Annex 7: Legislative changes to the Employment Insurance program implemented and in force from April 1, 1996 to January 1, 2020

Element: Parental Sharing Benefits

• Effective March 17, 2019, additional weeks of EI parental benefits are available when eligible parents agree to share parental leave
• Parents who share standard parental benefits are eligible for 5 additional weeks of benefits, for a total of 40 weeks. No parent can receive more than 35 weeks of standard benefits.
• Parents who share extended parental benefits are eligible for 8 additional weeks of benefits, for a total of 69 weeks. No parent can receive more than 61 weeks of extended parental benefits.
• This measure is available to eligible 2-parent families, including adoptive and same-sex couples.
• Bill C-86 also amended the Canada Labour Code to ensure that workers in federally regulated sectors have the job protection they need while they are receiving the parental sharing benefits

Rationale : Parental Sharing Benefits

Encourage greater gender equality in the home and in the workplace by encouraging all parents to take some leave when welcoming a new child and share the joy and responsibility of raising their children more equally.

Element: Working While on Claim

• Effective August 12, 2018, Working While on Claim rules are permanent, enabling EI claimants to keep 50 cents of their EI benefits for every dollar they earn while on claim, up to 90% of their previous weekly insurable earnings. Any earning above this threshold results in a dollar-for-dollar reduction of their EI benefits
• The new permanent rules are extended to EI maternity and sickness benefits

Rationale: Working While on Claim

• Helps claimants stay connected with the labour market by encouraging them to accept available work while receiving EI benefits and earn additional income while on claim.
• Mothers and those dealing with an illness or injury have greater flexibility and can keep more of their EI benefits if they choose to work

Element

On August 20, 2018, the Government announced a pilot project which provides of up to 5 additional weeks of EI regular benefits to eligible seasonal claimants in 13 targeted EI regions. The additional 5 weeks of regular benefits are available to eligible seasonal claimants who start a benefit period between August 5, 2018 and May 30, 2020.

Rationale

Pilot Project No. 21 tests the outcomes of increasing the number of weeks of benefits paid to targeted seasonal claimants.

Element : Family Caregiver Benefit for Adults

• Effective December 3, 2017, the 15-week EI Family Caregiver benefit for adults is available to provide income support to eligible caregivers who take time off work to provide care or support for an adult family member who is critically ill or injured. Any family member or person who is considered to be like family is eligible to receive benefits
• Bill C-44 also amended the Canada Labour Code to protect the jobs of employees in federally regulated enterprises while they take unpaid leave to care for their critically ill or injured family member

Rationale: Family Caregiver Benefit for Adults

• Helps individuals balance work and family responsibilities by reducing the financial pressure they face when an adult family member is suffering from a critical illness or injury
• Recognizes that caregivers are likely to take time away from work when an adult member in their family is critically ill

Element: Family Caregiver Benefit for Children

Effective December 3, 2017, the EI Family Caregiver benefit for children replaces the EI Parents of Critically Ill Children benefits. Up to 35 weeks of EI benefits continues to be available for the care of a critically ill child. Any family member or person who is considered to be like family is now eligible to receive benefits, rather than only parents.

Rationale: Family Caregiver Benefit for Children

Enhances access to benefits by expanding eligibility to a wider support network that includes extended family members, rather than only parents.

Element: Making it easier to apply for caregiving benefits

• To improve access to EI caregiving benefits, nurse practitioners and medical doctors are now able to sign medical certificates
• This change, effective December 3, 2017, applies to the following benefits:
  • Family Caregiver Benefit for Children
  • Family Caregiver Benefit for Adults, and
  • Compassionate Care benefits

Rationale: Making it easier to apply for caregiving benefits

For many Canadians, nurse practitioners are the first and most frequent point of contact with the health care system. This change makes it easier for caregivers to access benefits.

Element: Earlier access to maternity benefits

• As of December 3, 2017, pregnant workers can begin receiving EI maternity benefits as early as 12 weeks before the expected week of childbirth. Previously EI maternity benefits were accessible up to 8 weeks prior to the expected week of childbirth.
• The Canada Labour Code was amended to ensure that workers in federally regulated sectors have the job protection they need while they are receiving maternity benefits

Rationale: Earlier access to maternity benefits

• This increased flexibility allows pregnant workers to consider their personal, health, and workplace circumstances when choosing when to begin their claim for maternity benefits
• Aligns job protection for workers in workplaces that are federally regulated with the change to EI maternity benefits

Element: More choice for parents

• As of December 3, 2017, parents with a newborn or newly adopted child can choose between standard and extended parental benefits
• The EI standard parental benefits provide up to 35 weeks of benefits at a 55% income replacement rate paid over 12 months
• The EI extended parental benefits provide up to 61 weeks of benefits at a 33% income replacement rate paid over 18 months
• When applying for EI, parents must choose between standard or extended parental benefits, and the choice cannot be changed once a payment has been made
• Parents must choose the same option. Parental benefits can be shared, at the same time or separately.
• Adjustments were made to the rules for combining EI benefits. They include a Schedule to convert EI weeks paid at the 33% income replacement rate into EI weeks paid at 55% income replacement rate for situations when EI regular benefits are combined with EI extended parental benefits. A benefit period extension is provided in these situations to allow a claimant to receive the equivalent of up to 50 “standard” EI weeks

Rationale: More choice for parents

Helps working parents manage work and family responsibilities by allowing them to choose the option of EI parental benefits that best meets their family’s needs.

Element: Expanded eligibility under EI Part II

• Broadened eligibility for employment benefits to also include unemployed individuals who have made minimum EI premium contributions (in other words, above the premium rebate threshold) in at least 5 of the previous ten years
• Expanded eligibility for Employment Assistance Services (for example, employment counselling, job search assistance), previously available to unemployed individuals, to also include employed workers, and
• Increased flexibility to support employer sponsored training under the Labour Market Partnerships Support Measure to also include employers who need to upskill or retrain their employees, in order to maintain their current employment (for example, to adjust to technological or structural changes in the economy)
• These changes came into effect on April 1, 2018, allowing provinces, territories and Indigenous agreement holders to benefit from the flexibilities upon the signing of amended or new agreements

Rationale: Expanded eligibility under EI Part II

The changes to the EI Act provide increased flexibility to provincial and territorial governments under the Labour Market Development Agreements (LMDAs) and Indigenous organizations under the Indigenous Skills and Employment Training (ISET) Program, to assist a broader range of Canadians in finding and keeping employment. This includes vulnerable populations such as persons with disabilities and Indigenous peoples, as well as the precariously employed.

