Agreement amending the Canada-Quebec Labour Market Development Agreement in principle and the Labour Market Implementation Agreement

Information for reference

This text copy of the bilateral transfer agreement between the Government of Canada and Quebec 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


Between

The Government of Canada (hereinafter referred to as "Canada"), represented by the Minister of Employment and Social Development styled as the Minister of Families, Children and Social Development and the Canada Employment Insurance Commission

And

The Government of Quebec, hereinafter referred to as “Quebec”, 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

  1. Whereas Canada and Quebec entered into the Canada-Quebec Labour Market Agreement in Principle on April 21, 1997 (hereinafter “the Agreement in Principle”), under which Canada and Quebec agreed to the provisions for the implementation of active employment measures for Quebec funded from the Employment Insurance Account;
  2. Whereas Canada and Quebec entered into the Canada-Quebec Labour Market Implementation Agreement on November 28, 1997 (hereinafter “the Implementation Agreement”) to implement the Agreement in Principle;
  3. Whereas the Agreement in Principle was amended on July 20, 2007, April 30, 2009, August 25, 2014, December 21, 2016, February 23, 2018 and March 27, 2019;
  4. Whereas in its 2017 Budget, Canada announced that it would invest an additional $1.8 billion for fiscal years 2017 to 2018 to 2022 to 2023 as part of the annual funding to provinces and territories under the Labour Market Development Agreements;
  5. Whereas there is a Quebec-specific partnership dynamic on labour force development in which the Commission des partenaires du marché du travail, a consultative body created in 1997 that brings together employer, labour, educational and community representatives, advises the Minister of Labour, Employment and Social Solidarity to guide public employment services to meet the needs of the labour market, from both the business and labour perspectives;
  6. Whereas the Commission des partenaires du marché du travail has advisory committees that focus on youth, persons with disabilities and Indigenous persons;
  7. Whereas, in order to modernize their labour market transfer agreements, Canada and Quebec wish to harmonize various provisions of the Agreement in Principle and the Implementation Agreement with the new Workforce Development Agreement;
  8. Whereas the modernization of Labour Market Transfer Agreements follows a 2016 pan-Canadian consultation by the Forum of Labour Market Ministers and a consultation by Quebec with the Commission des partenaires du marché du travail, in which 700 stakeholders voted on how best to meet the needs of Canadians;
  9. Whereas in terms of broad principles and objectives, in Quebec it is appropriate to maintain a client focused and results focused integrated, seamless and universal model for public employment and training services;
  10. Whereas Canada and Quebec agree that these broad principles and objectives will guide the investments made under the Agreement in Principle, the Implementation Agreement and the Workforce Development Agreement;
  11. Whereas Quebec determines the directions and priorities of the labour market in its territory and, as such, designs, offers and evaluates the employment and training measures and services in which it makes significant investments;
  12. Whereas Canada recognizes that the allocation of federal funding is done in accordance with Quebec’s jurisdiction, directions and priorities;
  13. Whereas Canada and Quebec recognize the importance of engaging their respective Indigenous partners, which in Quebec is reflected in the activities of the Commission des partenaires dans le marché du travail;
  14. Whereas Canada and Québec recognize the importance of the services provided by Indigenous partners;
  15. Whereas, in November 2017, the Government of Quebec created the Secrétariat aux relations avec les Québécois d’expression anglaise, whose main mandate is to ensure that the concerns of English-speaking Quebecers are taken into account in government policies and decisions and in matters of access to and application of government programs;
  16. Whereas Canada and Quebec agree that strong accountability and evaluation mechanisms are essential to demonstrate the results of public employment services and to guide the development of programs and policies;
  17. Whereas Canada recognizes that Quebec has already put in place such mechanisms and will continue to report to its residents in that regard;
  18. Whereas Canada and Quebec recognize the importance of continuous improvement and that it is based on labour market information, the sharing of best practices and the promotion of innovation;
  19. Whereas on June 22, 2017, the Budget Implementation Act, 2017, No. 1 amended the Employment Insurance Act (EI Act) to expand eligibility for assistance through the employment benefits and support measures established under Part II of the EI Act that came into force on April 1, 2018;
  20. Whereas Quebec also wishes to expand eligibility for assistance that may be provided under similar benefits and measures;
  21. Now therefore, the Parties agree to amend the Agreement in Principle, as amended from time to time, and the Implementation Agreement as follows:

