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Welcome to the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities. On this Wednesday, April 21, 2010, at 3:30 p.m., we are convening our 12th meeting here in Room 308, West Block.
On today's agenda is Bill . I would like to welcome our fellow MPs, Mr. Guy André, the member for Berthier—Maskinongé, and Mr. Yvon Lévesque, the member for Abitibi—Baie-James—Nunavik—Eeyou, who has asked to appear as the second witness. Is there any objection?
I see no objection, so please take your seat, Mr. Lévesque. Welcome to our Committee.
Mr. André, Mr. Lévesque, you have 10 minutes to make your opening presentation, and I think you are as familiar with the system as I am.
Mr. André, I believe that you are going to start. Please proceed.
Madam Chair, colleagues representing all the parties, I, of course, want to thank you for inviting myself and Mr. Yvon Lévesque to appear before the Committee to discuss Bill . I introduced this bill in the House of Commons for the first time in the second session of the current Parliament, back in May of 2009. It amends the Employment Insurance Act to extend eligibility to individuals who have lost their jobs following a labour dispute, either a lockout or a strike.
As you know, the Bloc Québécois is still of the view that the Employment Insurance system is not meeting its objectives and should undergo thorough reforms, because thousands of workers are unable to access it. The Bloc Québécois is therefore proposing a series of enhancements to the Employment Insurance system, including improving access and, of course, removing the waiting period. Having said that, the bill under consideration today does not propose significant changes to the Employment Insurance program. Indeed, that is not the purpose of Bill .
Madam Chair, this bill is intended to correct a major omission or shortcoming in the Employment Insurance Act which affects thousands of workers when businesses shut down following a labour dispute, either a strike or a lockout.
At the present time, the Employment Insurance Act calculates benefits based on a given salary during a given period, known as the “qualifying period”, as you most certainly already know, being members of this Committee. As you all know, the normal qualifying period covers the 52 weeks that precede the start of the benefit claim period, or the period between the start of a previous claim and the start of the new claim, which is based on the claimant's insurable earnings.
However, the qualifying period may be extended in certain cases, up to a maximum of 104 weeks, for a variety of reasons, including the inability to work because of illness or injury. Where individuals do not work during the qualifying period, of course, they are not contributing to the Employment Insurance system and are therefore not covered.
However, what happens at the end of a long labour dispute, where there has been a strike or the business has shut down? Of course, if the labour dispute is of short duration, the laid off worker will receive Employment Insurance benefits if that period falls within the qualifying period. However, if the labour dispute lasts a long time—in other words, longer than the qualifying period—the laid off worker will not make contributions during the qualifying period and will therefore not be eligible for Employment Insurance benefits based on the provisions of the current Act. Therefore, the Employment Insurance Act makes no provision for cases involving lengthy labour disputes, which, unfortunately, often result in business closures.
Madam Chair, let's look at an actual example from Quebec. I am sure you have heard of the 425 Domtar workers in Lebel-sur-Quévillon who were laid off in December and deprived of employment insurance. Indeed, I would like to take this opportunity, Madam Chair, to convey greetings to my colleague who is here today, the member for Abitibi—Baie-James—Nunavik—Eeyou, who was the driving force behind the bill we are considering today. This plant is located in his riding.
I would also like to draw the Committee's attention to the presence here today of Mr. Mario Pothier, President of Local 1492 of the Communications, Energy and Paperworkers Union of Canada, as well as Josselin Bouchard, a worker who has been directly involved in the labour dispute in Lebel-sur-Quévillon.
They are the ones that pay the price for the current gap in the Employment Insurance Act.
After a lockout that lasted approximately three years, Domtar finally announced on December 19, 2008 that its plant in Lebel-sur-Quévillon would shut down for good. Because it was a very lengthy labour dispute, that lasted three years, and because laid off workers had not accumulated any hours of work during the qualifying period—the 52 weeks—they were not eligible for Employment Insurance, even though they had been contributing to the EI fund for 25 or 30 years.
Essentially, even though they had been locked out for more than three years, Domtar employees still had a job attachment. They were not contributing, because they were receiving strike fund pay, and they obviously did not accumulate any hours of work during the qualifying period. Therefore, under section 27, they were not eligible to receive Employment Insurance benefits.