Element: Changes to the definition of suitable employment under the Employment Insurance Act

• Amendments introduced under Part IV, Division 1 of the Budget Implementation Act No. 2 amend the Employment Insurance Act to change the definition of what is classified as suitable employment when determining whether a claimant should be disentitled to EI benefits
• The definition of suitable employment is modified to exclude claimants being unable to work as a result of a labour dispute; claimants working at lower rates of earnings or conditions less favourable than those observed by agreements between employers and employees or conditions observed by good employers; and if it is not the claimant`s usual occupation and is performed at a lower rate of earnings or in conditions less favourable than those a claimant might reasonably expect to obtain in their usual occupation

Rationale: Changes to the definition of suitable employment under the Employment Insurance Act

• Enhances the flexibility and responsiveness of the EI program in situations where employers may be engaged in hiring practices determined not to be those recognized by good employers, including lower levels earnings or not providing conditions of work that employees can expect to obtain in their usual occupation for claimants in that profession
• While long-standing requirements for claimants to search for and accept available work while receiving Employment Insurance benefits continue to be upheld, restrictions on these requirements have been eased with respect to commuting times, offered wages and the types of work claimants are required to accept

Element: Reduced waiting period for Employment Insurance benefits

• Amendments introduced under Part IV, Division 12 of the Budget Implementation Act No. 1 amend the Employment Insurance Act to reduce the waiting period for EI benefits from 2 weeks to 1 week
• These changes came into effect on January 1, 2017

Rationale: Reduced waiting period for Employment Insurance benefits

The waiting period for EI benefits acts as a deductible. Shortening the waiting period will help ease financial pressures when claimants become unemployed or leave work temporarily due to health or family pressures

Element: Elimination of the New Entrant and Re-Entrant (NERE) requirements for Employment Insurance benefits

• Effective July 3, 2016, additional eligibility criteria that restricted access to Employment Insurance regular and fishing benefits for workers who were entering or re-entering the labour market were removed. Changes to the Employment Insurance Regulations and Employment Insurance (Fishing) Regulations were also made
• Claimants, including those formerly defined as NEREs are now required to meet their regional variable entrance requirement (420 to 700 hours of insurable employment, reduced from 910 hours) to access EI regular benefits
  • NEREs are those who had minimal or no labour market attachment (less than 490 hours of work) in the 52-week period prior to the qualifying period
• All NERE self-employed fishers will now need to reach regional insurable earnings entrance requirements ($2,500 to $4,200, reduced from $5,500) to qualify for EI fishing benefits
  • NEREs are those who had minimal or no labour market attachment (less than $3,000 in earnings from employment as a fisher) in the 52-week period prior to the qualifying period
• These changes also make it easier for workers entering or re-entering the labour market to receive EI-funded employment and training supports under Part II of the Employment Insurance Act

Rationale: Elimination of the New Entrant and Re-Entrant (NERE) Requirements for Employment Insurance benefits

• Ensures greater equity for new entrants and re-entrants in accessing EI benefits and training and employment supports under EI Part II
• Evaluation of the NERE provisions by Employment and Social Development Canada concluded that the NERE provisions did not act to discourage future frequent use of EI, the original intent of the provision

Element: Extra weeks of benefits for workers in regions affected by downturns in global commodity prices

• Eligible workers could receive 5 additional weeks (up to a maximum of 50 weeks) of EI regular benefits in 15 economic regions that exhibited a sharp and sustained increase in the unemployment rate without showing significant signs of a recovery
• Eligible long-tenured workers were also eligible to receive up to 20 additional weeks to their entitlement (up to a maximum of 70 weeks) in these regions
• Extended benefits were available for a period of one year starting in July 2016, and applied to claimants who started a claim for EI regular benefits on or after January 4, 2015 and were still unemployed
• The applicable economic regions were:
  • Newfoundland/Labrador
  • Sudbury
  • Northern Ontario
  • Northern Manitoba
  • Saskatoon
  • Southern Saskatchewan
  • Northern Saskatchewan
  • Calgary
  • Edmonton
  • Northern Alberta
  • Southern Alberta
  • Southern Interior British Columbia
  • Northern British Columbia
  • Whitehorse, and
  • Nunavut

Rationale: Extra weeks of benefits for workers in regions affected by downturns in global commodity prices

• Declines in global commodity prices since late 2014 led to sharp and sustained shocks of unemployment in commodity-based regions
• This temporary measure is meant to provide the financial support these workers need while they search for work and to inform possible future changes to the EI program
• This measure ensures that long-tenured workers, who may have spent years working in one industry or for one employer, have the financial support they need while they search for work, possibly in an entirely different industry and/or acquire the skills necessary to change career
• Regions selected as eligible for extra weeks were selected as a result of their unemployment rates increasing by 2 percentage points or more for a sustained period, in comparison to its lowest point during a defined reference period, with no signs of economic recovery

Element: Changes to the definition of suitable employment under the Employment Insurance Regulations

• Amendments to the Employment Insurance Regulations, announced in Budget 2016, replaced the criteria for determining what constitutes suitable employment that a claimant is expected to search for and obtain, by removing specific criteria for various claimant categories and those related to daily commuting times; and easing the criteria related to the offered earnings and type of work which claimants must accept, with provisions describing employment that was not suitable
• These changes came into effect on July 3, 2016

Rationale: Changes to the definition of suitable employment under the Employment Insurance Regulations

Introduces more flexibility and simplifies job search responsibilities.

