Can Someone Please Explain to me What Is So Wrong With EI Reform?

I’m sorry, I know some people come to personal finance blogs solely for information on how to save money, and how to invest it properly amongst other things. While today’s topic definitely deals with keeping cash in your pocket, if you are one of those A-Political-types go ahead and click through to something more to your liking, because today I want to ask my predominantly Canadian readers a serious question:

Are we really becoming a nation that is afraid of work?

I will admit right up front that I have a definite Libertarian bent on most issues. In Canada this means that while I would be in favour of legalizing marijuana, am a supporter of gay marriage and women’s rights, I ideologically fit best with the Conservative Party. This rant/slash serious financial discussion does not come solely from my Libertarian bias however, it comes from a recent conversation I had with my dad.

My father has ran his own small lumber harvesting business in Canada his entire life. I can honestly say he is the hardest working man I know. He is also very common sense-oriented and sees the world practically as many people in his generation do. My father was also a lifelong supporter of the Liberal Party of Canada. I remember him driving around the local MP when he would come out to our rural Manitoba area to knock on doors, and he always spoke very highly of him. The Reform Party and/or PCs were rarely mentioned in our house, and never spoken about positively. In our recent conversation my dad commented that he believed this country was truly falling apart. He said that he couldn’t believe we actually had to put in laws to ask people to take work if they were on EI. You see in his mind (and mine) EI is a really great thing that the government can do to help people who are in-between jobs. The idea that someone would actually turn down work while systematically abusing a government support system is totally foreign to him. He can’t understand why no one will work for $15 in our rural area (when the minimum wage is $10). The end result of our conversation was his statement that he couldn’t see himself ever voting for the Liberal Party again.

I absolutely cannot believe that any self-respecting Canadian of any kind, regardless of party affiliation and/or partisanship can disagree with the common sense reforms of EI that are being brought into law. I definitely understand if you disagree with the way it was “bullied” through the system bundled within a massive budget, but the actual reforms themselves are nothing drastic. In fact, I know I personally would like to see something much more radical!

In case you have only heard the spun version of what is going to happen to EI here are the basic facts:

-EI claimants will now be split into three groups. For a complete summary, see this CBC article.

-People who systematically collect EI year after year will be the ones most affected by the changes.

- No changes apply to Canadians receiving EI special benefits, such as maternity, parental, compassionate and sick leave.

- Approximately 17 per cent of EI claimants are considered frequent users, while 58 per cent fall under the occasional category and 25 per cent under the long-tenured category (CBC.ca)

-The numbers that you hear quoted most often: “70% of their wage” only apply to the people who have used the system extensively over the past few years.

-People will be required to look for jobs within 60 miles or 100 KM of their residence.

-Under certain circumstances people will have to prove they are looking for work every day they don’t have a job and are collecting EI (what a novel idea).

There is little doubt that right now the EI system is a mess. With varying rules for each part of the country to claim EI, and certain people knowing exactly how to take advantage of the system while deserving claimants get lost in the bureaucratic mess. I ask people genuinely, from a completely non-political perspective, what is wrong with asking people who are unemployed to look for work?!

Every time I watch the news I see another “seasonal worker” (the lumber harvesting business is very seasonal by the way, winter is the only season when the ground is hard enough in most areas to accommodate all of the necessary machinery) complaining about how the government isn’t being fair to them. This seems to border on sheer lunacy to me. These people truly believe that the government has a responsibility to subsidize their chosen way of life. I honestly don’t understand what is so wrong with asking people to work the full year if at all possible. So you have to drive an hour to work every day? My mom drove 130 KM to work for most of her adult life. I can’t believe the arrogance and the audacity to believe that simply because your main source of income is seasonal, you should be paid every single year by the rest of Canada. I don’t understand how politics play into this belief at all. I’m sorry, if you live in an area that is not economically viable, then the reality of the situation is that area IS NOT ECONOMICALLY VIABLE. Why should the rest of Canada have to subsidize your personal decision to work in an area that only offers seasonal employment? It’s no wonder we are in trouble when we are distorting the labour market this badly. My dad worked all kinds of odd jobs during the summer, he did everything from welding, to making roads, plowing garbage dumps (in 100 degree heat), doing mechanical work, and a hundred others. This is the life you are choosing if you choose seasonal employment. Why should it be any different?

