EI Raw Deal for Ontario Workers

Ontario workers are getting a raw deal from Employment Insurance (EI) with only 30 per cent of Ontario workers receiving benefits, even if they have paid the premiums.

Formerly known as Unemployment Insurance, this program was created 71 years ago, in 1940, to help workers weather job losses by giving them a temporary income. Yet, after successive guttings by politicians and bureaucrats, the conditions required for newly unemployed to access EI now prevent 70 per cent of unemployed Ontarians from accessing it.

EI has not caught up to the reality of work in Canada, particularly for young workers who are working multiple part-time jobs to pay the bills. Permanent, full-time employment is no longer even an economic goal on the part of businesses and politicians. Neoliberal demands for more so-called flexible forms of employment (contract, temporary, casual, part-time work) are resulting in workers not meeting the hours quota required to qualify for EI, according to an EI report by the Toronto Social Planning Council. (Uninsured: Why EI is Failing Working Ontarians, http://socialplanningtoronto.org/wp-content/uploads/2009/05/ei-report.pdf). The number of workers eligible for EI in 1990 was 80 per cent; by the end of 2008, it was 44.5 per cent. In short, this safety net has more holes than cord to help newly unemployed people in Canada, especially immigrants, youth and women.

The result of denying so many EI claims is a $57 billion surplus in the federal EI fund, which both Liberal and Conservative governments have used to balance their budgets, rather than help unemployed workers. In response to the economic crisis, soaring unemployment and public pressure to do something, the Conservative federal government threw labour a bone by adding an extra five weeks for current EI claimants to receive benefits. However, as of September 11, new EI applicants won’t get these extra weeks of benefits if they need them. Human Resources Minister Diane Finley said that her government was sticking to their Economic Action Plan by cutting off the extra EI dollars.

The Workers Action Centre also reported that some employers are also misclassifying employees as independent contractors to avoid paying payroll taxes and EI premiums (Working on the Edge [PDF]). The Workers Action Centre proposes a broader redefinition of what a worker is in Ontario’s Employment Standards Act to remedy this problem.

Toronto’s Social Planning Council says the government can solve the problem primarily by reducing the number of hours needed to claim from 910 hours to 360 hours and to take the best earning 12 weeks over the past 12 months for the payment sum. The result would be that workers who pay into the Employment Insurance scheme get paid out of it. Sounds fair.

Of course, no one is talking about the need for all workers to organize precarious workers into unions and to ensure that unions across the country are strong enough to prevent both company mismanagement and layoffs. EI is a government program and if we have learned anything over the last 71 years, then it should be that governments change their mind all the time and try to erode workers’ benefits and rights. The long-term answer to this state of affairs is a strong, united labour movement that is willing to challenge the government toe-to-toe on this issue and have the full support of its millions of members. Only then will we see the government respond in a way favourable to the workers they rip off today and every day.