Element: Regulatory Amendments: Working While on Claim (2016)

• On August 7, 2016, as part of Budget 2016, the Government introduced Pilot Project No. 20 (Working While on Claim Pilot Project). This pilot allowed all eligible claimants to choose from 2 options
• Under the default rule, claimants could keep 50 cents of EI benefits for every dollar earned (up to a maximum of 90% of their weekly insurable earnings). Under the optional rule, claimants could choose to earn up to the greater of $75 or 40% of their weekly benefit rate (earnings beyond this threshold result in their weekly EI benefits being reduced dollar-for-dollar)
• This pilot applied to regular, fishing, parental and compassionate care benefits but excluded maternity and sickness benefits. The 'optional rule' did not apply to claimants receiving special benefits for self-employed persons, where only the 'default rule' was available
• This Pilot Project No 20 concluded on August 11, 2018
• Since 2005, a number of Working While on Claim (WWC) pilot projects were introduced.
  • Pilot Project No. 8 took effect on December 11, 2005 in 23 EI economic regions with an unemployment rate of 10% or higher. The parameters of this pilot were re-introduced nationally in 2008 as Pilot Project No. 12, which was then extended (effective October 12, 2010) until August 6, 2011
  • Budget 2011 announced a one-year renewal of the WWC Pilot Project parameters through a new pilot (Pilot Project No. 17), available nationally until August 4, 2012
  • These pilot projects (Pilot Projects No. 8, No. 12 and No. 17) increased the amount that claimants were allowed to earn while on claim to $75 per week or 40% of their weekly EI benefit rate, whichever was higher. Any income above that amount was deducted dollar-for-dollar from benefits. These pilot projects applied to regular, fishing, parental and compassionate care benefits, but excluded maternity and sickness benefits
  • On August 5, 2012, as part of Budget 2012, the Government introduced Pilot Project No. 18 under which claimants kept 50% of their EI benefits from the first dollar earned, up to 90% of weekly insurable earnings to ensure that claimants did not earn more than when they were working. Claimants with earnings during the period beginning on August 7, 2011 and ending on August 4, 2012 could elect to have their EI weekly benefits calculated based on the parameters of the previous WWC pilot project (Pilot Project No. 17) rather than the Pilot Project No. 18. This pilot project concluded on August 1, 2015
  • On August 2, 2015, as part of Budget 2015, the Government re-introduced the parameters of Pilot Project No. 18 under Pilot Project No. 19. This pilot project ended on August 5, 2016

Rationale: Regulatory Amendments: Working While on Claim (2016)

• Pilot Project No. 20 tests how offering the choice of 2 options for the treatment of income earned while on claim will encourage people to accept work, particularly low income claimants
• Pilot Project No. 8 tests to determine whether allowing claimants to earn more income without a reduction in their EI benefits give them incentives to accept all available work
• Pilot Project No. 17 provides additional data to assess the effectiveness of pilot parameters during a period of economic recovery and a full economic cycle
• Pilot Project No. 18 tests whether a new approach further encouraged claimants to work additional days while on claim. Pilot Project No. 18 was amended to test which method, parameters under Pilot Project No. 17 or those under Pilot Project No. 18, is more effective in encouraging claimants to work more while receiving EI benefits
• Pilot Project No. 19 provides additional data to assess the effectiveness of the pilot parameters and test which method, parameters under Pilot Project No. 17 or those under Pilot Project No. 18, is more effective in encouraging claimants to work more while receiving EI benefits

Element: Increased duration of Compassionate Care Benefits

• Amendments to the Employment Insurance Act increased the duration of compassionate care benefits to a maximum of 26 weeks (up from 6 weeks) and allowed weeks of benefits to be taken within a 52-week period (up from a 26-week period)
• Bill C-59 also amended the Canada Labour Code concurrently to ensure that the jobs of employees in federally regulated enterprises remain protected while they avail themselves of compassionate care benefits
• These changes came into effect on January 3, 2016

Rationale: Increased duration of Compassionate Care Benefits

Provides additional financial security to Canadians workers and their families providing end-of-life care or support.

Element: New Regional Unemployment Rate Methodology in the Territories and New Employment Insurance Economic Regions in the Territories and Prince Edward Island

• Amendments to the Employment Insurance Regulations replaced the administratively set 25 percent unemployment rate used for Employment Insurance (EI) purposes in the Yukon, the Northwest Territories and Nunavut with variable monthly regional unemployment rates. Under this new approach, the regional monthly unemployment rate is henceforth equal to the greater of a seasonally adjusted unemployment rate based on a 3-month moving average or a 12-month moving average. A monthly regional unemployment rate substitute is used if Statistics Canada is not able to publish a monthly unemployment rate for reasons of confidentiality
• In addition, the EI economic regions of Prince Edward Island, Yukon, the Northwest Territories and Nunavut were each divided into 2 EI economic regions, one consisting of the capital area and the other the remaining non-capital area
• These changes came into effect on October 12, 2014

Rationale: New Regional Unemployment Rate Methodology in the Territories and New Employment Insurance Economic Regions in the Territories and Prince Edward Island

• Ensures a better reflection of regional labour market conditions in the territories
• Offers a balance between responsiveness to regional labour market conditions in the territories (with the 3-month moving average) and better protection against statistical variance (with the 12-month moving average)
• Recognizes differences in labour market realities between the capital and the non-capital areas in the Yukon, the Northwest Territories, Nunavut and Prince Edward Island

Element: Small Business Job Credit

• Division 14 of the Economic Action Plan Act 2014 No. 2 amended Section 96 of the Employment Insurance Act to allow for businesses with $15,000 or less in employer premiums paid per year to receive a partial refund of premiums paid for the 2015 and 2016 tax years
• The Small Business Job Credit applied to Employment Insurance premiums paid by small businesses. The credit was calculated as the difference between premiums paid at the legislated rate of $1.88 per $100 of insurable earnings and the reduced small business rate of $1.60 per $100 of insurable earnings.
• Since employers pay 1.4 times the legislated rate, this 28-cent reduction in the legislated rate was equivalent to a reduction of 39 cents per $100 of insurable earnings in EI premiums paid by small employers.
• The 39-cent premium reduction applied in addition to the premium reduction related to Quebec’s parental insurance plan, the Québec Parental Insurance Plan.
• Eligibility for the Small Business Job Credit was determined by the Canada Revenue Agency based on T4 information provided, and employers did not have to apply separately for this credit

