Human Resources Committee on April 21st, 2010

[The Vice-Chair, Liberal, Raymonde Folco]

Thank you.

Mr. Lessard, please.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

Thank you, Madam Chair.

I would like to thank my colleagues for their presentation. For colleagues who were not involved in drafting the bill or may not be aware of what happened during that period in Lebel-sur-Quévillon, it might be appropriate to be given an overview of the events. It is important to keep things in context; the employer could have shut down before that. However, the company shut down at a time when its own employees no longer had any recourse.

Perhaps you could explain all of that, Mr. Lévesque, because you are quite familiar with the events.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

The workers had already been negotiating the renewal of their collective agreement for more than a year. As I recall, early in the day, there was a meeting with the company to negotiate and try to reach an agreement—the other witnesses lived through this, and they would certainly be better able to explain the details. Approximately one half-hour later, security staff entered the company to take the workers out.

We know that, at that time, the kraft paper market was in trouble. That employer produces kraft paper. When the company directors realized they needed to restructure and refinance the business to get things back on track, the lockout represented a good solution for them. It gave them the time they needed to try and get things back on track. When they saw that it was not going to be possible, they shut down.

Of the workers living in that municipality, only a very few would occasionally decide to go and work somewhere else. They would get up and go out to try and find work elsewhere, given the few options available in a town of that size.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

You said the closest town is how far from Lebel-sur-Quévillon?

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

About 170 kilometers.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

The nearest town is 170 kilometers away. It is really isolated.

Mr. André, in preparing this bill, I understand that you also looked at the practical effects on the workers themselves and on their families. At the end of a labour dispute of this duration, if you think you are going to be eligible for EI and then end up in the situation Mr. Lévesque was describing… What are the impacts you saw that prompted you to draft this bill?

[Guy André, Bloc, Berthier—Maskinongé, QC]

First of all, it should be said these workers had nothing but a strike fund to meet their needs for almost three years during the lockout. As you know, a strike fund does not provide as high an income as what you would receive from working. When the company shut down, the workers were left without a dime. They were not eligible for unemployment insurance. In order to get by, they probably decided to dip into their own savings and RRSPs or sell their homes. Unfortunately, the government did not provide any financial support through the Unemployment Insurance program. Yet that support should have been available to these workers who had been contributing to EI for 25 or 30 years.

As a result, these workers faced serious poverty. Many of them went on welfare in Quebec. As Mr. Lévesque pointed out, this was a single-industry town. It was the only industry where people in the town could make a living. Many of them sold their homes at a loss, homes they had built with their savings over the years. For example, houses that were worth $100,000 or $125,000 sold for only $25,000. People had to move to another community. We also noted a very high divorce or separation rate, which had repercussions for the children. So, these workers suffered significant social, economic and even psychological effects by the fact of having simply been abandoned by the Employment Insurance program.

[Yves Lessard, Bloc, Chambly—Borduas, QC]

We know how important this is for you. The argument we are hearing has less to do with implementation than it does with the cost. My colleagues will certainly want to come back to that later.

Have you been able to calculate the cost of such a program under the circumstances?

[Guy André, Bloc, Berthier—Maskinongé, QC]

No cost estimate has been done because this type of labour dispute usually is resolved. However, there are exceptions. In this case, we are talking about 450 workers who were deprived of EI benefits. I have not done the math, but perhaps I could ask the Committee to do that. I do not think we are talking about exorbitant amounts of money. As I say, 450 unemployed workers for 50 weeks. Without wanting to offend anyone, I would just like to point out that the Conservative government is planning to remove some $19 billion in Employment Insurance contributions over the next four years. We know full well that the government has some $55 or $60 billion in the EI fund. I am confident that we can meet the objectives laid out in Bill C-395, which does not represent exorbitant amounts of money. Other bills designed to enhance the Employment Insurance system have also been tabled—for instance, one that proposes to abolish the waiting period. Despite the cost of these measures, there will be a perfectly adequate surplus in the Employment Insurance fund for the government to be able to use this money as it sees fit, as it has been doing for the last several years to reduce the deficit or for other purposes.

[The Chair (Ms. Candice Hoeppner (Portage—Lisgar, CPC)), Conservative, Candice Bergen]

Thank you very much.

We will now go to Mr. Martin, please.

[Tony Martin, NDP, Sault Ste. Marie, ON]

You'll have to excuse my voice; I have a bit of a cold.

I want to say, first of all, I appreciate your bringing this forward. I think it is a very good idea. I had not thought of this myself, but I think it's a logical extension to the protection that we give workers. No worker wants to be on strike; no worker chooses easily to be on strike. It's usually something that arises in the normal negotiating of contract. You get to a point where the only option left for the worker is to remove his labour and to make his case in that way.

Most of these workers willingly pay into EI while they're working, and oftentimes many of the workers who I have known over the years don't ever avail themselves of the fund because they're not out of work. But we know that being out of work for any length of time, and particularly being on strike.... The workers in Sudbury who are on strike right now with Vale Inco are getting $200 a week. That doesn't pay for very much, and as you said earlier, it doesn't take long before you begin to see your assets disappear as you cash them in or use them to provide money to feed your kids.

Are you looking at this particularly out of the Quebec situation, where you have a very highly unionized workforce? Have you done any assessment or research in terms of Canada?

[Guy André, Bloc, Berthier—Maskinongé, QC]

No. I focus more on the situation in Quebec, but I am certain there are similar cases in the rest of Canada. There have been strikes and lockouts there as well.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

In my opinion, the economic system and changing markets have given rise to this kind of problem. The globalization of trade has resulted in stiffer competition in Canada and Quebec. The number of workers who are on strike or locked out for more than 100 weeks is extremely low, both in Canada and elsewhere. This is a very recent phenomenon. It is important to point out that workers are eligible for EI benefits if, before negotiations begin, the company decides it cannot remain in business and shuts down immediately. That does not represent an additional cost. Nor is it an additional cost if a company closes after that period. As a general rule, the company secures certain advantages when it dialogues with the employees. Normally they will cut back their demands, even if they already have. If the company is unable to reach an agreement, it is generally because it killed time rather than trying to resolve the problem.

So, we are talking here about a right the workers had before the company took those steps. The normal process that is involved when a company shuts down does not result in any additional cost for the Employment Insurance fund.

[Tony Martin, NDP, Sault Ste. Marie, ON]

Have you done a broad consultation on this before you put it together and presented it in the House? Not just with the labour groups.... I noted here that we have somebody coming before us from CEP this afternoon. I would think that particularly in small communities, where a labour strike has a huge impact, that even the business folks, the chamber of commerce, would have some concern, because not only are the workers not receiving and not going to receive after they go back if they get laid off--according to the formula that you brought forward here--but they then don't have money to spend in the local businesses.

Who have you consulted with regard to this bill?

[Guy André, Bloc, Berthier—Maskinongé, QC]

I guess we should talk about the whole process surrounding changes to the Employment Insurance program, as developed by the Bloc Québécois—this bill, as well as others like it. Consultations were held with unions, obviously, as well as with employers and other institutions.

I would like to provide an example with respect to the waiting period—the bill proposing the elimination of the waiting period and this bill. Employers are not always very happy about leaving their employees without any income when there is a waiting period, because of a lockout or a temporary layoff.

When the Employment Insurance system is enhanced, I think all of society benefits. That is why, generally speaking, measures proposed in bills that deal with Employment Insurance are often very well received by employers, employees, social and community groups, socioeconomic groups and chambers of commerce. They know full well that when you deprive a group of people of income, you are penalizing the entire community. The workers are poorer as a result, meaning that they are unable to buy anything, and this sometimes has repercussions for the family and the children.

Overall, the measures proposed in Bill C-395, as well as in the other bills, were developed by the Bloc Québécois following consultations with a wide variety of socioeconomic actors in Quebec.

[The Chair, Conservative, Candice Bergen]

Thank you very much, Mr. André.

We'll now go to Mr. Komarnicki, please.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

Thank you, Madam Chair.

I'll direct my question to Mr. André.

I notice that the coming-into-force provision specifically refers to it coming into force on January 1, 2008. Why did you choose that specific date? Can you give us the significance of it?

[Guy André, Bloc, Berthier—Maskinongé, QC]

In terms of the significance of this measure, let us just say that it became important when the labour dispute arose in Lebel-sur-Quévillon. It was then that workers were locked out of the plant—425 workers received no support through the Employment Insurance program. It is because of this lengthy, three-year labour dispute that we are proposing that it be retroactive.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

But of course the bill is not specific to that situation. Do you agree with me? It will cover anyone in the 2008 to 2010 period who might not have qualified for EI because of lack of hours. This bill will potentially allow them to qualify now and go back to 2008, or maybe 2007 and further, if you're going to count the days on a lockout or strike as days that count for the qualifying period.

Is that correct?

[Guy André, Bloc, Berthier—Maskinongé, QC]

If your government wants to suggest that we go even further back, you will certainly get no argument from the Bloc Québécois. If you want to go back to 2004 or 2005, I am confident that the Bloc would support you.

It is important to remember one thing about this labour dispute that affected many workers in 2008: it had important repercussions, it caused an injustice--

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

I'll stop you there, Mr. André. I appreciate that you are talking about this specific conflict, but I'm asking whether it would apply to other situations that occurred from 2008 to 2010, and perhaps even before that, because the act is not specific to a situation. That was the question.

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

This change in the legislation is being proposed with a view to correcting a flagrant injustice from the time when it occurred. There is no doubt that this bill is aimed at a particular group of workers. However, could it also affect other groups of workers? We specifically state in that regard… As is the case for protective reassignment, and for inmates, for instance, for whom there is an exception, the idea here is to create an exception in the Act for this type of worker who… We are not talking about workers who were laid off in 2007 and who had not accumulated the required number of hours. Could they avail themselves of this measure? No, they could not; only workers--

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

I take it, then, that you have not directed your mind as to whether it would have broader or further applications, or what it might cost. Is that correct?

[Yvon Lévesque, Bloc, Abitibi—Baie-James—Nunavik—Eeyou, QC]

It would be similar kinds of applications, yes—all across Canada. If other workers suffer the same fate as these workers, it would apply to them.

[Ed Komarnicki, Conservative, Souris—Moose Mountain, SK]

And have you ascertained how many of them there might be and what the cost might be?