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Winnipeg Free Press - PRINT EDITION

Employment insurance flaws exposed by current recession

By: Julian Beltrame

Posted: 04/19/2009 1:00 AM | Comments: 0 (including replies)

OTTAWA -- The most severe recession in decades is exposing the gaping holes in Canada's vaunted social safety net.

Only six months into an economic downturn, social advocates and the jobless say the employment insurance system that was supposed to cushion the fall is in reality either inadequate or so hard to access that tens of thousands of newly unemployed just don't qualify for benefits.

As is always the case in times of economic troubles, it's the most vulnerable in society that are being hurt most by the recession. And it's those Canadians, along with a smattering of individuals with unusual circumstances, who are finding the EI system not as advertised.

After giving birth last May, Maninder Rehsi of Maple, Ont., north of Toronto, was only able to acquire 430 insurable hours of work before her employer, Progressive Moulded Products, succumbed to the recession and went out of business, idling 2,000 workers, including her husband. Under EI requirements for her region, she was out of luck because she hadn't accumulated 600 insurable hours over the previous 12 months.

Now, Rehsi says, her husband's benefits are close to exhausted and she doesn't know how they'll make ends meet if they don't find a job soon.

Martin Smith of Guelph, Ont., a British manufacturing engineer was recruited by auto-parts maker Linamar four years ago and had been paying EI premiums ever since, only to find out that for him the system was a one-way street.

When he was laid off for about seven weeks this winter, he was told his permit allowed him to work only for Linamar, hence he didn't qualify because he couldn't seek employment elsewhere without a new work permit.

Or Deonarine Persaud of Toronto who lost his nine-year job at a car-parts supplier last May and is now barely getting by on his wife's Wal-Mart Canada salary, after his EI benefits of about $400 a week ran out.

"It's not like I don't want to work," said Persaud. Canada's previously robust labour market began stalling last spring and went into a tailspin last fall, dropping 357,000 jobs since October. Economists believe as many as 600,000 Canadians could become victims this year of the worst recession in decades.

It is precisely for such times that unemployment insurance was created and worked relatively well during the recessions of the early 1980s and 1990s.

But unlike the past two slumps, when about 80 per cent of the unemployed collected unemployment insurance, today less than 43 per cent, or 560,000 of the 1.3 million Canadians who were officially jobless in January, are collecting benefits.

-- The Canadian Press

Republished from the Winnipeg Free Press print edition April 19, 2009 A5

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