July 8, 2020, COVID-19, Committee of the Whole Question Period notes

Mandate letter commitment

One of the priorities in your mandate letter is to work with the Minister of Status of Women Canada and other ministerial colleagues to take action to ensure that federal workplaces are free from harassment and sexual violence (for example, the federal public service and the federally regulated private sector). The other ministers tasked with similar priorities are: the Minister of National Defense, the Minister of Public Safety and Emergency Preparedness, the Leader of the Government in the House of Commons and the President of the Treasury Board.

Bill C-65

Following comprehensive consultations by the Labour Program with federally regulated employers, unions and subject matter experts, Bill C-65 was drafted and tabled on November 7th, 2017 and received Royal Assent on October 25th, 2018.

Harassment and Violence Prevention Regulations consultations

• The consultations, which started in March 2018, were held in three phases: in-person roundtables across the country, WebEx sessions, and online. The online consultations were open to the public from July 24th to October 5th, 2018
• Over 1,000 Canadians participated in the round tables, WebEx sessions, and requested presentations. In addition, approximately 18,000 Canadians visited the consultations and survey websites, over 1,000 completed the online survey and close to 60 individuals and organizations submitted detailed responses. Survey respondents were overwhelmingly supportive of the proposed regulations
• Key elements of the new regulatory framework includes requiring employers to:
  • co-develop with their workplace committee or representative a comprehensive harassment and violence prevention policy and mandatory training programs specific to the context of their workplace
  • provide employees who are the object of a harassment and violence occurrence with options for the resolution process
  • implement measures to mitigate the risk of family violence from entering the workplace
  • provide support to employees who have been affected by harassment and violence; and
  • report on all occurrences in the workplace to the Labour Program to improve data collection
• The new draft Work Place Harassment and Violence Prevention Regulations were pre-published in Canada Gazette, Part I on April 27, 2019 for a thirty-day public comment period
• Key issues raised included:
  • inability to assess the occurrence against the definition of “harassment and violence”
  • no exception for work places where harassment and violence are a normal condition of work for example Correctional Services Canada and Royal Canadian Mounted Police
  • timelines for the resolution process were protracted
  • inability to continue or initiate conciliation if an investigation has begun; and
  • burden of requiring to work jointly with employee representatives
• The above issues were considered as part of the review and revision of the draft Regulations
• Regulations were published in the Canada Gazette, Part II, on June 24, 2020, and will come into force on January 1, 2021

Bill C-65: Harassment and Violence Regime

• Bill C-65 amends the Canada Labour Code to create a single, integrated regime that will protect federally regulated employees from harassment and violence in the workplace. More specifically, it would:
  • expand the current violence prevention requirements under Part II (Occupational Health and Safety) to ensure that employers take the necessary steps to prevent and protect against both harassment and violence in the workplace
  • repeal the sexual harassment provisions currently found in Part III (Labour Standards);
  • require employers to investigate, record and report occurrences of harassment and violence, subject to regulatory requirements
  • protect the privacy of employees who report occurrences of harassment and violence in order to encourage potential victims to come forward
  • narrow the grounds for exemption from the establishment of a workplace committee;
  • extend coverage of Part II of the Code to cover staff in ministers’ offices, also known as “exempt staff”
  • incorporate by reference Part II of the Code within the Parliamentary Employment and Staff Relations Act to ensure that parliamentary workers benefit from the same occupational health and safety protections as other federally regulated workers; and
  • provide the Minister of Labour with the power to establish pilot projects to test new amendments under the Code to determine if they would lead to better outcomes for employees and employers
• In Budget 2018, which was announced on February 27, 2018, the Government committed $34.9 million over 5 years, starting in 2018 to 2019, and $7.4 million per year ongoing to support activities included in the proposed regime under Bill C-65. This new funding will be used for assisting workplace parties in resolving harassment and violence complaints, establishing an outreach hub to support employees, regulatory development and enforcement activities, training programs for inspectors, an awareness campaign, education materials and tools, and funding other initiatives related to harassment
• Budget 2018 also contains several other measures to support victims of violence, including amendments to the Canada Labour Code to provide 5 days of paid leave to workers in the federally regulated private sector who are victims of family violence or the parent of a child who is the victim of family violence. This paid leave will build on the new 10-day unpaid leave for victims of family violence that was introduced in the Code last December. This will help employees protect their financial security while they seek the support they need. Research shows that financial dependence is one of the most significant reasons why victims of family violence stay with their abuser, or return after leaving
• Statistics Canada released a report on December 5, 2019 titled: Gender-based violence and unwanted sexual behaviour in Canada, 2018: Initial Findings from the Survey of Safety on Public and Private Spaces

EI account

Of the total Canada Emergency Response Benefit, the portion of payments made by Service Canada (about $36 billion since the launch of the benefit) would be charged to the EI Operating Account pursuant to existing legislation. In normal circumstances, an increase in benefits paid from the Account would result in premium increases going forward. However, the government could choose to limit or freeze premium increases to avoid further disruptions to the labour market.

