Fairness for the Self-Employed Act

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

This bill was last introduced in the 40th Parliament, 2nd Session, which ended in December 2009.

Sponsor

Diane Finley  Conservative

Status

This bill has received Royal Assent and is now law.

Summary

This is from the published bill. The Library of Parliament often publishes better independent summaries.

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.

Elsewhere

All sorts of information on this bill is available at LEGISinfo, provided by the Library of Parliament. You can also read the full text of the bill.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:30 p.m.
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Bloc

Yves Lessard Bloc Chambly—Borduas, QC

Madam Speaker, my colleague from Jonquière—Alma will probably admit that he made an error in his presentation earlier. The number of weeks of sickness benefits is 15, not 25. I do not believe that the bill says that it will increase. He said 25, but I think that that is a mistake, because the bill provides for 15 weeks of sickness benefits. That said, I do not believe he deliberately misstated the number.

I would like to talk about my colleague's presentation, in which he defended Bill C-50 instead of Bill C-56. I understand that he is embarrassed at having supported that bill and that he felt obliged to defend it because it is indefensible.

My colleague from Chicoutimi—Le Fjord pointed out that in Quebec, both the major unions and the groups that represent the unemployed are unanimously opposed to the bill. I would add that even in the auto sector, the Canadian Auto Workers have acknowledged that it would help them so little for the price that they would prefer not to have it.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:30 p.m.
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Conservative

Jean-Pierre Blackburn Conservative Jonquière—Alma, QC

Mr. Speaker, I appreciate the correction the hon. member made. It was an error. There are 15 weeks of sickness benefits and 6 weeks of compassionate care benefits. Parental benefits vary by province or territory.

In Quebec, for example, maternity leave runs for 15 to 18 weeks under the plan there. In the other provinces, it runs for 15 weeks. We can see that there are differences, just as there are for parental leave.

That said, I would like to tell the hon. member once again that the Conservative government is standing up in the House to introduce measures to help workers who lose their jobs, especially long-tenured workers who have paid into the employment insurance plan for maybe 20 years and have never received a cent. We are offering to give them from 5 to 20 additional weeks of benefits if something disastrous should happen and they should lose their jobs. If they are entitled to a year, for example, we will give them 5 to 20 weeks more. You are voting against this.

How can you explain why you are voting against a measure like this that helps—

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:30 p.m.
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Charlesbourg—Haute-Saint-Charles Québec

Conservative

Daniel Petit ConservativeParliamentary Secretary to the Minister of Justice

Madam Speaker, through you, I have a question for the Minister of National Revenue, who, like me, is a citizen of Quebec.

I have been watching the Bloc in this House for the past 20 years. First of all, it has never brought forward any measures to protect the interests of Quebec's unemployed workers. Second, it has never wanted power, and accordingly, never wanted to resolve any issues.

I would like to ask my colleague who will pay for this new system. In Quebec, I already pay, in part, for unionized employees who have certain rights, but those employees do not necessarily pay for me.

Since I am a self-employed worker who decided to run for election, I would like to know who is going to pay for this new bill, which benefits self-employed workers in Quebec.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:30 p.m.
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Conservative

Jean-Pierre Blackburn Conservative Jonquière—Alma, QC

Madam Speaker, I thank the hon. member for Charlesbourg—Haute-Saint-Charles. It is an excellent question.

Since we are talking about self-employed workers, those who wish to take advantage of this insurance in order to have benefits, including sick leave and compassionate leave—so the self-employed workers themselves—will pay a premium of $1.36 for every $100 of earnings.

To be entitled to employment insurance, the employee and employer both pay. For instance, the employee pays $1.73 in all other provinces and territories, and the employer pays the same amount multiplied by 1.4. In the case of self-employed workers, the employer does not pay. Only the individual who wishes to receive special benefits will have to pay premiums. The money accumulated should allow this to remain revenue neutral.

Furthermore, beginning in 2011, the Canada Employment Insurance Financing Board will ensure that premium rates correspond to the actual costs associated with the benefits provided by the employment insurance system.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:35 p.m.
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Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Madam Speaker, I rise today to speak to Bill C-56, An Act to amend the Employment Insurance Act and to make consequential amendments to other Acts.

These amendments will mainly affect self-employed Canadians who have been lobbying for changes to employment insurance legislation for a number of years.

In principle, Liberals will support this legislation because the intent is good. We would like to see the bill sent to committee for an in-depth study.

What my colleagues and I on this side of the House find surprising is the fact that the government has drafted such an important bill without even defining the expression “self-employed worker”.

As a legislative body, it is our responsibility as parliamentarians, when laws are written and codified, to provide advice to whose who will apply the law in the legislative framework.

At the outset of any piece of legislation, it is important to say what we mean by the terms. Who are these independent workers? When we talk about the self-employed, who are we speaking about? Are we speaking about people who work as individual consultants, or those who work within a consulting firm where there are several independent consultants but only share office space, phone lines, a receptionist and other administrative services? Are we speaking about contractors, small and medium-sized entrepreneurs who work in teams yet have no financial responsibility towards each other?

Surely the definitions of the people affected by any legislation, and particularly such a major piece as we are discussing today, should be included and clarified in the actual legislation and not left to regulations. These regulations, which come after the legislation has passed this House and the other House, can be amended by order in council, at the government's will, without any debate in Parliament. It is therefore imperative that there be substantial amendments to the bill as it stands today, and the very first one that I would suggest to this House would be a definition of who are the people who will be affected by this bill.

Who are these self-employed workers? What we do know, based on socio-demographic characteristics, is that the number of self-employed workers has increased.

Throughout Canada, one worker in six is now self-employed.

According to the surveys, self-employment has grown more quickly than employment in general in the past 25 years.

According to Statistics Canada, between August 2008 and August 2009, self-employment rose by 3.5% on average. That is in one year. That is over 92,000 more people.

Concurrently, the paid work force has decreased by 2.7%.

There are now more than 2.7 million self-employed people in Canada, as compared to 2.5 million in 2005. This is despite the downturn in the economy. It is obvious that this bill comes at a very important time for these 2.7 million self-employed people in Canada, but we have to know, within this 2.7 million, who is going to be affected by the bill.

In the case of women who are self-employed, 35.9% have their spouses as business partners compared to 28% for men. That means that both workers in the family are self-employed.

We also know that around 88% of the self-employed work full time.

We know that people have chosen self-employment either after retirement, or in many cases, when they have grown frustrated with their inability to find full-time work that suits their qualifications and skills.

We also know that stress in the workplace, especially within the public service sector, has forced people to choose the uncertainties of self-employment, and I could talk about the uncertainties of self-employment, because for 10 years I was self-employed. It was really an up-and-down ladder. There were months when nothing would come in and I would do no work, and there were months when I would be trying to do two or three things at the same time. One could never tell a few months ahead whether there was going to be any money coming into the house.

We know that among the self-employed, 17% are newcomers to Canada. We know one of the reasons is that they have degrees they have earned outside Canada and they are not able to have a comparable degree here in Canada. These people have no choice but to become self-employed, because barriers to employment are more prevalent.

The opposition has been waiting a long time to discuss changes to employment insurance. We spent the summer trying to work with the Conservative government.

In the end, we have a bill that has no flexibility within the employment insurance program, does not take into consideration the variety of legislation in the provinces and territories, and does not provide a clear definition of self-employment. If there is one, it is not good enough.

This is as a result of a summer of discontent, of a lack of goodwill on the part of the government to be open and willing to discuss public policies that matter to Canadians.

While we are pleased that many of those self-employed women, and I am only speaking of women here, will now be able to access maternity benefits and parental, sick and even compassionate benefits, what calculations did the government use to assure Canadians that the EI fund will be able to withstand the added cost? If it has done calculations, these calculations are still unknown to Canadians and are definitely unknown to parliamentarians.

What models did the government look at before coming up with this framework? Obviously not very many.

For instance, had the government made an effort to look at what the provinces and territories had in terms of programs, it would have realized that the Quebec model is a very good one, and it would be important that it be used as a basis for developing a fairer and more equitable system for the self-employed. I would like to take a moment to outline this Quebec model.

The Government of Quebec currently provides parental and maternity benefits to the self-employed, but it uses a different model. All Quebeckers who are in business for themselves have to pay, out of their income, premiums to Quebec's parental insurance plan, QPIP. Self-employed workers with at least $2,000 in insurable income may qualify for benefits under this plan and receive up to 70% of their income in QPIP benefits. That is a more generous plan than the one proposed in the bill before us today.

As long as the QPIP is in place, the new federal maternity and parental benefits plan will not apply to Quebec, but the self-employed in Quebec will be able to contribute to the plan for the caregiver and sick leave benefits that are not currently provided under QPIP. Consequently, in Quebec, the self-employed will pay premiums corresponding to 37% less of their income. It goes without saying that this sounds like a more equitable arrangement than the one proposed in this federal bill, which corresponds to 55% of an individual's average income.

Another questionable aspect of what is being presented in this legislation is the threshold of $6,000 in pre-tax earnings before the self-employed can qualify.

Again, what calculations did the government use to come up with this figure?

This is one aspect that we, on this side, would like to see discussed in detail at committee in the interest of those who will be affected by the proposed regulations.

At committee, we would also like the hear the Government of Quebec on the best practices and lessons learned in providing services to the self-employed in that province.

While we are pleased that many of those self-employed women will now be able to access maternity benefits, we still ask, again, what calculations has the Conservative government made? How has it come to these calculations? Will it make them public to members of Parliament, as well as to the Canadian public?

The labour force must become flexible. Working full time for a single employer is no longer the norm. We must therefore have a system that meets and responds to the needs of this new labour force, one that is flexible, mobile and even seasonal.

This is what fairness and equity is all about in the 21st century.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:45 p.m.
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Conservative

Ron Cannan Conservative Kelowna—Lake Country, BC

Madam Speaker, it is a pleasure to rise in the House to speak to this very important piece of legislation, which is being brought forth as part of our Conservative government's campaign commitment last year, not only fulfilling but exceeding expectations of our constituents with regard to this platform initiative. I would like to thank the hon. member for her dissertation. We work together on the human resources standing committee and will be discussing this piece of legislation.

From a British Columbia perspective, and you yourself, Madam Speaker, being from B.C., I know that John Winter, the chair of the Coalition of B.C. Businesses has said that the legislation would ease some of the risk associated with self-employment and provide greater financial security to Canadian entrepreneurs. He said:

This is welcome news to B.C.'s 216,300 owner/operators. No longer will an economic downturn or the decision to care for children leave them in the lurch without employment insurance or parental leave. It's only fair that...British Columbians who hang their own shingle should not have to choose between raising a family and raising a business.

One of the fastest-growing sectors of the self-employed is women entrepreneurs. The women's enterprise centre is located in my riding of Kelowna—Lake Country and I see how the women's resource centre is expanding. A Globe and Mail editorial made reference to the fact that:

Broader supports for this group of 2.7 million Canadians, men and women who work long hours with little certainty, would make the country more equitable and make the path to entrepreneurship more viable.

This is substantiated by Stats Canada, which says that, from 1976 to 2008, the number of self-employed men in Canada roughly doubled, from 873,400 to 1,719,700, and the number of self-employed women nearly tripled over the same period, going from 311,600 to 909,900.

Understanding the importance of this type of insurance for men and women, specifically the entrepreneurial women sector, does the member support expediting the bill through the House so we can ensure the legislation is effective in January 2010?

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:45 p.m.
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Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Madam Speaker, I am very happy to hear the member for Kelowna—Lake Country. I totally agree with him that there is a great need. I said so myself in the brief remarks I just made in the House.

However, it is clear that some basic elements are missing from the bill before us. The bill must go to committee. The member for Kelowna—Lake Country sits on that committee, as I do. It depends on us, as members of the committee, and on how fast we want to work.

I suggest that we work as fast as possible to correct the flaws in this bill so that it can come back to the House as quickly as possible and so that all these people, these women and men, can benefit from it as soon as possible.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:50 p.m.
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Conservative

Ben Lobb Conservative Huron—Bruce, ON

Madam Speaker, I thank the hon. member for her work on the human resources committee. She works very hard on behalf of her constituents on issues like this.

There was a briefing on the bill itself. I understand the member attended the briefing and it was quite clear how the calculation came to be about the $6,000 threshold, related to the number of dollars per hour earnings, as well as the threshold for special benefits. I wonder if the member had missed that in the briefing.

Perhaps the member would like to make a rebuttal to this comment. In 2003, the parental benefits for the self-employed was the principal recommendation of the Liberal women on the Prime Minister's task force on women entrepreneurs. Just recently, the member for Notre-Dame-de-Grâce—Lachine was asked about the success or failure of that on behalf of the previous Liberal government and she admitted on Power Play that the previous Liberal government completely ignored it.

I wonder if the member would be prepared to comment on either of those issues.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:50 p.m.
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Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Madam Speaker, I was a member of the committee of women entrepreneurs which came to my riding at the time and we met a large number of women entrepreneurs in Laval—Les Îles. Along with the other groups, we made those recommendations. I was for that recommendation then. I discussed it with my party. We discussed it in the Liberal women's caucus. This was important for us because, as everyone agrees, women in the workforce form a large part of the independent, autonomous workers.

I am sorry to say that when we in the Liberal Party were in government, we did not push this sufficiently. What is past is past. What is now before us is a bill which I think means well but is definitely incomplete and must be ameliorated.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:50 p.m.
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Liberal

Judy Sgro Liberal York West, ON

Madam Speaker, I want to recognize the contribution that my colleague has made in working on that whole issue of the self-employed and women in particular. She mentioned the needs of women in her comments and that self-employment is attractive to women. They can arrange their own schedules and so on, so it is a real benefit.

Some of the things that go against women are: not being able to contribute to their pensions and insufficient support. I would like to ask the hon. member, what other suggestions does she have for the committee in order to make this bill that much stronger and really help the women of Canada that we are talking about with this motion.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:50 p.m.
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Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Madam Speaker, I thank my colleague for the compliments.

My colleague is our party's critic for seniors' issues. The issue of pensions is a very important topic these days in Canada. It is something that we must definitely examine carefully in connection with how much a person earns.

For self-employed workers, the amount of money they earn one year will not necessarily be the same as the amount they may earn another year. Even within the year, there are ups and downs. They work hard some months, and other months, they do absolutely nothing and have no income.

I would say that it is like a roller coaster, and we must have a close look to determine the minimum threshold that would allow self-employed workers to receive pension benefits.

I thank my colleague for bringing up this issue, because this will enable us to study it in committee.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:55 p.m.
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Conservative

Patricia Davidson Conservative Sarnia—Lambton, ON

Madam Speaker, I would like to thank my colleague opposite for her comments and her study of this bill, which of course is a huge step forward and is fulfilling some of our campaign promises.

We all know there is a great number of people who are self-employed. There are certainly thousands of self-employed tradespeople who are currently unable to participate in the EI program. I would ask the member opposite to give us her thoughts on how this would greatly help the tradespeople.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:55 p.m.
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Liberal

Raymonde Folco Liberal Laval—Les Îles, QC

Madam Speaker, I should put the question back to my colleague opposite. That is the major flaw in this bill. Who will benefit from it? Will it be businesspeople, people who work from home? Who are they? The member's party has not identified the groups who will benefit from this bill. That still needs to be done.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 12:55 p.m.
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Glengarry—Prescott—Russell Ontario

Conservative

Pierre Lemieux ConservativeParliamentary Secretary to the Minister of Agriculture

Madam Speaker, I will be splitting my time with the member for Simcoe—Grey.

It is a pleasure for me to rise today in defence of Bill C-56, Fairness for the Self-Employed Act, which provides self-employed persons in Canada with special employment insurance benefits.

Entrepreneurship is vital to a vibrant economy and creates jobs in Canadian communities. Last year, there were 2.6 million self-employed in Canada, accounting for 15.4% of the active population. Nearly one-third of self-employed women are in their reproductive years.

Self-employed persons have little or no income protection during major events in their lives, such as the birth or adoption of a child, sickness, or the provision of care to gravely ill relatives. Our government wants the self-employed to have special employment insurance benefits comparable to those available to salaried employees.

Expanding access to these benefits is both fair and responsible. Let me explain these special benefits, which provide Canadians with income support during major events in their lives, such as the birth or adoption of a child or the need to care for a terminally ill relative.

Anyone would find that major events like these affect a person’s ability to work. Our Conservative government is very sensitive to the difficulties facing all working Canadians, who have to deal with the pressures of both their occupational and family responsibilities. All indications are that these benefits are very important to the self-employed.

A recent survey showed that self-employed persons are very interested in getting some help in dealing with these sorts of events in their lives. Our government is responding to their long-standing desire to be able to draw on this kind of support. We are proposing that the special employment insurance benefits for the self-employed should be similar to those available to employees under the current employment insurance program. The following would therefore be similar: benefit periods, income-replacement rates, maximum insurable earnings, the treatment of earnings, and the waiting period.

Adjustments will be made, of course, on the basis of the individual situations of the self-employed. For example, participation in the program will be voluntary and self-employed persons must contribute on an ongoing basis for at least a year in order to qualify for benefits. They can withdraw from the program at the end of any financial year, provided they have never received benefits. The contribution rate is the same as for employees, but they will not be required to pay the employer’s share of the employment insurance contribution because they will not be eligible for regular employment insurance benefits. The self-employed will qualify for benefits if their income is interrupted as a result of the birth or adoption of a child, a sickness, or the need to care for a gravely ill relative.

To be eligible for those benefits, they must earn at least $6,000 in the calendar year as a self-employed worker. As many hon. members know, the Government of Quebec already pays maternity and parental benefits to self-employed workers through Quebec's parental insurance program.

I would point out that with this bill, self-employed workers who live in Quebec will continue receiving maternity and parental benefits from Quebec's parental insurance program established by the Government of Quebec for everyone who lives in Quebec. However, they could also be eligible for the sickness and compassionate care benefits offered by the federal government through the employment insurance system. Since the province is already paying for parental and maternity benefits, the premiums paid by self-employed workers in Quebec will be lowered. Those are the main points of this bill.

Increasing access to these benefits is a fair, equitable, family-based policy that will greatly benefit families across Canada. Our Conservative government knows that family is the foundation of our beautiful country.

We believe that self-employed workers in Canada should not have to chose between their families and their professional responsibilities. I would like to look at Bill C-56 in a broader context.

When the Prime Minister came to power in 2006, he made child care one of this government's top priorities. In fact, this summer marked the third anniversary of the universal child care benefit. Since July 2006, we have been giving parents $100 a month for each child under the age of six. This means a total of $1,200 a year for each child under the age of six, which helps parents choose the solution that best meets their family's needs.

Since last February's budget, we have made major new investments in families. We have increased the income thresholds at which the national child benefit and the Canada child tax benefit are phased out. We have created $580 billion in refundable tax credits through the working income tax benefit. We have created $1 billion in decent, affordable housing. Over five years, we will deliver $20 billion in personal income tax relief. In short, support for Canadian families is one of this government's top priorities. That is the backdrop against which we are introducing Bill C-56, the Fairness for the Self-Employed Act.

These special benefits will not only help many people take responsibility for their family and loved ones, they will also give them peace of mind and greater financial security. As hon. members are well aware, the government acted quickly to help Canadians get through these tough economic times. That is another one of our priorities.

Thanks to Canada's economic action plan, we quickly made improvements to the employment insurance system by increasing the benefit period, making service more efficient, providing support for training and extending the work sharing program. The measures in Canada's economic action plan reflect this government's commitment to help all Canadians through this economic crisis.

This government has also expanded eligibility for compassionate care benefits and created the Canada Employment Insurance Financing Board to improve the governance and management of the EI account. More recently, the government has passed legislation to pay regular EI benefits to long-tenured workers who lose their jobs. These are people who have paid into EI for years but seldom received benefits and who now need a hand.

Our Conservative government is sensitive to Canadians' needs. This bill reflects our commitment to pay parental and maternity benefits to self-employed workers.

I encourage all members to join me in voting for this bill.

Fairness for the Self-Employed ActGovernment Orders

November 5th, 2009 / 1:05 p.m.
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NDP

Jim Maloway NDP Elmwood—Transcona, MB

Madam Speaker, I want to thank the member for his presentation.

Does the government have any projections as to the uptake of this program? How many people will be affected by it? How many people will be applying for it, projected? In terms of its cost, who makes up for it if there are cost overruns in the program and where does the money to make up those costs come from?