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New report on EI: Small business strongly supports reinstating youth hiring incentive

Effective rates for SMEs set to rise slightly in 2017

Regina, September 14, 2016 – With a government review of Employment Insurance (EI) service quality underway and EI premium rates for 2017 being announced this week, CFIB’s latest report on EI offers guidance to policymakers as they consider changes to the system.

“Small businesses tell us that payroll taxes, like EI, are their number one concern, and that even a small increase in EI premiums would come at the worst possible time, particularly given plans to increase CPP,” said Dan Kelly, CFIB president. “While employees and large employers are expected to see their rates drop in 2017, small employers will actually pay a little more, due to the end of the Small Business Job Credit.”

The report, based on 7,880 responses from small business owners, shows strong support for one of the new government’s key election promises: waiving EI premiums for employers hiring youth between 18 and 24 in 2016, 2017 and 2018. “Small firms loved the government’s planned youth hiring incentive – similar to one implemented by previous Liberal governments – but were disappointed this plan was dropped in the 2016 budget,” Kelly said.

Small biz support compassionate care changes, concerned about extending parental leave 

Some of the government’s other changes are supported by small business owners, including additional flexibility for compassionate care benefits. However, small firms want government to reconsider extending maternity/paternity benefits from 12 to 18 months, and eliminating the 910-hour rule for EI eligibility.

“Our members understand the importance of a healthy EI system and support its primary intent, but they sometimes feel they are competing with EI for workers,” added Kelly. “It is worrisome to learn than 12 per cent of employers have been asked by workers to lay them off so they can collect EI benefits. EI should never be used as a replacement for employment.”

Other recommendations:

  • Consider a permanent lower EI rate for smaller firms;
  • Extend the Canada Job Grant to include on-the-job training;
  • Improve EI customer service;
  • Simplify Records of Employment.

Read the full report: Insuring Employment: SME Perspectives on the Employment Insurance System.

To arrange an interview with Dan Kelly, please call (306) 757-0000, 1-888-234-2232 or email [email protected]. Follow CFIB Saskatchewan on Twitter @cfibsk.

CFIB is Canada’s largest association of small- and medium-sized businesses with 109,000 members (5,250 in Saskatchewan) across every sector and region.

September 14, 2016

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