Regulations Amending the Employment Insurance Regulations (Pilot Project No. 21): SOR/2018-228

Canada Gazette, Part II, Volume 152, Number 23

Registration

SOR/2018-228 November 2, 2018

EMPLOYMENT INSURANCE ACT

P.C. 2018-1353 November 1, 2018

RESOLUTION

The Canada Employment Insurance Commission, pursuant to section 109 of the Employment Insurance Act ^{footnote a}, makes the annexed Regulations Amending the Employment Insurance Regulations (Pilot Project No. 21).

October 16, 2018

Graham Flack
Chairperson
Canada Employment Insurance Commission

Pierre Laliberté
Commissioner (Workers)
Canada Employment Insurance Commission

Judith Andrew
Commissioner
Canada Employment Insurance Commission

Her Excellency the Governor General in Council, on the recommendation of the Minister of Employment and Social Development, pursuant to section 109 of the Employment Insurance Act ^{footnote b}, approves the annexed Regulations Amending the Employment Insurance Regulations (Pilot Project No. 21), made by the Canada Employment Insurance Commission.

Regulations Amending the Employment Insurance Regulations (Pilot Project No. 21)

Amendments

1 The Employment Insurance Regulations ^{footnote 1} are amended by adding the following after section 77.991:

Pilot Project Relating to Increased Weeks of Benefits for Seasonal Workers

77.992 (1) Pilot Project No. 21 is established for the purpose of testing the effectiveness of a mechanism that targets persons who meet the criteria set out in subsection (2) and testing the outcomes of increasing the number of weeks of benefits paid to the targeted population.

(2) Pilot Project No. 21 applies to every claimant who meets the following criteria:

• (a) the date on which a benefit period is established falls within the period beginning on August 5, 2018 and ending on May 30, 2020;
• (b) at the time that the benefit period is established, the claimant is ordinarily resident in a region described in Schedule I that is set out in Schedule II.92;
• (c) in the 260 weeks before the beginning of the benefit period referred to in paragraph (a), at least three benefit periods had been established during which regular benefits were paid or payable; and
• (d) at least two of the benefit periods referred to in paragraph (c) had begun around the same time of year as the benefit period referred to in paragraph (a) began.

(3) For the purposes of paragraph (2)(c), a claimant’s benefit period established before the beginning of the 260-week period is considered to have been established within the 260-week period if the claimant received a notification of payment or non-payment with respect to any week that falls within that 260-week period.

(4) For the purposes of paragraph (2)(d), a benefit period in a previous year is considered to have begun around the same time of year if it began during the period that begins eight weeks before and ends eight weeks after the week that is

• (a) 52 weeks before the first week of the benefit period referred to in paragraph (2)(a);
• (b) 104 weeks before the first week of the benefit period referred to in paragraph (2)(a);
• (c) 156 weeks before the first week of the benefit period referred to in paragraph (2)(a);
• (d) 208 weeks before the first week of the benefit period referred to in paragraph (2)(a); or
• (e) 260 weeks before the first week of the benefit period referred to in paragraph (2)(a).

(5) Despite subsection 12(2) of the Act, the maximum number of weeks for which benefits may be paid in a benefit period that is established for a claimant who is included in Pilot Project No. 21 shall be determined in accordance with the table set out in Schedule II.93 by reference to the regional rate of unemployment that applies to the claimant and the number of hours of insurable employment of the claimant in their qualifying period.

2 The Regulations are amended by adding, after Schedule II.91, the Schedules II.92 and II.93 set out in the schedule to these Regulations.

Coming into Force

3 These Regulations come into force on the day on which they are registered.

SCHEDULE

(Section 2)

SCHEDULE II.92

(Paragraph 77.992(2)(b))

Regions Included in Pilot Project No. 21

• Central Quebec
• Charlottetown
• Chicoutimi – Jonquière
• Eastern Nova Scotia
• Gaspésie – Îles-de-la-Madeleine
• Lower Saint Lawrence and North Shore
• Madawaska – Charlotte
• Newfoundland/Labrador
• North Western Quebec
• Prince Edward Island
• Restigouche – Albert
• Western Nova Scotia
• Yukon

SCHEDULE II.93

(Subsection 77.992(5))