The second huge issue I have is the “outrage” at the 70% figure. We are bringing in temporary foreign workers to do jobs that are worked mere minutes from peoples’ houses that are collecting support from the government! This is infuriating to me as a Canadian taxpayer, and frankly I don’t understand how that sentiment is not widespread. I’m all for giving people help when they need it, I really am. I just can’t see where anyone gets off saying they are too good for a job when they don’t have one. I hear arguments like, “Well if we settle for a job beneath our qualifications we will miss the one we could have gotten that would have benefitted everyone more with me in it.” This is a ridiculous notion. Does your day end when your workday does? Do you not have a lunch hour? Pick up the phone and continue to look for a job as you work somewhere. The fast food industry has flexible shifts, work there in the evenings while you pound the pavement during the day. We bring in people from around the world everyday who can’t believe their good fortune at being able to work the jobs that we truly believe are beneath us!

I’m not saying the government couldn’t do things better. Maybe certain incentives need to be offered by the government to encourage labour movement to high-need areas. Maybe re-training initiatives and support for education options for in-demand fields need to be seriously considered. I don’t know what the final product of EI reform needs to be, but I do know it shouldn’t be the current system. I have seen it abused my entire life, and now I work in the education system where the “two months of collecting pogey” for educational assistants, secretaries, janitors, and bus drivers is a given. This is ridiculous. Maybe those people deserve to be paid more, that is a separate conversation, but to just hand them money when there are plenty of minimum wage jobs available in the area makes me sick.

As Canadians we need to do right by our elders that built this country and our children that will come after us looking to build on what we leave behind. We need to remember what it is to put our collective shoulder down and work hard instead of asking for entitlements. We need to quit voting ourselves a bigger handout at the expense of other taxpayers and future generations, because if we don’t, Greece has given us a great example of the eventual outcome.

Written by Teacher Man

TM writes about all things personal finance over at My University Money and Young and Thrifty. He intends to continue his quest for lifelong learning and hopefully help others along the way.

22 Responses to Can Someone Please Explain to me What Is So Wrong With EI Reform?

  1. As a fellow Canadian, I agree with your position. I’m a Conservative in most areas, not necessarily 100% in bed with everything that the present Feds are doing (like cop outs on environment issues, but that’s for another post).

    The way I see it “some” of the fundamental causes for what you rant about are:
    We live in an age of excess entitlement – worldwide.
    We live in an increasing world of technology, not agriculture, not manufacturing – training is lacking.
    We live in an age of greed – read a few books on what kind of $Billion payouts the banksters got leading up to the last big 2007-2008 worldwide recession.
    We live in a age of demographics – things will drastically continue to change as the big Baby Boomer bubble grows leading up to the 2030′s when they all die off.

    I’ll look forward to your thoughts on 12/21/2012 :-)

    • Thanks for the back up Rob! I’ve read a lot about the bankers in 2008 – absolutely sickening to me – it actually physically makes me queasy.

      I’m not a doomsday profit unless it involves us slowly politiking ourselves into oblivion!

  2. I couldn’t agree with you more! When I was raising my boys by myself, I refused to consider welfare and looked around for a way to support them by myself and went to work, working labour, in a steel mill. It enabled me to buy a house and put them both through college. Was it my ideal job, or ideal for a woman? Probably not but it served the purpose. And, while laid off from there (which was normal) I worked at grocery stores, fast food, or whatever it took to pay the bills. This sense of entitlement just boggles my mind!

  3. I felt the same way when I first heard about the EI reforms. I absolutely hate the idea of subsidizing people who chose to work seasonal jobs because they refuse to pick up other work during the off-season.

    It’s a really rampant sort of entitlement that many seem to adhere to, and I completely disagree with it.

  4. You don’t have to be a liberal or a conservative to agree with your obvious common sense points. Great comments. As crazy as this sounds I really think when people use the term “the goverment should pay for..” in a sentance they just don’t have a clue what that really means. They don’t understand the goverment does not make money, they collect taxes from everyone and re-distribute it. There is this disconnect with a large group of people. Like you say above, that group of people are screaming bloody murder in Greece right now, lashing out at a fictional conspiracy of who to blame for stealing the free money tree. Stop taking money off my paycheck so people can float through a few months on my hard work. This is ridiculous and it’s high time it ended.

