Facilitating the Future of Work Through a Modernized EI System

Gaps in Canada’s Employment Insurance program are already leaving too many workers behind as gig work, part-time jobs and self-employment grow. EI needs to be modernized now to support Canadians as they transition to an economy and labour market disrupted by technology and automation.

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The stable, long-term jobs that Canada’s unemployment support system are based on are being replaced by non-traditional arrangements involving temporary, part-time and gig work. Reforms of Employment Insurance programs have never addressed these gaps in any meaningful way. Since 1976 in Canada:

The number of multiple job-holders has increased by 168%
The number of part-time job-holders has increased by 49%
Self-employment has increased by 26%

Employment Insurance programs’ outdated structures and assumptions have left more unemployed Canadians excluded from benefits. In the late 1980s, more than 80% of unemployed workers received EI payments; In the last decade, on average, only 43% did:

EI excludes many workers based on their type of work arrangement or the geographical lottery of where they happen to live. Neither of these factors, however, is indicative of how easy or difficult it is for them to find new employment.

Determining eligibility for support must not be based on assumptions about the nature of work formed 50 years ago. The EI system must be updated to reflect a world of work increasingly disrupted by technology and automation to ensure that Canada’s workforce is resilient and competitive.

The report lays out four recommendations:

Supplement Canada’s unemployment support system with an intermediary program designed to provide time-limited and flexible income support to unemployed individuals in non-traditional employment relationships.
Replace the regionally determined EI benefits system with a single, national entrance requirement, benefit duration range and weekly benefit formula.
Divorce eligibility for skills training programs from EI eligibility and create a single labour market development transfer to allow provinces the flexibility to design and administer more integrated programming.
Gradually work toward ensuring that labour market transfers are fairly allocated and contain an element that is responsive to large swings in provincial unemployment rates.

Addressing these issues will require more than simple tinkering. To ensure that Canadian workers are properly supported in light of ongoing and emerging trends related to the future of work, these problems must be addressed through bold and fundamental reform of the entire system of unemployment supports.Sunil Johal and Erich Hartmann, report authors

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About the Authors

Sunil Johal
The Mowat Centre

Sunil Johal is Policy Director at the Mowat Centre. He is frequently invited to speak about the future of work, technology and social policy at conferences in Canada and abroad. He has contributed expert commentary and advice on regulatory and policy issues to a range of organizations and media outlets, including the G20, World Economic Forum, Brookings Institution, The Globe and Mail, the Toronto Star, CBC Radio and Television, the Washington Post, The Guardian, the National Governors Association, and the OECD. He holds degrees from the London School of Economics, Osgoode Hall Law School and the University of Western Ontario.

Erich Hartmann
The Mowat Centre

Erich Hartmann was the Mowat Centre’s Practice Lead for Intergovernmental Affairs. Erich has a deep knowledge of intergovernmental affairs and federal fiscal issues. Previously, Erich spent 13 years in the Ontario Public Service at the Ministry of Finance in a number of policy and management roles, most recently serving as Manager of Federal-Provincial Relations. Erich holds an MPA and a BA (Hons) from Queen’s University.