Agreement No. 6 to amend the Canada-Québec Labour Market Development Agreement in Principle

Information for reference

This text copy of the bilateral transfer agreement between the Government of Canada and Québec is provided for reference and research purposes only. The final signed version of the agreement is the official version between the parties.

List of acronyms and abbreviations

Canada: The Government of Canada

CANSIM: Canadian Socio-Economic Information Management System

EI: Employment Insurance

NAICS: North American Industry Classification System

Québec: The Government of Québec

The Agreement: Canada-Québec Labour Market Agreement in Principle

The Implementation Agreement: Canada-Québec Labour Market Implementation Agreement

Between

The Government of Canada, hereinafter referred to as “Canada”, represented by the Minister of Employment and Social Development and the Canada Employment Insurance Commission.

And

The Government of Québec, hereinafter referred to as “Québec”, represented by the Ministre du Travail, de l’Emploi et de la Solidarité sociale and the Ministre responsable des Relations canadiennes et de la Francophonie canadienne.

Hereinafter referred to as “the Parties”.

Preamble

Whereas the Parties concluded the Canada-Québec Labour Market Agreement in Principle (hereinafter “Agreement”) on April 21, 1997, pursuant to which Canada and Québec agreed on the provisions for implementing active employment measures in Québec funded from the Employment Insurance Account;

Whereas the Parties concluded the Canada-Québec Labour Market Implementation Agreement (hereinafter “the Implementation Agreement”) on November 28, 1997, in order to implement the Agreement;

Whereas the Agreement was amended on July 20, 2007, April 30, 2009, August 25, 2014, December 21, 2016 and February 23, 2018;

Whereas the forest sector, the steel and aluminum industries as well as their related industries continue to face economic adjustments that result in significant negative impacts on jobs and workers in Québec;

Whereas given the unique nature of the situation in Québec, Canada is prepared to provide a one-time targeted increase to the federal contribution to the costs of active employment measures in Québec for fiscal year 2018-2019 provided under the Agreement to support workers directly or indirectly affected by the economic adjustments in Québec;

Whereas Canada and Québec recognize that workers in seasonal industries play an important role in economic vitality for all regions of Québec and face unique labour market challenges due to the cyclical nature of seasonal work;

Whereas Canada is prepared to provide a one-time targeted increase to the federal contribution to the costs of the active employment measures in Québec for fiscal years 2018-2019 and 2019-2020 provided under the Agreement to support workers in seasonal industries; and

Whereas the Parties agreed to amend the Agreement to reflect these one-time targeted increases to the federal contribution to the costs of the active employment measures in Québec.

Therefore, the Parties agree to amend the Agreement, as amended from time to time, as follows:

Clauses

1. The Agreement is amended with the addition of the following titles and sections after section 7D:

   “One-time targeted increase in the contribution to the costs of active employment measures in Québec for the forest sector and related industries
   7E. Notwithstanding the provisions in section 7, for fiscal year 2018-2019, the maximum contribution payable under section 7 towards the cost of active employment measures in Québec is increased by an amount not exceeding the amount determined by the following formula, rounded to the nearest dollar:
   ((A/B) x 0.5)) + ((C/D) x 0.5) x $25 million

   Where 

   A is the total number of people employed in the forest sector in Québec in 2016 based on the CANSIM table 383-0031, consulted in spring 2018, under North American Industry Classification System codes 113, 1153, 321 and 322;

   B is the total number of people employed in the forest sector in the five provinces with the most individuals employed in the forest sector in 2016 based on the CANSIM table 383-0031, consulted in spring 2018, under North American Industry Classification System codes 113, 1153, 321 and 322;

   C is the total number of forest sector jobs lost in Québec between April 2017 and January 2018 based on reports from Service Canada; and

   D is the total number of forest sector jobs lost between April 2017 and January 2018 in the five provinces with the most individuals employed in the forest sector in 2016 based on reports from Service Canada.

   As a result of this formula, Québec will receive an additional amount of $14,666,614 in 2018-2019, which will be paid in two equal installments.

   7E.1 The first installment will be paid upon the signing by the Parties of this amending agreement.

   7E.2 The second installment will be paid at the written request of Québec. This request must be made by Québec no later than March 1, 2019.

   7E.3 Québec agrees that it will identify the use of this additional funding for the specific purpose of supporting workers who are directly or indirectly affected by the economic adjustments faced by the forest sector and related industries in Québec in its audited financial report submitted to Canada under the Agreement.

   One-time targeted increase in the contribution to the costs of active employment measures in Québec for the steel and aluminum industries and related industries
   7F. Notwithstanding the provisions in section 7, for fiscal year 2018-2019, the maximum contribution payable under section 7 towards the cost of active employment measures in Québec is increased by an amount not exceeding the amount determined by the following formula, rounded to the nearest dollar:
   A funding floor of $500,000 is provided to Québec if there is direct and indirect employment in the steel and aluminum industries and where the following formula results in an allocation of less than $500,000:

   (A/B) x $25 million

   Where

   A is the total number of workers directly and indirectly employed in the steel and aluminum industries in Québec in 2016; and

   B is the total number of workers directly and indirectly employed in the steel and aluminum industries in Canada in 2016.