Clauses

Part A – Agreement in principle

  1. paragraph i of clause 3.1.3 (B) of the Agreement in Principle is replaced by the following:
    • I. organizations that provide employment assistance services;
  2. paragraph i of clause 3.1.3 (B) of the Agreement in Principle is replaced by the following:
    • II. employers, employee or employer associations, community organizations and communities to develop and implement strategies to deal with labour force changes, meet human resource requirements and provide assistance to people who are employed, at risk of losing their job or who need help to keep their job;
  3. the definition of “Employment Insurance participant” in clause 3.4 of the Agreement in Principle is replaced by the following:

    in this clause and throughout this agreement, the term “Employment Insurance participant” means an insured person under Employment Insurance who applies for assistance under an employment benefit and who, at the time of the application, is an unemployed person, as the case may be:

    1. who is an active Employment Insurance claimant;
    2. in respect of whom a benefit period has been established or ended within the last 60 months;
    3. in respect of whom a benefit period has been established under a provincial plan, as defined in section 76.01 of the Employment Insurance Regulations, or has ended within the last 60 months, and who would have been eligible for special benefits under section 22 or 23 of the Employment Insurance Act had they not been eligible for provincial benefits, as defined in section 76.01 of the Employment Insurance Regulations, under a “provincial plan”;
    4. who has made employee contributions, as defined in section 2 of the Employment Insurance Act., in at least 5 of the preceding 10 calendar years and, in respect of those contributions, was not entitled to a refund under subsection 96(4) of the Employment Insurance Act.
  4. clause 4.1.3 of the Agreement in Principle is replaced by the following:
    • 4.1.3 Quebec agrees that priority access to active employment measures is given to active employment insurance claimants.
  5. clause 5 of the Agreement in Principle is amended by adding the following after clause 5.3:

    5.3.1 The Parties agree that the accountability framework related to increasing the maximum contribution that may be made to Quebec under clause 7H of this Agreement for the 2019 to 2020 to 2022 to 2023 fiscal years will respect the process described in clause 5 of this Agreement.

  6. clause 5.4.1 of the Agreement in Principle is replaced by the following:

    5.4.1 Annual Plan

    • In view of the labour market objectives pursued in this Agreement;
    • Whereas the funds provided as a financial contribution in connection with this Agreement are intended to support the achievement of those objectives;
    • Whereas an accountability framework is needed, among other things in order to measure the results obtained through the use of the funds provided as financial contributions from the Employment Insurance Account, and in view of the fact that both Parties are accountable to their respective legislatures;
    • Whereas, given the strong partnership structure in the planning and delivery of public employment services, including the Commission des partenaires du marché du travail (CPMT) and the regional labour market partners councils, Quebec ensures that it meets the various regional labour market needs in terms of labour and employment;
    • Whereas the Government of Quebec, in November 2017, set up the Secrétariat aux relations avec les Québécois d’expression anglaise, whose mandate includes ensuring that the concerns of English-speaking Québecers are taken into account in government actions and decisions and in regard to access to and the application of government programs, liaising with the sectoral, regional and provincial groups that represent them, and advising the government on service delivery and on the issues, agreements, programs and policies that may have a direct or indirect impact on this community;
    • Whereas, pursuant to the Act respecting the Ministère de l’Emploi et de la Solidarité sociale and the Commission des partenaires du marché du travail (CQLR, c. M-15.001), the Ministère du Travail, de l’Emploi et de la Solidarité sociale (MTESS) prepares, in collaboration with the CPMT, an annual action plan on labour and employment;
    • Quebec shall, for each fiscal year during the term of this Agreement, beginning in fiscal year 2019 to 2020, make available the MTESS annual labour and employment action plan on February 15 or when it is tabled in the National Assembly.
    • This annual action plan shall, for the purposes of this Agreement and the Implementation Agreement, represent the annual plan. This annual plan shall set out:
      • the issues concerning labour markets and the clients selected for intervention;
      • strategic directions stemming from this analysis, taking into account, among other things, government directions as well as the priorities of the Minister and the CPMT;
      • areas of intervention and strategies for addressing those issues and responding to the labour market needs identified;
      • targeted outcome indicators, the level of their targets, and the results achieved in relation to client participation in public employment service interventions;
      • intervention budgets available to MTESS to meet its targets, the allocation of this budget among regional and central envelopes, major budget items, and the amount of Canada's transfers under bilateral labour market agreements, broken down by agreement.
    • Within 30 days after the release of the annual action plan, Quebec shall also provide to Canada relevant public information, including information on public employment measures and services in Quebec and targeted clients.
  7. The Agreement in Principle is amended by adding the following after clause 7G:
    • “Targeted increase for the contribution to the costs of active employment measures in Quebec”
    • 7H notwithstanding the provisions of clause 7, in each fiscal year from 2019 till 2020 to 2022 till 2023, Canada agrees to increase the maximum contribution that may be made to Quebec under clause 7, based on an allocation method that takes into account Quebec’s share in the pan-Canadian total of the following 2 variables, which shall be updated annually:
      1. number of EI Part I claims for which regular benefits were paid (representing 50% of the total value);
      2. number of unemployed (representing 50% of the total value).
    • The maximum contribution payable under clause 7 relating to the costs of active employment measures in Québec is increased by an amount not exceeding the amount determined by the following formula
      • ( (A × 0.5) + (B × 0.5) ) * C

