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SOCI - Standing Committee

Social Affairs, Science and Technology

 

Proceedings of the Standing Senate Committee on
Social Affairs, Science and Technology

Issue No. 51 - Evidence - November 20, 2018


OTTAWA, November 20, 2018

The Standing Senate Committee on Social Affairs, Science and Technology met this day at 2:06 p.m. to study the subject matter of those elements contained in Divisions 8, 15, 16 and 21 of Part 4 of Bill C-86, A second Act to implement certain provisions of the budget tabled in Parliament on February 27, 2018 and other measures (topic: Divisions 8, 15 and 16).

Senator Chantal Petitclerc (Chair) in the chair.

[Translation]

The Chair: Good afternoon everyone.

[English]

Welcome to the Standing Senate Committee on Social Affairs, Science and Technology. My name is Chantal Petitclerc.

[Translation]

It’s a pleasure to be chairing today’s meeting. This afternoon, we begin our study of those elements contained in Divisions 8, 15, 16 and 21 of Part 4 of Bill C-86, A second Act to implement certain provisions of the budget tabled in Parliament on February 27, 2018 and other measures.

[English]

I would like to thank our guests for being here today. As you have noticed, we have had to make some changes to our agenda. Our guests have one hour with us today, maybe a little more. We thank them.

It’s a very busy day for you. You have to return to the Finance Committee for clause by clause, so we appreciate your time. We will try to be very efficient with the time you have to answer our questions.

Without any delay, I would ask that we start right away with the seven-minute presentations that you have on the different divisions, and then we will follow up with questions.

Andrew Brown, Director General, Employment Insurance Policy, Skills and Employment Branch, Employment and Social Development Canada: Thank you and good afternoon. I’m the director general responsible for Employment Insurance policy at Employment and Social Development Canada. Joining me today is Rutha Astravas, the director responsible for Employment Insurance, Special Benefits.

[Translation]

We are here to discuss the proposed amendments to the Employment Insurance Act, which would increase the number of weeks of parental benefits payable where both parents have agreed to share them, as well as related amendments to the Canada Labour Code.

[English]

I’ll begin by sharing with the committee some information on the EI program and the support it offers to Canadians.

Employment Insurance is Canada’s largest labour market program, playing a key role in Canada’s economic and social union. The program provides temporary income support when workers lose their job through no fault of their own, known as regular benefits, and in specific life circumstances that may occur over the course of one’s working career, known as EI special benefits. Special benefits play an important role in helping individuals balance work and life responsibilities. Special benefits include maternity, parental, sickness and caregiving benefits.

Workers need to have accumulated at least 600 hours of insurable employment during the year — 52 weeks — before the start date of their claim or since their last EI claim to qualify for special benefits, including maternity and parental benefits. These provisions do not make any changes to the eligibility requirements.

Currently, there are 35 weeks of EI parental benefits available that can be shared among parents. In 2016-17, over 196,000 parents received EI parental benefits, representing a total of $2.7 billion. This bill would amend the EI Act to introduce a parental sharing benefit. The objective of the measure is to promote gender equality, and it would provide parents with additional weeks of parental benefits for parents who share these benefits when welcoming a newborn or newly adopted child. With the parental sharing benefit, parents would be able to receive 5 additional weeks of standard parental benefits for a total of 40 weeks. These would continue to be paid at the 55 per cent rate of average weekly insurable earnings over a period of 12 months. No parent would be able to receive more than 35 weeks of parental benefits. If one parent took 35 weeks, there would be 5 weeks left for the other parent.

Since December 2017, an extended parental benefits option has also been available that offers 61 weeks of EI extended parental benefits paid at a lower replacement rate. For the extended parental benefits option, the parental sharing benefit would offer 8 additional weeks of benefits for a total of 69 weeks of extended parental benefits. No parent would be able to receive more than 61 weeks of extended parental benefits.

[Translation]

The parental benefit would be inclusive and available to eligible birth and adoptive parents, including both opposite-sex and same-sex parents. The measure would be available to parents with children born or placed for adoption on or after March 17, 2019, the date on which the amendments are scheduled to come into force, and parents who agree to share parental benefits.

The parental sharing measure incorporates elements of Quebec’s regime, which has shown that incentives play a key role in the decision as to which parent takes time off work to care for the child. Prior to the introduction of the Québec Parental Insurance Plan in 2006, just 20 per cent of fathers took advantage of parental benefits. In 2015, some 80 per cent of Quebec fathers claimed parental benefits under the provincial plan.

The proposed changes will have no direct effect on Quebec residents, given that the province currently provides maternity, parental and adoption benefits through the Québec Parental Insurance Plan.

[English]

It is estimated that up to 97,000 Canadian parents may claim the EI parental sharing benefit per year, and the bill ensures that the same changes that apply to insured workers will also apply to self-employed workers who voluntarily participate in the EI program by paying premiums. This proposed amendment for EI parental benefits represents an incremental cost of $345 million per year and a total of $1.3 billion over a five-year period. In accordance with the EI Act, these costs will be charged to the EI Operating Account and recovered through EI premiums. This measure is expected to result in upward pressure on the EI premium rate of approximately 2 cents per $100 of insurable earnings.

