital (i.e. education, training, work experience, etc.) and not to discrimination. A number of issues related to differences in economic status within the visible minority community also surfaced during the pre-review consultations conducted by HRDC’s Labour Branch.²⁷

1. Human Resource Development and Disadvantaged Workers

As mentioned elsewhere in this report, the Canadian labour force is rapidly ageing and many are concerned about the potential labour shortages this demographic phenomenon may have in the future. While some of our witnesses maintained that the employment prospects of members of designated groups (including those who are not covered directly under the Act) will improve dramatically without public sector investments in human capital, others expressed the view that the federal government’s involvement in providing skill acquisition opportunities to disadvantaged workers is as necessary today as it was when the Employment Equity Act came into force in 1986.

Employer surveys, including one survey that included many of our members, show that attracting and retaining talent remains an absolute top-of-the-mind issue in building businesses. In combination with aging, this suggests that employers will be falling all over themselves doing outreach in the next couple of decades, they will be looking everywhere to find, develop, and retain human capital, and they won't need much outside encouragement to do so. This will benefit all covered groups, but most particularly the disabled, because, for example, workplace changes that are aimed at accommodating the mobility problems associated with the elderly will also improve the workplace environment for those whose mobility is limited for reasons other than age. (Mr. Finn Poschmann, Senior Policy Analyst, C.D. Howe Institute)²⁸

The Committee was reminded on more than one occasion that the recent retrenchment in federal spending has had an adverse impact on programs supporting human resource development among members of designated groups. Part of the reason for this is the way these programs are now delivered and funded, and part is due to program structural changes that have had a direct impact on clients’ access to support. Today, much of this support is delivered under Labour Market Development Agreements (LMDAs). Prior to the LMDA model, HRDC had more control over the allocation of employment and training support and the clientele served under its programs. At one time, target levels of participation for each designated group were set annually. Today, no such arrangement exists under the LMDAs, although provincial and territorial governments have agreed to provide the federal government with client-based information on gender, disability, visible minority and aboriginal status, where clients have willingly provided this information.

There are no target programs for women and visible minorities, but the flexibility and targeting of EBSM [Employment Benefits and Support Measures] at the local level help adapt projects to certain groups when they are considered a priority on the labour market. (Mr. Phil Jensen, Assistant Deputy Minister, Employment Programs Branch, Department of Human Resources Development)²⁹

In addition to program delivery changes, participation in what is now called Employment Benefits and Support Measures (EBSM) under Part II of the Employment Insurance Act requires individuals to be eligible for Employment Benefits. Because members of designated groups are seen to be disadvantaged in employment, including insurable employment, it follows that this disadvantage extends to eligibility for Employment Benefits.³⁰

If you have not been in the labour market, if you have not had a job, you are not now eligible for training because the accountability mechanism for those labour market agreements is the number of people provincial governments move from employment assistance into the labour market. So frankly, not only has the employment equity legislation not been effective for our community, but the federal government's turning over responsibility of labour market agreements to the provinces, without any guarantee that the needs of those who are not eligible will also be addressed has meant you have abandoned the whole area. Frankly, we see this leading to a continued patchwork of programs at the provincial level that have no equity across this country. (Mr. Laurie Beachell, National Coordinator, Council of Canadians with Disabilities)³¹

According to the data presented in Table 1, some 44.2% of EBSM clients were women in 1999-2000. A somewhat smaller proportion, 38.5%, of women participated in long-term interventions, a category of labour market programming that includes training. EBSM participation rates among persons with disabilities, aboriginal people and visible minorities in the same year were 2%, 4.3% and 3.8% respectively. Except for aboriginal people, participation rates for these designated groups were also lower in long-term interventions. These participation rates, irrespective of the duration of the intervention, are also below the overall availability benchmarks applied to each designated group, except Aboriginal Peoples, in the federally regulated private sector.

Between 1997-1998 and 1999-2000, progress in terms of raising the EBSM participation rates among members of designated groups has been, at best, modest in the case of women and Aboriginal people, and, regrettably, participation rates have declined  in the case of persons with disabilities and members of visible minorities. According to our testimony, HRDC maintains that incomplete data capture continues to contribute to the problem of under-reporting by designated groups. We only note, in this regard, that employers covered under the Employment Equity Act are also exposed to the same, or perhaps even more serious, data problems attributed to under-reporting.

TABLE 1
Participation of Designated Groups in Employment

Source: Human Resources Development Canada, 1998 Employment Insurance Monitoring and Assessment Report, Annex 3; and Employment Insurance 2000 Monitoring and Assessment Report, December 2000, Annex 3.

Despite differences in assumptions underlying future population and labour force growth in Canada, two things are virtually certain: Canada’s workforce will become older and it will become more diverse in the medium-term. Aboriginal peoples make up one of the fastest growing components of the Canadian population, increasing at a rate that is about twice the national average. By the year 2011, immigration is expected to account for all net labour force growth in Canada.³² In other words, Aboriginal peoples and immigrants, many of whom are members of visible minority groups, will comprise a growing share of the Canadian labour force in the years to come. The Committee acknowledges the efforts of the federal government to address the labour market needs of immigrants and Aboriginal people (e.g. Aboriginal Human Resources Development Strategy, Immigrant Settlement and Adaptation Program and Language Instruction for Newcomers to Canada). Nevertheless, the fact remains that Aboriginal people continue to experience much higher rates of unemployment and acquire significantly less schooling than the general population. Many newly-arrived immigrants also continue to face serious difficulties entering the Canadian labour market because they lack adequate language skills and/or are unable to have their educational or occupational credentials recognized fully, an issue that is further discussed below.

