Baby vs. Bathwater: new rules from our esteemed government
Hello Internet, it’s Friday, May 25th, and I have an opinion on the news.
Who is surprised? Is it you? You must be new.
Disclaimer disclaimer politics below do not read if you do not want to know etc.
So, a couple of weeks ago, the government announced that there would be major reforms to the legislation surrounding employment insurance, declaring in vague terms that they would be encouraging EI recipients to take jobs that were either out of their field or lower-paying than the job they used to have. This was very effective at galvanizing the public into two groups: 1) people who have never been on EI, do not understand it and believe that the majority of people who do use the system are free-loaders who would rather not work; and 2) people who understand EI and what it’s for and worry about the potential backlash on the average EI recipient who is not, in fact, abusing the system.
Actually, there’s a third group – the one I was in.
3) people who have become increasingly disgusted with the secrecy that surrounds all major decision-making that takes place under Prime Minister Stephen Harper and figured they would just wait until the rules actually came out to come to a conclusion about how dangerous they were.
Well, the rules were announced yesterday – or at least the broad strokes – and I have come to a conclusion.
You know that saying, Throwing out the baby with the bathwater?
I’ve always loved that saying. I picture a disgruntled woman (she is wearing a white muffin cap and an apron, so it is probably Edwardian London), who, arms full of baby bath, has to kick open the 2nd-storey window so that she can pour the contents of the washbasin out into the narrow, cobbled, drain-ditch-down-the-centre-of-it street below. But she has forgotten, due to stress, or lack of sleep, or just sheer thoughtlessness, to remove the baby she was just bathing. And so, baby and filthy water tumble out the window together.
The end result is that, in an attempt to get rid of the dirty bathwater (something she does not need, and, in a worst case scenario, could be poisonous to her household should she keep it), she has thrown away the whole purpose of having a bath in the first place. Without the baby, the tub itself is useless.
I have had 2 separate EI claims since April 2010 (when I became a freelancing artist), and I have noticed some problems with the system. Here’s a short list:
-It is insanely hard to get EI the first time around, but then, instead of it being just as hard or more difficult to open a second claim, it gets dramatically easier the second time around. This turns EI into sort of a club – once you’re in, you’re in – which is just not the point.
-There is a way for self-employed people to pay into EI, but it is quite expensive and you can only claim benefits if you get hurt to badly that you can’t work or have a baby. So, drawing regular EI benefits is basically impossible for the self-employed, which is ridiculous because 1) self-employed people are the ones most likely to need a couple of weeks of pay just to cover the basics between contracts, and 2) self-employed people are the ones most efficiently fuelling the economy and they are already up against tax laws, CPP payments and insane interest rates on capital loans that are slanted against them.
-When you are on EI, you are encouraged to find work. You are also encouraged to take part-time work, even when you can’t live on what it pays. You “top up” your employment insurance benefits by working part-time. Good, right? Only, your “allowable earnings” are based on what your claimable amount is. So, if you are claiming $451/week (the most you can claim), you can make $185 of earned income, and after that, your claim pays out $1 less for every $1 you make. So there is this plateau where you earn between $185 and $636 in a week where you don’t make any more money when you work more. And that is the opposite of the point of employment insurance.
OK, so there are 3 points that I, total economic layperson, have noticed.
The solution passed down by the government (*cough*aspartofamassivebillthatwillonlybevotedononceinparliament*cough*) is to divide EI claimants into 3 categories, of varying levels of disgrace, and then to make all of them find a job as quickly as possible, whether or not it is in their field or pays close to what they had been paid before.
The rules are strict. “Frequent” users (people who have had 3 claims in the past 5 years totalling 60 weeks or more) will only get 6 weeks of EI to look for a job that is “similar” to their past employment for 80% of what they had been paid before they are forced to take any job available for 70% of their previous income.
(Furthermore, all EI recipients will receive job postings to help them with their job search starting at week one. They will receive these postings TWICE A DAY. So, really, the proposal is to spam the recipients’ inboxes with job postings that they will not read if they are not looking for work, and that they are already reading if they are looking for work, thus irritating all involved to little effect.)
So here is the situation: seasonal workers and short-term contractors are likely to fall into this “frequent” category. There is a lot of backlash, especially from leaders in the Atlantic Provinces where seasonal workers are more common, and it is hard to make that backlash sound like anything but a) whining, or b) pandering to your voter base. But it IS more than that.
Theatre artists in Newfoundland are largely seasonal workers, since the most work is available in the summer, but they are always looking for work during the rest of the year. These are the people I am closest to, so they are the ones most in my head. What the new rules will mean is that actors who work a summer contract for $600/week will have until Thanksgiving to find another “similar” job (of course, it will be a bureaucrat deciding what jobs are “similar” to theatre, which is a point of some concern) that pays $480/week or better. But then, assuming that no such job arises, they will be forced to accept any job at all that pays $420/week or better. Any job at all. Within “one hour’s commute from their home”. (On foot? Public transit? You don’t have to go very far to spend an hour on public transportation in St. John’s.)
So what happens when that artist chooses to leave their $420/week steady job slicing pizza on the other side of town to take a 3-week contract that pays $2500? Do they void their employment insurance eligibility by taking a short-term, better-paid contract in their field? It seems that they do.
And finding that higher-paying, more appropriate job is pretty hard when you’re working 37.5 hours and commuting for 10 hours a week.
How long before that actor gives up on either their chosen career, or the EI system? Living as an artist is plenty hard enough as it is. But under the new rules, there will be two options to the average artist who now claims EI: give up on a career in the arts, get a full-time, salaried job that has nothing to do with the skill set, and relegate art to a “spare time” activity; or live poorer.
I am worried about what will happen to fishers and farmers. We need fishers and farmers. They feed us. Under the new system, we are discouraging all seasonal workers, including the most vital, from being seasonal workers. If the rules of survival are this strict, how long until those fishers and farmers – already an endangered species in the workforce – give up on feeding the rest of society because we have made it too difficult? How long until they decide that they’re better off working full-time at a coffee shop in the city? Then – and this is not facetious or sarcastic – WHAT WILL WE EAT?
Of the problems that I’ve noticed with EI, the new rules address… the first one. Sort of. It makes drawing EI less and less appealing the more often you do it. It will be harder to abuse the system for very long with the new rules. For the first little while. Until all the loopholes are found. It actually makes things worse for the self-employed, and so far nothing at all has been done about the plateau problem.
The point of the EI system is, according to Service Canada, to provide “temporary financial assistance to unemployed Canadians who have lost their job through no fault of their own, while they look for work or upgrade their skills.” It is designed to be a little bit of financial security while people with skills look for work that is challenging and interesting to them. Work that pays enough to support their lives and commitments. Work that they can keep.
The baby in this situation – the one that we should not be throwing out – comes to us as the careers of people with specialized training, with years of experience, with a natural inclination toward certain kinds of work. It’s the support for people who choose to work in vital industries where the cards are already stacked against them: seasonal workers and contractors. It’s the encouragement we should be offering to young workers with training so that they can find a job that’s suitable for them to build their life around.
Instead, we are encouraging employers to offer lower rates of pay for people with the skills they need. We are making the poor poorer by cutting workers off before they can find a job that will actually advance their careers. We are pushing the people who are now making it work in those vital seasonal jobs – against the odds as it is – to abandon them and take something year-round that uses none of their skills and experience.
Sorry, purpose of the Employment Insurance program. Out you go, into the street and down the drain with the tiny bit of waste that this “solution” will cut.