EI: Entitlement, Right or Insurance

[ballz]

I was unable to find the info I was looking for, so I went a much easier route and started looking at Income Insurance in the UK.

I've been quoted, based on my age and $60,000 per year working for the Gov't, a rate of $840/year which would give me 12 months continuous coverage of 50% of my earnings. I would receive first payment 31 days after becoming unemployed, but be backpaid to the first day of unemployment (so no time period without income).

Compared to the current EI program in Canada, where if I understand it correctly I'd only be eligible for 44% of my income for just over 10 months (45 weeks) after waiting one month for the first cheque. And yet I'm paying $891/year plus my employer is paying an additional 1247 for a total of $2138, and that's about to go up for 2014....

 

[ballz]

I remain unconvinced that a select few categories of workers in certain regions of the country should be able to work less than a year to support themselves for a year, while others must work all year round.

There are seasonal jobs where you can make a year's wages (50,000 or more) in 20 weeks, but then turn around and collect EI for the other 35 weeks (so another 16,000 bucks). You really hit the nail on the head when you called it a "wage subsidy."

 

[stealthylizard]

I was one of those employed in a seasonal job for about 9 years.  Seismic exploration/surveying.  Most of the time, the work didn't exist year round, either due to weather (aka spring break-up, or snow to fall for the mountain work) or the uncertainty of the oil and gas market.  Lay-offs would start being offered when the work dried up in April/May.  I could sit at home and wait for the work to pick back up again somewhere between September and November.  I really didn't make enough money to support myself for a minimum of 4 months (it wasn't a very high paying job {$8.50/hr 90 hrs/week, 4-6 weeks on, 1 week off}, the overtime almost made it worthwhile), and maybe hope to find a job to quit again in 4 months, when work would pick back up again. 

Or I could collect the EI that I had been paying into, and look for a temporary job.  Where I was living, work was hard to come by, other than part time minimum wage jobs.  EI paid more than I would have made full time at a minimum wage job.  And anything I earned at a job while collecting EI would reduce the EI I was receiving.  If I made more than $200 gross/week, I would lose the full amount of EI for that week (approximately $350/week).

EI benefits are taxed, once when you get your money, and again during tax season, you claim them as taxable income.  Employers that have a regularly occurring record of lay-offs also pay a higher rate than other employers.

The program should remain in place, but changes need to be made.  Not once was I ever asked to provide a record of job searches.  The only employment that I had to search for was something comparable to the work I was doing prior to my lay-off, and at a comparable wage.  I did find other work, not because I had to, but because I was bored sitting at home 4-6 months every summer doing nothing but sitting by the phone hoping that the season would start early.  If you find another job but it's in a different locality, maybe they should help you with moving to the new area.  Make it mandatory to attend employment seeking seminars.  Have a "case worker" attached to your file, that can point you in the direction to more stable permanent work that's related to your previous employment.  Have a program set up with employers in areas with a lot of seasonal workers, and give them incentives to hire or build up your job related skill sets.

 

[Edward Campbell]

To reiterate what I've written here before, EI is not properly insurance.  For some people (long-term employed who rarely are out of work) it functionally can be insurance.  Otherwise, it is chiefly a wage subsidy.  I remain unconvinced that a select few categories of workers in certain regions of the country should be able to work less than a year to support themselves for a year, while others must work all year round.  EI is, bluntly, capricious and unfair - something no government entitlement should be.  Economically, it reinforces failure and retards success.

The additional paid social leave entitlements that were grafted on in recent years were introduced because of the surplus funds sloshing around in the pot.  The genuine merits of what those programs deliver are irrelevant; they should have been funded out of general revenues if they are worthwhile and the government should have raised taxes accordingly.

Real unemployment insurance can be purchased as a financial product without the government holding your hand.  Or, you can self-insure (ie. respect the "6" in the 10/10/6 rule - or use 10/10/3 if you are a little stretched).

No-one ineligible to collect should have to contribute.

Benefits should be inaccessible to anyone with less than two years continuous employment.  Premiums paid by anyone terminated with less than two years continuous employment should be refunded.  IOW, you won't get screwed (lose the premiums) if you can't get a proper full-time year-round job, but you won't collect unless you had a proper full-time year-round job.

:goodpost:

I am with Brad on this; I agree with him, point by point.

 

[Infanteer]

Yes, great post Brad.

 

[Lightguns]

I meant skidders in my past post. This auto correct on this iPhone is driving me to distraction. 

 

[Bruce Monkhouse]

No-one ineligible to collect should have to contribute.

Everyone agreeing with Brad's post are missing one thing, explain to me who that particular line above includes.

 

[Edward Campbell]

My understanding ~ and I cheerfully admit to knowing somewhat less that Sweet Fanny Adams about EI ~ is that when a person is entitled to an annuity of a certain amount, let's call it $NN,NNN per year, one cannot claim EI when one leaves, say, a government job. Now some people reach that $NN,NNN level several years before they reach their optimum (or required) retirement age. It seems to me that those people, folks who cannot claim EI when they leave their jobs, ought not to have to pay into it after they reach the $NN,NNN threshold.

 

[Bruce Monkhouse]

Edward,
Of course it was you, my friend, that 'sniffed out' my trap.............

 

[PPCLI Guy]

And why I will never draw EI.

 

[Bruce Monkhouse]

And why I will never draw EI.

Yes, but until you reached Edwards 'magic' number you had no way of knowing that.  I also sure hope the pension you count on stays solvent........[which we know the Govt. will just rape the taxpayer furthur to fund if required but, once again, not all unfortunate souls are that lucky]

 

[Infanteer]

Edward,
Of course it was you, my friend, that 'sniffed out' my trap.............

Your lucky Sweet Fanny Adams wasn't on these threads....

 

[stealthylizard]

At the end of my TOS, I was told to make sure I apply for EI right away if I expected any problems finding employment.