Bill C-56 (Historical)

Fairness for the Self-Employed Act

An Act to amend the Employment Insurance Act and to make consequential amendments to other Acts

This enactment amends the Employment Insurance Act and other Acts by establishing a scheme to provide for the payment of special benefits to self-employed persons who are not currently entitled to receive them.

Fairness for the Self-Employed Act

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, that is a very good question and I will respond first by asking what took the Conservatives so long to bring forth this legislation.

As a former independent business person I will tell the member and everyone else that there are policies and programs that we do purchase through insurance. For example, as a former officer and director of the company, I was not allowed by law to pay for any of these benefits, but I purchased additional benefits should unforeseeable and difficult circumstances arise. The renovation contractor also has that option. Independent business people have various options for various writeoffs, whether it be a car, lunches, et cetera, which the average person does not. There is a trade-off right there.

I close by asking, if members on the Conservative side are so compassionate, what took them so long?

[Phil McColeman, Conservative, Brant, ON]

Mr. Speaker, I would like a quick follow-up on the previous question because I am not aware, nor have I been aware as a business person my whole life, that we can purchase private insurance in order to protect our income or be replaced by a program. There are programs, disability programs, for an individual being insured, but there are no programs that I have ever been aware where an individual's loss of income is covered in the circumstance of a child diagnosed with cancer and having to spend two years in cancer treatment at a hospital. Please tell me where we could buy that insurance because this is a real-life example I am talking about today.

[John Cannis, Liberal, Scarborough Centre, ON]

Mr. Speaker, I would answer the hon. gentleman in two ways.

First, as an individual entrepreneur that we are talking about, what took the government so long?

Second, with respect to the specific example that he is referring to where, unfortunately, a child within the family is sick and one of the parents, who are both working if I understand his example, is in the business. There are programs, in terms of insurance for the individuals, et cetera, but for the child, again, that is something that we should look at because it would fall under unforseeable circumstances. I do not have the answer. I am answering him on the individual case. We could extend it and extend it, and there would be a never-ending story.

[The Acting Speaker, Conservative, Barry Devolin]

It is my duty, pursuant to Standing Order 38, to inform the House that the questions to be raised tonight at the time of adjournment are as follows: the hon. member for Nanaimo—Cowichan, Employment Insurance; the hon. member for Gatineau, Infrastructure.

Resuming debate. The hon. member for Nanaimo—Cowichan.

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, I will be splitting my time with the member for Welland.

I want to begin by indicating that New Democrats will be supporting this bill in principle. We have been advocating the need for changes to the Employment Insurance Act, including self-employment, for a very long time, and we look forward to sending this bill to committee in order to consider it fully and recommend some potential changes to the legislation.

For Canadians who may be tuning in, I want to cover some of the key points in this piece of legislation. Many people are self-employed and this will only deal with a very small group of them.

Specifically, this legislation would allow self-employed Canadians to opt into employment insurance programs dealing specifically with maternity benefits, up to a maximum of 15 weeks; parental and adoptive benefits, up to a maximum of 35 weeks; sick leave benefits up to a maximum of 15 weeks; and compassionate care benefits up to a maximum of six weeks. We see this as being a positive step.

As other members in the House have pointed out, the member for Hamilton Mountain introduced legislation in the House to deal with some of the issues regarding employment insurance and maternity benefits.

We have heard members in the House speak about the fact that it is about time this bill was introduced. I want to bring to the attention of the House a report from 1999 called “The human face: unemployment insurance”. In those days it was called unemployment insurance. This was a report put together by the member for Acadie—Bathurst. It is probably no surprise to members of the House that the member for Acadie—Bathurst has done very good work for a number of years with respect to employment insurance.

People say it is about time, but in 1999, as a result of a cross-country tour that the member undertook, one of the recommendations was that insurance must be made available to more self-employed workers. In the report he outlined a much broader perspective than just the kinds of special benefits that we are talking about: maternity, paternity, adoptive, compassionate care and sickness benefits. He outlined a proposal that talked about covering self-employed workers in all categories of employment.

When people say it is about time, it is a sad commentary. It has been 10 years since this report was put together that we are finally seeing some movement on employment insurance benefits for self-employed workers.

We have also heard in the House that there are approximately 2.6 million self-employed workers in this country. That is a significant portion of the workforce. We are talking about workers who have no social safety net.

We are talking about workers who, if they fall sick, are “Tough, out of luck”. If they become pregnant or adopt a child, they have to somehow figure out how to make ends meet if they put their business on hold. If they have a child who becomes ill, as the member opposite pointed out, they have to find some other way to cover their expenses when they need that very important family time to look after that sick child.