The EI Operating Account was established in the accounts of Canada by the Employment Insurance Act. All amounts received under the Act are deposited in the Consolidated Revenue Fund and credited to the Account. The benefits and the costs of administration of the Act are paid out of the Consolidated Revenue Fund and charged to the Account.

In the financial statements, the Consolidated Revenue Fund is represented by the Balance of the account with Receiver General for Canada. The Canada Employment Insurance Commission, through the officers and employees of the Department of Employment and Social Development (ESDC), is responsible for the delivery of the Employment Insurance program and the day to day administration of the Account.

Since April 1, 2016, the Commission is responsible for setting the annual EI premium rate according to a 7-year break-even mechanism, as forecast by the EI Senior Actuary. This is the premium rate that will result in a balance of $0 in seven years in the EI Operating Account, including the elimination of any cumulative surplus or deficit in the Account. Annual changes to the premium rate are subject to a legislated limit of five cents. The seven-year break-even mechanism ensures stable and predictable premium rates for Canadian workers and employers, and is also intended to ensure that EI contributions are only used for EI purposes.

CERB

The Canada Emergency Response Benefit (CERB) provides temporary income support to workers who have stopped working related to COVID-19. The Benefit provides $500 per week, and is delivered through both Service Canada and the Canada Revenue Agency (CRA). The CERB is available to workers:

• residing in Canada, who are at least 15 years old
• who have stopped working because of reasons related to COVID-19 or are eligible for Employment Insurance regular or sickness benefits or have exhausted their Employment Insurance regular or fishing benefits between December 29, 2019 and October 3, 2020
• who had employment and/or self-employment income of at least $5,000 in 2019 or in the 12 months prior to the date of their application; and
• who have not quit their job voluntarily

When submitting their first claim, workers cannot have earned more than $1,000 in employment and/or self-employment income for 14 or more consecutive days within the 4-week benefit period of their claim.

When submitting subsequent claims, workers cannot have earned more than $1,000 in employment and/or self-employment income for the entire 4-week benefit period of their new claim.

As of July 12, 2020, we have received 20.88 million applications for support through the CERB.

The Government of Canada expects that workers will be seeking work opportunities or returning to work when their employer reaches out to them, provided they are able and it is reasonable to do so. We encourage Canadians to consult Job Bank, Canada’s national employment service, that offers tools to help with job searches.

Prepared by

Heather MacKinnon

Senior Policy Analyst

Key contact

Joel Reimer

Manager

Approved by

Jean-François Girard

Executive Director

819-661-1794

Date

Date approved in SADMO / COO

The debate over basic income

• The economic impact of the COVID-19 pandemic has led to increased calls from a range of stakeholders and experts to introduce a basic income, with the goals of reducing poverty and inequality, addressing the changing nature of work (including automation and increases in precarious employment), and improving population health and well-being
• In April 2020, 50 senators signed a letter that advocated building on the Canada Emergency Response Benefit (CERB) to establish a “crisis minimum income” for the short-term and then pursue further social and economic reforms
• In a May 2020 brief to the Senate’s Standing Committee on Social Affairs, Science and Technology, Basic Income Canada Network says that in the context of the COVID-19 pandemic, “a basic income provides a foundation of stability, security, a measure of confidence and a level of trust in government that will make good outcomes possible.”
• Critics of basic income express concerns about the anticipated costs and disincentives to work, and many oppose payments without requirements to work or seek employment. As well, some critics suggest that, rather than a basic income, governments should increase expenditures on social services such as Pharmacare, dental coverage, childcare, housing, and public transit

Existing federal programming

• Provinces and territories have significant authority in the area of income support. Communication from ESDC has indicated that the Government of Canada recognizes the importance of working with provinces and territories to find solutions to common challenges, while stating that it is up to the provincial and territorial governments to make decisions around the design of social assistance systems and policies in their own jurisdictions
• Some Government of Canada initiatives have many of the features of a partial basic income for specific groups. This includes the Canada Child Benefit (CCB), which provides income support to families raising children. For Canadian seniors, the Old Age Security (OAS) program play a significant role in providing income security. OAS pensioners who receive little or no income, other than the OAS pension, are eligible for additional assistance through the Guaranteed Income Supplement (GIS). The GIS is income-tested to ensure that this additional assistance is provided to seniors most in need. Between 2015 and 2018, there was a decrease of 73,000 seniors living below Canada’s Official Poverty Line
• The government has made significant efforts to address the short-term needs of Canadians facing hardship as a result of the COVID-19 outbreak. These initiatives include the Canada Emergency Response Benefit (CERB) to help replace lost incomes, as well as one-time enhancements to the Goods and Services Tax/Harmonized Sales Tax Credit, Canada Child Benefit, and Old Age Security/Guaranteed Income Supplement