        where:

        • A is the number of Part I EI claims for which regular benefits have been paid to residents of Québec, divided by the number of such claims for Canada as a whole, based on data obtained and prepared by Canada for the purposes of the Employment Insurance Monitoring and Assessment Report required pursuant to section 3 of the EI Act to be published at the beginning of the fiscal year for which the additional funding is calculated;
        • B is the average number of unemployed persons residing in Québec, divided by the average number of unemployed persons in Canada, according to the monthly Labour Force Survey published by Statistics Canada during the fiscal year covered by the Monitoring and Assessment Report used to calculate variable "A";
        • C is, subject to Parliamentary appropriation, the amount of additional annual pan-Canadian funding to be distributed among provinces and territories for fiscal years 2017 till 2018 to 2022 till 2023.
  8. The Agreement in Principle is amended by adding the following after clause 7.16:
    • 7.17 Notwithstanding clause 7H and clause 7.8 of this Agreement, Québec may use up to 10% of the additional annual contribution payable by Canada under clause 7H of this Agreement for costs related to the administration of active employment measures for fiscal year 2019 to 2020 if Québec’s total contribution for administration costs under clause 7.8 of this Agreement for the previous fiscal year was less than 30% of the maximum contribution for active employment measures costs under clause 7 of this Agreement for the previous fiscal year.