This is an exceptional and shocking situation. It reflects a major gap in the Employment Insurance Act that must be corrected as soon as possible. I am making an appeal to MPs from all the parties: it is critical that they listen to what is being proposed here in this bill. We must take action to help these workers who have been completely abandoned by the Employment Insurance system.
Let us not forget that many of the workers in Lebel-sur-Quévillon had worked without interruption—as I pointed out earlier—for 25, 30, 35 years and more. They obviously made contributions throughout those years, without ever receiving a cent in EI benefits. Then when they lost their jobs following a three-year lockout, they all applied for Employment Insurance benefits, but their applications were rejected, Madam Chair. Why should they have been refused Employment Insurance benefits? It is inconceivable, it is sad and it is a disgrace. These workers have paid a high price for that injustice.
Bill proposes to exclude, from the qualifying period, the period covered by the labour dispute. Therefore, a worker who loses his job when a company shuts down following a lockout or a strike would see his benefits calculated based on the 52-week period preceding the labour dispute. Whether the dispute lasted two or three years, the calculation would be made based on the period prior to the labour dispute.
In Quebec, according to the Department of Labour's data for the period from 1995 to 2004, which we examined, there were, on average, slightly fewer than four long-term labour disputes per year. These are disputes that may last—as was the case for the Journal de Québec—for more than 14 months. However, the Domtar workers' case is exceptional, because in Quebec, no more than eight labour disputes lasted in excess of 721 days between 1995 and 2004, and barely 0.5% of labour disputes lasted more than two years in the last 20 years.
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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 , as well as in the other bills, were developed by the Bloc Québécois following consultations with a wide variety of socioeconomic actors in Quebec.
First of all, let me congratulate you both on getting this bill to this stage, Mr. Lévesque for inspiring it based on what you've seen in your own community and Mr. André for the work that you've done in taking it this far.
I don't know that I have a question. I may have a little comment, and then I'll just leave it to you.
People who are on strike or who are locked out do need some protection under the EI system. And there's another classification of people. I'm not sure whether this is where Ed was going or not, but another group of people who have been hurt in this recent recession are people who have seen their hours reduced by a company that is struggling and has had to reduce the hours of their employees, in some cases for an extended period of time, and then lays them off because they've closed. Then those people haven't had the number of hours they need to qualify for EI benefits. And they're stuck, because if they're told that they have to go on reduced hours and they quit their job, they don't qualify for EI because they have left their job. If they stay with the company and then get laid off, that could impact their benefits as well.
I wonder whether you have any thoughts on that.
Do you have any thoughts on that piece of it, Mr. André?
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Thank you very much, Madam Chair.
Colleagues, thank you very much for being here today to discuss this bill.
If I understand you correctly, you are proposing that, when there is a work stoppage caused by a labour dispute, workers who find themselves with no income benefit from an exception, such as the ones that exist for inmates and individuals who can no longer work or have no income because of illness. You would like to see another exception under the Act for these workers with no income.
Mr. Lévesque, you made an interesting comment earlier when you were talking about what happened in Lebel-sur-Quévillon, and I would like to come back to that. You said it is a single-industry town and people are anxious to hang on to their jobs because opportunities to work in other companies are extremely rare.
At the same time, you talked about the economic situation. You are right that this could prompt an employer, after a three-year lockout, for example, to lay off employees, which is what happened in your area.
I would like to know whether you think this bill would give some power back to employees, or at the very least, reassure them, and perhaps limit a tendency to go to extremes by engaging in mass layoffs when a strike or lockout lasts a certain number of years.
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I do not think the bill
per se gives more power to other workers or employers. It is simply intended to do justice to workers who make contributions for 30 years and, in some cases 40 years, and who need protection when a company shuts down.
If a company that is in financial difficulty decides one day to force its workers to strike or locks them out in order to protect itself and try to turn things around, well, workers have no control over that. The bill is simply intended to do justice to those workers.
For example, someone who is in prison—this is strange—is entitled to 104 weeks of benefits. That is well established. But it is different for a worker who is on strike or has been locked out.
We have just been through a lockout that lasted more than three years, that workers had absolutely no control over. There were small businesses in the area. Some people, while their colleagues were making sure that no other workers would take their place, went out into the surrounding communities to collect “Employment Insurance stamps”—that is the expression they use. They set up a rotation.