TABLE OF WEEKS OF BENEFITS FOR PILOT PROJECT NO. 21

Number of hours of insurable employment in qualifying period	Regional Unemployment Rate
	6% and under	More than 6% but not more than 7%	More than 7% but not more than 8%	More than 8% but not more than 9%	More than 9% but not more than 10%	More than 10% but not more than 11%	More than 11% but not more than 12%	More than 12% but not more than 13%	More than 13% but not more than 14%	More than 14% but not more than 15%	More than 15% but not more than 16%	More than 16%
420 - 454	0	0	0	0	0	0	0	0	31	33	35	37
455 - 489	0	0	0	0	0	0	0	29	31	33	35	37
490 - 524	0	0	0	0	0	0	28	30	32	34	36	38
525 - 559	0	0	0	0	0	26	28	30	32	34	36	38
560 - 594	0	0	0	0	25	27	29	31	33	35	37	39
595 - 629	0	0	0	23	25	27	29	31	33	35	37	39
630 - 664	0	0	22	24	26	28	30	32	34	36	38	40
665 - 699	0	20	22	24	26	28	30	32	34	36	38	40
700 - 734	19	21	23	25	27	29	31	33	35	37	39	41
735 - 769	19	21	23	25	27	29	31	33	35	37	39	41
770 - 804	20	22	24	26	28	30	32	34	36	38	40	42
805 - 839	20	22	24	26	28	30	32	34	36	38	40	42
840 - 874	21	23	25	27	29	31	33	35	37	39	41	43
875 - 909	21	23	25	27	29	31	33	35	37	39	41	43
910 - 944	22	24	26	28	30	32	34	36	38	40	42	44
945 - 979	22	24	26	28	30	32	34	36	38	40	42	44
980 - 1014	23	25	27	29	31	33	35	37	39	41	43	45
1015 - 1049	23	25	27	29	31	33	35	37	39	41	43	45
1050 - 1084	24	26	28	30	32	34	36	38	40	42	44	45
1085 - 1119	24	26	28	30	32	34	36	38	40	42	44	45
1120 - 1154	25	27	29	31	33	35	37	39	41	43	45	45
1155 - 1189	25	27	29	31	33	35	37	39	41	43	45	45
1190 - 1224	26	28	30	32	34	36	38	40	42	44	45	45
1225 - 1259	26	28	30	32	34	36	38	40	42	44	45	45
1260 - 1294	27	29	31	33	35	37	39	41	43	45	45	45
1295 - 1329	27	29	31	33	35	37	39	41	43	45	45	45
1330 - 1364	28	30	32	34	36	38	40	42	44	45	45	45
1365 - 1399	28	30	32	34	36	38	40	42	44	45	45	45
1400 - 1434	29	31	33	35	37	39	41	43	45	45	45	45
1435 - 1469	30	32	34	36	38	40	42	44	45	45	45	45
1470 - 1504	31	33	35	37	39	41	43	45	45	45	45	45
1505 - 1539	32	34	36	38	40	42	44	45	45	45	45	45
1540 - 1574	33	35	37	39	41	43	45	45	45	45	45	45
1575 - 1609	34	36	38	40	42	44	45	45	45	45	45	45
1610 - 1644	35	37	39	41	43	45	45	45	45	45	45	45
1645 - 1679	36	38	40	42	44	45	45	45	45	45	45	45
1680 - 1714	37	39	41	43	45	45	45	45	45	45	45	45
1715 - 1749	38	40	42	44	45	45	45	45	45	45	45	45
1750 - 1784	39	41	43	45	45	45	45	45	45	45	45	45
1785 - 1819	40	42	44	45	45	45	45	45	45	45	45	45
1820 -	41	43	45	45	45	45	45	45	45	45	45	45

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Executive summary

Background

Employment Insurance (EI) Regular Benefits

Part I of the Employment Insurance Act (EI Act) provides temporary income replacement to eligible unemployed workers, in the form of regular benefits, while they look for employment. The EI Program is designed to respond automatically to changes in economic conditions that affect local labour markets. The EI Program currently divides the country into 62 economic regions. Eligible individuals are entitled to between 14 and 45 weeks of EI regular benefits during a benefit period, depending on the regional rate of unemployment in the region where they reside and the number of hours worked in the qualifying period.

The EI Act also provides the Canada Employment Insurance Commission (the Commission) with the authority to make regulations to introduce pilot projects, for a period of up to three years, to test whether or which amendments to the EI Act or the regulations would make them more consistent with current industry employment practices, trends or patterns or would improve service to the public.

