Question Period Note: EWDOL_Jan2024_020

The Government has announced a new, temporary one-year measure that will provide up to four more weeks of Employment Insurance (EI) regular benefits to eligible seasonal claimants in 13 EI regions to mitigate the increased risk of an income gap between work seasons due to low unemployment rates combined with shorter than usual work seasons.

Over the last year, the unemployment rate has hit historic lows in some parts of Canada. While this is good news for most people, it can result in fewer weeks of benefits for seasonal workers who rely on the Employment Insurance program for income support during the off-season when work is scarce in their communities.

Due to specific and atypical economic circumstances this year, some seasonal workers may not qualify for enough weeks of benefits to cover them until the next season, resulting in a greater risk of an income gap.

This is why the 2023 Fall Economic Statement proposed a one-year measure to provide additional temporary support for these workers. This would provide up to four additional weeks of Employment Insurance regular benefits to eligible seasonal claimants in the 13 targeted regions, on top of the up to five additional weeks already available, reducing risk of income gap.

While this is a temporary measure, the Government is committed to modernizing the EI program, including finding a permanent approach to support seasonal industries and their workforce.

Unemployment Fluctuations and the “Trou Noir”

The EI program is designed to respond automatically to changes in economic conditions that affect local labour markets by dividing the country into 62 economic regions, for which the monthly unemployment rates determine EI eligibility and entitlement:

First, the number of hours of insurable employment needed to qualify for EI regular benefits depends on the monthly unemployment rate in the EI economic region in which the individual lives.

Second, the number of weeks of entitlement varies depending on regional unemployment rates and the number of hours of insurable employment an individual worked in their qualifying period.

Third, the number of weeks used for calculating the weekly benefit rate depends on the monthly unemployment rate in a claimant’s EI economic region.

When a region’s unemployment rate changes, the entrance requirement, the maximum duration of benefits, and the number of weeks of insurable earnings used to calculate the benefit rate may adjust in response. 

Because fluctuations in regional unemployment rates can affect the number of weeks of regular benefits that EI claimants are entitled to receive, seasonal claimants who receive fewer weeks of income support due to declining unemployment rates may be at greater risk of a “trou noir”.

The “trou noir” represents the period when some workers in seasonal employment have exhausted their EI benefits but continue to wait to be called back in for their seasonal job and are unable to find other employment. In other words, these claimants do not receive either employment income or EI benefits during this period.

Unusual labour market conditions and a rapid decline of unemployment rates in some regions over the past year caused significant changes in the maximum EI duration for seasonal workers compared to previous years.

Existing Support for Seasonal Claimants

In 2018, a pilot project was introduced to provide up to five additional weeks of EI regular benefits (up to a maximum of 45 weeks of entitlement) to eligible seasonal claimants in 13 targeted EI regions.

Through Budget 2021, the Government made legislative changes to the Employment Insurance Act to replicate the rules of the seasonal pilot project as a temporary measure until October 2022. Budget 2022 further extended the temporary measure until October 2023. Most recently, Budget 2023 extended these temporary rules for an additional year, until October 2024; the cost of this support is estimated at $147 million over three years, starting in 2023-24, which will benefit 62,000 seasonal workers.

This measure provides up to five additional weeks of EI regular benefits to seasonal claimants in 13 regions in Atlantic Canada, Quebec and Yukon:

Newfoundland and Labrador (excludes St. John’s)

Eastern Nova Scotia

Western Nova Scotia

Prince Edward Island (excludes Charlottetown)

Charlottetown

Madawaska–Charlotte

Restigouche–Albert

Gaspésie–Îles-de-la-Madeleine

Lower Saint Lawrence and North Shore

Central Québec

Chicoutimi–Jonquière

North Western Québec

Yukon (excludes Whitehorse)

In order to be eligible for the additional weeks of EI regular benefits, claimants must:

(1) Meet all of the eligibility conditions for EI regular benefits;

(2) Demonstrate a seasonal claiming pattern;

(3) Reside in one of the 13 targeted EI economic regions; and

(4) Establish a benefit period between September 26, 2021 and October 26, 2024.

