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In 1996, the Federal Government began phasing in changes to the employment insurance system. One of the important changes to the Employment Insurance (EI) system was the move from a week-based to an hour-based system of accounting for insured earnings. The change to an hour-based system was partially motivated to provide fairer coverage for those workers that worked many hours over fewer weeks. In particular, the change to an hour-based system should be more equitable for seasonal workers that often work many hours over a constrained number of weeks. However, a recent evaluation study found that not all seasonal workers benefited from the change to an hour-based system.¹In fact, it noted that seasonal workers earning less than $12,000 were adversely affected by EI reforms. Moreover, these individuals were less likely to qualify for EI benefits after EI reforms.

This study investigates the characteristics of seasonal workers earning less than $12,000 and examines why they were unfavorably impacted by EI reforms. It examines the association between the change to an hour-based system and the corresponding decrease in the likelihood that seasonal workers earning less than $12,000 would qualify for EI benefits. It focuses principally on the attributes of seasonal workers that earned less than $12,000 and did not qualify for EI benefits.

Data Sources

The main source of data for this study is the Canadian Out-of-Employment Panel (COEP) survey. COEP provides important information on the socio-economic conditions and other personal and employment related information that was used to develop descriptive statistics.

Main Findings

• About 9.0 percent of all individuals experiencing a job separation are seasonal workers that earned less than $12,000 in the previous year. This represents 58.4 percent of all seasonal workers.
• Approximately 82.1 percent of all seasonal workers are eligible for EI benefits, however, only 76.4 percent of those earning less than $12,000 qualify.
• The likelihood of qualifying for EI benefits decreased 18.6 percent for seasonal workers earning less than $12,000 with the transition to an hour-based system.

Footnotes

1	See "An Evaluation Overview of Seasonal Employment," Evaluation and Data Development (EDD).