[Translation]

I will now turn the floor over to my colleague, who will explain the related amendments to the Canada Labour Code.

[English]

Barbara Moran, Director General, Strategic Policy, Analysis and Workplace Information, Labour Program, Employment and Social Development Canada: I’m Barbara Moran, Director General, Strategic Policy, Analysis and Workplace Information, Labour Program of ESDC. I’m going to briefly discuss the proposed amendments to Part III of the Canada Labour Code that correspond to the changes Andrew just described.

As a reminder, Part III of the code establishes minimum working conditions in the federally regulated private sector, such things as hours of work, annual vacation, various types of unpaid leave. The federally regulated private sector includes about 6 per cent of all Canadian employees employed in industries such as banking, telecommunications, interprovincial and international transportation, federal Crown corporations and certain activities on First Nations reserves. Part III does not, however, apply to the federal public service.

In general, when amendments are made to Employment Insurance special benefits, corresponding amendments are made to the unpaid leaves under the code. This ensures that federally regulated employees have the right to take unpaid job-protected leaves while receiving EI special benefits without fear of losing their job. Amendments are therefore being proposed to Part III to increase the amount of parental leave that may be taken when shared between employees.

More specifically, the amendments will increase the maximum aggregate amount of parental leave that may be taken by more than one employee for the same birth or adoption from the current 63 weeks to 71 weeks, while the maximum amount of leave taken by one employee will remain at 63 weeks. And they will increase the maximum aggregate amount of maternity and parental leave taken by more than one employee from the current 78 weeks to 86 weeks, while one employee cannot take more than the current 78 weeks of maternity and parent leave.

That finishes the parental leave portion. I will move to the next section, clauses 441 to 534. These are further changes to modernizing labour standards.

Essentially, to ensure that labour standards are robust and modern in the new world of work and that they both protect employees and support productive workplaces, amendments are being proposed to update federal labour standards to strengthen the rights and protections of employees in the federally regulated private sector and provide a solid foundation to equip employees and employers to succeed in this changing world of work.

[Translation]

Currently, an individual has to be continuously employed by the same employer for a minimum length of time before they are eligible to take advantage of a number of labour protection measures and rights, under Part III of the Labour Code. Employees who change jobs frequently have trouble meeting these requirements.

[English]

To improve employees’ eligibility for labour standards, amendments are being proposed to eliminate the minimum length of service requirements for general holiday pay, sick leave, maternity leave, parental leave, leave related to critical illness, and leave related to death or disappearance of a child. The length of service required to be eligible for three weeks of vacation with pay would also be reduced from six weeks to five.

Now we will go through the next bundle.

[Translation]

It is challenging for many employees to balance their work and family lives owing to time and scheduling constraints. That is especially true for non-unionized workers and those engaged in precarious employment, who do not enjoy the same job stability or working conditions as permanent employees who work full time.

[English]

To further improve work/life balance, the Canada Labour Code would be modified by adding an unpaid break of 30 minutes for every 5 hours of work, a minimum eight-hour rest period between shifts, and unpaid breaks for nursing and medical reasons; requiring employers to provide employees at least 96 hours advance notice of their schedules; adding four weeks of vacation with pay after 10 years or more of service with the same employer; introducing a new five-day personal leave, of which three days are paid, and five days of paid leave for victims of family violence out of 10 days in total; improving access to medical leave by allowing it to be taken for medical appointments; clarifying that it covers organ or tissue donation, and only allowing employees to request a certificate for a leave of three or more consecutive days; and introducing a new and unpaid leave for court our jury duty.

Amendments are also being proposed to enhance the leave of absence for members of the Reserve Force in order to ensure that reservists are properly trained to deploy on missions while balancing fairness for employers. Specifically, the proposed amendments would reduce the length of service requirements to be eligible for the leave from six to three months, allow the leave to be used to attend Canadian Armed Forces military skills training, and limit the maximum amount of leave that an employee may take to 24 months in any 60-month period, subject to exceptions such as declared national emergencies.

These amendments respond to the Auditor General’s recommendations and advance National Defence commitments as well.

[Translation]

Employees engaged in non-standard employment face different challenges than those with typical jobs, and those challenges vary depending on the worker. For instance, employees with temporary or part-time jobs may not be paid the same wage as their full-time counterparts and may have a harder time accessing certain rights and protections, putting them in an even more precarious situation.

[English]

To ensure that employees in precarious work are paid and treated fairly and have access to labour standards, amendments are being proposed to require that casual, part-time, temporary and seasonal employees are paid equally to full-time employees when performing substantially the same job for the same employer. This requirement would not apply if the difference in rates of pay is based on objective factors such as seniority or merit.

Amendments would protect temporary help agency employees from unfair practices, such as being charged a fee for being assigned work; require employers to provide employees with information about labour standards requirements and their conditions of employment, and to entitle all employees to be informed of promotion opportunities. They would prohibit employers from treating an employee as if they were not their employee in order to avoid their obligations or to deprive the employee of their rights, and they would treat employees’ length of service as continuous in cases of contract retendering within the federal private sector or when the employment is transferred from a provincially regulated employer to a federally regulated employer. It would allow an employee to seek reimbursement of work-related expenses and raise the minimum age of work in hazardous occupations from 17 to 18 years of age.

