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Three of the changes to EI, as part of EI-reform, are directly relevant to seasonal workers. First the move to count hours rather than weeks will have a greater influence on seasonal workers because they work 5 hours more per week than non-seasonal, as shown on Table 3. Secondly, the divisor rule will encourage those who establish claims with the minimum number of weeks to work at least an extra two. Lastly, the intensity rule will reduce the benefits for repeat users of EI, which will impact seasonal workers more than non-seasonal. This section will first review the earlier evaluation evidence, which help set the stage for these three changes. Then the most recent evaluation evidence will be examined to determine the impact of EI-reform on seasonal workers.

Earlier Evaluation Evidence

The early evaluations on subjects directly related to seasonal work did not touch on the subject of hours. However, a justification for the move to the hours system can be found in an evaluation of jobs excluded from the UI system (Lin 1995)⁵. In this study, it was found that 21 per cent of all employment in 1990 was not eligible for EI benefits. This share had been growing since 1986. There were many reasons for this such as self-employment, however, the exclusion of jobs with less than 15 hours was prominent among them. The counting of all hours of work, in EI, can be seen as move towards rectifying this situation.

Early evaluations, directly related to seasonal workers, were concerned with the behavior of claimants while forming claims. Substantial evaluation evidence was compiled which argued that a significant portion adjust the length of their employment while forming a claim to suit the requirements of the UI system. Christofides and McKenna (1995) found that there was a significant tendency for workers to terminate their employment once they had accumulated the minimum number of weeks to qualify for EI. When a distinction was made between seasonal and non-seasonal workers by Green and Sargent(1995 p. 45), it was found that seasonal workers are more likely to terminate their employment at the point which would provide them just enough benefits to cover the time that they would be unemployed during the off-season. Thus in most cases, they would work more than just the minimum to qualify. However in very high unemployment regions, low wage seasonal workers were found by Green and Riddell(1995) to be sensitive to changes in the minimum required weeks. As a means of discouraging these tendencies described in the evaluation and other studies, the divisor rule was implemented which reduces the benefits for those who only work the minimum number of weeks.

It has been observed that a substantial portion of UI use resulted from individuals who were repeat users of the system. Lemieux and MacLeod (1995) found that seven per cent of claimaints had more than eleven spells and accounted for 22 per cent of all UI claims. Overall, the incidence of repeat use was found by Wesa (1995 p. 27) to be trending upwards, as the share increased by 25.9 percent from 1982 to 1990. It was argued that the bulk of this change occurred in seasonal industries. This is particularly significant when it is considered that the overall trend towards seasonal work is downward, as was discussed above. It should be pointed out that the change that came from the seasonal industries was due to both an increase in the number of claimants in these industries as well as an increase in the incidence of repeat use by the seasonal industries.

The growth of repeat use was most pronounced in the eastern provinces. Examples were found of identical industries which had higher incidence of repeaters in Atlantic Canada than they did in Ontario. For example, the logging industry in Atlantic Canada had a repeater rate of 87.8 per cent where for Ontario it was significantly lower but still high at 67.4 per cent.

Current Evaluation Evidence on EI Reform and Seasonal Work

A major innovation with EI Reform has been the implementation of a monitoring framework which has ensured that evaluative evidence would be available relatively soon after the reforms were put in place. The reforms were fully implemented in January of 1997, and as of the Fall of 1999, fourteen evaluations had been completed by external evaluators. In addition, a large volume of internal evaluative work had been completed by that time.

Some of the evaluation work focussed on the impact of the move to hours. Friesen and Maki (1999) found that the move to EI resulted in a reduction in the proportion of seasonal workers who had jobs of 30-40 hours in favour of those who had jobs of 40-48 hours a week. A possible reason for this was suggested by Green and Riddell (1999), as they found that the greater hours of work by seasonal workers were leading to more entitlements. This resulted from the flexibility of seasonal workers to concentrate hours in a week such that there was no change in the total numbers of hours worked per year but they were able to qualify for EI benefits with 1.5 less weeks on their jobs.

As indicated in Wesa (1995), the changes in behaviour that resulted in high rates of repeat behaviour occurred over a period of many years. Still Fortin and Audenrode (1999 p. 1 and 12) were able to find some indications in the first year that the repeaters were starting to respond to the change in EI incentives. This primarily occurred with individuals having a one percentage point greater probability of leaving unemployment in the 19th week, the last week before benefits drop takes effect, so as to avoid their benefit rate dropping the next time that the collect EI. However, it should be pointed out that these changes in the probability of leaving unemployment were very small. It is interesting to note that in focus groups that were conducted at the community level, the intensity rule was found to be punitive and unfair.

Internal HRDC evaluative work found that seasonal workers increased their entitlements by slightly more than one week after EI reform. There was also an 8 percentage point drop in the share of seasonal claimants who experience "gaps" or periods of time when they are neither collecting benefits or receiving employment income. These two changes were a result of a move to the hours rule which benefited seasonal workers as they worked an average of 5 more hours per week.

Footnotes

5	This is only one possible source of justification for the move to the hours system.