Rationale: Small Business Job Credit

• Ensures savings for employers on their Employment Insurance premium obligations and brings small business premium contributions more in line with premium rates that would be introduced following implementation of the 7 year break even rate formula to be implemented in 2017
• Businesses will have additional resources to pursue expansion opportunities that would lead to additional hiring of workers within the Canadian economy and helps businesses to take advantage of emerging opportunities and compete in the global economy

Element: Enhanced access to Sickness Benefits for Compassionate Care Benefits or Parents of Critically Ill Children Benefits claimants

Effective October 12, 2014, claimants receiving compassionate care benefits (CCB) or parents of critically ill children (PCIC) benefits no longer have to be otherwise available for work to receive sickness benefits. This legislative change allows claimants who fall ill or injured while receiving CCB or PCIC benefits to access sickness benefits and then resume collecting the balance of their CCB or PCIC benefits, if needed, once their sickness benefits have been paid.

Rationale: Enhanced access to Sickness Benefits for Compassionate Care Benefits or Parents of Critically Ill Children Benefits claimants

• Recognizes that a claimant who becomes ill or injured while in receipt of CCB or PCIC benefits may not be able to take care of a gravely ill family member or his/her a critically ill child
• Enhances the flexibility and responsiveness of the EI program

Element: Limiting access to Maternity and Parental Benefits to persons authorized to remain in Canada

• Claimants who leave Canada and whose work permit and Social Insurance Number (SIN) expire are no longer eligible to receive maternity and parental benefits
• Claimants with a valid SIN can continue to receive these benefits both inside and outside Canada

Rationale: Limiting access to Maternity and Parental Benefits to persons authorized to remain in Canada

Ensures that maternity and parental benefits are paid only to claimants with ongoing ties to the Canadian labour market—notably, those authorized to live and work in Canada.

Element: Canada Employment Insurance Financing Board Act

Effective March 7, 2013, the Canada Employment Insurance Financing Board Act has been suspended until the Employment Insurance Operating Account has returned to cumulative balance and the Canada Employment Insurance Financing Board can fulfill its full legislative mandate.

Rationale: Canada Employment Insurance Financing Board Act

Ensures that independent Employment Insurance rate-setting is performed in the most cost-effective manner.

Element: Premium rate-setting

An interim rate-setting regime takes effect, under which Employment Insurance premium rates are set by the Governor-in-Council on the joint recommendation of the Minister of Employment and Social Development and the Minister of Finance. The 2014 rate is the first rate set under the interim regime.

Rationale: Premium rate-setting

Ensures premium rates are set according to the premium rate-setting mechanism set out in the Employment Insurance Act, and provides ongoing stability and predictability for contributors.

Element: Parents of critically ill children

• Effective June 9, 2013, a 35-week Employment Insurance special benefit became available to provide income support to eligible parents who are unable to work while providing care or support to a critically ill or injured child under the age of 18
• Bill C-44 also amended the Canada Labour Code to protect the jobs of employees in federally regulated enterprises while they take unpaid leave to care for their critically ill or injured child

Rationale : Parents of critically ill children

• Helps parents balance work and family responsibilities by reducing the financial pressure faced by parents who take time off work to care for their critically ill or injured children
• Recognizes the needs of parents who are likely to take time away from work when their child is critically ill

Element: Enhanced access to sickness benefits for parental benefits claimants

Effective March 24, 2013, claimants receiving parental benefits no longer have to be otherwise available for work to receive sickness benefits. This legislative change allows claimants who fall ill or injured while receiving parental benefits to access sickness benefits and then resume collecting the balance of their parental benefits, if needed, once their sickness benefits have been paid.

Rationale: Enhanced access to sickness benefits for parental benefits claimants

• Recognizes that it may be difficult for a parent who becomes ill or injured to take care of and bond with his/her child
• Enhances the flexibility and responsiveness of the EI program

Element: Connecting Canadians to available jobs

• Enhanced the content and frequency of job and labour market information for job seekers
• Strengthened and clarified claimants’ obligations by defining reasonable job search and suitable employment for claimants who were receiving regular or fishing benefits
• Ensured qualified Canadians were considered before temporary foreign workers were hired to fill job vacancies
• Initiated discussions with provinces and territories to make skills training and job search support available to Employment Insurance (EI) claimants earlier in their claim

Rationale: Connecting Canadians to available jobs

• Ensures unemployed Canadians are better connected with available jobs in their local area.
• Clarifies claimants’ responsibility to undertake a reasonable job search for suitable employment while receiving EI regular or fishing benefits

Element: Variable best weeks

• Effective April 7, 2013, claimants (with the exception of fishing and self-employed claimants) have Employment Insurance (EI) benefits calculated based on the weeks of their highest insurable earnings during the qualifying period.
• The best 14 to 22 weeks are used to calculate EI benefits, depending on the unemployment rate in the EI economic region where the claimant resides

Rationale: Variable best weeks

• Makes the EI program more responsive to regional economic conditions
• Ensures that those living in areas with similar labour market conditions receive similar benefits

Element: Premium rate-setting

• The Employment Insurance (EI) premium rate-setting mechanism has been amended whereby the premium rate will be set annually at a 7-year break-even rate. This revised rate-setting mechanism is intended to come into force once the Employment Insurance Operating Account has returned to cumulative balance
• The legislated limit on year-to-year changes to the premium rate has been adjusted from 15 cents to 5 cents per $100 of insurable earnings
• Advanced the date by which the premium rate must be set to September 14, rather than November 14

Rationale: Premium rate-setting

• Ensures that the Employment Insurance Operating Account is in cumulative balance at the end of the 7-year period
• Enhances the predictability and stability of the EI premium rate
• Provides employers and workers with more notice of the EI premium rate for the coming year