[Translation]

Amendments are also proposed to ensure that employees who are being terminated are given notice and adequately compensated in order to protect their financial security.

[English]

Specifically in situations where 50 or more employees are being terminated, employers would now be allowed to provide pay in lieu of the required 16-week group notice, or a combination of notice and pay in lieu. Employers would also be required to give employees eight weeks’ notice of individual termination or pay in lieu. The ability for employers to request waivers from the group termination requirements would be eliminated.

In situations where fewer than 50 employees are being terminated, the current two-week notice of individual termination requirement would be replaced with a graduated notice of termination that would range from two weeks’ notice, pay in lieu of notice, or a combination of notice and pay in lieu for employees with between three months and less than three years of continuous employment, up to a maximum of eight weeks after eight years of continuous employment. Employers would also be required to inform terminated employees about their termination rights.

Finally, there are a number of amendments to the code’s administration provisions that are being proposed to resolve technical issues, eliminate duplication of recourse mechanisms, clarify existing provisions and ensure the efficient treatment of complaints. For example, the amendments would broaden the scope of health care practitioners who can issue medical certificates to reflect changes in which health care services are delivered, improve access to leave and help reduce the pressure on the health care system. They would also transfer responsibilities for adjudicating genetic testing complaints from adjudicators to the Canada and Industrial Relations Board, as this will also be the case with respect to the adjudication of wage recovery and unjust dismissal complaints.

I’ll now turn to Charles Philippe Rochon to outline Subdivision B.

Charles Philippe Rochon, Senior Policy Analyst, Labour Standards and Wage Earner Protection Program, Labour Program, Employment and Social Development Canada: I work in the labour standards policy unit at the Labour Program. I will speak about Subdivision B of Division 15 of Part 4 of the BIA. These are clauses 535 to 625. It is a fairly lengthy part of the BIA, but it is there to deal with a technical issue related to what has just been described in terms of the changes to Part III of the Canada Labour Code.

Subdivision B would bring a number of amendments to Part II, “Occupational Health And Safety”; Part III, labour standards; and Part IV, the new administrative monetary penalties part of the code, the last of which is not yet enforced.

It would essentially provide for the designation of a head of compliance and enforcement by the Minister of Labour. This new head of compliance and enforcement would exercise the powers and perform the administrative duties and functions that are currently conferred on inspectors, regional directors and the Minister of Labour with respect to the administration and enforcement of the Canada Labour Code.

The head of compliance and enforcement would have the authority to delegate to any qualified person or class of persons any of these powers, duties or functions. That would include, for example, current inspectors, regional directors and others. Essentially, although it will change the responsibilities and who is assigned those responsibilities for the purposes of the code, this does not necessarily lead to immediate changes in terms of how the work is actually done on the ground.

The head of compliance and enforcement would be responsible for the day-to-day administration and enforcement of the code, but the minister would still retain a number of responsibilities under the code. The minister would still be responsible for appointing advisory committees, entering into administrative agreements with provincial governments, recommending regulations to the Governor-in-Council, giving consent to any prosecution, and the minister would be ultimately responsible and accountable for the administration of the code, especially if no head of compliance and enforcement has been designated at a specific time.

The minister would also have the power to impose terms and conditions on the delegation powers of the head of compliance and enforcement. That would be, again, specifying any qualifying requirements in order to exercise any of these powers and responsibilities.

[Translation]

Clearly, these measures flow from certain objectives. The first is to improve client service and reduce the time it takes to process complaints related to labour standards and address health and safety issues in the workplace. The measure is especially important given that the Budget Implementation Act contains a series of amendments to federal labour standards. Not only are more standards being introduced, but they will also be more complex to administer.

The designation of a new Head of Compliance and Enforcement, who will still be supported by the Labour Program inspectorate, contributes to better program compliance and enforcement, provides greater operational flexibility to delegate, for instance, more qualified individuals to deal with specific matters, and harmonizes parts of the code that currently rely upon different enforcement regimes. This will result in better harmonization and a more integrated approach.

The measure reflects recommendations made by the Federal Labour Standards Review Commission more than a decade ago. The commission recommended a more integrated approach to Labour Program compliance and enforcement.

[English]

Just to conclude on this, it should be noted that all of the amendments in Subdivision B deal with a new head of compliance and enforcement. These do not change any of the rights of employees or obligations of employers. These are very technical changes. However, it is fairly lengthy, because everywhere in the legislation where there is a mention of inspectors, regional directors, et cetera, there was a need to actually change the language. A lot of provisions are opened, but the actual purpose of these provisions does not change.

Alex Duff, Manager, Wage Earner Protection Program, Policy and Oversight, Labour Program, Employment and Social Development Canada: I’m going to speak to Division 16 of Part 4 of the bill, clauses 626 to 653. These amendments will increase the maximum payment under the Wage Earner Protection Program Act and will provide more timely and equitable access to the program. It will also make other technical and administrative changes, which I will go over.

