Changes to EI program announced
On May 24, 2012. Minister of Human Resources, Diane Finley announced changes to the Employment Insurance (EI) program. These changes are intended to connect Canadians with existing jobs to reduce unemployment and to advance the Canadians First policy initiative.
The Canadian Nursery Landscape Association (CNLA) has prepared this release, noting that the exact impact and implementation of these changes are unknown. CNLA will continue to work with the provincial associations to gather information and establish an advocacy strategy to help our members with the new policies. These policy changes are scheduled for implementation in early 2013.
Points of interest
The consensus amongst stakeholders is the proposed EI changes to do not accurately address the seasonal nature of our industry. As Michelle Gillespie of Sun Nurseries in Sussex, N.B., puts it, “our seasonal business will suffer as we lose good employees. Constantly retraining new employees will take a heavy toll on finances and lost business opportunities. Our climate dictates the seasonality of our industry not our lack of willingness to work in our chosen careers.”
The following items have been identified as areas of potential interest for the green industry.
Delay or loss of seasonal agricultural or temporary foreign workers: We believe this is unlikely given the distance and wage criteria for postings. The greater concern is delay in receiving positive Labour Market Opinion’s and thus filling the positions.
Loss of returning employees: Repeat users of EI are going to face additional pressure to find alternate employment. They will be required to take jobs at 70 per cent of former wage as early as six weeks after starting EI.
Increase in applications: The new EI policies will likely result in many more applications for open positions. We anticipate this could become an administrative issue for companies large and small.
Previous changes to note:
Reduction in the claw back amount to 50 per cent of earnings to apply against EI claims. This helps reduce the disincentive to work by allowing workers on EI to keep more of what they earn for casual labour.
Reduction in wages for SAWP workers by as much as 15 per cent below minimum wage based on regional variation. This could widen the gap in some areas and help maintain the ability of foreign labour.
If you have questions or comments on this issue please direct them to Joel Beatson at the CNLA office, 1-888-446-3499, ext 8610 or joel@canadanursery.com.
The following are excerpts from the backgrounder provided by HRSDC
HRSDC has clarified the definition of suitable employment and what constitutes a reasonable job search.
Suitable employment depends on a number of issues:
Personal Circumstances—health, family obligations, transportation options and physical demands of the job
Turning down a job that is considered suitable could result in EI benefits being discontinued.
Below is a breakdown of what will happen when someone applies for employment insurance. The applicant will be filed into one of three categories:
Frequent Claimants (17 per cent of all claims): Seasonal workers would fall into this category
This includes anyone who has filed three or more EI claims in the past five years
Right away claimants will have to take any work that is a “similar occupation” of their old job and pays 80 per cent of their previous earnings
After six weeks on EI, claimants will have to take any job they are able to do at 70 per cent of their previous earnings
Occasional Claimants (58 per cent of all claims): Seasonal workers averaging seven weeks a year on EI would fall into this category.
This category includes people who don’t go on EI enough to be considered frequent claimants, but also who haven’t worked steadily enough to be longâ€tenured workers.
For the first six weeks of receiving EI, they will only have to take a job in their same occupation that pays at least 90 per cent of their previous earnings
After six weeks, they will have to take a job in a similar occupation that pays 80 per cent of their previous workings
After 18 weeks they will have to take any work at 70 per cent of their previous earnings
Long tenured workers (25 per cent of all claims):
Claimants must work for seven of the past 10 years while paying at least 30 per cent of maximum EI payments and have received no more than 35 weeks of EI over the past 5 years
Claimants will have 18 weeks to find a job in their existing occupation that pays at least 90 per cent of their previous earnings
After 18 weeks they must move to a similar occupation that pays 80 per cent of previous earnings
The Government is providing clarity on what constitutes a reasonable job search. EI claimants’ job search efforts would be assessed based on the following criteria:
Job search and employability activities – Canadians receiving EI benefits will be required to complete the following job search activities while collecting benefits:
Researching and assessing job prospects;
This will be measured by the intensity of the search, the type of work being sought and evidence of job search efforts.
A more complete description of the changes can be found at:
http://news.gc.ca/web/article-eng.do?mthd=tp&crtr.page=1&nid=676379&crtr.tp1D=1
Banking hours is an option to EI
A strategy to tackle the issue of retaining valued employees in seasonal work is banking hours.
LO executive director Tony DiGiovanni says, “The system of banking hours is ultimately the best solution. The other strategy is to start an employee association that trains and supplies labour to the industry. It’s a union model, without the union.”
The system allows employers and employees to put the emphasis on the total hours worked in a year, rather than the number of weeks that the employee needs to be laid off. With pay cheques equalized throughout the year, reliance on EI is eliminated or greatly reduced and employees can take time off during the winter months, knowing that their personal cash flow will still allow the mortgage and other bills to be paid.
Several years ago, Landscape Ontario’s Labour Task Force identified the seasonal nature of the landscape industry as a significant barrier. Who wants to consider horticulture as a career alternative when winter layoffs and unpleasant dealings with Human Resources and Skills Development are an unavoidable part of the future? The concept of hours banking is often looked at as a viable alternative.
But while some companies claim to use an hours banking system with great success, some feel it is impractical and others question the legality of such a system.
Hours banking is the equalization of the hours worked by an employee over the course of a year. If you work 2,000 hours, you get paid for 2,000 hours, but the system evens out the payment schedule.
The system is similar to salary in that the employee’s pay cheque is similar from week to week. The employee is paid an hourly rate for actual hours worked, thereby avoiding the potential for misunderstood expectations on the part of both the employers and the employee.
If the many advantages of an hours banking system are so obvious, why isn’t it used by more seasonal businesses?
For the smaller company, the administration required to calculate income taxes and other deductions on two different amounts might be onerous. There is also a problem of educating employees who are accustomed to pay cheques that reflect the actual hours worked each week. Some people still feel entitled to EI benefits in the winter months.
The seasonal nature of the horticulture industry in Ontario dictates that long hours will be required at certain times of the year. While the long spring hours are offset by fewer or no hours during the winter months, many seasonal employees still work approximately 2,000 hours per year.
To make the hours banking system work, employers and employees must form an agreement and the employer must pay WSIB premiums on the hours worked, not the hours paid. But if the system solves some the industry’s seasonal issues, it certainly deserves a closer look.
To view the sample hours banking agreement, go to http://bit.ly/LgwRIi.
Radio interview expresses concerns
In the radio interview, Leeanne Hachey, Canadian Federation of Independent Business Atlantic vice-president, talks about the landscape industry’s concerns about the new rules affecting seasonal workers. To access the interview go to Employment Insurance.