A legislative fix was introduced in 2022 that ensures claimants whose seasonal claim pattern was disrupted due to the COVID-19 pandemic, but who meet the other eligibility conditions and qualified for the previous seasonal pilot project between August 5, 2018 and September 25, 2021, are able to continue to access up to five additional weeks of EI regular benefits. This fix will continue to apply for the duration of the extension to October 2024.

New Temporary Measure for Seasonal Workers

The decline in unemployment rates in many of the 13 targeted regions – which reduced the number of weeks of EI regular benefits available – combined with shorter work seasons in some seasonal industries, could severely impact some seasonal claimants who rely on EI support during the off-season, increasing the likelihood and duration of them experiencing a period during which they receive neither EI benefits nor employment income before their return to seasonal employment.

Of the 13 targeted EI economic regions, eight EI regions experienced declines in unemployment rates that resulted in fewer weeks of benefit entitlement for seasonal claimants who established an EI regular benefits claim in fall 2023 compared to what they would have qualified for at the same time last year with the same number of insurable employment hours. These regions are: Newfoundland / Labrador (excluding the capital), Eastern Nova Scotia, Western Nova Scotia, Madawaska–Charlotte, Restigouche–Albert, Gaspésie–Îles-de-la-Madeleine, Prince Edward Island (excluding the capital), and Yukon (excluding the capital).

As an example, the EI economic region of Newfoundland / Labrador (excluding the capital) experienced a steep decline in its unemployment rate, falling from 14.8% in September 2022 to 12.0% in September 2023. For workers in that EI economic region who started a claim on September 10, 2023 (when the new unemployment rate came into effect), including those in seasonal industries, the result is fewer weeks of regular benefit entitlement compared to those who had a claim established in September 2022.

The new, one-year measure announced November 21, 2023, in the Fall Economic Statement, provides up to an additional four weeks of EI regular benefits claimants (on top of the up to five additional weeks already provided by the existing temporary legislated seasonal measure) to claimants who meet all the criteria of the existing legislated measure and start a claim between September 10, 2023, and September 7, 2024. The maximum number of weeks for regular benefits is maintained at 45 weeks.

The greatest impacts of declines in the unemployment rates in these regions are expected to be felt from September to December 2023, as the majority of all seasonal claims in these regions are established during that period each year (e.g., 59% in 2019).

An estimated 42,000 seasonal claimants in the 13 targeted EI regions are expected to access at least one of the four additional weeks of benefits available under the measure. These workers are part of the 62,000 claimants who are expected to use at least one additional week of the five weeks of benefits available under the existing legislated seasonal measure.

EI Fishing Benefits

EI fishing benefits provide temporary income support to qualifying, self-employed fishers who are actively seeking work.

Eligibility for EI fishing benefits is based on insurable earnings from fishing, not insurable hours. To receive EI fishing benefits, self-employed fishers must be unable to qualify for EI regular benefits and have between $2,500 and $4,200 in earnings from fishing in the qualifying period. The minimum insurable earnings required is based on the unemployment rate in the EI region where the claimant resides.

For example, in the EI region of Newfoundland and Labrador, the decline in unemployment rate from 13.7% in July 2023 to 12.0% in September 2023 meant an increase in the minimum earnings from fishing required to qualify from $2,500 to $2,900. However, the average amount of fishing earnings used to establish a claim in the EI region of Newfoundland and Labrador varied between $13,000 and $15,400 between 2017 and 2023. Very few qualified with less than $2,900 in earnings (numbers suppressed due to confidentiality). While the true impact of the 2023 snow crab dispute had on fisher’s total fishing earnings this season is unknown, the snow crab season was extended, and fishing quotas were increased to compensate for the labour dispute in the spring. According to the Department of Fisheries and Oceans, most fishers would have caught their quota.

The maximum number of weeks per season (summer or winter) of EI fishing benefits payable to self-employed fishers who qualify to receive them is 26. The number of weeks is not affected by the unemployment rate.

The summer off-season can start as early as the week of October 1 and must end no later than the week of June 15. While the winter off-season can start as early as the week of April 1 and must end no later than the week of December 15.

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