Element: Social Security Tribunal

• The Social Security Tribunal (SST) replaced the 4 Employment and Social Development Canada tribunals for Employment Insurance (EI), Canada Pension Plan (CPP) and Old Age Security (OAS) appeals with a single decision-making body
• The SST is comprised of 2 levels of appeal, similar to the previous appeal process:
  • The General Division has an Employment Insurance Section for EI appeals, and an Income Security Section for CPP and OAS appeals. A vice-chairperson heads each of the sections of this Division
  • The Appeal Division reviews decisions made by the General Division. The third vice-chairperson heads this Division
• Before an EI appeal can be filed with the SST, clients must make a formal request for reconsideration. This is a new process whereby EI clients who disagree with the Canada Employment Insurance Commission’s decision are able to submit new or additional information that the Commission is required to review to determine if the decision can be reversed or modified
• Appeals are considered and decided by single member panels. Tribunal members have the authority to summarily dismiss an appeal when the member is satisfied that the appeal has no reasonable chance of success
• The SST began its operations on April 1, 2013

Rationale: Social Security Tribunal

• Eliminates administrative duplication in appeals and tribunal services by replacing the administrative tribunal system for major federal social security programs with a single-window decision body
• This new approach to appeals introduced a number of measures to improve efficiencies, simplify and modernize the process and reduce costs

Element: Temporary hiring credit for small businesses

• Provided small businesses with a temporary hiring credit of up to $1,000 against an increase in the firm’s 2011 Employment Insurance premiums over those paid in 2010
• Available to approximately 525,000 employers whose total EI premiums were at or below $10,000 per employer in 2010 and will reduce their 2011 payroll costs by about $165 million

Rationale: Temporary hiring credit for small businesses

Encourages additional hiring in small businesses, and helps them to take advantage of emerging opportunities and compete in the global economy.

Element: Extended Employment Insurance benefits pilot project

• Pilot Project No. 6, Pilot Project Relating to Increased Weeks of Benefits, was introduced for a 2-year period on June 6, 2004 in 24 Employment Insurance (EI) economic regions with an unemployment rate of 10% or higher. It increased the maximum number of weeks for which regular benefits could be paid by 5, to a maximum of 45 weeks
• The parameters of this pilot were re-introduced as a new pilot project on June 11, 2006, under Pilot Project No. 10, for a period of 18 months in 21 EI economic regions and were further extended until May 31, 2009. Pilot Project No. 10 increased the maximum number of weeks for which regular benefits could be paid by 5, to a maximum of 45 weeks
• Pilot Project No. 10 ended earlier, on February 28, 2009, and was replaced by the national Extra 5 Weeks Budget measure, which came into effect on March 1, 2009 and lasted until September 11, 2010. It increased the maximum number of weeks for which regular benefits could be paid by 5, to a maximum of 50 weeks, on all claims that were open between March 1, 2009, and September 11, 2010
• On September 12, 2010, the Government of Canada re-introduced the parameters of the Extended Employment Insurance Benefits Pilot Project (as Pilot Project No. 15) for 2 years, until September 15, 2012, or earlier if there was a sustained economic recovery. An automatic termination trigger was implemented in regions where regional unemployment rates were below 8% for 12 consecutive months. It included the same 21 Employment Insurance (EI) economic regions as Pilot Project No. 10
• Pilot Project No. 15 increased the maximum number of weeks for which regular benefits could be paid by 5, to a maximum of 45 weeks
• Pilot Project No. 15 concluded earlier in 3 regions where the unemployment rate was less than 8% for 12 consecutive months. This was the case for the EI economic region of St. John’s (September 24, 2011), Chicoutimi-Jonquière (March 24, 2012) and Sudbury (June 23, 2012)

Rationale: Extended Employment Insurance benefits pilot project

• Tests the cost and impact of extending the number of weeks of benefits in EI economic regions of relatively high unemployment
• Provides time-limited, broad-based support for all workers during the recent recession
• Tests the effectiveness of providing additional EI regular benefits in reducing the number of individuals experiencing an income gap between EI and their return to work, as well as the impact of a regional unemployment rate-based trigger
• Allows for further collection of data and testing to more fully capture the impact of increasing the maximum number of weeks for which regular benefits could be paid during a period of economic recovery

Element: Best 14 weeks pilot project

• Pilot Project No. 7 (Best 14 Weeks) was introduced on October 30, 2005, in 23 EI economic regions with unemployment rate of 10% or higher. The parameters of the pilot project were re-introduced on October 26, 2008, for 2 years, as Pilot Project No. 11 in 25 Employment Insurance (EI) economic regions with an unemployment rate of 8% or higher
• Under this pilot project, EI benefits were based on claimants’ 14 weeks of highest earnings in the qualifying period
• Initially scheduled to end on October 23, 2010, Pilot Project No. 11 was subsequently extended until June 25, 2011
• Budget 2011 announced a one-year renewal of the Best 14 Weeks pilot project parameters (as Pilot Project No. 16) in the same 25 EI economic regions until June 23, 2012. Pilot Project No. 16 was subsequently extended until April 6, 2013

Rationale: Best 14 weeks pilot project

• Tests whether basing claimants’ benefit rate on their 14 weeks of highest earnings in the qualifying period (generally 52 weeks) before they claimed EI encouraged claimants to accept all available work
• Provides additional data to assess the effectiveness of the pilot during a period of economic recovery and a full economic cycle

Element: Improved access to parental benefits for military families

• The Employment Insurance (EI) parental benefits eligibility window has been extended to support Canadian Forces (CF) members, including reservists, who are ordered to return to duty while on parental leave or whose parental leave is deferred as a result of an imperative military requirement
• This gives these CF members a window of up to 104 weeks following their child’s birth or adoption in which to access part or all of their 35 weeks of EI parental benefit entitlement

Rationale: Improved access to parental benefits for military families

Provides additional flexibility to CF members to access parental benefits for parent-child care and bonding, while recognizing the importance of military service.

Element: Employment Insurance operating account

• The Employment Insurance Operating Account was established in the accounts of Canada to record all Employment Insurance (EI) related credits and charges since January 1, 2009, the date from which the Canada Employment Insurance Financing Board (CEIFB) was to ensure that EI revenues and expenditures broke even and the Employment Insurance Account was closed
• This change repeals the provision under which advances from the Consolidated Revenue Fund to the Employment Insurance Account were made and the provision under which interest could be paid on the balance of the Employment Insurance Account
• The CEIFB’s obligation to set EI premium rates under section 66 of the Employment Insurance Act has been clarified to ensure that EI revenues and expenditures recorded in the Employment Insurance Operating Account balance over time, beginning January 1, 2009

Rationale: Employment Insurance operating account

• Further strengthens the transparency and effectiveness of the financing of the EI program
• In line with steps taken in 2008 to establish the CEIFB

Element: Special benefits for self-employed persons

• Effective January 31, 2010, Employment Insurance (EI) special benefits (maternity, parental, sickness and compassionate care benefits) have been extended to self-employed workers. Self-employed persons can opt into the EI program on a voluntary basis. Benefits were paid starting January 1, 2011
• These benefits for self-employed persons mirror special benefits available to salaried employees under the current EI program

Rationale: Special benefits for self-employed persons

Provides a voluntary scheme of EI benefits to self-employed Canadians for life transitions such as the birth of a child, adoption, illness, injury or critical illness of a family member.

Element: Career Transition Assistance Initiative

• Two measures to support long-tenured workers:
  • the Extended Employment Insurance and Training Incentive extended EI regular benefits to a maximum of 104 weeks for long-tenured workers who enrolled in long-term training, including up to 12 weeks of EI regular benefits for job search
  • the Severance Investment for Training Initiative allowed eligible long-tenured workers who used their severance payments to invest in full-time training to receive EI regular benefits sooner
• For the purposes of the Career Transition Assistance Initiative, long-tenured workers’ claims must have started on or after January 25, 2009, and no later than May 29, 2010

Rationale: Career Transition Assistance Initiative

• Improved claimants’ incentive to renew or upgrade their skills
• Encouraged claimants to invest in their own training
• Encouraged claimants to undertake long-term training to improve their re-employability

Element: Premium rate freeze

This measure froze Employment Insurance (EI) premium rates for employees at $1.73 per $100 for 2010, the same rate as in 2009 and 2008.

Rationale: Premium Rate Freeze

Maintained premium rate stability during the recession despite higher EI costs.

Element: Premium rates

Legislation was enacted to retroactively set the premium rates for 2002, 2003 and 2005.

Rationale: Premium rates

This retroactive change was made necessary by the ruling of the Supreme Court of Canada in the CSN-Arvida case, in which the Court ruled that the premium rates in 2002, 2003 and 2005 were not constitutionally valid as regulatory fees and represented an unlawful tax on premium payers.

Element: New Entrants and Re-Entrants pilot project

• Pilot Project No. 9 (New Entrants and Re-Entrants Pilot Project) was introduced on December 11, 2005 in 23 Employment Insurance (EI) economic regions with an unemployment rate of 10% or higher. The parameters of the pilot project were renewed on December 7, 2008, as Pilot Project No. 13 in 25 EI economic regions with an unemployment rate of 8% or higher
• The pilot project reduced the number of hours New Entrants and Re-Entrants (NEREs) needed to be eligible for EI regular benefits from 910 to 840
• Pilot Project No. 13 sunset as scheduled on December 4, 2010

Rationale: New Entrants and Re-Entrants pilot project

Tests to determine whether providing NEREs with lower EI eligibility requirements and informing them of EI employment programs improves their employability and helps reduce their future reliance on EI benefits, partly by improving their access to measures under Part II of the Employment Insurance Act.

Element: Quebec Parental Insurance Plan

• Effective January 1, 2006, Quebec residents receive maternity and parental benefits through the Quebec Parental Insurance Plan (QPIP) while they continue to have access to sickness and compassionate care benefits through the Employment Insurance (EI) program
• The Employment Insurance Regulations provide for a reduction of EI premiums for Quebec residents, reflecting the savings to the Employment Insurance Operating Account resulting from the Government of Quebec providing maternity and parental benefits

Rationale: Quebec Parental Insurance Plan

Ensures consistency with the Employment Insurance Act provisions that provinces may provide their own benefit plans, as long as they provide benefits equivalent to those offered under the EI program.

Element: Definition of family member

Effective June 14, 2006, expanded the eligibility criteria and the definition of family member for the compassionate care benefit from that of immediate family to include extended family members and any other individuals considered by the person who has a serious medical condition to be like family members.

Rationale: Definition of family member

Expands the definition of family member to ensure that additional caregivers, who were previously excluded from the definition of family member, are able to get access to income support when they must leave work to care for a family member who has a serious medical condition.

Element : Premium rate-setting process

• Effective January 1, 2006, the legislation allows the Canada Employment Insurance Commission to set the premium rate under a new rate-setting mechanism
• In setting the rate, the Commission will take into account the principle that the premium rate should generate just enough premium revenue to cover payments to be made for that year. It will also consider the report from the Employment Insurance Chief Actuary and any public input

Rationale: Premium rate-setting process

Allows for a new rate-setting process where the Employment Insurance premium rate is determined independently by the Canada Employment Insurance Commission.

Element: Compassionate Care Benefits

• Since January 4, 2004, compassionate care benefits have been available to help eligible family members to provide or arrange care for a family member who has a serious medical condition with a significant risk of death. The duration of the benefits is up to 6 weeks within a 26-week period
• Flexibility is a key feature of the benefits. Claimants can choose how and when to claim benefits within the 26-week window. Eligible family members can decide to have 1 person claim all 6 weeks or decide to share the benefit. Eligible family members can claim weeks of compassionate care benefits concurrently or consecutively

Rationale: Compassionate Care Benefits

Provides support to workers during temporary absences from work to provide care or support to a family member who has a serious medical condition with a significant risk of death within 26 weeks.

Element: Extension of benefit period for parental benefits – Child in hospital

Effective April 21, 2002, parents of a newborn or newly adopted child who is hospitalized can have their parental benefit window extended up to 104 weeks, instead of 52 weeks.

Rationale: Extension of benefit period for parental benefits – Child in hospital

Provides flexibility for parents who choose to wait until their child comes home before collecting parental benefits.