On the other hand, some 180 workers were unable to find jobs in the surrounding area, the closest town being 170 kilometers away. So, the company shut down and the workers do not have access to EI. How much do you think their houses are worth now that the company has shut down and there is no other business in the region?
These people paid $150,000 or $200,000 for their homes in an isolated area. They have ended up with houses that are only worth $30,000 or $40,000, in some cases, even though the original value was $150,000. So, they lost everything and yet they had no control over any of it.
And this sort of thing does not only happen in Lebel-sur-Quévillon. It can happen anywhere. In a large urban centre like Montreal or Toronto, 425 workers is a drop in the bucket. The fact is that some of those workers might be able to again qualify for Employment Insurance, depending on their skills, by working in small businesses in the surrounding area; but everyone is not able to do that.
Why penalize a worker when the company he worked for did not want to lay people off, or was not honest enough to make those layoffs at the time it was shutting down? That would not prevent the company from negotiating a return to work, if the closure turned out not to be final. If it closed temporarily, workers could still exercise the rights they acquired over all those years. However, that did not happen.
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Thank you, we will be sharing the presentation, which will be brief.
First of all, we would like to express our thanks on behalf of our two organizations, the Conseil national des chômeurs et chômeuses and the Fédération des travailleurs et travailleuses du Québec.
Madam Chair, members of the Standing Committee on Human Resources, thank you for inviting us to appear to discuss Bill .
We would like to say, at the outset, that we are in favour of this bill—at least as regards its intention—which is to make a labour dispute grounds for extending the qualifying period. I also want to take this opportunity to mention that the text of the proposed bill contains certain errors. Indeed, before establishing the reasons for the extension, it is necessary to understand the definition of “qualifying period”. That definition can be found in subsection 8(1) of the Act. The qualifying period cannot exceed the 52 weeks immediately before the beginning of the benefit period. However, the bill does not amend that definition of qualifying period.
Now let us look at the extension of the qualifying period. The Act provides for the extension of the qualifying period by an equivalent number of weeks, during the qualifying period, where the worker's situation corresponds to one of those described in subsection 8(2). The purpose of Bill is to add “work stoppage attributable to a labour dispute” as grounds for extending the qualifying period. We are very much in favour of that first proposal in the bill. In our opinion, it is part and parcel of the modernization of the Employment Insurance program. Indeed, we do not understand why it has not yet been included under the reasons for granting an exception.
Pierre.
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Madam Chair, I am going to take over now, as this is a brief presented jointly by the FTQ and the Conseil national des chômeurs et chômeuses.
I would like to draw your attention to the second paragraph of Bill . In our opinion, this second provision, which is intended to provide for an extension greater than the current maximum of 104 weeks, cannot apply unless “qualifying period” is redefined. Under this bill, the definition remains the same—namely the 52-week period immediately before the beginning of the benefit period.
I would like to refer you to page 3 of our brief—there you have the French and English versions. These are excerpts from the relevant sections of the Employment Insurance Act—subsection 8(1), which defines the qualifying period, and subsections 8(2), 8(3), 8(4), and so on, which define the exceptions which could give rise to a potential extension of the qualifying period. You will see that, if you compare that wording with the one found in the bill, the latter only refers to subsection 8(2), relating to the reasons for granting an extension of the qualifying period, without actually amending the definition of “qualifying period”, which remains at 52 weeks.
Madam Chair, we clearly understand the intent of this bill: to bring the entire labour dispute period into the qualifying period and extend it by 52 additional weeks, to include the year prior to the labour dispute, so as to qualify workers laid off at the end of the labour dispute. I must admit that, during the first hour of your hearings, I sometimes could not believe my ears. It was said that the purpose of the bill was to allow workers to receive Employment Insurance benefits for the duration of the labour dispute. But that is not at all what this bill is about. And, if people believe that labour dispute period would entitle workers to hours of work that would allow them to qualify, once again, they are mistaken. It is important to understand what is meant by the qualifying period and potentially extending that qualifying period.
Not only do we understand the bill, but we support its intent, which is to extend the qualifying period, in some cases, beyond the 104 weeks. Furthermore, it is our view that an extension of the qualifying period beyond the current maximum of 104 weeks should also be permitted for other reasons. Here we are thinking of workers deemed to be—and I am quoting from subparagraph 8(2)(a)—“incapable of work because of a prescribed illness, injury…”.
