Toronto, Ontario – The Canadian Auto Workers Union (CAW) is asking the Prime Minister and premiers for an agreement that includes new Employment Insurance (E.I.) and training support as part of an economic stimulus package. The CAW has sent an open letter to leaders attending the First Ministers Meeting in Ottawa.
The letter, signed by CAW president Ken Lewenza, states that “Unemployment insurance can be the most powerful of all economic stabilizers. A federal study has shown that during the recessions of the early ’80s and ’90s, U.I. prevented deeper and longer downturns and reduced the shock of both job and GDP losses. But we’ve entered this new economic crisis with a much weaker E.I. system. It provides only half the coverage it did in the last recession. At any given time, only 42 per cent of the unemployed are receiving E.I., because fewer workers qualify and because benefit weeks were reduced.”
The CAW said that in Canada, the E.I. maximum is 45 weeks, but only for regions with 10 per cent unemployment. Most workers live where the maximum is only 36 to 40 weeks. In cities such as Vancouver, Calgary, Regina, Winnipeg, Ottawa, Quebec City, Fredericton and Halifax, workers have a maximum of 36 weeks. The duration and benefit level has also been reduced. Workers now receive 55 per cent of earnings, a drop from almost 67 per cent, along with a 2009 maximum of $447 per week.
The union is asking that the government increase benefit duration to at least 50 weeks in all regions; provide an additional year of “special extension” benefits if national unemployment exceeds 6.5 per cent, paid from federal general revenues; eliminate the two-week unpaid waiting period; revamp older worker adjustment initiatives; provide benefits that are at least 60 per cent of earnings and increase the $447 maximum benefit rate; further extend E.I. Part 1 benefits as “skills development income support” so long as the worker remains in approved training; and set a fixed 360 hours to qualify for all types of E.I. benefits in all regions. Currently, the requirement is set monthly, and varies from 420 to 700 hours, depending on the unemployment rate in each of the 58 E.I. regions.
The letter states that successive governments have borrowed more than $54 billion from the E.I. “surplus” premiums paid by workers and employers, and that until 1989, the federal government contributed to the E.I. account to pay for extended benefits. It has not contributed since then.
The CAW is also suggesting that E.I. premium rates be set so that they are raised in economic upturns, and reduced during downturns, citing at 1995 federal report that concluded such actions were key to E.I.’s role as Canada’s “single most powerful automatic stabilizer.”