The Wage Earner Protection Program pays workers when their employer enters bankruptcy or receivership for wages they are owed — regular wages, vacation pay, severance pay or termination pay. These would increase the maximum payment under the program. The payments are tied to Employment Insurance maximum weekly insurable earnings. The current maximum is equivalent to four weeks of EI insurable earnings, which is an amount of $3,977. These amendments would increase it to seven weeks, which is $6,959. The 2018 numbers would increase year over year. The increase in the maximum payment would come into force on Royal Assent and would apply effective the date of the budget announcement, so February 27, 2018.

The amendments would also provide more timely payments to workers when an employer engages in a lengthy restructuring process under the Companies’ Creditors Arrangement Act or the Bankruptcy and Insolvency Act prior to filing for bankruptcy or entering receivership. When it’s clear that a business is failing and they are using a restructuring proceeding to effectively liquidate the assets, which is analogous what is going on with Sears Canada at the moment, this would enable us to trigger payment under the program sooner so that workers can get paid sooner and not have to wait possibly a number of years before there is an actual bankruptcy to trigger payment under the program.

The amendments would also expand eligibility to include individuals who worked for foreign companies operating in Canada that filed for bankruptcy or became subject to receivership outside of Canada, so long as the foreign proceeding is recognized by a Canadian court under the Bankruptcy and Insolvency Act. A court would have to determine that it meets prescribed criteria, which would be in regulations. There would also need to be a trustee appointed, because under the Wage Earner Protection Program, there always needs to be a trustee. We rely on them for certain administrative functions, such as telling us how much people are owed.

The amendments would also modify the definition of “eligible wages” to ensure that workers who continue to be employed following the date of bankruptcy or receivership remain eligible for WEPP payments in respect of termination and severance pay. They would strengthen provisions allowing the Crown to recover amounts paid out by WEPP. When a WEPP payment is made, the worker subrogates to the Crown their rights in respect of the wages they were owed, so the government can seek recovery of those amounts through insolvency proceedings. In some cases, a worker could be paid directly out of the insolvency proceeding. That money is effectively owed to the government because the worker received WEPP, so we want to ensure we avoid workers being paid and then having to go and try to get the money back. We would like trustees or other people who owe money to a worker to come to the government first, figure out if WEPP was paid and how much, and if there is a subrogated debt there, to pay the government first.

The amendments would also require individuals to inform the government if they are seeking a separate legal action in respect of those wages owed. That’s for similar reasons so that the government is aware the action is going on and can exercise its subrogated rights.

Another change is to confirm the minister’s authority to pay the fees and expenses of trustees and receivers. The norm is that fees and expenses of trustees and receivers are paid from the estate of the bankrupt or the property of the receiver. However, in certain cases, if there is not sufficient assets in the estate, there is a mechanism under the regulations for the minister to cover certain fees and expenses. The goal is to ensure there is a way for the bankruptcy to still occur so that workers can still take advantage of the program. That does require regulations. There are existing regulations that we would be looking to revise, and this legislative amendment will give us the authority to follow through with that.

Lastly, it will provide program recipients with the right to review an appeal with respect to overpayment decisions, which doesn’t currently exist under the act.

The Chair: Thank you very much. I would like to thank our witnesses.

It is a lot of information and a very different division. I want to assure committee members that, although we have limited time today, if required, we will reinvite the witnesses.

For now, I would like my colleagues to move forward with questions. Let’s try to be brief with our questions and precise on which division we want to ask about. We will begin with the deputy chair.

Senator Seidman: Thank you all very much for being here. I know it’s a tough day for you, so I really appreciate it.

My questions probably relate mostly to Division 8 and Division 15. I would like to ask you about the extent of the application of these changes.

It’s my understanding that the federal government can only legislate for federally regulated workplaces. So these parental benefits and the other Labour Code changes will only be accessed by 6 per cent of the Canadian workforce, roughly 18,000 employers and 900,000 employees. You laid out the costs of $1.3 billion over the next five years for the EI parental sharing benefit, and it will only be accessed by 6 per cent of the Canadian workforce population.

It’s a very nice benefit, but the uptake is on a small proportion of the population. Can you give me some help with how that really affects Canadian families?

Mr. Brown: The EI benefits are separate from the leave provisions, so I’ll speak to the benefits. They are available to all workers in Canada, save Quebec because of its separate program. Canadian workers would have access to the benefits, provided they meet the eligibility requirements. Where there are two or more parents seeking to access parental benefits, they could now access these additional weeks. It’s from that larger group of parents across the country that we’re estimating the 97,000 parents that could benefit annually.

To the leave provisions, only through changes to the Labour Code are we able to provide job protections specifically to workers in federally regulated workplaces. Provinces and territories would need to choose whether to make changes to their own leave provisions that would align with the EI benefits. Historically, provinces and territories tend to follow the federal lead, but that is a decision for them to make.

Senator Seidman: So it’s an attempt at trying to show a little leadership and pushing it along. Thank you for that.

In March of this year, there was a piece published in The Globe and Mail — “New parental-leave rules for fathers pose challenges for small businesses.” A degree of concern has been expressed that the parental leave will be a challenge. For example, small-business owners say it’s difficult to cover a short-term staffing gap of five weeks; it’s much easier to cover a gap of a year. You train someone over five weeks — a father takes five weeks — and then that person’s time is over.