The fact is that people who are injured at work will be covered by the provincial health and safety regime. Other people may become seriously ill and will sometimes be covered by a wage insurance plan. However, if someone spends the last two years under a WCB or wage insurance plan, upon return to work, that person will not be able to receive Employment Insurance if there have been job losses, because the qualifying period is 52 weeks and can only be extended by another 52 weeks. Again, I would refer you to subsection 8(2) on page 3. In other words, in spite of the reasons stated for a possible extension of the qualifying period—which include illness, injury, inmate status, receipt of severance pay, and so on—the maximum is 104 weeks. It would be possible, however, in the spirit of this bill—and understanding the intention behind this—to provide for exceptional situations where the 104 weeks could be somewhat exceeded.
I would also like to draw your attention to the Quebec Act respecting Parental Insurance. This is not the first time that I have been here, and it is not the first time either, ladies and gentlemen, that I have talked about the Quebec Act respecting Parental Insurance. This Act is an extension of the Employment Insurance Act. Starting in 1998—and this came into force on January 1, 2006— Quebec repatriated part of the Employment Insurance Act—the part of the Act that deals with maternity and parental benefits. When that legislation was introduced in 1998, and finally passed in 2006, it was based on the Employment Insurance Act.
However, we looked at it and tried to modernize it. We tried to modernize it with respect to the eligibility criteria, the calculation of the benefit rate and the benefit period claimants are entitled to. Again, I would refer you to our brief. I hope you have it. On page 5, you have excerpts from the Act respecting Parental Insurance that relates to the qualifying period and the extension of that period. I repeat: the Act respecting Parental Insurance that has been implemented in Quebec is an extension of the Employment Insurance Act. In Quebec and at the federal level, it is considered to provide the equivalent of Employment Insurance benefits.
When I say that we have modernized that part of the Act, what that means is that the Quebec government met with a wide variety of civil society representatives. People like myself, people from union organizations, employer associations and government institutions all contributed to the Act respecting Parental Insurance. The purpose of this long preamble is to ask you to look at page 5 of the brief that we tabled, and specifically subparagraph 31.2(1)(d) of the Regulation respecting parental insurance plan premiums. There you will find the provisions that mimic subsection 8(2) of the Employment Insurance Act with respect to the reasons that can give rise to an extension of the qualifying period. In that regard, Quebec has added a strike or lockout as a potential reason for extending the qualifying period.
We believe that the federal Employment Insurance Act should take its inspiration from that statute. It is our view that the very minimum provision the House of Commons should consider would be to make labour disputes—which were completely forgotten, as we mentioned a little earlier—a reason for extending the qualifying period, along the same lines as the other reasons set out in subsection 8(2) of the Employment Insurance Act. It is simply a matter of adding labour disputes, strikes and lockouts to the list of reasons.
Madam Chair—and I will end on this—this is not a partisan matter. There really is no partisanship involved here. It is our humble opinion that the Standing Committee on Human Resources could easily and unanimously propose that the Parliament of Canada pass this legislative measure. What do you think?
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Thank you, Madam Chair.
First of all, I want to say that I like the bill. From your presentation, it has been very clear that the people who are on strike and then subsequently return to work and are fired or let go or the company shuts down, or what have you, shouldn't be penalized for the time that they were either locked out or on strike. They're actually not unemployed. They're not off the payroll. They're actually still employees of that company; they're just not being paid for that period. There's the penalty. So I understand, and I don't have great problems with the bill as such, I must say.
I asked some questions earlier of our colleague who has put the bill forward. One of the questions that is being asked and has come up with us is will this--and as you are with labour, I think it's important to ask you--cause an undue advantage for labour? In other words, if the employees know that they are not going to lose out on the amount of time that they're on strike, would that in any way make it more difficult for negotiations, that labour gets an advantage in that way?
This is something that has been raised, and I don't buy it, but I really want to hear from you as labour representatives about what you think, having been in situations like that and obviously having negotiated walkouts or labour disputes before. How would this play into that?
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First of all, I would like to thank you for being here to provide your testimony on this important bill. I have two questions for Mr. Pothier and Mr. Ducharme, who is also from the union, I believe.