Past pilot projects

Some past pilot projects were aimed at supporting seasonal workers facing an income gap and provided up to five additional weeks of EI regular benefits to all EI claimants in EI economic regions of relatively higher unemployment. The objective of these pilot projects was to test the costs and impact of increasing the number of weeks of benefits. Evaluations of past pilot projects that were aimed at supporting seasonal workers facing an income gap have found that providing up to five additional weeks to all EI claimants did reduce the frequency and length of the income gap experienced by seasonal claimants (i.e. those who have demonstrated a seasonal pattern of establishing EI regular benefits claims, as defined in this new pilot project).

While evaluations in general have noted that past pilot projects have reached seasonal claimants, they also noted that other non-seasonal claimants have also benefited from the extra weeks provided, which was an unintended result of the pilot projects. Of particular note, the evaluation of Pilot Project No. 15 found that the measure was not well targeted and only 3.2% of the total $558 million of additional EI regular benefits paid during the pilot project were used by seasonal claimants with an income gap.

Issues

Workers in seasonal employment often face unique labour market challenges due to the cyclical nature of their employment. Seasonal jobs are often found in rural and remote areas of the country, with scarce or no other job prospects nearby. In these areas, there are more unemployed workers looking for fewer available jobs during the off-season, making it especially difficult to find work after being laid off from a seasonal job. Many seasonal workers rely on the EI Program to help them get through these recurring periods of unemployment.

If the number of weeks of EI benefits for which a seasonal worker qualifies is not sufficient to bridge the period between the seasonal layoff and the return to their seasonal work, and the seasonal worker is unable to find other work, they are said to be experiencing an income gap or “trou noir.” The frequency and duration of income gaps can be impacted by the cyclical nature of seasonal jobs and weather patterns as well as by the EI economic region’s rate of unemployment, which affects the duration of EI benefits.

Seasonal income gaps are not a new phenomenon. There have been consistent calls for reforms to the EI Program to better respond to the needs of workers in seasonal employment. However, seasonal criteria have not been used before to administer the EI Program.

Objectives

The objective of the amendments is to introduce a new pilot project that provides up to five additional weeks of EI regular benefits to seasonal claimants to test claimant outcomes resulting from providing additional weeks of benefits to targeted claimants.

Description

The amendments to the EI Regulations establish a pilot project that increases the number of weeks of EI regular benefits by up to five weeks (to a maximum of 45 weeks) for seasonal workers who meet the following seasonal criteria:

1. begin a benefit period between August 5, 2018, and May 30, 2020, in one of thirteen targeted EI regions;
2. have at least three benefit periods in which regular or fishing benefits were paid or payable to them in the five years prior to the start of the current benefit period; and
3. at least two of these benefit periods must have started “around the same time of year” as the benefit period established during the period of the pilot project. “Around the same time of year” is defined as the period that is eight weeks preceding and eight weeks following the week of the current claim in the previous five years (looking back in 52-week increments).

The thirteen EI economic regions targeted for the pilot project are

• Central Quebec
• Charlottetown
• Chicoutimi – Jonquière
• Eastern Nova Scotia
• Gaspésie – Îles-de-la-Madeleine
• Lower Saint Lawrence and North Shore
• Madawaska – Charlotte
• Newfoundland/Labrador (excludes St. John’s)
• North Western Quebec
• Prince Edward Island (excludes Charlottetown)
• Restigouche – Albert
• Western Nova Scotia
• Yukon (excludes Whitehorse)

Regulatory and non-regulatory options considered

A non-regulatory alternative considered was a legislative amendment to the EI Act. However, these mechanisms of targeting seasonal claimants and specific regions have not been used before to administer the EI Program. Therefore, testing is required to determine the effectiveness of the pilot project to better assess whether amendments to the EI Act are desirable. Other status quo and non-regulatory options would not have addressed the current situation for EI claimants in seasonal employment.

Benefits and costs

During the period in which the pilot project is in force, costs are expected to be $189 million ($172.5 million in additional EI benefits paid and $16.5 million in administrative costs to Government). Incremental costs of new EI program measures are charged to the EI Operating Account and recovered through future EI premiums. The estimated impact of this measure on the premium rate is 0.16 cents per $100 of insurable earnings per year, for the next seven years.

This EI pilot project is expected to benefit 51 500 EI claimants annually by reducing the incidence and duration of income gaps faced by seasonal claimants in the thirteen targeted EI regions. The thirteen EI regions will likely benefit economically from the additional weeks of EI benefits as a result of recipients spending money locally. Information gathered under this pilot project will be used to help inform longer-term approaches to helping EI claimants in seasonal employment.