Element: Maximum duration of combined special benefits

Effective March 3, 2002, the maximum number of combined weeks of special benefits has been increased from 50 to 65 weeks and the benefit period may be extended accordingly, under certain circumstances.

Rationale: Maximum duration of combined special benefits

• Ensures full access to special benefits for biological mothers who claim sickness benefits prior to and following maternity or parental benefits.
• Responds to the ruling of the Canadian Human Rights Tribunal in the McAllister-Windsor case

Element: Small Weeks Provision

• Before the introduction of the Variable Best Weeks method of calculating claimant benefits on April 7, 2013, benefits were calculated based on the average weekly earnings in the 26-week period prior to claiming benefits. The small weeks provision allowed claimants to exclude weeks where they earned less than $225 unless those weeks were needed to satisfy the "minimum divisor"
• Pilot projects tested a $150 exclusion from 1997 to 2001 before legislating the parameters of the pilot projects ($150 exclusion) in all Employment Insurance (EI) economic regions on November 18, 2001. On September 7, 2003, the legislation was amended to increase the exclusion to $225
• Between October 2005 and April 2013, EI claimants in the select EI economic regions had their benefit rates calculated according to the Best 14 Weeks pilot project provisions
• The small weeks provision was replaced by the Variable Best Weeks provision on April 7, 2013, except for fishers

Rationale: Small Weeks Provision

• At the time when the small weeks provision was introduced, weekly EI benefit rates were based on an average insured earnings in the 26 weeks preceding the last day of employment. Including "small weeks” in the calculation of a claimant’s average earnings resulted in reduced weekly EI benefit amounts. This approach to calculating EI benefit rates could have the unintended effect of discouraging some workers from accepting weeks with lower earnings
• Removes program feature which may discourage workers from accepting all available work. Calculating the weekly benefit rate using insurable earnings from the 14 highest weeks of insurable earnings aims to ensure that workers who accept work with lower earnings will not see a reduction in their EI benefits

Element: Intensity rule

Effective October 1, 2000, eliminated the intensity rule, which had reduced the benefit rate by 1 percentage point for every 20 weeks of Employment Insurance regular benefits used in the past. The maximum reduction was 5 percentage points.

Rationale: Intensity rule

Eliminated an ineffective rule that had the unintended effect of being punitive.

Element: Benefit repayment (Clawback)

• Applied new rule, effective retroactively to the 2000 taxation year:
  • first-time claimants of regular or fishing benefits are now exempt from the benefit repayment
  • claimants of special benefits (maternity, parental and sickness benefits) are no longer required to repay any of those benefits
  • The benefit repayment threshold for regular and fishing benefits was set at one level: $48,750 of net income, with a repayment rate of 30%. The maximum repayment is the lesser of 30% of excess net income above the threshold of $48,750, or 30% of the claimant’s benefits

Rationale: Benefit repayment (Clawback)

• Corrects a discrepancy, as analysis indicated that the benefit repayment provision was having a disproportionate impact on middle-income claimants
• Focuses on repeat claimants with high incomes
• Simplifies the provision

Element: Re-Entrant parents

Effective retroactive to October 1, 2000, the rules governing new entrants/re-entrants have been adjusted so that claimants who are re-entering the workforce following an extended absence to raise children and who have received parental benefits are now only required to work the same number of hours as other workers to qualify for regular benefits.

Rationale: Re-Entrant parents

Ensures that parents returning to the workforce following an extended absence to raise young children are not penalized.

Element: Maximum insurable earnings

The maximum insurable earnings (MIE) will remain at $39,000 until average earnings exceed this level, at which time the MIE will be based on average earnings.

Rationale: Maximum insurable earnings

Corrects a discrepancy in which the MIE was higher than the average industrial wage.

Element: Parental benefits

Effective December 31, 2000, the duration of parental benefits has been increased from 10 to 35 weeks.

Rationale: Parental benefits

Helps working parents to better balance their work and family responsibilities by providing them with temporary income replacement when they take time off work to take care of their newborn in the first year of the child’s life or the first year of placement of the child (for adoptive parents).

Element: Entrance requirements: special benefits

Effective December 31, 2000, the number of hours of insurable employment required to qualify for maternity, parental or sickness benefits has been reduced from 700 to 600 hours.

Rationale: Entrance requirements: special benefits

Improves access to special benefits.

Element: Waiting period

Effective December 31, 2000, the second parent sharing parental leave is no longer required to serve the 2-week waiting period.

Rationale: Waiting period

Promotes gender equality and improves flexibility by reducing the income loss for the second parent.

Element: Allowable earnings While on Claim (parental benefits)

Effective December 31, 2000, claimants receiving parental benefits can also earn $50 or 25% of their weekly parental benefit rate, whichever is higher, without a reduction of their Employment Insurance benefits.

Rationale: Allowable earnings While on Claim (parental benefits)

Improves flexibility and fosters labour attachment by allowing parents to work while receiving parental benefits.

Element: Hours-based system

• Effective January 1997, Employment Insurance eligibility is based on hours of insurable employment rather than weeks worked
• For regular benefits, claimants need 420 to 700 hours of insurable employment instead of 12 to 20 weeks of insurable employment
• For special benefits, claimants need 700 hours instead of 20 weeks

Rationale: Hours-based system

• Introduces a fairer and more equitable measure of time worked by making all hours count
• Removes inequities and anomalies of the weeks system by:
  • recognizing the intense work patterns of some employees
  • correcting the anomaly that existed under the Unemployment Insurance, when a week of 15 hours or a week of 50 hours each counted as one week, and
  • eliminating the 14-hour job trap as, under the Unemployment Insurance, those working fewer than 15 hours (either all of the time or some of the time) with a single employer were not insured or not fully insured

Element: New Entrants and Re-Entrants

• Effective July 1996, new entrants and re-entrants to the labour force needed 26 rather than 20 weeks of insurable employment to qualify for Employment Insurance (EI) regular benefits. In January 1997, the 26 weeks were converted to 910 hours
  • This rule applies only to those who have had minimal or no labour market attachment (that is those who had less than 490 hours of work) during the 52-week period prior to the qualifying period. Time on EI, workers’ compensation, disability benefits and sick leave count as time worked
• Effective July 1996, new entrants and re-entrants to the labour force needed 26 rather than 20 weeks of insurable employment to qualify for EI fishing benefits. In January 1997, the 26 weeks were converted into earnings of $5,500 from employment as a fisher
  • This rule applies only to those who have had minimal or no labour market attachment (that is those who had less than $3,000 in earnings from employment as a fisher) in the 52-week period prior to the qualifying period. Time on EI, workers’ compensation, disability benefits and sick leave counts as time worked

Rationale: New Entrants and Re-Entrants

• Discourages a cycle of reliance by ensuring that workers, especially young people, develop a significant attachment to the labour force before collecting EI benefits
• Reintroduces insurance principles to the system by ensuring that workers make a reasonable contribution to the system before collecting benefits
• Strengthens the relationship between work effort and entitlement to benefits

Element: Reduction in maximum insurable earnings

The maximum insurable earnings (MIE) was reduced to $39,000 per year ($750 per week) in July 1996 and frozen at this level until 2006. This reduced the maximum weekly benefit to $413 (55% of $750), from $448 in 1995 and $465 for the first 6 months of 1996.

Rationale: Reduction in maximum insurable earnings

• Adjusts the MIE to a level where Employment Insurance benefits would no longer be competitive with wages in some parts of the country and in some industries
• Was based on a formula that took into account average wage increases over the eight years before the reduction. Because the high inflation and wage increases of the 1980s continued to be considered in setting the MIE, it had escalated faster than wages

Element: Reduced maximum duration of regular benefits

Effective July 1996, the maximum length of a claim was reduced from 50 to 45 weeks.

Rationale: Reduced maximum duration of regular benefits

Reflects the fact that most claimants find work within the first 40 weeks of receiving benefits.

Element: Calculation of weekly benefit rate

Weekly benefits were calculated based on total earnings over the 26-week period preceding the establishment of the claim, divided by the number of weeks of work in this period or the minimum divisor of 14 to 22 (depending on the regional rate of unemployment), whichever is higher. The result is multiplied by 55% to determine the weekly benefit rate.

Rationale: Calculation of weekly benefit rate

• Creates a strong incentive to work more than the minimum amount of time to qualify for benefits (at least 2 more weeks than the old entrance requirement)
• Provides an incentive to work in the “shoulder” season

Element: Family supplement

• Claimants with children who receive the Canada child tax benefit and who have an annual family net income of up to $25,921 receive a top-up of their basic Employment Insurance benefits
• The Family Supplement increased the maximum benefit rate to 65% in 1997, to 70% in 1998, to 75% in 1999 and to 80% in 2000

Rationale: Family supplement

• Improves assistance to those most in need, because:
  • the old 60% dependent rate under the Unemployment Insurance was very poorly targeted—about 45% of low-income families did not qualify, and
  • about 30% of those who did receive the 60% rate had family incomes over $45,000

Element: Allowable earnings While on Claim

Effective January 1997, claimants can earn $50 or 25% of their weekly benefit rate, whichever is higher, without a reduction of their Employment Insurance benefits. Prior to 1997, the exemption was only 25% of the weekly benefit rate.

Rationale: Allowable earnings While on Claim

• Helps low-income claimants
• Encourages claimants to maintain work attachment and increase their earnings from work

Element: Benefit repayment (Clawback)

• Benefits were repaid at the rate of $0.30 for every $1 of net income above the threshold.
• For those who had collected 20 or fewer weeks of benefits in the last 5 years, the threshold was $48,750 of net income (the former level was $63,570). The maximum repayment remained at 30% of benefits received
• For those with more than 20 weeks of benefits in the last 5 years, the threshold was $39,000 of net income. The maximum repayment varied from 50% to 100% of benefits received, depending on previous use

Rationale: Benefit repayment (Clawback)

• Makes benefits fairer and more accurately reflective of insurance principles
• Discourages repeated use of EI by those with high levels of annual income
• The Benefit Repayment provision was revised in Bill C-2 (2001)

Element: Intensity rule

• The intensity rule reduced the benefit rate by 1 percentage point for every 20 weeks of regular or fishing benefits collected in the past 5 years
• The maximum reduction was 5 percentage points

Rationale: Intensity rule

• Introduces an element of experience rating to the program, since heavy users of the system bore more of the costs
• Discourages use of Employment Insurance as a regular income supplement rather than insurance for times of unpredictable job loss, while not excessively penalizing those who makes long or frequent claims
• Creates a better balance between contributions made and benefits received
• Repealed in Bill C-2 (2001)

Element: First-dollar coverage

Effective January 1997, all earnings from the first dollar are insurable up to the maximum yearly insurable earnings. There are no weekly minimums or maximums for determining earnings.

Rationale: First-dollar coverage

• Creates a more equitable and balanced system—all earnings are insurable
• Decreases paper burden for employers
• Helps guard against abusing the system to avoid paying premiums

Element: Premium refunds

Since 1997, workers earning $2,000 or less per year have had their premiums refunded.

Rationale: Premium refunds

Helps workers who must pay premiums but do not have enough hours to qualify for benefits.

Element: Increased sanctions for fraud

• Effective July 1996, penalties for fraud by employers and claimants were increased
• Since January 1997, claimants who committed fraud after June 1996 have faced higher entrance requirements

Rationale: Increased sanctions for fraud

Protects the integrity of the Employment Insurance program.

Element: Part II of the Employment Insurance Act: Employment benefits and the National Employment Service

Part II of the Employment Insurance Act provides authority for 3 types of arrangements for employment program implementation and delivery with support from EI funds.

Rationale: Part II of the Employment Insurance Act: Employment benefits and the National Employment Service

• The Canada EI Commission is authorized to:
  • establish federal employment programs, coupled with a duty to work with provincial governments regarding their design, delivery and evaluation
  • enter into agreements for the administration on its behalf of its employment benefits and support measures, and
  • enter into agreements with provinces, territories and other entities to contribute toward the costs of their similar benefits and measures programs (Labour Market Development Agreements/Indigenous Skills and Employment Training program agreements)