Part B – Implementation Agreement

  1. Clause 2.0 of the Implementation Agreement is amended by adding the following clauses after clause 2.2.3.3:
    • 2.2.4 Designated representatives;
    • 2.2.4.1 For the purposes of this Agreement, the Senior Assistant Deputy Minister of the Skills and Employment Branch of Employment and Social Development Canada is the designated representative of Canada, and the sous-ministre adjoint du développement et des partenariats de Services Québec of the ministère du Travail, de l’Emploi et de la Solidarité sociale is the designated representative of Québec;
    • 2.2.4.2 The Parties may, upon written notice to the other party, designate a new representative to replace the existing designated representative;
    • 2.2.4.3 The designated representatives, or their alternates, shall meet as required to resolve issues arising under the Agreement in Principle and this Agreement.
  2. Clause 4.0 of the Implementation Agreement is amended by adding the following clauses after clause 4.3.1:
    • 4.4 principles and objectives
      • 4.4.1 Canada and Quebec agree that the main objectives of active employment measures are to encourage inclusive participation in the labour market, promote training for employment, and foster labour market resilience and efficiency;
      • 4.4.2 Canada and Quebec agree that the active employment measures developed by Quebec in collaboration with its labour market partners are based on the key principles of being:
        • centered on client needs, among other things to minimize barriers to accessing measures and services;
        • inclusive, including to support under-represented groups and those further removed from the labour market; and
        • centered on results, flexible, responsive and innovative.
        • These active employment measures particularly aim to improve the level of training, increase knowledge, maintain supports and strengthen employment partnerships.
      • 4.4.3 Quebec’s active employment and training measures may be offered in person, online or by any other means.
  3. Clause 5.2.3.3 of the Agreement in Principle is replaced by the following:
    • 5.2.3.3 Québec shall provide to Canada, pursuant to the terms and conditions set out in Appendix V - "Information and Data Exchange", the data required for the purposes of calculating the results for the primary indicator, that is, savings to the Employment Insurance Account.
  4. Clause 5.2.3.6 of the Agreement in Principle is replaced by the following:
    • 5.2.3.6 For the purpose of measuring and analyzing results, Canada and Québec agree to exchange information in the manner set out in Appendix V - "Information and Data Exchange".
  5. Clause 5.0 of the Implementation Agreement is amended by adding the following before clause 5.3:
    • 5.2.01 Annual Report;
    • Every year, MTESS produces an annual management report that contains a separate component on the results of the annual workforce and employment action plan, developed in conjunction with the CPMT;
    • Québec shall, for every fiscal year during the term of this Agreement, beginning in fiscal year 2019 to 2020, make available the MTESS annual management report on October 1 or when it is tabled in the National Assembly. That annual plan shall set out:
      • the key strategies implemented to realize the directions of the annual action plan and its targeted outcomes;
      • the results achieved against those targets and the factors that explain any differences between the targets and the outcomes; and
      • use of the budget, including transfers from Canada under bilateral labour market development agreements.
    • Within 30 days after the release of the annual management report, Quebec shall forward to Canada a document containing structured information to describe and attest to the outcomes of the programming funded in part by this agreement and the Agreement in Principle and the Workforce Development Agreement.
  6. Clause 5.5.1 of the Agreement in Principle is replaced by the following:
    • 5.5.1 Quebec shall provide a statement of revenues and expenses for each fiscal year in the form and manner set out in the template in Appendix VIII detailing, among other things, the amount of the costs that Quebec actually incurred during the fiscal year in respect of each active employment measure, the administrative costs associated with those measures and the functions of the national employment service for which Quebec is responsible, the amount of overpayments recovered and the amount of loans repaid.
  7. clause 5.0 of the Implementation Agreement is amended by adding the following after clause 5.5.6:
    • 5.5.7 Canada and Quebec agree that the audit and attestations by the Auditor General of Quebec under this clause may be conducted by an agent of the Auditor General of Quebec or an independent public accounting firm registered under the laws of Quebec;
    • 5.5.8 Quebec’s use of Canada’s annual additional contribution provided under clause 7.17 of the Agreement in Principle for administration costs for fiscal year 2019 to 2020 shall be included in the statement of revenue and expenses provided under clause 5.5.1.
  8. Clause 5.6.6 of the Implementation Agreement is replaced by the following:
    • 5.6.6 for the purpose of detecting and controlling abuse, Canada and Quebec agree to exchange information in the manner set out in Appendix V - "Information and Data Exchange"
  9. Clause 7.2 of the Implementation Agreement is replaced by the following:
    • 7.2 Federal contribution delivery mechanism;
