After the federal government introduced major changes and cuts to the Employment Insurance (EI) system last January, hundreds of protests followed, including road closures, a hunger strike and many large demonstrations. Recently, focus has been put back on EI as many workers are preparing for what might be a long winter.
On November 5th, coalitions advocating for fair employment insurance policies issued a joint statement opposing the changes and suggesting their own. The statement was endorsed by over 80 community, labour and student groups nationwide, who also called for a November 15th day of action.
“The unemployment rate hasn’t gone down, but the number of people collecting EI benefits has. It may be a fact that they no longer qualify for the EI benefits. It may be that they couldn’t get the EI benefits and there were no jobs so they relocated out of province,” says Patrick Colford, president of the New Brunswick Federation of Labour and part of the NB Coalition Against the EI Changes.
Many workers are dependent on seasonal employment with little or no local work available in off seasons, a condition particularly common in the rural landscape of Atlantic Canada. Many others are laid off and simply require time to find another job suitable to their skills. Evading these considerations and ignoring the fact that there are more unemployed people than available jobs (in New Brunswick there are 10 people searching for each available job), the federal government has suggested that their EI changes confront laziness. It was in this context that Federal Finance Minister Jim Flaherty infamously commented that “there is no such thing as a bad job,” and Prime Minister Stephen Harper spoke of millions of dollars being lost through “false or fraudulent or inappropriate claims.”
These comments are a distortion of reality with a particular design. “This plays into the mythology of the lazy recipient (of EI). There is this idea of someone collecting EI sitting back, enjoying gifts or handouts from the state. This mythology is being used to restructure the program,” argues Dr. Thom Workman, Professor in the Political Science Department at the University of New Brunswick, and author of two books covering the struggles of Canadian workers (Social Torment and If You’re in My Way, I’m Walking).
The EI changes force workers into lower wage employment in explicit ways. Applicants are categorized into three tiers: long-tenured, frequent and occasional claimants. Workers in all three categories must accept jobs with progressively lower hourly rates, based on set timelines, or else watch their benefits disappear.
“Occasional” and “frequent” claimants, the most numerous, face the steepest declines, with both eventually staring down a 30 per cent wage drop, frequent claimants just getting there sooner. Benefits are also re-calculated based on work obtained during an active claim, so wage drops can lead to ever lower EI benefits in a downward spiral.
Additionally, EI recipients must accept a job within an hour’s distance, with no subsidies to cover fuel costs. A Prince Edward Island woman, Marlene Giersdorf, lost her EI benefits last January when she would not travel 40 minutes to a job.
Even worse, many workers have no access to any EI benefits under the new changes. “Special parental benefits” were eliminated for migrant workers, the only subsection of EI to which they had access, in spite the fact they contribute an estimated $3.4 million annually to the EI fund.
Workers are also being denied EI benefits in more deceptive ways. As revealed in a leaflet by the Good Jobs for All Coalition, Service Canada has already made a number of job cuts, with 2,100 more slashes in the works, according to the 2012 budget. Many of these workers would have processed EI claims. Last winter, the media was full of stories about EI processing delays and unresolved files. Today, many calls to the 1-800 call centre are not even transferred due to high volumes.
To cast away the remainder, the EI appeal system has been rendered futile. Before the changes, each case was heard by a 3-person appeal board, with appointees chosen by business and labour. About 900 different people would sit on these boards in a given year. Now, there are only 38 judges who can hear cases, one judge per case. All of them are appointed by the Harper government. If a judge believes that a case has no chance of success, then (s)he can deny a hearing. There are thousands of cases to be heard and these few dozen judges cannot cover them all. Under this system, appeals will generally be subjected to long delays due to backlogs. Many will simply be denied. For appeals that are eventually heard, judges appointed by a government that is trying to limit access to EI benefits can be expected to rule in obvious ways.
When looking at the total sum of the recent EI changes, it may seem that the Harper Government has been particularly antagonistic against EI recipients; however, history reveals that Liberals have been equally as busy making cuts as the Conservatives.
The Mulroney government – near the close of their reign in 1992-1993 – stopped government contributions to the EI program, reduced benefits from 60 per cent to 57 per cent of earnings and cut off coverage to those who left their employment. Between 1994–1996, Chrétien reduced benefits to 55 per cent of earnings, maximum weekly benefits from $448 to $413 and introduced a qualifying calculation based on hours of work rather than weeks of work, which killed eligibility for countless workers. It was under this Liberal government that disqualification of EI benefits for quitting a job became regularized, which, for example, condemned many women suffering from sexual harassment to simply endure rather than risk having no income by “leaving work.”
But the roots of the recent EI changes go much deeper than just the last few governments. Workman described how after wages rose steadily post World War II, neoliberal restructuring in the 1970s eventually reduced the tolerance for such gains. “The main concern was that the UI program was creating for workers too much latitude … driving up the low-end wage market. This was generally inconsistent with the idea of seeing wages either stagnate or fall. The view from capital, the business class, was that wages could no longer be allowed to rise. By the 90s (under the Chrétien Liberals), there was enough momentum to take a run at EI. At a point when the number of unemployed workers was rising, we saw for the first time a decrease in the number of EI recipients. The number of unemployed people receiving EI fell from (more than) two-thirds to about one-third.”
So, what does the job market facing unsupported, unemployed people look like? For some, nothing.
“The number of people frequenting and using food banks has been on the rise for years. I’m willing to make the assumption that the number of people on social assistance is also going up. If you have no job, no EI benefits, you still need to make ends meet,” Colford warns.
For a person on social assistance, the absurd statement, “there’s no such thing as a bad job” may seem like reason. In New Brunswick, a single person on social assistance deemed employable is entitled to a paltry $558 per month, less than 40 per cent of what someone working a full-time minimum wage job in New Brunswick would receive. One may indeed accept any job to avoid such poverty.
For other unemployed people, the job market looks like a revolving door. According to Statistics Canada, the number of temporary workers in Canada hit a record two million last year. The largely low-waged work of this fleeting variety has more than tripled compared with the growth of permanent work since 2009, with even more disproportionate numbers for younger workers. For women everywhere between the ages 25 and 44, temporary work accounts for staggering 95 per cent of new jobs. This trend fits neatly with what Workman identifies as a goal of the EI changes, “to flood the low wage sector in Canada as much as possible.”
Driving masses of workers towards low wage employment will only increase the downward pressure on wages more generally. The following scenario plays out: if employers know that workers in a particular area are being pushed to take jobs with lower wages due to the EI changes, these employers will have an incentive to lower their wage offers. As low wage employment becomes even lower wage employment, higher wage jobs become a rarer, more precious commodity, subjected to increased competition, which leads to lower wages there as well. Almost everyone sinks, employers exempted.
However, as protests against the EI changes over the past year have shown, workers have no intention of simply letting themselves be pushed down and subjected to the margins of survival. They are resisting the push towards greater deprivations. With some of the worst effects of the EI changes yet to be felt, only more resistance can be expected. It may be a long winter indeed.