What would you say about the impact this is going to have on small businesses? Did you consult with small-business employers in developing this new policy?

Rutha Astravas, Director, Special Benefits, Employment Insurance Policy, Skills and Employment Branch, Employment and Social Development Canada: Thank you for your question.

It’s important to note that even before the changes we’re making now, the parental benefit is available. It’s a shareable benefit, so employees can take up to the existing 35 weeks or up to the existing 61 weeks at a lower rate.

We did note that article, and we heard from employers — small-business owners — about how creating new EI special benefits or new leaves can have impacts on them, but it depends on each business.

We conducted public online consultations as well as a focused ministerial round table in the fall of 2016 when we were looking at the extended parental benefit and changes to bring more flexibility to maternity and caregiving benefits. Consultations at that time included the Canada Federation of Independent Business and a number of labour and employer organizations. We also received submissions from sectoral councils.

Views were mixed. Many employers applauded the fact that in this budget we’re trying to address gender equality, whereas others spoke about one-time costs to their business to adjust HR or payroll and also replacing employees while on leave.

To conclude, already we have a number of leaves that are shareable across parents or caregivers, so it’s not necessarily something new for employers to deal with.

Senator Seidman: Thank you.

Senator Eaton: With this leave for family violence, how do you determine that? Do you get a doctor’s letter, photographs from the hospital? Does someone phone you up and say, “My husband punched me; I’m not coming into today”? There is emotional as well as physical abuse, so how is that determined?

Ms. Moran: The leave for family violence was actually in previous legislation that passed. It was originally 10 days of unpaid leave. This legislation actually makes the first five days of it to be paid.

In terms of your question about the documentation for it, the way the 2017 legislation reads is that documentation can be requested by the employer if it’s reasonably practicable. That’s terminology we use in the code. If you have something like a doctor’s note that can be furnished, then the employer could request it. But in many cases as you point out, for family violence in particular, it could be that it’s just not reasonably practicable, so the legislation allows for that.

Senator Eaton: So it would be up to the employer’s discretion.

Ms. Moran: It would be up to the employer’s discretion.

Senator Eaton: I represent Ontario in the Senate. What kind of impact analysis have you done on the impact of forcing companies to pay part-time employees or casual workers at the same rate of full-time workers? Ontario is thinking of repealing those measures because they are viewed as job killers. I just wonder what your data is and where you got it.

Ms. Moran: We looked at the different provisions already available through collective agreements to come up with an estimate of what it would cost. I’m looking through my notes here.

Senator Eaton: Why is the government imposing that? Why is it not left to collective agreements?

Ms. Moran: One of the things about Part III of the Canada Labour Code is that it establishes a base level. In many cases, collective agreements do provide much more than what is under the Canada Labour Code. The code provides that base for the many employees who are not protected by collective agreements.

Senator Eaton: So you are taking the place of a collective agreement, in other words?

Ms. Moran: I think it’s just establishing a base level and then collective agreements may exceed that. And they do, as I mentioned, in many cases. This provides protection if there is no collective agreement and for smaller employers and so on.

Senator Eaton: How will that work if a province like Ontario repeals those measures? Will it just be used for federal employees, then?

Ms. Moran: Yes, all the changes I described are for the federally regulated private sector.

Senator Eaton: Thank you.

Senator Ravalia: I have a question for Mr. Brown with respect to foreign adoptions. In instances where a couple is adopting overseas, there may be a gap period before the adoption is formalized. I am aware of situations where people may travel to China or Nigeria. Once they arrive, there may be a two- to four-week gap before the documentation is completed. When would the benefits commence for a couple like that? Would they commence on receipt of the documentation of the formal adoption, or would it include the time they have to travel there and commence the process?

Ms. Astravas: In the case of all adoptions, it’s at the point of placement in the home of the worker that triggers the benefit as well as the leave. In the case of foreign adoption, the person would have to return to Canada with the child.

Senator Ravalia: In some instances, there are significant lag periods where couples may be left without an income during that period. Is there possibility of looking at those cases on a case-by-case basis?

Ms. Astravas: We are aware of the lag that can occur in any kind of adoption, whether private adoption through a public system as well as overseas adoption. However, the legislation is clear that in order to receive the benefit, you must be present with the child and caring for the child or children at the time. We do not cover instances where the child is not yet with a person.

However, there is one flexibility we introduced a few years ago. It is the foster-to-adopt stipulation, which means that if the child is already placed with you in your home and you are waiting for final adoption to come through — you are already in the adoption proceeding, have demonstrated a clear intent to adopt and the proceedings are well under way — you may begin to receive the EI parental benefits at that time, ahead of the formal, final papers coming. That is the only time. But the child must be present in the home.

Senator Ravalia: My final question is with respect to foreign bankruptcies. At the present time in Newfoundland and Labrador, we have a large hydro project at Muskrat Falls. One the companies, an Italian contractor, has declared bankruptcy, which has resulted in the loss of a significant number of middle manager jobs, individuals who have not been paid while this process goes through the courts. The actual time lag with respect to when the formal bankruptcy process is completed may result in individuals being shortchanged for a considerable period of time. Is there any recourse in that type of situation to expedite payment to these individuals?