    • 7.2.1 Canada shall pay its annual contribution, including the additional contribution under clause 7H of the Agreement in Principle, for active employment measures and administration costs in two installments for each fiscal year. The first payment shall be made on or around April 1st of each fiscal year and the second payment shall be made on or around October 1st of each fiscal year:
      1. the amount of the first installment shall be an amount equal to fifty percent (50%) of the total amount of Canada’s maximum contribution for the fiscal year based on the Canada’s maximum contribution to Quebec during the fiscal year for active employment measures and administration costs;
      2. the amount of the second installment shall be an amount equal to the balance of Canada’s total contribution to Quebec during the fiscal year for active employment measures and administration costs.
      • 7.2.1.1 For the 2019 to 2020 fiscal year, the amount of the first installment referred to in subclause 7.2.1(1) shall be reduced by any amount already paid by Canada to Quebec under this Agreement for that fiscal year.
    • 7.2.2 Canada shall pay its first instalment for the fiscal year in accordance with clause 7.2.1 once Quebec has shared with Canada the information identified in subclauses 10.1.1(5)(a) and (b) related to the work or a meeting of the Labour Market Committee;
    • 7.2.3 Canada shall pay its second installment for the fiscal year in accordance with clause 7.2.1 of this Agreement once the prior year’s Annual Report and Annual Statement of Revenue and Expenditures have been provided by Quebec in accordance with clauses 5.2.01 and 5.5.1 of this Agreement;
    • 7.2.4 On October 15 of each year, Quebec undertakes to provide to Canada the amount of cumulative expenses incurred at September 30 for active employment measures funded from the Employment Insurance Account;
    • 7.2.5 Under no condition shall the aggregate amount paid by Canada for a fiscal year exceed the maximum amount of the contribution made available to Quebec as set out in Appendix XI of this Agreement for that fiscal year;
    • 7.2.6 The aggregate amount of the annual contribution for active employment measures to be paid by Canada, subject to the outcome of the financial audit, shall correspond to the costs incurred (expenses incurred in the fiscal year) by Quebec under this Agreement minus any overpayments recovered and loans repaid. However, under no condition shall the amount disbursed by Canada exceed the amount confirmed in Appendix XI of this Agreement for the fiscal year in question;
    • 7.2.7 Quebec undertakes to provide preliminary data on the total annual use of the contribution within five working days following the end of its first additional accounting period in each fiscal year just ended, and to reimburse Canada immediately for any excess payments;
    • 7.2.8 Following the financial audit, any surplus paid by Canada under this Agreement, excluding overpayments established pursuant to clause 5.6.4 of this Agreement, shall immediately be reimbursed;
    • 7.2.9 Quebec undertakes to fully reinvest recovered overpayments and repaid loans in active employment measures identified in the annual plan in accordance with clauses 5.4.1 and 5.4.2 of the Agreement in Principle;
    • 7.2.10 Funds not used in a given fiscal year lapse.
  10. Clause 10 of the Implementation Agreement is replaced by the following:
    • 10.0 Joint mechanisms
    • 10.1 The Parties agreed to establish three joint committees:
      • a joint Canada-Quebec Labour Market Agreement Implementation Committee for the period leading up to Quebec's assumption, for the transition period and for the breaking-in period, as defined in clause 2.2.3 of this agreement, and whose composition, terms of operation and mandate are set out in Appendix X;
      • a joint Canada-Quebec labour market agreement monitoring committee called the Labour Market Agreement Monitoring Committee whose composition, terms of operation and mandate are set out in Appendix X;
      • a joint Canada-Quebec committee called the Labour Market Committee, that will facilitate strategic discussions related to the labour market, this Agreement, the Agreement in Principle and the Workforce Development Agreement.
    • 10.1.1 Labour Market Committee
      1. The Committee will facilitate strategic discussions related to the labour market, this Agreement, the Agreement in Principle and the Workforce Development Agreement;
      2. The Labour Market Committee will be co-chaired by the designated representatives of the Parties and shall meet at least twice a year, on or around February 15 and October 1st, or at a time agreed to by the co-chairs. Co-chairs may invite representatives from other agencies, departments or portfolios to attend Committee meetings as required.
      3. The Assistant Deputy Minister of Service Canada responsible for the Quebec Region shall be represented on the Labour Market Committee.
      4. Decisions of the Committee will be made by consensus on matters under its authority.
      5. The role of the Labour Market Committee includes, but is not limited to:
        1. sharing the most up-to-date information available identified in clause 5.4.1 of the Agreement in Principle;
        2. sharing information on regional or local labour market challenges and priorities, and an overview of consultations with various relevant stakeholders;
        3. exchanging information on best practices and holding strategic discussions related to this Agreement, the Agreement in Principle and the Workforce Development Agreement;