Ontario pilot project

• In April 2017, the Ontario Government launched a 3-year basic income pilot project. The 4,000 participants were low-income people aged 18 to 64 in selected communities. Payments were based on 75% of Statistics Canada’s Low-Income Measure (LIM). A single individual received $16,989 annually, less 50% of earned income, while couples received $24,027 less 50% of any combined earned income. People with disability received an additional $500 per month. Participants were also eligible to receive certain benefits including the CCB
• The Ontario Basic Income pilot tested a potential new approach to income support that would replace social assistance, and possibly other programming, if it were fully implemented
• The Ontario Minister of Community and Social Services announced in July 2018 that the basic income pilot would be cancelled. Payments to participants continued only until March 2019
• Legal action to overturn the Ontario government’s cancellation of the pilot was pursued. The Ontario Superior Court ruled against the challenge on February 14, 2019
• A separate class action lawsuit was launched against the Ontario government seeking damages due to the cancellation of its pilot. The plaintiffs, participants in the pilot, are seeking damages on various grounds, including breach of contract, negligence, breach of public law duty, and violation of section 7 of the Charter of Rights and Freedoms (life, liberty, and security of the person)
• On March 5, 2019, Basic Income Canada Network reported on a non-random survey of 424 participants in the Ontario pilot. Key findings include:
  • 34% of participants found that the basic income supported employment by enabling transportation, childcare, or the ability to start or expand a business
  • 74 % of respondents said they were able to make healthy food choices
  • however, when the cancellation of the pilot was announced, 80% of respondents experienced previous problems returning, and 61% had to alter future plans
• In March 2020, economist Wayne Lewchuk of McMaster University and colleagues released a separate report, based on surveys and interviews with 217 former pilot participants in the Hamilton area. Findings of the study include:
  • for some participants, basic income was “transformational, fundamentally reshaping their living standards as well as their sense of self-worth and hope for a better future.”
  • a majority of respondents who were employed before the pilot continued to work while receiving a basic income. Some moved to better paid jobs

Other provinces

• Other provinces have shown interest in the idea of a BI. Ernie Hudson, P.E.I.’s Minister of Social Development and Housing, has asked the federal government “to consider additional partnership, such as funding support” for a BI pilot project. The P.E.I. government also plans a “secure income” pilot with means-tested benefits for individuals with severe barriers to entering the workforce (that is, it is narrower in scope than a full basic income proposal)
• The PEI Legislature’s Special Committee on Poverty has been examining the BI. Committee members, including Minister Hudson, have shown an interest in BI and chair Trish Altass affirmed that the committee “will be putting forward recommendations around a fully costed basic income”
• The B.C. government is examining the concept of BI in the context of its poverty reduction efforts
• The federal government has offered to share available data with provinces and territories interested in implementing BI pilots or programs within their jurisdictions, including tax, administrative, and survey data

Cost of a national basic income

• In 2018, the Parliamentary Budget Office (PBO) estimated the gross annual cost of a basic income modelled on Ontario’s pilot project and implemented across Canada: $76B for the 2018 to 2019 fiscal year. The PBO also calculated that $32B of existing federal support could be eliminated, leaving a net cost of $44B. As well, economist Evelyn Forget builds on the PBO’s estimate and calculates that if provincial income assistance expenditures could be reallocated and directed towards basic income expenses, the annual cost of a BI program could be cut to $23B
• On July 7, 2020, the PBO issued a separate report, which estimated the gross cost of a BI program for 6 months, starting in October 2020, at $47.5B if designed following the model of the Ontario pilot. The PBO also showed that lower phase-out rates, with more generous treatment of earned income to reduce disincentives to work, would lead to substantially higher gross costs (potentially as high as $98.1B for 6 months). The projected cost is greater because of the high rates of unemployment due to the COVID-19 pandemic.

Basic Income Canada Network (BICN) report

• On January 23, 2020, BICN issued a report advocating the introduction of a basic income in Canada. The report proposed 3 options featuring benefits of $22,000 per year for individuals ($31,113 for couples in 2 cases), either targeted to Canadians with low incomes or universal with a significant portion of costs recovered through the tax system
• BICN’s report explains that each of the options could be paid for mainly through changes to the tax system, along with modifications to or elimination of certain existing federal and PT programs

Examples of basic income pilots and measures

• Governments in several other countries are in varying stages of experimentation with basic income projects. For example, on February 8, 2019, the Government of Finland issued the preliminary evaluation of a 2-year pilot project with 2,000 unemployed participants receiving monthly payments of €560 (about $840 Canadian). The evaluation showed that these payments contributed to the health and happiness of the beneficiaries; however, there was no positive or negative impact on the likelihood of recipients participating in the labour force. The final evaluation, issued in May 2020, showed largely consistent results; recipients had slightly higher workforce participation than members of the control group
• Overall, other research and pilots, including a study in Manitoba in 1975 to 1978, indicate that basic income would have at most a small effect on work incentives, address poverty, and promote health and well-being
• Since 1982, Alaska has paid a partial basic income for all residents, usually about $1000 to $2000 U.S. per year
• Spain has recently taken steps towards implementing a partial basic income for lower-income households, with benefits for eligible individuals of €462 (about $700 Canadian), and higher benefits for households. Spanish authorities started to accept applications in June, 2020 and payments are expected to commence later in 2020