By Paul Weinberg
TORONTO, Jan 29 2002 (IPS)

Three women show up for an interview in a room at the Royal York Hotel here on, coincidentally yet symbolically, the same day the federal budget is being delivered. In faster times, they might have been smoothing out sheets or folding towels but hotel employees are among the first to be burned by a new recession.

“We feel trapped,” says Grace, a single mother who earns 24,000 dollars annually after eight years of working in hotels. “I am temporarily laid off and the company can call us anytime to work a few hours. I have been waiting since Nov. 11 for my first (Employment Insurance) cheque. My little savings are gone and I make 300 dollars a month.”

Women like Grace are “canaries in the mineshaft” for the current surge in Canadians applying for Employment Insurance (EI) benefits, says Canadian Labour Congress (CLC) economist Kevin Hayes. Working in downtown hotels, they see firsthand the impact of last September’s U.S. terrorist attacks and the downturn in the local tourist trade.

Vacancies are up by 10 to 15 percent, according to Local 75 of the Hotel Employees and Restaurant Employees International Union, which estimates that more than 4,000 of its members are either laid off or working fewer hours.

The women also highlight a gap in the EI system. Officially, unemployment stands at eight percent nationwide. Grace and her colleagues, however, belong to a larger and growing segment of the work force: people who are neither entirely out of work nor fully employed.

They are still on call, sometimes getting only two days of work per week. And it is not clear until the last minute if the hotels will require their services that particular day, which can play havoc with childcare arrangements and their ability to fulfil EI job search requirements.

“If you are not home when they call, you lose the opportunity to work,” says Grace.

She adds: “They [the EI program] want me to search for a job. It’s hard because I’m on call. But my caseworker said it doesn’t matter, I have to do my ten calls [of job search] a day.”

EI pays half of one’s previous weekly salary – down from two- thirds under a predecessor programme almost a decade ago.

While benefits have been whittled down, some highly unpopular restrictions on claimants have been lifted. Human Resources Development Canada (HRDC), which oversees EI, has announced that people on benefits may keep additional earnings so long as they do not exceed 150 dollars per week.

“It is a small victory,” says Hayes, who suggests HRDC is chiseling away at recipients who are struggling to make ends meet in an expensive city like Toronto. He says those on EI should be allowed to keep all of their part-time earnings. At present, he notes, “if someone makes 200 dollars (part-time), they have to give something back.”

Politically, EI is less of a hot button issue nationally after the Liberal government withdrew some of the restrictions, which sparked heated opposition from the large number of seasonal workers and their families in Quebec and the easternmost Atlantic region.

As a result of concessions made to appease populations there, for example, some 85 percent of the jobless in New Brunswick province can access EI benefits.

Nationwide, however, the average proportion of unemployed Canadians deemed to qualify for EI is only about one-third.

The reason for the disparity, says Hayes, is that the programme is applied unequally: Eligibility rules are determined on the basis of work hours and vary from region to region. Thus, where economies are dominated by one or two industries or where most workers share are engaged in seasonal work, they are more easily organised and mobilised than in cities with diversified economies.

Thus, he adds, federal statistics show that while workers in New Brunswick were able to win better terms, eligibility remains as low as 24 percent among the unemployed of Toronto and 19 percent in Ottawa, the country’s capital.

The CLC takes the position that entrance requirements for EI should be standard across Canada.

In Toronto, those people who are new entrants or re-entrants to the labour market must have worked at least 910 hours (or 26 weeks at 35 hours a week) annually in the previous year in order to qualify for EI benefits, a jump from 300 hours during the recession of the early 1990s.

Furthermore, those in Toronto who have been laid off from full- time jobs must have worked at least 595 hours annually, up from 255 hours a decade ago.

Hayes expects that the numbers of jobless exhausting their benefits before they find another job will rise.

Almost a decade ago, the majority of unemployment insurance recipients got almost a year’s worth of benefits. Now, the majority is only qualifying for approximately 26 weeks annually, says Hayes.

The federal government has an economic incentive to make EI benefits difficult to access, argues Laurell Ritchie, a national representative for the Canadian Auto Workers Union. “The EI fund is the single most important contributor to the surpluses that the government has been reporting now for the last number of years.”

EI is financed by the contributions of employers and employees but more than 40 billion dollars from the fund has gone into the federal government’s general revenue since 1994, one year after the Liberals came to power at the federal level. The money has been used to pay for such items as new military hardware, scholarships, and tax cuts.

Whatever the limitations or inequities of the programme, EI spokesperson Marilyn Taylor says at least the bureaucracy is getting better. Claims began rising rapidly during the summer, says Taylor, and in some cases claimants had to wait two months for their first cheque. “We have got it down to 28 days,” she says.

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