Ottawa to create EI-like benefit for contract workers post-CERB

OTTAWA — The federal government plans to move as many outof-work Canadians into the employment insurance system when a key emergency benefit runs out in the fall, and provide an EI-like support for millions who can’t qualify under existing rules.

The change signals a potentially sweeping overhaul to the decadesold social safety net criticized in recent years for not keeping up with a modern labour force marked by increasing contract and gig work.

It was partly because of those holes that the government created the $80-billion Canada Emergency Response Benefit at the start of the pandemic, which is set to wind down over the coming weeks.

Those who already qualify for EI will be moved to that program.

The government is promising a parallel, transitional benefit with EI-like components for those who can’t yet — “and I emphasize yet,” said Employment Minister Carla Qualtrough — get into the EI system. It will include access to training and the ability to work more hours without having as steep a clawback in benefit payments.

The government is also promising to relax EI eligibility rules like the number of hours required to receive support payments.

Speaking Friday morning, Prime Minister Justin Trudeau said the goal is to move everyone receiving CERB to employment insurance, and cover anyone looking for work “with a better, 21st-century EI system.”

Details will be rolled out in the coming weeks.

The government’s most recent CERB figures show $62.75 billion in benefits to 8.46 million people. About half of those recipients have gone to EI-eligible workers.

Those eye-popping numbers were the reason the EI system was shelved in favour of the CERB in March, as federal officials worried the volume of claims would overwhelm the decades-old system. The government is still expecting millions to be on EI come the fall — about four million, Qualtrough said, adding that the system has been tested and was ready to handle the deluge upon its restart.

“We believe that the CERB has served its purpose and the reason it was created is no longer the main focus of our efforts as a government to support workers,”

Qualtrough said.

“We are going to move on to something different.”

The Liberals are hoping the change prods more Canadians to either go back to work or look for a job as the economy moves into what the Bank of Canada has described as a recuperation period before a long, bumpy recovery.

The recuperation appears to have started in May when the economy grew by 4.5 per cent, Statistics Canada reported Friday, re-emerging from severe lockdowns in March and April. That figure beat expectations, and a further sign of optimism was a preliminary estimate of five per cent growth in June, which will be finalized next month.

The national data agency said rebounds in May were seen across multiple industries, including retail trade registered that saw its largest monthly increase since comparable readings began in 1961.

“May’s GDP numbers demonstrate that our economy is rebounding from all-time lows, but the growth numbers we’re seeing simply represent businesses reopening after needed lockdowns,” said Trevin Stratton, chief economist at the Canadian Chamber of Commerce.