Reuters: Regulatory News: UPDATE 1-Canada tightens employment insurance rules

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UPDATE 1-Canada tightens employment insurance rules May 24th 2012, 17:29 Thu May 24, 2012 1:29pm EDT * Trying to tackle joblessness alongside job shortages * Frequent claimants will have to take pay cuts up to 30 pct * Minister says people will not be forced to move * Part of prime minister's "transformational changes" * Want employers to hire Canadians before foreigners By Randall Palmer OTTAWA, May 24 (Reuters) - Canada tightened its rules on payouts to the unemployed on Thursday, requiring jobless workers to accept jobs at lower pay or commute further for work. The Conservative government said the changes would help deal with the anomaly of high overall unemployment, and job shortages in certain areas. Opponents said the government was demonizing people without jobs, and would force skilled workers to accept unskilled jobs. "Let me be crystal clear," Human Resources Minister Diane Finley told a news conference. "The changes that we are proposing...are not about forcing people to move across Canada or to take work that doesn't match their skill set. Our goal is to help Canadians find local work that matches their skills." Noting that some employers were hiring foreign workers even while Canadians were making claims for employment insurance in the same occupation and province, she added: "We want to redress the balance right now so that Canadians get first crack at the jobs before we bring in temporary foreign workers." The changes to employment insurance rules mean that frequent claimants, for example in the seasonal fisheries industry, will have to take any job in their region for which they are qualified after seven weeks of benefits, even if it means taking a 30 percent pay cut. People will not have move to get benefits, but may have to commute up to an hour if they have the means of transport. The changes, expected to take effect from early 2013, are part of what Prime Minister Stephen Harper has called transformational changes to help Canada compete better. But opposition politicians have raised the prospect of people having to move to oil-rich Alberta, or unemployed teachers picking apples on local orchards. Canadian unemployment was 7.3 percent in April, but regional jobless rates range from 4.9 percent in resource-rich Saskatchewan and Alberta to rates as high as 12.3 percent in Newfoundland and Labrador. In March, almost 550,000 people received benefits across Canada, out of a total of nearly 1.4 million unemployed, which includes people who have quit their jobs and those who have not paid into the system, such as new immigrants and the self-employed. "What we heard today is the minister scapegoating unemployed Canadians, that they're not trying hard enough to find work, said Peggy Nash, of the left-leaning New Democratic opposition. The government plan has the potential for a backlash in areas of high and seasonal unemployment, for example in Atlantic Canada, which has 32 of the 308 seats in the House of Commons. The Conservatives have 14 of those seats. With no requirement for the jobless to consider moving, the changes will have a limited impact in Alberta and Saskatchewan, which are in the midst of a resource boom and face acute job shortages in some areas. Nonetheless, even in those provinces there were nearly 37,000 employment insurance claims in March. The new rules are more lenient for long-tenured workers than frequent claimants. They will only be asked to take a pay cut of 10 percent and can insist on taking jobs within their usual occupation for the first 18 weeks of benefits. Canadians can usually claim employment insurance for between 14 and 45 weeks, provided they have built up enough contributions in the system before they start claiming. The benefit rate is 55 percent of their insurable earnings, with a maximum weekly benefit of C$485 ($471). Finley said the fact that this percentage is lower than the 70 percent of past pay that frequent claimants would have to accept offered a financial incentive to get back to work. The unemployed have always been required to search for and accept "suitable employment" to draw benefits. The changes add clarity to these terms, which previously left a gray zone and caused some employers to say they cannot find willing or able Canadians. Link this Share this Digg this Email Reprints

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