Insuring Employment: SME Perspectives on the Employment Insurance System

A new report on Canada’s Employment Insurance (EI) system shows that small business owners are in favour of some changes, but would like government to approach it with a scalpel rather than a bulldozer.

The federal government is currently considering changes to the system and setting the EI premium rates for 2017.

The report is based on a survey of Canadian small business owners and it found areas for the federal government to improve the EI system for small employers and their workers.

Report highlights

  • Employer/employee ratio of premium contributions: a strong majority of employers (87%) support setting equal EI premium rates for employers and employees.
  • Small business job credit: 78% of small employers support this credit, which is ending this year.
  • EI rebate for hiring youth: 80% of small business owners support its renewal.
  • Maternity/paternity benefits: only 28% of small employers support extending maternity/paternity benefits from 12 to 18 months.
  • Training programs: 22% of business owners perceive them to be either very poor or poor, while another 60% do not know or have not dealt with training programs.
  • 910-hour eligibility rule: only 30% of small employers support eliminating the rule requiring workers to have at least 910 hours of work before they can make an EI claim.
  • Readability/simplicity of information: nearly one-third (27%) of employers said it is poor or very poor.

Some small businesses report they are competing with the EI system for workers: 17 per cent of small businesses (and a quarter of seasonal businesses) say they think job candidates prefer collecting EI benefits instead of working.