Mr. Duff: It’s difficult to comment on a specific situation because if you have a foreign contractor, it depends whether there is a Canadian-based entity and who the workers are employed by.

The changes that I spoke about with respect to foreign proceedings would not come into force on Royal Assent; they would require the development of regulations. So they likely would not apply to a bankruptcy that occurred in the near future.

I’d be happy to look into a specific case because we are always looking to make sure the program applies when it should. In most instances, there is some sort of Canadian-based entity that would be the employer. The likelihood of a foreign entity being the employer is more remote; it doesn’t happen very often. It is a smaller loophole we are looking to fix, but hopefully in this instance there is a Canadian entity. And in that case, if that entity goes into bankruptcy, workers would be eligible under the Wage Earner Protection Program for wages earned in the six months prior to the bankruptcy. There could be a longer period if that employer went through a restructuring proceeding prior to bankruptcy, so they could restructure under the Companies’ Creditors Arrangement Act or a proposal under the Bankruptcy and Insolvency Act. In that case, it would be six months prior to those proceedings up until the date of the bankruptcy.

Senator Ravalia: Thank you.

[Translation]

Senator Mégie: My question pertains to Division 8 of the bill. Last year, under Budget 2017, the government made a small improvement to parental leave benefits. Now, Budget 2018 sets out even further improvements to the benefit. Did the measures flow from the consultation of Canadians or a comparison of the regimes in place elsewhere in the world?

Ms. Astravas: Thank you for the question, senator. As mentioned, we held consultations further to budgets 2016 and 2017, with the 2016 consultation informing the 2017 budget bill. The online consultation focused on employment insurance benefits, including maternity, parental and caregiving leave. Canadians, non-profit organizations and employers were asked for feedback on our proposal to provide greater choice and flexibility so that more situations would be covered when caregivers look after an adult or a child.

Further to that consultation process, we introduced changes to create a new benefit for caregivers who were looking after a critically ill or injured adult. We also made changes to the medical certificate requirements, allowing doctors and nurse practitioners to certify that the patient is critically ill or injured. Previously, the certificate had to be issued by a specialist in some cases, so the benefit is now much more accessible to people. We also made the maternity benefit more flexible, so that payments could begin sooner.

Many Canadians had comments regarding the eligibility requirements, but these provisions do not include any such changes. We did take into account Canadians’ suggestion for shared parental benefits or paternity leave. Many organizations, experts and researchers told us that having a non transferable benefit, as set out in this bill, was a good idea because it increases the participation of fathers or the second parent in caregiving. We also looked at what Quebec was doing to increase the proportion of fathers taking parental leave. In addition to that, we studied what OECD countries were doing. All of that research showed that a benefit accessible to fathers could contribute to a higher rate of caregiving sharing.

Senator Mégie: Thank you.

The Chair: Ms. Astravas, when you looked at the other regimes, did you find that opening up parental leave to fathers led to greater social acceptance of the male caregiving role? It likely wasn’t the main purpose of the measure, but was it a side effect?

Ms. Astravas: Yes, in fact it was. It was a significant effect, however, because without greater social acceptance, employers don’t necessarily let fathers, or parents in general, take leave or longer periods of leave. Sociologists, political scientists and even economists all found that to be the case when they studied the labour markets of OECD countries.

The biggest finding, though, of all the researchers had to do with gender equality. The introduction of paid leave for both parents had a major impact: the gender gap in labour force participation and wages shrank.

The Chair: Thank you very much.

[English]

Senator Dasko: I have a couple of points of clarification. The benefits that are received for 61 weeks, at the lower level, what is that lower level again? Can you describe the difference between the basic benefits and the lower benefits, and is that 61 weeks in addition to 35?

Ms. Astravas: No. Parents have a choice of benefit. The standard parental benefit is 35 weeks, paid at 55 per cent, or they may choose 61 weeks, paid at 33 per cent.

Senator Dasko: They choose between one or the other program. I understand that. That’s good.

To what extent was this program shared between spouses? Was it 95 per cent female or mothers taking it up? Do you have a number?

Ms. Astravas: The stats for 2016-17, parental benefits were taken by 85 per cent women and 15 per cent men.

Senator Dasko: So you really do expect that by limiting the extra five weeks there is a real incentive for the fathers to jump in and take that time.

Ms. Astravas: Yes, that’s the intended design. When Quebec implemented their dedicated paternity benefit, we saw that their take-up rates went from approximately 20 per cent in 2005 up to 80 per cent in 2015.

Senator Dasko: It’s the extra weeks. They take it or lose it.

Ms. Astravas: Yes.

Senator Dasko: Ms. Moran, where did you come up with the 96 hours of advance notice that employers have to give with regard to the scheduling of workers? And, of course, this is in federally regulated industries which may not be so affected by this, but I can certainly think of many industries where it would be difficult to provide a schedule so far ahead. Where did the 96 hours come from?

Ms. Moran: In terms of the 96 hours, we actually did extensive consultations in preparation for all of these changes to the Labour Code. We did a series of round tables. We had a virtual network of academics, experts, that type of thing, as well as an online consultation where we got extensive feedback from a range of different stakeholders. We landed on the 96 hours based on that, as well as our analysis of what collective agreements currently include and so on.

One thing of note with that 96-hour advance notice, there is a provision in the legislation that if a collective agreement actually provides for a different time period, the collective agreement actually oversees that, and that’s a recognition that in some cases there are collective agreements in place that have adjusted that 96 hours.

Senator Dasko: Would you say that many collective agreements would have something like this in them? Is this a high standard or a medium standard?

Ms. Moran: I would say that most collective agreements do have some sort of provision around it. Whether or not it’s high or low, I would have to look at the numbers before I give that answer, but I can certainly check and get back to you.

Senator Dasko: I’m really interested in that.

I have a general question about the EI program and the coverage of self-employed workers. How many self-employed workers participate? I know it’s probably a tough question because there are all kinds of self-employed workers, of course, from large to small. What percentage of self-employed workers would be participating in the EI program? They have to pay both the employer and employee remittances, correct?

Mr. Brown: In terms of the EI program, a very small proportion of self-employed workers participate, so I think it’s important to know that they don’t have eligibility for regular benefits in terms of job loss. But they do have eligibility for special benefits, such as maternity and parental benefits, sickness, as well as caregiving benefits. That’s what is available to them.

In order to participate, they need to opt in. Essentially they contact Service Canada, complete the forms and then start paying the premiums. They only need to pay the worker portion; they don’t have to pay the employer portion as well.

That said, there are only about 21,000 self-employed workers participating in the program today, out of an estimated more than 2 million self-employed workers in Canada, so it’s very small. The people we see participating are primarily female entrepreneurs, young women aged 25 to 40, 45, of childbearing age. When accessing benefits, the majority of them are accessing maternity and parental benefits which they are not able to access in any other way, typically.

Senator Seidman: If I might come back to the issue of Division 16, I think Senator Ravalia asked a question about foreign employees. Perhaps I could just ask you in a more general way, because I’m not sure I understood the answer. How do the proposed amendments in Division 16 address the issue of employer pensions for workers whose employers become insolvent?

Mr. Duff: The Wage Earner Protection Program does not cover pensions. It’s not considered a wage, so it doesn’t address it.

Senator Seidman: It doesn’t address the pension contribution of the individual, the employee or the employer? That’s it; that’s all? It doesn’t address it?

Mr. Duff: That’s correct.

Senator Seidman: If I might ask a question about Division 15, Subdivision B, as you say, it establishes a head of compliance and enforcement. However, I’m trying to understand the chain of command once you create this head of compliance and enforcement.

It seems to me from what I’ve read — and please correct me if I’m wrong — that this replaces inspectors and regional directors, and then there’s a Labour Program inspectorate somewhere in this chain. There’s the minister, the deputy minister, the head of compliance, the inspectors and regional directors, if they still exist, and the Labour Program inspectorate.

This new head of compliance and enforcement, where does he or she fit in the chain of command, and what does it do away with if it does away with any pieces of this chain?

Mr. Rochon: There are a couple of parts there. First of all, the head of compliance and enforcement will be an official who is designated by the Minister of Labour. We expect it is probably going to be at the assistant deputy minister level, so somebody who would already be involved in operations and enforcement decisions right now under the code.

Just to be clear, what is changing is what is in the legislation, not necessarily what is on the ground. The legislation currently, under Part III of the code, does explicitly give responsibilities to inspectors and to regional directors. What is changing, essentially, is that we will no longer have references, if the legislation passes, to inspectors and regional directors. The mention, then, will be to the head of compliance and enforcement.

All of the duties, responsibilities and powers provided for under the legislation will be provided to the head of compliance and enforcement who will then have authority to delegate those powers, duties and responsibilities to any competent person or class of persons.

We currently have an inspectorate, so labour affairs officers, occupational health and safety officers and others. They will remain in place. They will still have a role in terms of enforcing the legislation, except that rather than being explicitly mentioned in the legislation, they would have their power, duties and responsibilities delegated by the head of compliance and enforcement.

It is a technical change and has some importance in the sense that it will allow, for example, providing some responsibilities to officials who are not currently named in the legislation. For example, there are administrative staff who may be receiving complaints from the public, so from employees who believe that their rights have not been respected. The head of compliance could delegate the power to receive complaints to officials other than inspectors, for example.

But at the end of the day, there will still be a need for an inspectorate and a need for all of the resources that the Labour Program currently has with respect to administering the legislation. What changes is the manner in which those responsibilities are conferred. Rather than being conferred directly by the legislation, they will be delegated by the head of compliance and enforcement.

Senator Seidman: I’m trying to understand the impact of that. You will have a head of compliance, but you will not have any defined way for that head of compliance to carry out his or her job because you’ve taken away all the various component parts that normally sat in this legislation.

The powers and duties of the inspectors and the regional directors who currently are in the legislation, you take that out and replace it with the head of compliance, but where’s the specification down the line?

Mr. Rochon: All the powers currently given to inspectors and regional directors are just given to the head of compliance and enforcement. None of the powers change. None of the responsibilities change under the legislation. It’s just that rather than specifying that these powers are conferred on inspectors or regional directors, or the minister in some cases, they are now conferred on the head of compliance and enforcement. All of these powers are still there and can be delegated.

Senator Seidman: “Can be”; those are the operative words. You leave a lot to discretion..

Brenda Baxter, Director General, Workplace Directorate, Labour Program, Employment and Social Development Canada: I want to add that there are a lot of changes in Budget 2018 that will require our ability in the Labour Program to be able to serve clients.

We currently have issues with our ability to respond in a timely manner to complaints that we receive. Part of that is because the code speaks to powers being designated to officers on the ground, so that means only officers can receive complaints from the public, only officers can fill out a form, and only officers can do certain things.

What the head of compliance and enforcement will do is delegate. From there, depending on the nature of the activity, that power can be delegated to various levels. Our health and safety officers will continue to do inspections and investigations, but we could have someone called an “early resolution officer” who answers the phone and is able to respond to a simple complaint in a timely manner.

It really is to enable us to have the flexibility to respond in a timely manner to clients. So there would be the head of compliance and enforcement, and we would then have a delegation chart that would delegate the various powers to the level necessary to make that decision.

Senator Seidman: Thank you.

Senator Ravalia: I have an EI-related question. In a scenario where an employee alleged unfair dismissal, where on their Record of Employment they get fired or dismissed but they’re disputing that, what form of documentation or appeals process do you refer to in order to determine whether that individual may, in fact, be eligible for those benefits?

Mr. Brown: A simple case where someone gets their benefits right away would be where somebody is laid off and where the employer issues — employers are required to issue something called the Record of Employment. One of the things that is important there is for them to indicate what is called the reason for separation. If that reason for separation is layoff and the laid-off employee — now a claimant — comes looking for EI benefits and all the information matches up, we’re able to pay benefits.

Now, suppose that isn’t the case because of a dispute. Perhaps the employer has indicated that it was a firing, not a layoff, or some other reason that does not result in the automatic payment of benefits. So the employer says one thing and the employee says something else. In that case, the first step of the Service Canada officer adjudicating that claim is to reach out to both sides to try to understand the situation better and to see whether it can be resolved. That is definitely something that happens on a case-by-case basis.

But suppose the outcome is to decline benefits. The person is informed of that decision, and there is recourse available to that person. A number of steps can be pursued. The first one is a reconsideration process which, in short, would allow another Service Canada officer to look at that information, sometimes gather additional information and make another decision. If they are still declined, they can pursue their case through the Social Security Tribunal. That’s an informal tribunal that looks at EI as well as income security cases.

Senator Dasko: I have a follow-up on the topic of how many provinces cover the Labour Code — I’m not sure if that’s the terminology. How many provinces comply with the protection of the job over the period of EI benefits? Are all the provinces on board with their labour codes in terms of job protection under EI?

Ms. Moran: The way that the job-protected leave works is that you are either federally or provincially regulated. It’s up to the provinces to make that decision if they’re going to give the job-protected leaves. They generally do. It takes some longer than others. Sometimes there’s a lag as they move forward. In the last round of changes, all but two provinces have already put in place the appropriate job protections similar to what we do under the Canada Labour Code.

Senator Dasko: Which provinces are they?

Ms. Moran: I would have to get back to you. I would have to check my resource person.

Mr. Brown: I’m not sure which provinces they are, but I would add that when there are changes being made or proposed to the Employment Insurance Act as well as the Canada Labour Code, we reach out proactively to the provinces and territories to let them know of this coming change.

For example, as soon as the specifics of Bill C-86 were tabled, we once again reached out to our counterparts to let them know that these changes are coming and that this is when we expect them to come into force. I would say it’s at least an encouragement to make the change, but we recognize that that’s within their authorities.

Ms. Moran: It looks like, in the last round, B.C., Alberta, Manitoba, Ontario, New Brunswick, and Newfoundland and Labrador have already enacted legislation. Quebec and Nova Scotia have tabled legislation. I believe that Saskatchewan intends to introduce a bill this fall. They may have. As far as I know, they have not done so yet. P.E.I. is also preparing to change its law.

[Translation]

The Chair: I think we’ve covered all the questions, so I’m going to take a moment to satisfy my own curiosity.

Ms. Astravas, if I understand correctly, a single parent cannot use the full 40 or 69 weeks of leave themselves. Given the increased burden on single parents, I’d like to know why the full amount of leave isn’t accessible to them. Was it something you looked at, and if so, why wasn’t it included?

Ms. Astravas: The purpose of these amendments is to promote the sharing of caregiving responsibilities and gender equality. The additional weeks are accessible only to two-parent families. Individually, however, each parent will not be able to access more than the maximum number of weeks of leave per parent. That hasn’t changed. Therefore, a single parent, or a parent sharing caregiving responsibilities, is still entitled to 35 weeks, or 61 weeks, of leave at the maximum benefit rate, where eligible. The additional weeks will not be payable to an individual.

[English]

The Chair: I would like to say thank you to our witnesses. We truly appreciate the time you have taken to answer our questions.

(The committee adjourned.)

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