   If this formula results in an allocation greater than $500,000 and where there is direct and indirect employment in the steel and aluminum industries, the maximum contribution payable under section 7 towards the costs of active employment measures in Québec is determined by the following formula, rounded to the nearest dollar:

   (A/B) x C

   Where

   A is the total number of workers directly and indirectly employed in the steel and aluminum industries in Québec in 2016;

   B is the total number of workers directly and indirectly employed in the steel and aluminum industries in Canada in 2016; and

   C is the $25-million investment to support workers in the steel and aluminum industries made available to the provinces and territories, less the sum of the amounts distributed to provinces and territories eligible for the funding floor of $500,000.

   Direct employment in the steel and aluminum industries is based on Statistics Canada’s 2016 Census Table 98-400-X2016290 and North American Industry Classification System codes 3311, 3312 and 3313.

   Indirect employment in the steel and aluminum industries is based on a National Job Multiplier of 3.14 for North American Industry Classification System code 3311, 3.01 for North American Industry Classification System code 3312, and 2.20 for North American Industry Classification System code 3313.

   Funding for fiscal year 2019-2020 may be revised to take into account actual job losses related to economic adjustments in the steel and aluminum industries.

   As a result of these formulas, Québec will receive an additional amount of $6,609,083 in 2018‑2019, which will be paid in two equal installments.

   7F.1 The first installment will be paid upon the signing by the Parties of this amending agreement.

   7F.2 The second installment will be paid at the written request of Québec. This request must be made by Québec no later than March 1, 2019.

   7F.3 Québec agrees to identify the use of this additional funding for the specific purpose of supporting workers directly or indirectly affected by the economic adjustments facing the steel and aluminum industries and related industries in Québec in its audited financial report submitted to Canada under the Agreement.

   One-time targeted increase in the contribution to the costs of active employment measures in Québec for workers in seasonal industries

   7G. Notwithstanding the provisions in section 7, for fiscal years 2018-2019 and 2019-2020, the maximum contribution payable under section 7 towards the cost of active employment measures in Québec is increased by an amount not exceeding the amount determined by the following formula, rounded to the nearest dollar:

   A funding floor of $500,000 is provided to Québec if the following formula results in an allocation of less than $500,000:

   (A/B) x $41 million

   Where

   A is the number of Employment Insurance (EI) Regular Beneficiaries (total completed seasonal claims according to Employment Insurance Program administrative data) in 2016-2017 in EI Economic Regions in Québec where the unemployment rate was over 6.3% (the average national unemployment rate for 2017 according to the Labour Force Survey); and

   B is the number of EI Regular Beneficiaries (total completed seasonal claims according to Employment Insurance Program administrative data) in 2016-2017 in all EI Economic Regions in Canada where the unemployment rate was over 6.3%.

   If this formula results in an allocation greater than $500,000, the maximum contribution payable under section 7 towards the costs of active employment measures in Québec is determined by the following formula, rounded to the nearest dollar:

   (A/B) x C

   Where

   A is the number of EI Regular Beneficiaries (total completed seasonal claims) in 2016-2017 in EI Economic Regions in Québec where the unemployment rate was over 6.3% (the average national unemployment rate for 2017 according to the Labour Force Survey)

   B is the number of EI Regular Beneficiaries (total completed seasonal claims) in 2016-2017 in all EI Economic Regions in Canada where the unemployment rate was over 6.3%, excluding provinces and territories that receive the funding floor of $500,000; and

   C is the $41-million investment to support workers in seasonal industries made available to the provinces and territories, less the sum of the amounts distributed to provinces and territories eligible for the funding floor of $500,000.

   As a result of these formulas, Québec will receive an additional amount of $7,967,356.50 in 2018‑2019 and $7,967,356.50 in 2019-2020, which will be paid in two equal installments for each of the two fiscal years.

   7G.1 For fiscal year 2018-2019, the first installment will be paid upon the signing by the Parties of this amending agreement, and the second installment will be paid at the written request of Québec. This request must be made by Québec no later than March 1, 2019.

   7G.2 For fiscal year 2019-2020, subject to the appropriation of funds by Parliament, the first and second installments will be paid after April 1, 2019, at the written request of Québec for each of the two installments. Such requests must be made by Québec after March 1, 2019, and no later than March 1, 2020.

   7G.3 Québec agrees that it will identify the use of this additional funding for the specific purpose of supporting workers in seasonal industries in Québec in its audited financial report submitted to Canada under the Agreement.”

2. The Parties agree that no part of this amending agreement will have an impact on how Canada allocates the current Employment Insurance funding ($1.95 billion per year) when determining the maximum annual amount of contributions paid to Québec, in accordance with section 7.1 of the Agreement. The Parties acknowledge that the current method set out in section 7.1 of the Agreement for allocating the current $1.95 billion to the provinces and territories is the allocation method described in the letter dated June 26, 1996, from the Deputy Minister of the Department of Human Resources Development Canada to the Secrétaire général associé des Affaires intergouvernementales canadiennes du Québec.

3. In all other respects, the Agreement shall remain unchanged.

4. This amending agreement shall be read together with the Agreement, as amended from time to time, and the Implementation Agreement and takes effect as if its provisions were part of the Agreement.

5. This amending agreement comes into force once it has been signed by the Parties.

Signed on behalf of Canada in ____________ this 27 day of March 2019

Signed on behalf of Québec in Québec this 26 day of March 2019