“One-for-One” Rule

The “One-for-One” Rule does not apply, as the amendments do not impose any incremental administrative burden on business.

Small business lens

The small business lens does not apply, as the amendments do not impose any additional administrative or compliance costs on small businesses.

Consultation

Recent requests by stakeholders to provide additional support to seasonal workers have focused on declining EI unemployment rates, which have had the effect of shortening EI entitlements. Over the last few years, media coverage on seasonal workers was extensive, including more than 4 000 media articles on the topic, with much of the coverage focusing on the “trou noir.”

In response to the falling unemployment rate in their region, the Conseil national des chômeurs et chômeuses and Action-Chômage Côte-Nord brought together stakeholders from eastern Quebec regions in November 2017 to request an increase in the number of weeks of regular benefits available to help seasonal workers.

On November 23, 2017, the National Assembly of Quebec adopted a motion calling on the federal government to address EI coverage available to seasonal workers. On February 9, 2018, a motion calling on the federal government to resolve the plight of workers in seasonal employment was carried in the New Brunswick legislature.

In addition, the EI Commissioner for Employers and the EI Commissioner for Workers establish and maintain working relationships with a wide range of organizations and individuals that are clients of or affected by Employment and Social Development Canada (ESDC or the Department) programs and services such as EI. These relationships enable the Commissioners to convey the concerns and positions of stakeholders regarding the administration of EI legislation, policy development and implementation, and program delivery.

The new pilot project was announced on August 20, 2018, and was covered by multiple media outlets. Stakeholders have had mixed reactions since the announcement. While Action-Chômage Côte-Nord and the Comité d’action de l’assurance-emploi in the Péninsule acadienne have welcomed the additional five weeks, they maintain that challenges faced by seasonal workers have not been resolved.

Rationale

Drawing from lessons learned under previous pilot projects, this pilot project introduces a new targeting mechanism to better support seasonal claimants. The pilot project introduces, for the first time, a mechanism that targets persons who meet the seasonal criteria to better identify eligible claimants within targeted EI regions. The EI regions identified for the pilot project are those where seasonal claims represented a percentage of 4% or greater compared to the local labour force in 2016–2017 and where average 2017 EI unemployment rates were higher than the national average unemployment rate in 2017, i.e. 6.3%. In these regions, it may be more difficult to find work in the off-season.

The number of additional weeks is consistent with the number that was provided in previous pilot projects aimed at supporting EI claimants in seasonal employment.

The introduction of the pilot project will allow for the collection of data for the testing of the effectiveness of a targeting mechanism and of claimant outcomes resulting from providing additional weeks of benefits to the targeted claimants. Lessons learned from this pilot project will then be used to help inform longer-term approaches to helping EI claimants in seasonal employment.

This measure is part of the Budget 2018 commitment to provide $230 million to assist workers in seasonal industries.

Implementation, enforcement and service standards

Existing implementation and enforcement mechanisms contained in the Department’s adjudication and control procedures will ensure that these regulatory amendments are implemented properly.

Service Canada provides Canadians with a single point of access to a wide range of government services and benefits, including the processing and payment of EI claims. Regarding service standards, the Department’s continuing objective is to reach a decision on 80% of all EI claims within 28 days (four weeks) of the receipt of all pertinent information.

This pilot project applies when a benefit period is established in one of the thirteen EI regions within the period beginning August 5, 2018, and ending May 30, 2020. The additional weeks of benefits are automatically added to eligible claims. ESDC will continue to promote awareness through communication strategies that use multiple channels to connect with clients (online, by telephone or in person at a Service Canada Centre).

Performance measurement and evaluation

A summative evaluation of the pilot project is planned to be completed by the Evaluation Directorate at ESDC and will be available upon request once completed. The evaluation of the pilot project will support a more comprehensive assessment and understanding of targeting seasonal claimants and the assistance provided by additional weeks of EI regular benefits that will inform the development of future measures.

Results for new measures will also be reported in the annual EI Monitoring and Assessment Report (MAR). It is tabled in Parliament to ensure that workers, businesses and other stakeholders are aware of results of the measures. The MAR reports annually on seasonal claimants in Canada, with indicators which include EI exhaustion, average duration of benefits in addition to gender and regional information on seasonal claimants. Data reported in the MAR is used for performance reporting purposes and for analysis in support of policy development.

Contact

Cara Scales
Director
Policy Analysis and Initiatives
Employment Insurance Policy
140 Promenade du Portage, Phase IV, office 7C157
Telephone: 819-654-3192