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The Oakville Chamber of Commerce is cautioning the federal government that now is not the time to increase Employment Insurance (EI) premiums on businesses.
The Canadian government is looking at possible changes to the EI program after more than two years of COVID-19 pandemic measures have hit the program hard financially.
According to the 2022 Actuarial Report on the EI Premium Rate, COVID measures will result in a projected EI Operating Account cumulative deficit of $33.9 billion by the end of 2022.
In order to get back to balance, the federal government’s 2022 Budget suggests that rates could increase 15 cents (at 5 cent increments) over the next three years (2023-2025).
While the Oakville Chamber says it welcomes government’s review of the program – it has not had a comprehensive review in over two decades – it is reminding them it is not the time to place that burden on businesses.
“Businesses are still recovering post COVID and are facing a multitude of challenges including labour shortages, record inflation and supply chain disruptions,” penned Faye Lyons, Vice President of Government Relations & Advocacy for the Oakville Chamber of Commerce in a response to the federal government.
“We caution government that now is not the time to achieve these goals by increasing EI premiums.
The Chamber says it understands the EI program is a critical feature of Canada’s social safety net and a review would help ensure the its “services are resilient, accessible, adequate and financially sustainable”.
The EI program provides temporary financial support for individuals who lose their jobs while they look for work.
While it’s important that the EI system is modernized and reflects the needs of today’s labour market and workforce, Lyons says the business community has endured COVID and the pandemic has had a profound impact on the ability of businesses to operate.
“Employers should not have to carry any additional government EI pandemic debt burden through increased premiums,” she wrote. “We believe that economic recovery requires government programs and policies that focus on growth and sustainability.
As the government finalizes its consultations on reforming the EI program, consideration of the economic challenges that businesses and employers are facing today as a result of factors out of their control need to be recognized.”
Employers, who Lyons says have already pay 58 per cent of EI, should not be burdened with a premium increase.
“On behalf of our Chamber members, we encourage the federal government to consider EI program solutions that do not rely solely on increased premiums,” she concluded.