  5. Well said!! I have worked full time all my adult life
    (I am now 61) and am now facing an enforced end to my job due to a work closure. I have already landed part
    time work (even before this job has ended) and will continue to look for additional opportunities. I have no sympathy for the lazy or greedy who simply do not want to work. End EI benefits for seasonal workers – if they want a year round income,they can fill in the “off season” with whatever is available in their area. I very much resent subsidizing them with my hard earned dollars.(and some of them probably earn more per hour than I do, when they ARE working – ie.those in skilled jobs, or the education system)

    • Most seasonal workers pay more than their share of income tax and draw EI for 2-3 months which is around $4000. So considering people like myself pay 20-25000 a season in tax, I think you are out of line saying you subsidize my small amount of EI which I pay into and IS a temporary loss of work insurance!

      • Hi Rod,
        The EI system was not designed for employees that for recurring planned work gaps. It’s supposed to support workers from a sudden “unexpected” job loss.
        I’m trying to guess your taxation rate. I’m assuming you rolled in all the overall taxes you pay in a year not just your deducted tax on your paycheck? ( if your paying $25 k in deductions then you have to be kidding about collecting EI) either way you can’t look at it that way. You should be budgeting your year for your two months off. Or get a job in a Starbucks for 2 months out of the year.
        It’s obvious you just don’t get it or you feel the system owes it to you. Too many people feel that way. Why should I pay extra tax from my deductions so you can kick back for a few months? If everyone thought the same way what do you think would happen? I’d like two months off every year too paid by other peoples money. Maybe I should sit with HR on Monday and see if they would go for that.
        People mindset and understanding has to change. Your 2 planned month’s of EI (I still prefer the old term UI) affects other people. Where do you think that money comes from?

  6. You’re completely right – there’s no problem from me when it comes to changing an obviously borken system.

    I live in Nova Scotia, and I can see where some of the stereotypes come from about us form the rest of the country. I know of some people (a tiny minority, mind you) who calculate down to the hour how much they need to work in order to file for EI. It’s gross, and it’s a complete abuse of the system. Even her in Nova Scotia, we’re bringing in foreign workers due to not being able to fill less-great jobs like fast food or agriculture.

    However, I think the reason there’s such an opposition to the EI reforms is that there’s a noticeable mean-spirited “nasty” streak in how it’s being explained to Canadians from the Tory government. It’s not what they’re doing that’s the problem, but more how they’re doing it.

    • Thanks for the support Allan. I know several people that do the down-to-the-hour calculations as well. They don’t see anything wrong with that either. It’s crazy to me where we are going with this. I’ve heard a lot of stories about East Coast factories bringing in foreign workers even though there are hundreds of EI applicants within a 100km radius.

      I agree the Tories don’t do themselves any favours sometimes. They could have been a bit more democratic about the whole thing…

  7. Well said. I am in the long-tenured camp of EI collectors. Worked 32 years for the same company in Windsor, Ontario. I have worked more than 1/2 the time my claim has been open doing temp. jobs. The program should be for a shorter maximum time and harder to get if you re-apply. There are literally thousands of migrant workers in Leamington (40 minute drive) so no one in the Unemployment Capital of Canada is going to starve, just need to get going…. By the way had to go in for an interview to make sure I was looking for a job, guess which group they are following closely. Yes, long tenured workers who want to work. Maybe the group to watch might be the serial users of the system..sorry it’s their “right”

  8. As a long time emigrant in Canada (more than 7.5 years) I can say that I never applied to EI.
    I’ve only been w/o job for about 2 months; 1.5 since I settled here and 2 weeks the year after that… and that’s all.
    I always found job, even cumulated 2 for about 62 to 75hrs / week and mainly in the financial and insurance sectors.
    The EI reform is a good one, there are too much entitled and lazy people these years (and I know too much about them since I currently live in QC…) and we, the tax payers, need to shake the dirty bag once for all.
    A social system isn’t bad…on paper, but human beings, for many of them, can’t stand in it without become lazy and be a dead weight for the rest of the working population.