You are a worker from Lebel-sur-Quévillon and a member of the union, Mr. Ducharme. I have two questions which relate to the way the rules apply during a labour dispute.
I also have a question for you, Mr. Céré, regarding eligibility for employment insurance.
Mr. Vellacott's comments earlier raised a matter of interpretation as regards the rights of the parties during a labour dispute. I myself have been involved in negotiations in the past, and unless things have changed, everything goes back to neutral—if I can put it that way—meaning that there is no advantage for either party and no contributions are made by either one for the duration of the dispute. Perhaps you could let me know whether that continues to be the case.
I am going to ask you my three questions so that you have time to answer. The other question—and Mr. Pothier has already partly answered this—has to do with the number of labour disputes. In order to be eligible for employment insurance at the end of the labour dispute—because it is only at the end that you are eligible for EI—there must have been a company closure or temporary layoffs. How many such labour disputes occur in Quebec? You work in labour relations, so I would be interested in knowing how many known cases could be affected by this legislation? Those two questions are addressed to you.
I will also put my question to Mr. Céré right away. Does this give a special advantage in terms of eligibility for employment insurance? Does it give special rights to certain workers in terms of eligibility during a labour dispute, or is it just a matter of applying the rules that already exist?
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With respect to your first question, I would say that during a strike or lockout, there is no longer any advantage. Nothing has changed, and everything is still the same. The employer no longer has any costs to defray. The costs for an employer are connected to the payroll. During a strike or lockout, no wages are being paid, no benefits either, and not one cent is remitted.
In response to your second question regarding the number of labour disputes, I obviously do not know of any others that lasted as long as the one in Lebel-sur-Quévillon. Could there have been other ones? Certainly. In recent year in Quebec, we have started to see fairly lengthy lockouts—more than a year in length. So, this certainly could have happened elsewhere.
I recall one labour dispute that was particularly difficult, which everyone is aware of—at least people in Quebec—and that is the one that occurred at Vidéotron. The issue in the negotiations with Vidéotron, whose employees had been locked out, was jobs. The employer wanted to eliminate all the technician positions, and it was so determined to do that that an entire fleet of trucks had been sold. The situation was clear: it was the point of no return. That dispute, which lasted more than a year, ultimately had a happy ending, because the employer made a commitment to keep its technicians and bought another fleet of vehicles. So, there was a happy outcome in that case.
Had the reverse been true, hundreds of workers might have lost their jobs at the end of the labour dispute. The situation would have been exactly the same, where people had made Employment Insurance contributions throughout the period they had been working, but then ended up in a labour dispute that they did not want. They would have ended up, once the labour dispute was over, with no jobs as a result of a decision that they had not made, and therefore, they might have ended up in the same position as the workers in Lebel-sur-Quévillon. They would have paid into the EI fund throughout their lives, as workers, without being able to receive benefits.
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In terms of qualifications, would that mean they have more rights? The answer is no, their rights would be equivalent to those of other workers in the following way.
There is a qualifying period that precedes the application for EI benefits. Let us take the example of a labour dispute that has ended. People are expecting to go back to work. Some lose their jobs, because there is a closure or positions are cut. When that happens, they apply for EI benefits. What does the Employment Insurance Commission do at that point? Well, it ascertains whether these individuals have worked in the course of the last year. If they were involved in a labour dispute during that last year, there are no hours of work, and therefore they are not eligible for employment insurance. And yet these people worked for many years prior to that. The Act does not include labour disputes as a reason for extending the infamous qualifying period. In Quebec, as I mentioned previously, the parental insurance plan does include that reason.
If a new paragraph (e) were to be added to subsection 8(2), to provide for labour disputes to be included as a reason for extending the qualifying period, those people could receive benefits after losing their jobs. We are not saying that everybody who is on strike or locked out should be able to claim Employment Insurance benefits. However, if workers lose their jobs following a labour dispute and apply for EI, the qualifying period would be extended by a number of weeks equal to the number of weeks they were involved in the labour dispute. If someone was affected by a labour dispute for nine months in the previous year, that person would therefore be entitled to a nine-month extension. The work time associated with the labour dispute would be included so that people who had lost their jobs could qualify for benefits. Subsection 8(2) of the Act also includes other reasons. It is highly technical, but it is important to understand that in order to see the rationale for the bill.