Industry uncertain about impact of EI reform

Construction leaders in Canada have mixed views about what impact federal government Employment Insurance reforms will have on seasonal workers and the industry as a whole.

"It's hard to make an informed decision if the impact of these Employment Insurance reforms will be positive, negative or neutral," said Canadian Construction Association president Michael Atkinson.

"The measures are not nearly as negative for seasonal workers as people had speculated. So, the reforms are not anywhere near the type of draconian measures that some expected. The big fear was that these measures would force people to move to a different region of the country."

Minister of Human Resources and Skills Development Diane Finley announced on May 24 that the federal government is making changes to the Employment Insurance (EI) system that will help connect Canadians with available jobs.

Under new regulations expected to be in place by early 2013, the new definition of suitable employment will be based on six criteria: personal circumstances, working conditions, hours of work, commuting time, type of work and hourly wage.

In terms of commuting time the workplace should be within a one hour commute.

But, this could be higher depending on the applicant's previous commuting history and the community's average commuting time.

"When you look at the frequent user category and seasonal workers, the biggest fear employers have is that workers will go away and not come back in the spring," said Atkinson. >

"The only thing that is impacted is that they may have to take a salary at a reduced rate. But, even if they do accept a job at a reduced salary, why wouldn't they come back to their employer?"

The government is creating three different types of EI recipients including frequent users, occasional claimants and long-tenured workers.

Seasonal workers, which includes people in the construction industry, will fall into the frequent-user category. This is defined as those people who used EI at least three times for a total of 60 weeks in five years.

These people will be given six weeks to look for work in their field.

After this period, these applicants will be expected to find another job they are qualified for which pays at least 70 per cent of their last salary.

Christopher Smillie, spokesperson for the Building and Construction Trades Department, AFL-CIO, Canadian Office, agrees that the federal government needs to provide a clear explanation about how EI reforms will impact the unionized construction industry.

"Union members have different rules that apply to them as far as eligibility. We have inquired with the minister's office and are waiting to find out what impact this will have on hiring halls across the country."

According to Smillie, union members are currently exempt from showing they are looking for work, because the hiring hall is responsible for finding them employment.

"It is not clear where our members fit into these categories," he said. "We will have to see how it all shakes out. Everyone is waiting for clarification."

The president of the Alberta Federation of Labour said the changes to EI are part of the Harper government's low-wage agenda, "These changes radically alter labour market pressures in favour of employers offering low wage jobs to Canadians," said Gill McGowan.

"When the labour market functions as it should, employers strengthen and increase wages to attract workers. These new changes allow employers to simply sit back, wait, and keep wages low for Canadians. Eventually, an unemployed worker will be bullied into a low paying job.

The 2012 federal budget outlines measures to strengthen work incentives, which includes clarifying the definition of suitable employment and what is a reasonable job search.

Journal of Commerce, Wed Jun 6 2012
Byline: Richard Gilbert

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