  9. I cannot believe how you would lump all EI claimants into the same category!
    I am 30 years old, and spent my time from age 12-15 delivering papers and doing odd jobs. From 16-18, I took on every odd job I could until I was forced to leave school due to an unfortunate situation that also involved the need to live on my own.
    I struggled from age 18 to 28, taking on at times two full time jobs and a part time job on the weekend.
    At age 28, I finally landed a job that pays well above minimum wage in the construction industry. I work 12-16 hour days for at least 6 days a week for the 8-10 months I’m there each year. I take EI in the winter because there isn’t anything else in the area besides minimum wage or slightly above minimum wage paying jobs in this area, and I am a father of three now, so a minimum wage job just will not cut it…especially with the cost of living here.
    I’d move to Alberta, but I cannot afford to. My wife and one of my children have health issues that are quite expensive to take care of. I have to work like a madman and take full advantage of things like overtime pay rates just to set money aside to cover their medical expenses when I’m laid off because my insurance expires when I’m laid off, and I have to be working with the company to get it as it’s part of the union agreement.
    I’m making well above minimum wage and still barely making ends meet. I would love to be able to move my family to Alberta, where I could work just 40 hours a week and make more than I do now…and work year round to boot. I’d consider it a vacation!
    EI is, or was, the glue that held my family together in the winter months. There just simply isn’t any better option for us.
    This year, I was laid off a little over a month ago, and have been working to get the education and training I need to go out to Alberta and make the most money possible and create a better life for my family than is possible here. I’m getting the runaround from the college, student loan services, and the EI TSD program.
    The college just isn’t mailing me the information I need fast enough, and for some reason, won’t allow me to just pick it up from them. Student loan services and TSD can’t give me a straight answer on anything.
    I’m trying to make life better, but this is really delaying the process.
    Do I really deserve to be lumped in the same category as the people who do abuse the system? Answer me honestly.
    Do you consider me to be a lowlife as you’re implying all seasonal workers are?
    I may not even be able to provide Christmas for my children this year because EI wants me to take on whatever is available which is all minimum wage paying jobs in this area aside from a few administration positions which I am not qualified to do. Does this make you happy? Can you look straight into the faces of an 8 year old boy, and two toddlers and tell them Santa Claus isn’t coming this year?
    I do all I can for my family. When I am laid off, I constantly look for work to fill the gap, but it just isn’t here.
    You say it’s not your fault some of us live in an area where there is no work…but what of the ones who want to leave and can’t? Would you prefer us to just live on the streets? Would that make you happy?
    I want to know what YOU would do if you were in my situation. Please…enlighten me…since all I do is not good enough, show me my errors.

  10. Hi Shayne,

    First off, take a breath here…
    I read your post several times. You obviously have a different situation with your two family members having health issues. Can your wife work, can she get disability benefits? You didn’t mention her situation other then that. Do you have family that could watch your kids while she does some part time?

    I don’t think the posts are directed at you in particular. You have written you are working towards a long term goal of having full time employment and eventually being off of EI. That’s the key here. Most of the above post are directed at serial EI users who have no plan to get off of EI and plan to work seasonally and abuse the system until they retire.

    So no… you aren’t lumped in there in my estimation. I have posted twice above people just don’t get what’s right and whats wrong.

