One of the most important resources for employees immediately after being terminated from their jobs is the financial support offered by the federal Employment Insurance program. This funding, currently available to insurable employees who have been laid off or terminated without cause, can be a crucial resource to help provide a financial bridge to recipients, enabling them to keep on top of their expenses until they secure new employment elsewhere.

Federal Government Considers Expanding EI Coverage for Gig Workers, Independent Contractors, and New Mothers

The labour market in Canada has changed drastically in recent years, as more and more workers have become independent contractors or self-employed individuals due to the increase in the ‘gig worker’ model. As a result, many people who once would have been able to access Employment Insurance (EI) coverage are now shut out of the program because of their employment type, leaving them in a precarious financial position during periods of unemployment due to termination without cause.

To rectify this, and address other concerns with the existing program, the federal government is looking to overhaul the Employment Insurance Act to reflect the new reality and expand coverage to more types of workers and amend current requirements that may negatively impact new mothers. The government is currently consulting with various stakeholders and is expected to announce changes later this year.

Overview of Proposed Changes to the Employment Insurance Act

While details will likely be provided once the consultation period has ended, the federal government has provided insight into some of the aims of the proposed changes:

  • Providing better and broader coverage for self-employed workers, which make up approximately 15% of Canada’s workforce; according to an interview with Employment Minister Carla Qualtrough, this could include providing for a 26-week paid benefit for self-employed workers;
  • Providing more reliable and consistent benefits for those employed in seasonal industries;
  • Providing an extended benefit period for older workers who may take longer to find new employment post-termination;
  • Improving support during life events, such as new parenthood or illness, such as:
    • Creating a 15-week leave for adoptive parents, since adoptive parents cannot access maternity benefits;
    • Improving access and flexibility to other parenting-related benefits, such as job-protected leaves and employer top-up requirements;
  • Improving the Premium Reduction Program, which reduces EI premiums for employers who offer income protection to employees experiencing illness through short-term disability coverage.

Modernizing and Enhancing the Technology

The current Employment Insurance system is largely based on technology and code established in the 1960s. To bring the system into the present and allow for greater flexibility in the future, a new IT infrastructure is already in development but it is expected to take several years before it is fully operational.

Making the System Work Better for New Mothers

The current Employment Insurance program adversely impacts new mothers who may be unable to qualify for benefits due to minimum hour requirements which may be affected by maternity or parental leave. The problem was exacerbated by the pandemic, as more women lost their jobs and were unable to fulfill the minimum hours due to maternity or parental leave.

Just last month, the federal Social Security Tribunal ruled that sections of the Employment Insurance Act unfairly discriminate against new mothers. A group of six plaintiffs successfully argued before the Social Security Tribunal that various sections of the Employment Insurance Act are in violation of Section 15(1) of the Canadian Charter of Rights and Freedoms, which states that:

Every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination and, in particular, without discrimination based on race, national or ethnic origin, colour, religion, sex, age or mental or physical disability.

Each of the workers involved in the case has their own unique situation, but the claims essentially boil down to one of two situations:

  1. The new mothers were unable to meet the minimum hour requirements in order to qualify for EI after losing their job because the time they were away on maternity or parental leave was deducted from their qualifying hours in the year leading up to their job loss.
  2. The new mothers were unable to qualify for EI because they had reached their maximum benefit coverage due to benefits they received while on maternity or parental leave. While there are some exceptions for extending the benefit period, they did not qualify.

In both cases, the Tribunal found that the Employment Insurance Act was discriminatory towards the new mothers and that the discrimination could not be justified due to pressing or substantial objectives.

Rather than strike down the offending sections of the Act, the Tribunal left it to the federal government to make changes to ensure new mothers will be entitled to the same benefits as any other qualified person who suffers a job loss.

The Ministry of Employment has appealed the decision but is being encouraged to drop the appeal in favour of refocusing efforts on incorporating these issues into the upcoming changes.

Contact DBH Law for Skilled Representation in Workplace Disputes

The lawyers and staff at DBH Law believe in relationship-building and fostering strong, long-term connections with our clients. This approach allows us to provide tailored, trusted, bespoke advice to help both employers and employees manage their risks and reach their goals. If you are an employer who is considering terminating an employee, or you are an employee who has been fired, contact DBH Law in Calgary as soon as possible. We rely on our many years of experience to provide our individual and business clients with responsive and concise employment law advice they can trust. To learn more about how we can help you, contact us online or by phone at 403-252-9937.