We are also talking about many self-employed workers who are not self-employed by choice. In an economic downturn, many workers lose their employment. They lose the good paying jobs that they have come to rely on for their families.

In my own riding forestry has taken hit after hit after hit, and many of the workers do not want to collect employment insurance, despite the fact that they have paid into it for many years. They want to work hard, bring home a paycheque, and support their families. What many of these workers do when they lose their employment through no fault of their own is look at how they can make a living in their community through self-employment.

Someone recently came into my constituency office in Nanaimo—Cowichan to talk about that very thing. Sadly, in his case, he was going to be completely out of pocket. He had come up with an idea to put together a company and was doing all of the groundwork around it.

He told the employment insurance office that it was going to take him a little longer to make money and asked if he could apply for one of the programs that helps self-employed workers. There are some programs that help self-employed workers start up businesses. Sadly, in his case, because he had already gotten involved in starting up this company, because he had already done a significant amount of work, he was not eligible.

Here was a worker attempting to support himself, asking for some assistance from the government, so he could get his business off the ground and because of the very rigid rules in place around employment insurance, he simply was not eligible.

That is just one example of what happens to workers who are self-employed when they are looking for some financial assistance through a bit of a cash crunch. But I want to come back for one moment to some of the other workers who are being forced into self-employment.

Women are particularly disadvantaged. We find that women are often in contract, seasonal, part-time, self-employed work. In fact, women are some of the most significant business-starters in this country. There are significant numbers there. Under our current employment insurance system, women are disadvantaged. Only about a third of women who pay into it actually collect. On the other hand, we have women who are in non-standard employment, as it is called. This non-standard employment often leaves them ineligible to even pay into employment insurance.

Although we welcome these changes that are put before the House in terms of special benefits and the ability of workers to opt in, we would really encourage the government to actually expand how it is looking at self-employed workers to ensure that there is that social safety net there for them.

I want to touch briefly on the fact that New Democrats have consistently called for a significant number of changes to the Employment Insurance Act. We have seen the erosion of employment insurance since the mid-1990s. What we have seen is far fewer workers being able to qualify. We have seen the benefit rates reduced. We have seen the number of weeks that people can collect reduced.

We have seen some other anomalies in the system and I have raised this in this House before. There are problems with how the unemployment rate is calculated in regions, which then directly impacts on the number of weeks of benefits that people can claim.

In my own region, our unemployment rate is tied to the city of Vancouver. Of course, anybody who knows this country knows that Vancouver Island has a very different labour market than the city of Vancouver. It means that workers in my area collect far fewer weeks than the unemployment rate in our area actually would warrant if it were a more reasonable determination.

We know that there are some significant problems with the current employment insurance legislation. We also have heard members in this House speak about EI premiums. We know that over the years, workers and their employers have paid into the employment insurance fund, which used to be the unemployment insurance fund.

What we have also known is that this money has been siphoned off to pay down the debt. Some $54 billion to $57 billion of workers' and their employers' money has gone not into providing that social safety net, not into providing training and education for workers, not into providing some other benefits that would help an employer become more productive but into the government coffers. I would argue that in any other place, we would probably call that theft.

When people are talking about problems with the employment insurance fund and arguing that somehow or other a small measure for the self-employed is somehow not good enough, I would argue that we should support this measure and actually encourage the government to go further, to ensure that the funds that workers are paying are actually going toward programs that are going to support them and their companies, to look at how we can increase the self-employed benefits, and also at how we look at the overall fund.

I know that there is a lot of good work that has been done both by members of the New Democratic Party and also by the labour movement. I want to touch upon a couple of things that they have proposed in terms of changes that would be helpful with regard to creating a job strategy that ensures people have well-paying jobs and then looking at the social safety net that supports them when they do not have those jobs. One of the aspects I want to focus on very briefly is the fact that we need to ensure that we have well-paying jobs in manufacturing and forestry in this country. There are a couple of ways we can do that.

First of all, we can ensure that we develop sector strategies that look at investments in forestry and manufacturing. We can ensure that the raw resources are processed here in Canada, that they are value added and ensure that we add as much value in order to keep those jobs in our communities. We can also work to prevent plant closures by investing in those plants, helping those companies upgrade equipment, so that they are productive and efficient.

In closing, I urge all members of this House to support this bill at second reading and get it to committee, so that we can have a further discussion around the kinds of changes that we need to see to the employment insurance legislation.

