Government extends temporary tariff relief measures for employment insurance

A help wanted sign is pictured in a business window in Ottawa on Tuesday, July 12, 2022. THE CANADIAN PRESS/Sean Kilpatrick

OTTAWA — The federal government is extending changes it made in March to the employment insurance program in response to the trade war with the U.S.

The changes were meant to help businesses retain workers by reducing their hours and compensating them through employment insurance for lost wages.

The changes to EI came into effect in April and were set to end on Saturday.

Jobs Minister Patty Hajdu’s office says the changes will apply until Oct. 11 and are expected to help 290,000 workers.

The changes cap the threshold to qualify for regular EI benefits at 630 hours and allow claimants to qualify for an extra four weeks of benefits.

The temporary EI changes were announced in early March, along with a $6.5-billion aid package to help businesses cope with the trade war.

Steven MacKinnon, who was the labour minister at that time, said the measures were meant to help businesses avoid layoffs by allowing them to reduce hours and spread those hours among the same number of employees, with EI making up the difference in workers’ compensation.

On March 23, the government announced it was also temporarily waiving the one-week waiting period to receive EI benefits and allowing workers to start claiming EI while still receiving severance. Those changes are also set to be in effect until Oct. 11.

At last month’s G7 meeting in Alberta, Prime Minister Mark Carney announced that he had set a 30-day deadline to come up with an agreement with the U.S. to put an end to the tariffs.

Carney has been in regular discussions with U.S. President Donald Trump in recent weeks. The deadline for the deal is July 21.

Foreign Affairs Minister Anita Anand told reporters on Thursday she is “hopeful that an agreement can be achieved,” but hinted it may not happen by the deadline.

The tariffs targeting Canadian goods include a 25 per cent levy on imports that don’t comply with the Canada-U.S.-Mexico Agreement on trade, along with tariffs on steel, aluminum and vehicles.

By Sarah Ritchie

With files from Dylan Robertson.