Human Resources Committee on May 26th, 2022

[The Chair (Mr. Robert Morrissey (Egmont, Lib.)), Liberal, Bobby Morrissey]

I call the meeting to order.

Welcome to meeting number 27 of the House of Commons Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. Today's meeting is taking place in a hybrid format. Given the ongoing pandemic situation, I expect anyone who is attending in person to follow the proper procedures.

To ensure an orderly meeting, I would like to make a few comments for the benefit of the witnesses and members. Before speaking, please wait until I recognize you by name. For those participating by video conference, please click on the microphone icon to activate your mike. For those in the room, your mikes will be controlled in the room.

I would like to advise you that you have the option of speaking in the official language of your choice. For interpretation, go to the bottom of your screen to choose the language of your choice. If there is an issue with interpretation, please get my attention and I will suspend the meeting until it's corrected. You can do that by using the “raise hand” icon at the bottom of your screen.

I would also like to advise witnesses that you will be given the opportunity to make a five-minute prepared statement to the committee, after which we'll go into questions. I would also advise that I will indicate to you when you have 10 seconds left in your time, and then I will move to the next speaker.

Today, as you are aware, we are meeting pursuant to Standing Order 108(2) and the motion adopted by this committee on Monday, May 16, 2022, that the committee resume its study of the subject matter of part 5, divisions 26, 27, 29 and 32 of Bill C-19, an act to implement certain provisions of the budget tabled in Parliament on April 5, 2022, and other measures.

I would like to welcome the witnesses. From the Canadian Chamber of Commerce, we have Leah Nord, senior director of workforce strategies and inclusive growth. From the Centrale des syndicats démocratiques, we have Luc Vachon, president. From Centrale des syndicats du Québec, we have Luc Beauregard, secretary-treasurer.

We will start with Ms. Nord for five minutes.

You have the floor.

[Leah Nord, Senior Director, Workforce Strategies and Inclusive Growth, Canadian Chamber of Commerce]

Good morning and thank you, Mr. Chair, vice-chairs and committee members. It's a pleasure to be here this morning to make an appearance regarding certain divisions of part 5 of Bill C-19.

I'm speaking today from Ottawa, the traditional unceded territory of the Algonquin Anishinabe peoples. I go by the pronouns “she”, “her” and “elle”. Today I am wearing a light blouse, grey sweater and grey glasses. My hair is pulled back and I am attending virtually with a blurred background.

I'm speaking on behalf of the Canadian Chamber of Commerce, which is the voice of Canadian business. We represent 200,000 businesses across the country, across sectors and across sizes, including our network of 450 local chambers and boards of trade from coast to coast to coast.

Today, I have two interventions to make and the first is with regard to division 26.

It's very important to remind ourselves that the EI program is estimated to have a debt of $29 billion for fiscal year 2022-23, and that is as it is, before we add any additional pressures into the system. The eligibility expansion for support measures and employment services within division 26 is no doubt well intended and might not look like much in and of itself. However, what has happened continually over the years—in fact, the past eight decades—is recurring drops in the bucket that have a cumulative burdensome impact on the program.

As the Government of Canada is starting phase two of its EI modernization consultations tomorrow, we at the Canadian Chamber have urged that this be a truly comprehensive review, not more nibbling at the edges, as it were. We have said that this is our once-in-a-lifetime opportunity to really look at the program and set it—and future generations of Canadians—up for success.

Importantly, this includes part II of the EI program, referred to as active measures, which involves the over $2 billion transferred to the provinces and territories annually for employment services and skills training, alongside a plethora of pan-Canadian programs and initiatives. This is not to say that we don't think skills, education and training aren't important. It's quite the opposite.

When I appeared in front of this committee in the early days of the pandemic, back in May 2020, I stated, “we need to identify the reform needed to build a system that can respond to current and future workforce needs to ensure Canadians remain connected to the labour force, and that includes strong upskilling and reskilling training components.” It's not the importance that we're questioning; it's the suitability and efficacy of having support measures and employment services funded by EI dollars. EI doesn't need to—and can't—fund everything, and if it does continue, the business community, which contributes seven-twelfths to the program, would like greater transparency and input into how that funding is spent.

The second intervention I have this morning is with regard to division 32 and the EI board of appeal. Our recommendation is to remove division 32 from Bill C-19 for a separate and focused review. This is not the first time you have heard this and it likely won't be the last. Importantly, you have heard this from labour and business representatives. The institutional structures that underpin the EI system are critical for a well-functioning system that meets the needs and expectations of Canadians.

The employment insurance board of appeal would be complex, and the changes proposed in Bill C-19 are significant and do not necessarily align with the tripartite principles and framework that had been agreed upon before the onset of the pandemic. The changes included in division 32 are not the ones we thought we would see, and they need to be examined and discussed in a more deliberative manner.

Thank you, and I look forward to answering any questions.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madam Nord. That was in time.

We will now go to Monsieur Vachon for five minutes.

[Luc Vachon, President, Centrale des syndicats démocratiques]

Thank you, Mr. Chair.

Good morning. My name is Luc Vachon, and I am president of the Centrale des syndicats démocratiques, CSD. Thank you for inviting us and for taking the time to listen to our suggestions.

I want to begin by specifying that I will focus my remarks on division 32 of part 5 of the bill. It's not that other divisions are not worthy of attention, but you will understand that division 32 is of special interest to us. For a while, we have been raising the issue of returning to the tripartite formula found in the division titled Employment Insurance Board of Appeal. For the CSD, there is no doubt that the government proceeding to a reform of the employment insurance appeal process is excellent news, especially nearly three years after that reform was announced. However, division 32 must be amended to ensure that the reform will be carried out according to the announced parameters, while learning a few lessons from the shortcomings of the Social Security Tribunal, SST.

Division 32 of part 5 should contain provisions providing that the new Employment Insurance Board of Appeal fall under the tripartite structure of the Canada Employment Insurance Commission, and not only its chairmanship.

We feel that returning to tripartism in the employment insurance appeal process must only be done when the insured person is heard from. The insured person must be present and represented in the entire appeal structure. That would actually be in line with the discussions that were held in the co-development committee by the government, in fall 2018, at the initiative of Minister Duclos. That would also correspond to the press release announcement made by Employment and Social Development Canada, on August 15, 2019, from which I will quote a short excerpt:

The Canada Employment Insurance Commission will become responsible for first-level EI appeals through the creation of a new tripartite decision-making tribunal called the Employment and Insurance Boards of Appeal. As a tripartite organization, the new Boards of Appeal will represent the interests of government, workers and employers, helping put first-level EI appeal decisions back into the hands of those who pay into the EI system (i.e. workers and employers).

We think that reports should be made directly to the Employment Insurance Commission to monitor how union and employer representatives are recruited, appointed and trained and how they fulfil their mandate on boards of appeal. The government must not repeat the mistake made in the case of the Social Security Tribunal, which practically has no accountability to the Employment Insurance Commission. At the worst of the Social Security Tribunal's dysfunctions, the commission was actually powerless to request reports and to get adjustments.

In addition, provisions must be added to division 32 to grant employment insurance recipients the right to regional representation and a high likelihood of an in-person hearing. At the SST, the default hearing, so to speak, was held over the telephone. That trend must be reversed, so that in-person hearings would become the default. Concrete access to an in-person hearing has been recognized as a key aspect of any reform of the employment insurance appeal system.

Hearings must also be held as much as possible in the region of the insured person, so that it would be held by members who are familiar with the regional labour market realities, instead of by members who have a more detached view of the labour market, if you will, as it is too general. To give just one obvious example, the reality of regions is very different from the reality of major centres. Decisions must take that into account and reflect it as much as possible.

What's more, division 32 should provide for all members of boards of appeal to have a part-time status. Assigning a separate employment status to different members of the board of appeal may lead to different levels of implication and effectiveness for full-time members and part–time members. That could create inequity, which would be reinforced by differences in status and compensation between full-time members and part-time members.

Full-time members of the board of appeal are deemed to be public service employees who also participate in the superannuation plan, but not part-time members. Full-time members can be appointed as chairs and co‑chairs—

[The Chair, Liberal, Bobby Morrissey]

You have 10 seconds left, Mr. Vachon.

[Luc Vachon]

In that case, I will close with the following. For the part on the part-time component, it's okay. As for the regional component, returning to tripartism is extremely important, not only for the CSD, but also for workers.

Thank you.

[The Chair, Liberal, Bobby Morrissey]

Thank you.

Mr. Beauregard, you have the floor for five minutes.

[Luc Beauregard, Secretary-Treasurer, Centrale des syndicats du Québec]

Thank you very much, Mr. Chair.

I want to begin by thanking the committee for giving as an opportunity to speak.

My presentation today will essentially focus on division 32 of part 5 of Bill C‑19.

My name is Luc Beauregard, and I am secretary-treasurer of the Centrale des syndicats du Québec, CSQ.

The CSQ represents 200,000 members, 125,000 of whom are education staff, including in higher education, which makes it the most representative organization in that sector in Quebec. It also has 11 federations, which bring together some 240 affiliated unions, and one retiree association. We are also present in the sectors of health and social services and early childhood education, as well as municipal, recreation, cultural, community and communications sectors across Quebec.

A few days ago, we shared our concern with Minister Qualtrough regarding division 32 of part 5 of Bill C‑19, which pertains to the Employment Insurance Board of Appeal and the Social Security Tribunal of Canada, commonly known as the SST. We asked her to remove that division from the bill so that it can be analyzed separately.

The SST was created in 2013 as a single point of contact to replace four administrative tribunals, including boards of referees. Prior to that, tripartite boards rendered first-level appeal decisions for insurance employment clients, which ensured better access to justice and participation by sector representatives who were familiar with the labour market and their region.

In 2019, the government announced, in a press release, that, at the suggestion of the KPMG firm, in its report on the review of the SST, reforms would be made to the tribunal, including a return to true tripartism as of April 2021. The announcement assured us that people would be at the heart of the appeal process and that the process itself would be accelerated, simpler and better adapted to Canadians' needs. That announcement also implied that sector stakeholders would be consulted.

The bill provides that the SST will report solely to the chairperson of the Canada Employment Insurance Commission. It is essential for the structure to be tripartite in order to ensure monitoring of how union and employer representatives will be deployed and trained and to ensure that they will fulfil their mandate on the board of appeal.

The board of appeal will not be a truly tripartite institution if social partners are not directly involved in the selection and appointment of members, workers and employers. In addition, the right to regional representation and to an in‑person hearing is missing from the bill. The necessary reforms should focus on the client, and they should be flexible and accommodating. Concrete access to an in‑person hearing was recognized as a key aspect of any reform of the employment insurance appeal system, and the presence of a tribunal member with expertise and knowledge of local markets is necessary.

Finally, the board of appeal is supposed to consist of two types of statuses: full-time tribunal members appointed by the Governor in Council and part-time members from the community of employers and insured people appointed by the commission. That distinction between statuses is a concern for us, as it necessarily causes inequity among members, but also a different level of commitment. Full-time members will have the special status of public service employees, which is reinforced by the fact that they will be the only ones able to hold the positions of chair, co‑chair and coordinating members. We feel that inequity is obvious.

In short, we would have liked to be consulted beforehand and given an opportunity to help develop the appeal process.

The provisions proposed in the bill do not reflect what was advanced and proposed by the government since the beginning of the process. Of course, we understand the delays caused by the health crisis, but that should not have limited the consultation of social partners in such an important file.

If no amendments are made to the provisions in division 32, we think the division should be removed from the bill in order to be studied separately.

Thank you for listening.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Mr. Beauregard.

We will now move to opening the floor to questions beginning with Madam Kusie for six minutes.

Madam Kusie, you have the floor.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Mr. Chair.

I thank the witnesses for joining us today.

Ms. Nord, in a letter to the finance committee, you provided the recommendation to remove division 32 of part 5 from the bill. Can you elaborate, please, on why you think it should be studied independently of Bill C-19?

[Leah Nord]

Yes, that is our recommendation, one of those coming out of our response to Bill C-19 that I reiterated today for reasons that I can repeat. The changes that are proposed in division 32, part 5, of Bill C-19 are not what we expected. There is reference to the KPMG evaluation. There was also a 2018 codevelopment process that was truly tripartite.

On a personal note, I had the opportunity to participate in that process, and I laud it as an example of a tripartite discussion. There were two or three days where it was government, business and labour sitting together. We had principles, we went through a process, and we developed a framework.

You also heard reference to the 2019 announcement where all of us thought that those changes were reflected in the recommendations from KPMG and the process we had gone into. As you can hear from many here, this isn't exactly what we thought, and it doesn't align with the principles. We think that it should be taken out of an omnibus bill and that it deserves its own attention for those reasons as well as because it's an incredibly complex process. We want it to get the proper and deliberative attention it deserves.

Thank you.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Ms. Nord.

Would you say that the concerns you indicated here today are the same concerns reflected by your members, or would there be additional concerns to those you have raised today by your membership and your members?

[Leah Nord]

No, I am reflecting the views of our members. When it comes to the appeals process, I will say that it is the members of our labour colleagues who are more impacted. It's their members that it focuses on.

From the business community, our concerns were—and they've been discussed here by others as well—around the accountability piece and the way that it's structured. The idea is that this is a truly tripartite process from the business community. If and as business representatives are brought to the table, we want to ensure that the business community has a choice and vets those people rather than their being appointed on our behalf.

Thank you.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Ms. Nord, what I'm hearing you say is that you thought adequate consultation and proper consultation was done in the 2019 process, and you feel that consultation process was not done for Bill C-19 for division 32.

[Leah Nord]

That's correct. It was in the fall of 2018; I believe it was October 2018. There was a framework developed to modernize the SST process. It did look very much like the previous one, to be honest. A lot of the ways did lead to that previous structure. Again, in 2019, through announcements, we were led to believe that framework was going ahead, and this is not what we're seeing in its entirety within division 32 of Bill C-19.

Thank you.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Do you think the government should recomplete these consultations and evaluations, or is applying the result and the information as gathered in 2018-19 adequate? Do you think we need only look at the 2019 outcomes and recommendations, or do you think it's necessary to undertake the consultation process again, since we are three years further into the future after a pandemic? What do you think would be required at this time to adequately put forward good legislation?

[Leah Nord]

I don't think we need to revisit, consult or return to another consultation process. I believe, to be honest, that those consultation processes were well done. They were tripartite, and agreements were received together. Those recommendations that came into that framework in 2018 were by all three parties that are part of the EI Commission.

I would suggest—recommend—that, when we take it out, we look at what the framework was and what was put in. There might be some good explanations. I've heard some around the full-time and part-time, but we need to have a better understanding as a tripartite, all working together to bring it forward.

Thank you.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you.

Finally, Ms. Nord, you talk a lot about the tripartite approach, but you also mention in your recommendation the tripartite principles of government, business and labour. Can you elaborate on what those principles are and how they are not currently reflected in this new appeal board?

[Leah Nord]

Those principles were part of the framework of that codevelopment discussion. Again, this was all on paper and in my office, and I haven't been able to access them. They were things like client approach being first, simplicity, regionalism, in person. It was a really good process, because we would always go back to those principles as we led the development.

That's what we're looking for going forward.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Ms. Nord.

Thank you, Chair.

[The Chair, Liberal, Bobby Morrissey]

Thank you, Madam Kusie.

Madame Martinez Ferrada, you have six minutes.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

Thank you, Mr. Chair.

I thank the witnesses for participating in today's meeting.

I understand your fears, questions, concerns and recommendations on division 32, but I would like to discuss with you divisions 26 and 27 of part 5. I would like to know why you think legislative amendments are necessary, how those amendments will affect the programs currently provided under part II of the Employment Insurance Act and why eligibility needs to be expanded.

I don't know who would like to answer first, Mr. Vachon, Mr. Beauregard or Ms. Nord.

Mr. Beauregard, go ahead.

[Luc Beauregard]

You will understand that we focused our presentation and our analysis essentially on division 32. We did not consider division 27, as it concerns seasonal workers, and we don't have any of those.

I'm really sorry to give you an answer of so little use. The other two witnesses will probably have more to say on this. As I said in in the beginning, our members are not affected by that division.

[Soraya Martinez Ferrada, Liberal, Hochelaga, QC]

Thank you, Mr. Beauregard.

I will yield the floor to Ms. Nord.

[Leah Nord]

Thank you for the question.

What we as the Canadian Chamber of Commerce have argued for and very much encouraged, even long before the pandemic, is a comprehensive review. EI is a complex and expensive system. There's part I, which we're more familiar with, but there's also part II.

We've argued that the previous budget, not the one this year, had placed $5 million in the budget for the review. This is really our opportunity to look forward and crack open the future of work. We would argue that you have to look at it all, look at what is needed and then decide where it goes. Not everything belongs in EI. Not everything can belong in EI. We've argued that as well.

The important part of part II is that a significant amount of funds are transferred to provinces and territories. We're not saying it isn't necessary. As to whether it belongs in EI or belongs outside of EI, what does it look like? We're just really encouraging that, as we've always sort of nipped at EI over the past 80 years, this is our real opportunity to open it up.

Our other concern, as I previously expressed, is that we're already $29 billion in debt within the EI account before we do anything else. Through phase one of the consultations, and now as we lean into phase two, there's a lot more pressure coming on the system. I've been here before talking about increased eligibility and pieces around seasonal workers, which have just been announced in division 26. Again, it's not that they're not worthy in themselves, but these are all putting increased pressures on the system. This is the opportunity to look at the system and say what we need, what belongs in, what belongs out and what belongs in terms of costing.

We're quite often asked about whether government should return as a third party into the EI program and system. I can't make an informed response to that, because I don't know what's on the table. I don't know how much it costs. We have to do the costing that surrounds it as well. Again, this is our opportunity to do so, and we will warmly participate in the next round of consultations.