[Bill Siksay, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I am really pleased to have had the opportunity to listen to my colleague's intervention in this debate on Bill C-56 around special EI benefits for the self-employed. One of the things that I found most interesting about her speech was her comments about how this legislation particularly affects women.

We know that women are heavily represented among Canada's 2.6 million self-employed citizens, and that the benefits that are offered by this legislation are often of particular interest to women, certainly the ones regarding maternity benefits and compassionate care benefits. Although we would hope that everybody would share those kinds of responsibilities, we know that women often bear the burden of those kinds of familial responsibilities.

This legislation will directly address the concerns of many self-employed women in Canada and I wonder if she might just expand on that point a little in response to this question. How will this legislation particularly affect Canadian women?

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, the member is well aware that generally in the labour market, women are often in what is called non-standard employment. That means that women are often involved in contract employment or in starting up their own businesses. They may have seasonal or part-time employment, which can be insurable employment, but often women are not eligible to collect regular employment insurance benefits even if they have paid the premiums, because they often do not have enough hours since they have not worked enough weeks.

This piece of legislation is particularly attractive because it would allow self-employed women to opt into a system that would at least allow them to claim maternity or adoptive parental leave benefits if they chose to have children or adopt children. This would significantly contribute to women being able to spend some quality time with their children in their very early years. It would be of benefit in terms of encouraging them to continue to be self-employed.

[Olivia Chow, NDP, Trinity—Spadina, ON]

Mr. Speaker, 2.7 million Canadians who are self-employed cannot currently access employment insurance or maternity or parental benefits. Hard-working Canadians deserve access to these services regardless of who they are working for, and it is the government's responsibility to make sure every worker has access.

This bill would make sure that self-employed hairdressers, real estate agents and others would be able to make commitments to their families and to their careers at the same time and sleep easier at night knowing employment insurance was available to them in case of difficult times.

Could the member describe some of the other professions and other Canadians who have been denied employment insurance? What would it mean to them if this bill were passed and they could access maternity and parental benefits?

[Jean Crowder, NDP, Nanaimo—Cowichan, BC]

Mr. Speaker, people who are self-employed come from almost every walk of life.

One of the things the member for Acadie—Bathurst identified in his 1999 report was the fact that some employers were actually laying off their employees and then contracting them back as self-employed workers. We find that happening in every imaginable occupation.

There are some rules around that. The Canada Revenue Agency determines what is insurable employment and what is not. By the same token, however, there are self-employed workers in every sector.

I would like to emphasize the fact that this bill is a good first step. It would provide workers with access to the special benefits that are currently available under the Employment Insurance Act.

However, I would urge us to take a much broader perspective and look at ways to cover all self-employed workers so that they will not have to worry if the market crashes or if there is an economic downturn, or if they lose their companies through no fault of their own. That way they will know there is an avenue available to them to have some income.

[Malcolm Allen, NDP, Welland, ON]

Mr. Speaker, I would like to thank my colleague from Nanaimo—Cowichan for splitting her time, and thank all of my colleagues in the New Democratic Party for the work they have done over a great many years on this file regarding unemployment insurance.

I prefer to call it unemployment insurance rather than using the term for the premium collections of the employment insurance system, which finds itself in a dark hole under the current government as it was under the previous one which let $57 billion slip through its fingers. If a business lost $57 billion, it would be bankrupt, but it seems that we can spend it in other places and forget about it.

I would also like to be on the record as congratulating my good friend and colleague from Acadie—Bathurst. As my colleague from Nanaimo—Cowichan said, he has really led the charge in the House to try to make sure that we look at this whole system in its totality. Over the last number of sessions, we have been nibbling away at the edges of the unemployment system.

Basically, we are making this little change and that little change, not that this is a small change for those self-employed workers out there who are looking for compassionate care and maternity, parental and sick benefits. These are important things for those workers out there now, who at one time more than likely had that protection.

As my colleague said, all too many of them, in my riding as well, who once had well-paid manufacturing jobs are now forced into being entrepreneurs. I know that the pulp and paper makers in Newfoundland are faced with the same thing today. It is not because they necessarily want to be entrepreneurs. Eventually, what they have found is that there are no longer employers there to actually employ them, so they find themselves having to go out there.

What happens to them? The government's own document says that over 75% of the self-employed earned less than the maximum insurable earnings. Yet, if we were to look at those honourable workers in the pulp and paper industry up in the north of Newfoundland, the auto workers in southern Ontario and workers across this country, we would find that the bulk of those workers in the manufacturing sector made more than the maximum insurable earnings. They have now been forced into this so-called self-employment scheme. It seems to me it was driven at them when they least expected it and did not want it.

Here we have workers who indeed would have paid into the system for a long period of time, perhaps 20 or 25 years in some cases. We are seeing that type of worker who has worked that length of time forced out of work and forced into self-employment. One of the major training programs through the EI fund used to get a person to open up their own business. One of the major pushes seen inside of it is to go and do that.

For those who truly want to do that, it is a good thing. However, for those who feel forced and compelled to do it because they have no other options, that is a sad thing. It is a sad day in the sense that the government did not bring forward regular benefits for the self-employed, period, including all of these special benefits, as the EI system calls them, and put them together as a whole and made those workers whole like any other workers.

At the end of the day, they are workers. They work at home for the most part, but they are workers. People say that they own their own businesses, set their own standards and set their own times. Perhaps they do, but nonetheless, they work for a living. That is exactly what they do. Ultimately, we should have looked at that in its totality and protected it.

If we are going to review the system, let us review it in its totality and let us make it work as it once did. We have seen that it has been eroded. Unfortunately, it was beginning to be eroded under the Liberal government. I know that my colleagues down there will say, “Not I, not I. I was not here at the time”, but certainly, the Liberal Party eroded the system when it was in government. There was a $57 billion surplus. They could have covered every self-employed worker in this country for regular benefits and special benefits and it would not have made a dent in the $57 billion surplus. They chose not to.

Now, here we are at a moment in our history where the economy is in desperate straits and workers find themselves on the streets. Self-employed workers who thought that they were going to be able to build a business find themselves unemployed because their businesses have basically failed. We are now saying that maybe we need to build the model now.

I suppose some would say better late than never. The unfortunate part is all those souls who were lost between the time when we could have done it and had the money to do it and today when we are now thinking about doing it for special benefits.

How do we look at all those folks and say to them, “Sorry, we did not do it”?

I think that is a question all of us should ask ourselves. Truly we owed that debt to them and we should have paid it.

Now we need to get on with the work of making this happen. Yes, there are some flaws in the system when it comes to special benefits, and it happens in the regular scheme as well for those we call “employed persons” who work for an employer and have their deductions made at the moment. If they happen to be in an adoption situation they do not get the same time a natural birth mother gets. We do not have that at the moment. They get parental benefits but they do not get the additional 15 weeks.

The government should have included that. It could have used it as the springboard to actually give back to the other workers who worked through the regular employment system and paid regular employment insurance, to make sure that adoptive parents got the whole year off and collected unemployment insurance.

The government should have waived the two weeks. If one is sick, the two-week waiting period should be waived. The person is sick, for heaven's sake.

I can just imagine folks who contract H1N1 and have to be off work because the employer tells them to stay away. They will not get paid for two weeks. They are going to have to wait for those two weeks and they will get nothing for those two weeks.

It is all well and good to say one will get 15 weeks' sick time but the reality is they are going to lose the first two. If they are better, they will come back to work. So they are out the two weeks' pay.

I think we should have looked at that as being an opportunity if the government wished to do that. Hopefully we can look at that at committee, because, as some of my colleagues said earlier today, there are some things they would like to see done and some things they would like to see worked on.

When we look at the package, it is incomplete. It is a good first start. As others have said in the House, the government at least brought something forward. The Conservatives said that they promised it in the throne speech and they will take credit for it.

I am glad they heard the member for Acadie—Bathurst and perhaps they read his report before the throne speech and made sure they added it in.

In 1999 when the member did this report we made a pledge to workers to fix the system.

I worked in that system for a long time as an advocate for the unemployed, going back to 1990. I know the type of system that has been developed over the years and the hardships that they face trying to work through the system as it has changed over the years with the amendments to it, through the computerization of it and all of the other intricacies that we have seen over time. It did not work for workers and it should work for workers.

We need to get our heads around the fact that it is the unemployed that we are supposed to be protecting, not the system, not the collection of the money. Those are important to make it self-financing. However, it is about the system of protecting those who work and who, for whatever reasons, find themselves out of work whether because of sickness or because they are at that joyous moment in their life when have decided to have children and indeed they have them, and they want to be with their youngster, as someone said earlier, to hear the first voice, to hear that first word, to see that first step. All of us who have had the great joy of having children know what great occasions those are.

I appreciate the fact that we have changed the system from the days when my wife and I were graced with twins 27 years ago and she got only 15 weeks of maternity benefits. There were no parental benefits in those days. We have moved forward. That is a good thing.