    • Hi Paul,
      I need to start by apologizing if my words seemed harsh, as it was not my attention for them to seem as such.
      To add to the story describing my situation, my wife is able to work, and has been trying relentlessly to do so. She actually went to college for a few years so she would be able to work in office and administrative fields, but since graduating near the top of all her classes almost four years ago, she has been turned down for every office type job she’s ever applied for because she lacks the on the job experience these employers require.
      Also, she is not opposed to taking on other sorts of jobs, even low paying ones. She also applies for them, and at first, she was told she was “overqualified” for most of these positions.
      That was when I gave her the idea to write a separate resume which did not include her time in college in the education section. Then she started hearing that she lacked the experience needed, which she and I believe really means they are questioning the 6 or seven year gap between her last job and now.
      There was a two year period between all this in which I told her not to worry about a thing and I’d take care of everything. That was when I found this job I have now, and when we had no idea that this was going to happen.
      I’ve always wanted to bring my education and trade skills to the highest level possible, but just wanted to wait until I felt my family was secure enough to do so. I just got a huge raise at work a few months ago, so we figured next year would be the year to do it since this raise coupled with the amount of hours I work would be more than enough to ensure we had enough savings set aside for both the exodus to Alberta and the prescriptions needed.
      2013 was going to be my last year with this company. We want to leave NB for two reasons…the fact that there is a shortage of workers in Alberta basically by default ensures my wife will find employment, and also because I honestly don’t think it’s fair that I have to work an insane amount of hours while making a conscious effort to work harder and faster than everybody else just to ensure I keep this job and to also make the same amount of money that a person in Alberta can make in 1/4 of the time I put in.
      Now, I admit, there are people out there who do abuse the system, but I do not believe it’s as frequent as Stephen Harper and Diane Finley would lead you to believe. I believe they are just looking at the numbers on the surface and not looking into the full story…and families like mine are suffering as a result.
      Next month, I may be given a choice between the electric bill and food for my kids. As I said, my kids may not get a Christmas this year.
      Meanwhile, there is alot of people who spend their entire lives on welfare who have more than I do. They have new ipads, nice new furniture, bigger TVs than I own, and the newest cellphones on the market. Now I have nothing against people who genuinely need welfare, but if these lifetime welfare abusers aren’t being punished, why am I when I always do the absolute best I can? Why are Stephen Harper and Diane Finley punishing my kids?
      Why is the rest of Canada so content to let them do so?
      I’ve written to politicians all across the board about my story in the last three weeks, including Stephen Harper himself. Not one shred of sympathy was given to me or my family. Nothing but “We appreciate your concerns, we’re forwarding your message to the next guy”.
      I’m at my wits end. I’ve applied for the jobs around here, and if one of them hires me, my family will suffer beyond anything they’ve ever known, and my kids won’t ever forgive me for it. All because I have no choice but to accept what’s available, which will not support my family.
      I don’t want anyone who reads this to think I’m asking for help or for a miracle, that’s not the case. I just wanted to share my story so people understand that there’s people out there that genuinely have no choice but to take EI each year, and we’ve been abandoned by our government.
      From judging many of the comments on EI related news articles, I’d say families like mine have not only been abandoned by our government, but a good portion of our fellow Canadians too.
      Thank you, Paul, for listening and understanding that I am not one of the ones who go out of their way to abuse the system.

      • I should also add that the reason I am trying so hard to further my education and training right now instead of when I had originally planned is because the recent changes to EI, which came into effect in October (I believe), made me quickly realize sticking it out another year in NB is just not possible.
        Desperate times call for desperate measures, and if I have to take a personal loan, or some other equally desperate measure to move my family to where there is work when my courses are finished (If I can even do that), I will.
        I should also add that I do not have anyone who can mind my children, to answer your question. We’re entirely on our own.

  11. Just ship all the unemployed to Fort McMury.

    Eastern Canada needs a kick in the butt. Only the people of Western Canada particularly Alberta understands the meaning of hard work. Even Ontario’s unemployment (lazy rate) is higher than the national average!

  12. Only Alberta has the lowest employment rate in Canada. The rest of the country can learn from the Alberta example. Lots of jobs area available from office to the mines etc. Western Canada should not have to subsidize lazy Canada life style. Harper is on the right path! (Ontario, Quebec, NewFoundLand, PEI, NS, NB)!

  13. the ei fund is not help from the government as you seam to say. it is a program put together by the Canadian people and funded by the Canadian people. it is there for workers who have no work at no fault of their own and to re-training workers for better jobs. the government pays nothing into this. they only want to force people to take lesser paying jobs so they can take the ei fund and spend it on another tax break for a bank or some big cooperation like they did with the last 57 billion in ei funds they stole for the canaidan people.
    how can you justify a lobster fishermen working for $40/hour seasonally to go work for $10.50 or even less depending on where they live. that would hardly cover ones house hold bills . an then to feed a family and child care and travel expenses. what is wrong with you people do you even have a clue about the ei program or how it affect millions of coastal families. maybe back in the day when your dad had to work lots of off season jobs they didn’t have the ei program . when my dad was young he had to walk everywhere because they didn’t have cars back then . should we give up cars too? people fought our government to put the ei program in place for these reasons . like it or not this is Canada not all jobs can be worked all year around and there lots of them. families shouldn’t have to separate for work reasons and that’s what this new ei change is going to do force people to leave their homes and families for work.

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