The Committee heard from many groups representing persons with disabilities and virtually all expressed some dissatisfaction with current human resource development programming for persons with disabilities. Some also criticized the delay in establishing a labour force development strategy for persons with disabilities, an initiative that was announced in the latest Speech from the Throne. The Committee was told that Employability Assistance for People with Disabilities (EAPD is delivered under agreements with the provinces and territories) has resulted in reduced access to funding compared to its predecessor, Vocational Rehabilitation of Disabled Persons. Like the LMDAs, we were told that the assistance under EAPD has also assumed a bias in favour of short-term interventions. As a result, clients have limited access to the skill acquisition initiatives that can generate meaningful long-term results.

… as of July 1, 2000 the government announced the federal government would no longer be responsible for training programs. This created chaos in the community because you suddenly had to redraft all of your projects and programs so that it didn't reflect training because, we were told, training was now the exclusive responsibility of provinces based on the labour market agreements … To block funding of programs on the basis of the federal government no longer is involved in training, to me demonstrates, perhaps, a lack of diligence in terms of really understanding what the tools and mechanisms require or dictate. (Ms. Joan Westland, Former Executive Director, Canadian Council on Rehabilitation and Work)³³

The Committee is fully aware of the fact that the Employment Equity Act applies to a relatively small proportion of Canada’s labour force. But we also know that the Act’s objectives will not succeed unless these aims are integrated into a broader base of HRDC programs and labour market initiatives generally. We are also cognizant of the vital human resource development needs of members of designated groups throughout the entire Canadian labour market. While the need for public support in this area may wane in the years ahead, as private sector employers devote more resources to training to avert labour shortages, we are clearly not yet there.

In our opinion, enhanced federal support for human resource development is critical in terms of making more progress on the employment equity front as well as ensuring that Canada has the knowledge and skills to drive the economy in the years to come. As evidenced by the work being done on the National Skills and Learning Agenda, part of the Innovation Strategy, the government realizes that knowledge and skills do matter. It is vital to ensure that the support that does become available to individuals under this strategy to make the required investments in learning be allocated fairly and be accessible to all members of designated groups. It is for this reason that most members of the Committee believe that we need more equity-based human resource development support and input at the federal level.

Recommendation 4

The Committee recommends that:

2. Foreign Credential Recognition

The absence of a national system for recognizing foreign credentials was an issue that surfaced frequently during our hearings. It was also raised in the pre-review consultations held by HRDC’s Labour Branch. Given our historical heavy reliance on immigration  as a source of skilled labour, the successful integration of immigrants into the Canadian labour market has been a long-standing policy objective of the government. One aspect of this policy that has received the government’s attention for quite some time is our inability to assess adequately foreign educational and trade certification credentials that accompany many immigrants to Canada. The Committee is well aware that this is an area of provincial/territorial jurisdiction. Nevertheless, it is critical that we make progress in this area, a point that is also recognized in the government’s Innovation Strategy.

While the Employment Equity Act has achieved major gains and progress in the representation of women and visible minorities, certain barriers still exist that prevent them from achieving their full potential. As an immigrant woman myself, and also a member of Immigrant Women of Saskatchewan, I have experienced and have heard many of the experiences of other immigrants and visible minority women and how the system works against them. Many of us feel that progress in the labour market is inhibited by the underutilization of our skills. It is not very easy to integrate into the workforce, because most often we come to Canada with foreign education credentials that are sometimes not recognized by Canadian institutions and organizations. We end up accepting jobs that are far below the qualifications and skills we already have. The need to get a better job forces us to go back to school and to retrain, but we still face the issue of not having the Canadian experience to get us hired. (Ms. Martha Mettle, Vice-President, Immigrant Women of Saskatchewan, Regina Chapter)³⁴

According to a recent study, it is estimated that some 540,000 individuals in the Canadian labour market forego an average of $8,000 to $12,000 annually because some portion of their human capital (formal and informal learning) is not recognized, but could be recognized and rewarded if a better system for learning recognition were in place in this country.³⁵ Of these, an estimated 340,000 individuals possessed unrecognized foreign credentials. According to the study, individuals with unrecognized foreign credentials are most likely to come from China, India, Philippines and Guyana.³⁶

Recently, the government proposed changes to the selection criteria used for assessing skilled workers who want to immigrate to Canada. In relation to this proposal, points will be awarded on the basis of the number of years of schooling required to obtain a diploma, trade certificate, formal apprenticeship or university degree. Compared to the current approach, the proposed selection system affords more points to education and tries to provide a better balance between formal schooling and technical training. However, like the current system, the proposed system makes no distinction between foreign educational and technical training credentials that are similar or equivalent to Canadian credentials and those that are not. And in the absence of a policy that requires applicants to acquire credential assessment prior to applying to immigrate to this country, like the approach adopted in Australia, the current and proposed selection systems seem to contribute to the problem. Some, but not all of our posts abroad, provide information to successful immigration applicants regarding credential evaluation services in this country. This should be a common practice in all posts and provisions should also be made to provide this information to successful applicants when an interview is waived.

Recommendation 5

The Committee recommends that: