Mr. Speaker, I rise today to take part in this report stage debate on the employment insurance bill, Bill C-12. It is something I have great feelings about.
We have talked about this bill for many months, some people longer than I have. Many people on both sides of the aisle have spent many long days, weeks and months getting this piece of legislation to where it is today.
The government believes the object of the exercise is to make all aspects of the new employment insurance system fair and balanced. We have listened to the concerns raised in hearings by the parliamentary committee on Bill C-12 and we have responded by fine tuning the legislation to better respond to the reality of different job markets.
Over the last number of months one of the very important issues that has arisen is how to deal with individuals who have gaps or breaks in their employment. For example, there are individuals whose work patterns consist of some steady weeks of work interrupted by some weeks of not working, and then more weeks of work. For these individuals setting a relatively short consecutive period of weeks worked on which to calculate possible benefits could mean very low benefits.
The number of people affected is not very small. Approximately 35 per cent of all claimants who apply for income each year are affected by these gaps. That means some 850,000 Canadians with irregular work patterns who deserve access to the same protection against job loss as do those in regular jobs fell into this category.
Ten per cent of all claimants have gaps of four weeks or more. The average gap ranges from 2.9 weeks in New Brunswick to 4.8 weeks in Manitoba. We feel it is not fair to those who, through no fault of their own, have not had that steady work prior to becoming unemployed. That is why the employment benefit will be calculated in a new way. It will allow all individuals to count back 26 weeks to find their required weeks of work when calculating average income for employment insurance benefits.
This will enable individuals to have gaps of between four and 12 weeks without affecting their benefit levels. However, benefits will still be based on how much they earn in the 26 week period. This compromise of maintaining a fixed period of 26 weeks will maintain one of the central objectives of the new legislation, which is to increase work incentives while at the same time ensuring a better relationship between benefits paid and the normal pattern of earnings.
The 26 week period helps workers with irregular work patterns in every region of the country and in all industries from construction to the service sector. We feel that this is very important. Hundreds of thousands of Canadians in all industries suffer this problem of gaps in their employment income. They work several weeks and then are off for several weeks. The government believes that individuals should not be unfairly penalized because of this. In seeking a solution the government has had to find a balance between these two objectives.
First, a change had to be made to the old system so that there would be an incentive to work additional weeks if the work was available. In too many cases following the minimum weeks worked, an unemployment insurance claim was the first step toward finding replacement income rather than the last.
Second, many individuals in very high areas of unemployment who work in seasonal industries simply do not have the employment opportunities which would provide them with the steady work necessary to claim an adequate benefit.
It is doubly unfair in some cases. Many individuals who can only find the minimum number of weeks to qualify also have gaps due to the nature of their work, be it construction, the fishery, et cetera. Therefore, while all their hours worked would be counted in qualifying for benefits, some of their earnings would not be counted in determining the size of their weekly cheque.
Bill C-12 will allow individuals to count every dollar they have earned over the last 26 weeks prior to their claim to determine their benefit. The amounts of their employment insurance cheques will be calculated by averaging the amount earned over this period.
For instance, individuals in high unemployment areas will need 420 hours, or the equivalent of 12 weeks at 35 hours a week over the past year, to qualify. To maximize their benefits they will require two more weeks of work to get the full 55 per cent of their weekly wage. An individual in a low unemployment area will need 700 hours of work, or the equivalent of 20 weeks at 35 hours a week over the past year. To maximize their cheque they will require 22 weeks of earnings over the 26 week period.
The government believes this is a fair and balanced approach which strengthens the incentive to work while at the same time providing equal treatment for those workers with gaps in their income. It also recognizes that individuals in low unemployment areas have more opportunities to fill the gaps with alternative work.
In moving to the hours based system of calculating eligibility and benefits for unemployed Canadians, the government wants to ensure that every hour of work counts and that it pays more to work longer where the work is available. That is very, very important.
The new system is much fairer for those who work part time and in seasonal industries. For example, those who work less than 15 hours per week will now have their work insured. Under employment insurance, 90,000 workers in part time and seasonal jobs will now be eligible for benefits. Many will qualify sooner, for longer periods and will be able to insure more of their income than before. We think this is a great improvement.
Entitlement for benefit and duration of the unemployment benefit payable will be based on the number of hours worked in the last 52 weeks. Those in areas of high unemployment require 420 hours as I have said. About 270,000 workers will qualify for an additional three weeks of benefits because they will be given full credit for all the hours they worked.
Many people still have the problem of gaps in their employment. They work a few weeks, are off a few weeks and are back at work again. Addressing the issue of these gaps was one of the most important areas we dealt with and was a major concern of the committee and the government. The solution in the amended Bill C-12 is to allow all claimants to count back a full 26 weeks to find the required weeks of earnings.
In closing I feel, as I know my colleagues do on all sides of the House, that we have come a long way and we have made many great improvements. Many people appeared before the committee. Even though many were opposed to the bill in general, I believe that after listening, talking, and participating in open-line shows they have seen we have done a great justice especially to the seasonal workers in bringing these amendments forward.
I salute the people who brought the amendments forward. I thank the committee for all of its work. I look forward to the bill becoming law and to getting on with the process for the people who through no fault of their own have to use unemployment insurance.