The Harper government’s reform
of Employment Insurance

Three claimant categories

The unemployed are no longer all equal before the law. The new Employment Insurance Regulations, enforced since January 2013, establish three claimant categories and define different obligations for each.

The category to which claimants belong determines the type of employment and earnings that are suitable for them and that they must therefore seek and be willing to accept.

Note that the unemployed will have their benefits interrupted for up to several months if they exclude from their search or refuse jobs considered suitable.

An hour from home… or more

All claimants are now required to search out and accept work located an hour from their home, or even more (see 9.002 (d) of the new Employment Insurance Regulations).

A longer commute is considered acceptable under the following circumstances : 1) “it is not uncommon given the place where the claimant resides” or 2) it is comparable to “the claimant’s daily commuting time to or from their place of work” at its previous job.

Claimant Categories Weeks of unemployment Type of employment and salary suitable for a claimant (what a claimant must look for and be willing to accept)
Long-tenured workers 1 to 18 Usual occupation starting at 90% of previous salary
19 and more Similar job starting at 80% of previous salary
Occasional claimants 1 to 6 Usual occupation starting at 90% of previous salary
7 to 18 Similar job starting at 80% of previous salary
19 and more Any work starting at 70% of previous salary
Frequent claimants 1 to 6 Similar job starting at 80% of previous salary
7 and more Any work starting at 70% of previous salary
Proportion of claimants per category
(source: chart 14 in this document)
Long-tenured workers 23,3 %
Occasional claimants 53,1 %
Frequent claimants 23,6 %

In summary

Changes to Employment Insurance mean that three quarters of beneficiaries are now required, after six weeks of unemployment, to accept a job outside their usual occupation, with a salary 20-30% lower and up to an hour away from their home.

Before 2013, claimants were given time to look for a job that offered comparable remuneration and working conditions to their previous employment. This delay sought to provide a minimal protection for the unemployed to freely choose their employment. The length of this delay was never set by legislation. But caselaw generally recognized a period of 8 to 12 weeks as reasonable (see example here).

This is no longer the case today. Now, in their first week of unemployment, claimants must be willing to accept a pay cut of 10 or 20%, depending on their category. Beginning in the 7th week, a pay cut of 30% is considered “suitable” for a frequent claimant, while a cut of 20% is considered “suitable” for an occasional claimant.

The previous Employment Insurance Act contained provisions to ensure claimants were not forced to accept discount jobs. For example, a job offering a salary of $13/hour could be rejected by a claimant if the hourly wage normally paid for the same type of job in its region was between $16-18.

Those provisions have now been eliminated. A frequent claimant who, in its previous employment, earned a market rate of $16/hour, could now be forced to accept an identical position at $12.80/hour (80% of $16) in the first six weeks of unemployment, and at $11.20/hour (70% of $16) thereafter. The story is the same for an occasional claimant, but after a longer delay.

The process of appealing Employment Insurance decisions has also undergone significant changes in 2013. As a result, it is now longer and more complex for a claimant to appeal a negative decision. For more on this subject, see this article.

The Harper government’s reform of Employment Insurance has also introduced other changes to the program, which will disadvantage many of the unemployed. These changes are related to, among other things, the calculation of benefits and admissible earnings. More details can be found here.