        4. discussing regional issues, avoiding duplication of federal programs with Quebec’s employment and training programs, and finding ways to better coordinate the delivery of some of those programs;
        5. sharing information on innovative labour market policies and programs as well as general labour market developments and bilateral issues that may not be governed by this Agreement, the Agreement in Principle and the Workforce Development Agreement.
  11. Clause 4.0 of Appendix II of the Implementation Agreement entitled Nature of Measures and Services Provided under the Canada-Quebec Labour Market Agreement in Principle is replaced by:
    • 4.0 Workforce integration
    • 4.1 Workforce integration includes all measures to integrate or reintegrate unemployed workers into employment and to keep workers in employment, including employability assistance, job search clubs, integration businesses, training businesses, work platforms, labour intermediary corporations, wage subsidies for hiring, mobility aids, etc.
  12. Clause 2.4 of Appendix III of the Implementation Agreement entitled Implementation Mechanisms is replaced by:
    • 2.4 Once Canada has informed it of the referrals made, Quebec will provide the necessary follow-up information for purposes of eligibility for Part I Employment Insurance (see Appendix V - "Information and Data Exchange").
  13. Clause 2.5 of Appendix III to the Implementation Agreement entitled Implementation Mechanisms is replaced by:
    • 2.5 Canada shall provide Quebec with computer access to historical data concerning participants' eligibility for Employment Insurance Account-funded Employment Benefits, previous interventions by Canada's employees as part of the regular administration of active measures, and the strategic selection of Employment Insurance users for NES support measures (see Appendix V - "Information and Data Exchange").
  14. Clause 2.6 of Appendix III of the Implementation Agreement entitled Implementation Mechanisms is replaced by:
    • 2.6 When Quebec assumes responsibility, it will be responsible for notifying every user who has an active employment record at HRDC with an action plan about the new context and the new administrative operating procedures. To that end, Canada will provide Quebec with relevant information related to the concerned users in the form of computerized files (see Appendix V - "Information and Data Exchange").
  15. Clause 2.7 of Appendix III of the Implementation Agreement entitled Implementation Mechanisms is replaced by:
    • 2.7 From the perspective of continuity of service to users, Canada and Quebec agree on the need for a transfer to Quebec's systems of data from HRDC records on individuals for whom an intervention process is underway at the time of the transfer of responsibility to Quebec (see Appendix V - "Information and Data Exchange").
  16. Clause 2.4.2 of Appendix X to the Implementation Agreement entitled Joint Committee Provisions is amended by adding the following after subclause (d):
    • (e) the Committee will be a place to exchange information on possible changes to the Tracking, Referral and Feedback System to improve its performance.
  17. The Parties agree that nothing in this amending agreement will affect the manner in which Canada allocates current Employment Insurance funding ($1.95 billion per year) to determine the maximum annual amount of contributions to Quebec, pursuant to clause 7.1 of the Agreement in Principle. The Parties acknowledge that the current method referred to in clause 7.1 of the Agreement in Principle respecting the allocation between the provinces and territories of the current $1.95 billion is the allocation method set out in the June 26, 1996 letter from the Deputy Minister of Human Resources Development Canada to the Associate Secretary General for Canadian Relations for Quebec.
  18. The Parties agree to update Appendix V - Information and Data Exchange – and Appendix VIII – Fiscal Year 19XX-19XX Results of the Implementation Agreement.
  19. To facilitate early interventions with EI clients, Quebec will continue to use the Targeting, Referral and Feedback system that it developed jointly with Canada and whose terms and conditions for sharing information necessary for its implementation are detailed in Appendix V - Information and Data Exchange of the Implementation Agreement.
  20. All other provisions of the Agreement in Principle and the Implementation Agreement remain unchanged.
  21. This amending agreement shall be read with the Agreement in Principle and the Implementation Agreement, as amended from time to time, and shall be taken into account as if its provisions were part of the Agreement in Principle and the Implementation Agreement.
  22. The clauses of this amending agreement shall come into force when it is signed by both Parties.


Signed on behalf of Canada
in Gatineau
this 13 day of June, 2019

____________________________
The Honourable Jean-Yves Duclos
Minister of Employment and Social Development
styled as the Minister of Families, Children and Social Development

Signed on behalf of Québec
in Québec
this 10 day of July, 2019

____________________________
The Honourable Jean Boulet
Minister of Labour, Employment and Social Solidarity




____________________________
Graham Flack
Chairperson, Canada Employment
Insurance Commission




____________________________
Sonia LeBel
Ministre responsible for Canadian Relations
and the Canadian Francophonie

Report a problem or mistake on this page
Please select all that apply:

Thank you for your help!

You will not receive a reply. For enquiries, contact us.

Date modified: