Friday, October 02, 2009

Parental Benefits for the Self-Employed

The government has proposed an addition to EI: parental leave for the self-employed.

However, there's no EI for the self-employed if they lose their job and can't find another. This policy means that the only way the self-employed can get EI is to have a baby.

The old argument was that you couldn't let the self-employed participate in EI because the worker decides when to work and when not to work. However, self-employment is a lot more complicated than that now. We have multi-month contracts that are renewed on a rolling basis. We have to work through agencies so that the companies can protect themselves from civil suits or government regulators, since we are essentially regular full-time employees (who just happen not to get any holidays or benefits). The business of self-employment has become so bizarre lately that the agency I am forced to work through deducts EI from my pay cheque but I am not eligible for EI.

This proposal is not just unfair to the rest of the self-employed. It's also unfair to all those regular employees who pay into EI. If the self-employed are not paying into EI, then why is EI being used to provide parental leave for them? If they do this, why not use EI to pay for other government benefits wholly unrelated to paying in?

This new proposal by the government just reeks of pandering. It has no relation to good policy or fair policy.

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9 comments:

Marie said...

EI for the self employed is a separate issue and has already been presented as under discussion.

The parental EI benefits were proposed in Harper's 2008 election platform. This summer they said they were having analysis and costing done on a potential voluntary opt in program for the self employed which is very complex.

Step by step - with costing and all details on the table rather than airy fairy rhetoric is the only sensible way to develop policy don't you think.

Mark Francis said...

@Marie: So, the Conservatives ran in part on a platform to give us EI without having any policy plan? Gee, I do recall that they had the whole thing costed last election! How could they have costed something they have no policy plan for?

But, we can trust them. Sure, not a problem.

I recall they also ran a few years back on not taxing income trusts. How did that one work out?

A good fix to EI would be to not have people paying insurance premiums on something they can't ever collect on. My father's business employed my mother, and she worked. She had to pay into EI, but being related to the owner, she couldn't collect EI.

A lot of self-employed persons are providing a subsidy to the system.

The Cons have been sitting on this for a year. We only hear of it now because an election is coming up soon enough. Like so many other Conservative promises, it'll probably die on the order paper when an election comes, added to the dust bin.

Odds of real progress here? I say 1 in 5.

Yappa said...

Hi Marie,

The "I" in EI stands for insurance. People who are eligible for EI must pay into EI. How can it be extended to people who don't pay into it?

If they want to provide universal parental benefits, that's one thing: but it shouldn't be through EI.

Furthermore, parental leave is one tiny issue. The bigger issue about EI is what to do about all the people who work but aren't eligible because their employers don't want to provide other benefits, so call them contract workers and won't give them a Record of Employment that states why they left the company.

Yappa said...

H Mark,

It's really interesting to hear that your mother paid into EI without being eligible to collect. I had thought I was a unique case, but hers is a totally different reason from mine. I wonder how many more people pay into EI without being eligible?

Anonymous said...

Aliehs says......I was surprised to learn while working in Asia that Australians, South Africans and New Zealanders can collect EI when they return to their home countries after working in Asia on a contract basis. All they have to do is present their contracts to their home governmnet while looking for work at home and voila, its completed. I happen to be a qualified ESL (English as a Second Language) educator and when I returned to Canada after ten years in Asia working, I wasn't allowed to even use the Employment Office facilities. Oh yes, I also had to register as a non-resident so that I wouldn't be asked to pay the income tax difference between South Korea and Canada when I returned home.

Bert said...

My brother in law works for the family company, a farm supply firm. He pay's into EI, but is no allowed to collect. That is sick, sick, sick.

marie said...

The other Marie,10:38 Am, If a person is not qualifed to receive EI, they should not be required to pay into it. I don't care how anyone looks at it, that is a tax grab and needs to be abolished. If I am self employed andhave not paid into the system , I do not qualify so what's the big deal. If I work for 30 years without ever collected any EI when I retire, that too is a tax grab. EI is suppose to be an insurance policy for unemployed people who have paid their insurance into the system but seasonal workers do not qualify under our current system. They should be reimbursed everything they did pay.It is plain that EI needs to be re-evalulated so that it is fair to all Canadian workers. This policy and Harpers policy stinks to high heaven and needs to be scrapped and changes need to be made. This REform/Con government does not have a credible policy on EI. Their policies are make them up as you need them.

BTW Mark Frances & Yappa, I couldn't agree with both of you more.

Padmanaban said...

There are plenty of jobs in Hyderabad, so why not apply for those jobs to succeed in your career

Yappa said...

Hi Padmanaban -

Thanks for the tip. When I was working as a contract technical writer I found a site that was frequented by software writers in India and Russia. A typical price was $15 for a 500 word technical article. That would buy a Canadian less than the rent of a cheap apartment for the length of time it would take to write the article...

And I thought that my killer skill was having English as a first language.