EI Reform: One Size Does Not Fit All

  • Downhome Magazine
  • Posted: Aug 06, 2012 6:37 PM
Photo submitted by Melanie Beck.

By Kirsten Joy

In a recent revamp of Canada's Employment Insurance (EI) program -an attempt to eliminate EI's "disincentives" - the federal government has dramatically altered a system that maintains Atlantic Canada's many seasonal industries, including the fishery, tourism and agriculture. Now, hundreds of thousands of seasonal workers are left wondering how a new system might alter their lives, both on and off the job.

Memorial University's Dr. Wade Locke, who specializes in Newfoundland and Labrador economics, says there will be significant adjustments for people engaged in seasonal industries.

"The costs for these individuals will be higher, it'll lower their standard of living, it'll be a different lifestyle - including the work effort and work types they've been doing in the past."

Locke says seasonal workers may have to accept full-time work available within an hour's commute if their skills match those required, even if it wasn't a position they would have previously considered. He believes the most negative impact will be felt in rural Newfoundland and Labrador, where an hour's drive is quite different from the same commute in an urban centre like Toronto, where jobs and public transportation are more readily available.

"A lot of the skills that exist in rural parts of the province are not easily transferable to other industries. Some are, but a lot are not. And so it would be difficult for individuals finding 'comparable' jobs." For example, he says, there may be plenty of work for electricians in St. John's, but no qualified electricians in rural areas to take advantage of the jobs.

Considering the prominence of seasonal industries in this region, it's not surprising EI plays a large role in the local economy. According to Dr. Locke, "I don't know if people know how much EI comes into the province. Last year it was $1 billon. So you know, we have somewhere around 48-49 thousand people in the most recent periods drawing EI. That's somewhere between 18-19 per cent of the labour force. So it's substantial here. Now obviously it's dropped down from what it used to be around 1992 - we had 80,000 people drawing EI back then. So things have changed, but it's still significant."

Lack of Understanding

Locke says the changes are partially driven by an ideological belief concerning whether people are really unemployed or voluntarily unemployed, working just enough to become eligible to collect EI.

It is this attitude that has led many people, like Earle McCurdy, president of Fish, Food and Allied Workers (FFAW) to refer to the proposed changes to the EI system as being an "attack" on seasonal workers. "There is a complete lack of understanding of the nature of not just the fishery, but rural parts of the country where seasonal industries are an important part of the economy. There has always been an attitude amongst some in Ottawa, some kind of blame to be attributed to people because the nature of their industry is seasonal."

Judy Foote, MP for Random-Burin-St. Georges, says the legislation wrongly generalizes all EI claimants, thereby "trying to fit a square peg into a round hole." She says it lacks regional consideration, and doesn't consider individual circumstances that contribute to an individual's unemployment. Foote also has an issue with the lack of consultation and information given to the Atlantic provinces on the proposed reform.

"The minister herself (Hon. Diane Finley) said in the House of Commons that yes, she consulted with her own colleagues. I will not believe for a second that her colleagues who live in and represent these areas were in fact listened to," Foote says. "Clearly the changes that are being proposed do not at all reflect the reality of the situation for those that are employed in seasonal industries... Some of those who work with the minister have probably never even visited a rural community."

Among others, Foote reiterates the point that the money that's in the EI system (about $50 billion) is money that was contributed by workers and their employers - therefore they have a right to access it.

But there are those who have another perspective. In a column published online at theindependent.ca, writer Brandon Pardy argues seasonal workers in Newfoundland and Labrador are essentially transferring money from other provinces' full-time, long-term workers and employers to support this province's seasonal industries.

Hence the endless debate concerning whether EI should subsidize seasonal industries, as it has become in many cases an income supplement plan instead of income insurance.

Regarding the EI "pot" Foote says, "The government didn't contribute to this fund. So it's not the government's money to play with. And then they say 'well there's a skill shortage.' There may very well be a skill shortage - but this is not the way, forcing people into a work position for which they're not qualified. Imagine the stress and the strain of that."

McCurdy is equally critical of the federal Conservatives. "There's enough challenges already maintaining those small communities and the working population as it ages, without the federal government adding to it. Bad enough they don't have any proactive policies to help develop the economies of these areas, without making it worse. You know it always seems as though the policies of the government of Canada are driven by the wish list of the oil industry. Basically that's what's driving this."

On the Front Lines

Yvonne Phillips, who has worked at the Bonavista processing plant since 1977, is concerned about the changes. She expresses her and her co-workers' fears and agrees with McCurdy's view that the changes are an attack on seasonal workers. She's also worried about the lack of other opportunities in the area, particularly for older employees. "They're all 50- to 60-year-olds, working into the plant. Where are these people going to go? If they got to go to Fort McMurray or somewhere, at that age, they're not going to get a job," she says. "Even trying to get a job in a shop or something somewhere, someone that age isn't going to."

Minister Finley insists that government will not force people to move across the country for work. But what if someone is cut from EI and feels they have no other financial option?

Phillips also says it's not really practical to expect certain operations to exist year-round. "It's really not an easy job. For them to say we can work 12 months a year at OCI, I think it's wrong for them to put it up like that. It's very hard work. In March you gotta wear four sweaters to keep yourself warm, it's that cold. There's no way you could work in the plant in the wintertime like that, even if there was harvest."

Doreen Layman, President of Landscape Newfoundland and Labrador (LNL), echoes these statements.

"Our climate dictates the seasonality of our industry, not the lack of willingness of our workers. I think those that are returning to the same employers or industry year after year should be entitled to collect the benefits during the period of shortage of work (as a result of our climate)."

This weather-dependent nature of seasonal work does not mean they are not sustainable industries. Actually, seasonal industries generate more than a billion dollars for the economy, not to mention job creation. Darin King, provincial minister of Fisheries, says there are 20,000 people employed in the fisheries, with the province's seafood production worth $1 billion last year. According to ACOA, there are more than 110,000 Atlantic Canadians working in the tourism sector, which in 2010 brought an estimated 518,500 non-resident visitors (more than the population of the entire province) to Newfoundland and Labrador. Their spending in the province totaled $411 million, says the Tourism, Culture and Recreation Department's 2011 Provincial Tourism Performance Report.

Layman says not only will seasonal employees take a hit, but so too will their employers who fear their workers - repeat EI claimants - may leave the industry.

"Then you'll have employers constantly re-training people because of this, which is going to take a heavier toll on our finances."

Layman says a one size fits all approach is unfair to the majority of EI claimants, who do not abuse the system. "I don't think government should punish or dictate long-term employees in an effort to curb the abuse that may be happening. Historically if you review the work trends for an individual you can find that out yourself. To me it should be looked at on a one-on-one basis. I can understand why they did it, but basically they're taking a few bad apples and calling the whole bunch bad."

Another Perspective

Not everyone is fearful or critical of the federal government's decision to amend the EI system - some are even praising it, saying it's about time the outdated and often-abused policies change. Derek Butler, Executive Director of the Association of Seafood Producers, says the amendments are common sense.

"My initial reaction was, the same as I think a lot of Newfoundlanders and Labradorians and Canadians - that there is a long-standing recognition that there's a need for tweaking and changes to the EI system. I think that would be my reaction whether I was in or out of the fishery...I'm not one of those who think that there's a big boogeyman and this is all the end of the world."

He believes many fears expressed by seasonal workers are the result of scare-mongering. Using the 9,000 people working in processing plants as an example, he says it's unlikely 9,000 full-time jobs requiring the same skill set will become available nearby, forcing them all out of the fishery. And he says the isolation of many outport communities will render workers immune from travelling excessive distances for employment.

"I think most people would say we need to change the system; it needs tweaking and to be adaptive to new realities in terms of labour shortages, and the population available for work. There's always room for work and common sense change. I think that's what the government is talking about, that's what I hear. And then those that run around saying the sky is falling because everybody hates us, I don't wake up with that thought on my mind everyday, I don't think it works that way."

What do you think about the new legislation regarding EI? Share your thoughts by calling our toll-free submission phone line at 1-866-690-1999. Leave us a message and your comment could appear in the next issue.

Part II of this story, analyzing alternative solutions to the EI situation, appears in the September issue of Downhome.