However we have far to go. We could be doing it now. That is the sadness I see here today. Yes, there is a good piece here to work with, but the sadness is how much further we have to go. The fact is the alarm bell was rung 10 years ago by New Democrats when that report was written by the member for Acadie—Bathurst, and we needed to do it then.

Here we are 10 years later and we are still moving along ever so slowly. That is the great sadness I find with the changes in the bill.

I hope my colleagues are absolutely sincere and genuine in what I am hearing them say today, which is that they believe the system needs to be changed in a comprehensive way. I believe that is ultimately what they said.

If they did say that, I hope we will all be working in unison so eventually we will be making a system that truly works for the unemployed, because it is theirs. It belongs to them. They paid for it. It does not belong to the House. It belongs to the workers of this country and they ought to have what they have demanded of us which is a system that works for all of them under which they are all treated equally.

[Scott Simms, Liberal, Bonavista—Gander—Grand Falls—Windsor, NL]

Mr. Speaker, I appreciate my hon. colleague mentioning the situation in Newfoundland and Labrador, certainly when it comes to Abitibi.

Would he illustrate why, with this fundamental legislation, and other legislation, such Bill C-50, it is important to do something else in addition? A lot of that has to focus on upfront benefits, such as less hours and the two-week waiting period about which he spoke so passionately. I agree this should be considered. However, in this situation, the government has done all of it on the back end and it has done it piecemeal over the past year and a half. Now all of a sudden it is in a situation where it is forced into providing benefits all in the back end, nothing upfront.

Could the member illustrate, and perhaps he can allude to the study that was done by the hon. member for Acadie—Bathurst, and talk about what needs to be done with regard to EI legislation on the front end of enabling people to find additional income?

[Malcolm Allen, NDP, Welland, ON]

Mr. Speaker, my colleague is absolutely right. We have a gaping hole in the system. We can point fingers at folks and say that they created this hole and we have to fix it, but I will not comment on that now. However, the hole is there, and we recognize it. Congratulations to all who have recognized that. Now, let us stop trying to paper it over. Let us stop taking those little sticky notes one by one and slapping them up against that hole. Let us fix the hole.

We all understand there is a hole in the system, so let us come together, as a minority Parliament, and lets fix it. That is what it is about, working together in unison, understanding what is wrong with the system, understanding the hardship that Canadians are facing when they are unemployed and when they are sick. We know what it will take to fix it, so let us do that in the spirit of co-operation. Let us stand shoulder to shoulder and tell them that we understand their hardship, that we understand what we need to do, and let us simply do it.

A comprehensive review would fix the hole. Papering it over will only mean the hole will come back because each bit of paper will finally fall off that hole.

[Don Davies, NDP, Vancouver Kingsway, BC]

Mr. Speaker, I congratulate the hon. member for Welland. I know he has spent a lifetime in the service of helping working people of all types, and I view the bill before us today to be a further step in that regard.

The most positive thing about the bill is revealed when we focus on what it would actually do. The bill would allow self-employed people to take time off for maternity, to take time off for parental duties, to take time from the business when they are sick and to take time off for compassionate leave, which would allow them to look after a critically ill family member. These are important social issues in our country that I think all of us should join together and support. Just because people are self-employed does not mean they do not have a right or a need to engage in these kinds of activities.

Would my hon. colleague focus on the specific benefits that the bill would provide for people, and is that important to the people in his riding and to Canadians across the country?

[Malcolm Allen, NDP, Welland, ON]

Mr. Speaker, there is no doubt that in Welland these are absolutely important benefits. When this is passed, and hopefully it will, the fact that one can get compassionate benefits, can access sick benefits and can get parental and maternity benefits is hugely important to those folks who never before were able to get them.

My colleague from Scarborough Centre at one point talked about the fact that they could buy insurance, and I appreciate that. However, quite often individual entrepreneurs working in the home are unable to afford insurance premiums to insure themselves in case they get sick, and a lot of women who become self-employed work from their own houses. Therefore, what do they do when they get sick?

As we know, if they happen to have young children, mothers get sick more often than anyone else because young kids bring everything under the sun home. That is the nature of being a youngster. They go to school and everybody else shares. They share the hat, they share a cold, they share a cough. I see my hon. member has a cold and hopefully he will not share that with the rest us.

At the end of the day, that is what happens. We need to ensure they get the benefits. They deserve to have those benefits. They have a right. We ought to ensure it happens.

The House resumed consideration of the motion that Bill C-56, An Act to amend the Employment Insurance Act and to make consequential amendments to other Acts, be read the second time and referred to a committee.