Ottawa won’t change EI program, but acknowledges not all will be better off

OTTAWA – Human Resources Minister Diane Finley is sticking to her guns on controversial changes to employment insurance, although she concedes not all workers will be better off.

The minister told the House of Commons on Monday her pilot project will help Canadians remain attached to the labour force while collecting EI benefits, and will encourage them to work longer hours.

The pilot, introduced Aug. 5, replaces the previous system that clawed back EI claimants who found part-time jobs once their pay exceeded 40 per cent of their benefits, or $75 a week, whichever was greater.

The new program reduced the clawback on new earnings to 50 per cent, but kicks in with the first dollar earned, not at 40 per cent.

The effect is that low-wage earners will wind up penalized by the new system; however, those who work longer hours and at higher pay will wind up being able to keep more of their earnings.

NDP members tabled a motion Monday asking the government to take steps to fix the program, with one MP saying four in 10 affected by the program would wind up with less take-home pay under the new system.

“This country is short of workers. We have employers who are begging for skilled labour … and the old system discouraged people from working more than one day a week,” Finley responded.

“There are cases yes where somebody was better (off) on day one, but they were totally discouraged from working days two, three and four.”

British Columbia MP Kennedy Steward noted the average EI recipient receives about $360 in weekly benefits, meaning he or she would have little incentive to find work unless it paid at least $300 a week. If the part-time job paid only half that, the worker would be about $70 worse off under the new rules as opposed to the old.

“The minister should admit she made a mistake here and redesign the program so it works properly,” he said.