By Canadian Press

End of CERB means uncertainty for some, new system for others

Sep 27, 2020 | 8:05 AM

OTTAWA — In mid-March, Christine Ilott’s manager broke some bad news to her: she was losing her job in live theatre as a result of the pandemic. 

The 47-year-old went home to her basement apartment north of Toronto, walked down the stairs, sat down and took off her shoes. She glanced up the staircase and thought, “I don’t know when I’m leaving here next.”

“And for me, that was absolutely devastating because I love my job. I love working in theatre. And it just broke my heart.”

As she has searched unsuccessfully for work, and with no sign of theatres reopening in the next few months or longer, she relied on the $500-a-week Canada Emergency Response Benefit. Now, she, like millions of others, will lose the payments as the CERB winds down starting this weekend.

In its place is employment insurance, which the government says the majority of people will go on, and a new suite of benefits that won’t exist unless approved by Parliament.

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Ilott, isn’t sure if she’ll be automatically transferred to EI, have to apply anew, or have to wait for the new benefits. She’s spent the weekend figuring out what to do. 

All she is sure of is that she won’t have any income come Monday.

The cost of benefits

As of a week ago, the CERB had paid out $79.3 billion to 8.8 million people, or roughly two in every five members of the nearly 20.2 million-strong labour force in August. 

Benefits were paid up front, which won’t be the case for Ilott and others in the first wave of those being transferred to the new system: The government says the first payment will come the week of Oct. 11. About 80 per cent are expected to receive payments by Oct. 14; a further 10 per cent within the first two weeks. 

The $500-a-week floor on benefits in EI, or $300 per week floor for new parents using the extended-leave option, will be taxable. Jobless benefits through this EI program will be available for at least 26 weeks, and claimants will be allowed to earn more than they did under the CERB, up to $38,000 annually, before being completely cut off.

Employers will also be allowed to use “supplemental unemployment benefits” to top up EI payments.

The threshold to qualify for EI has been reduced to 120 hours of insurable work for those coming back into the system that has been nearly dormant since March.

The government says 2.8 million people will qualify for EI as of Monday. But many, like Ilott, may not do so automatically.

Applying anew

Ilott remembered calling a number to sign up for the CERB. She didn’t remember if it was Service Canada or the Canada Revenue Agency that she spoke with.

Anyone who applied for and received the CERB through Service Canada and is eligible for EI is supposed to be automatically transitioned over to employment insurance.

Anyone who applied and received the CERB through the CRA would need to apply anew for EI, if they qualify. Others who will have to apply to Service Canada are those with temporary 900-series social insurance numbers and self-employed workers who receive benefits through Service Canada.

Ilott planned to make calls and search online for answers this weekend to figure out what she needs to do. On Friday, Service Canada was warning about long wait times on the phone, with record volumes expected at call centres.

“I’m sick and tired of not knowing,” she said.

“Now that we’ve got this thing and it’s going to last for six months, that provides me with a little bit of relief, because now at least I know for those six months, but I’m sick and tired of everything being done at the last minute.”

Not qualifying for EI

The Liberals first proposed the new suite of benefits in August, two days after Parliament was prorogued.

The Liberals introduced a bill Thursday in the House of Commons that includes the CERB replacement, called the Canada Recovery Benefit, for everyone who doesn’t qualify for EI. 

With the bill just being introduced, and changes coming Monday after the New Democrats pushed the Liberals to expand access to the sick-leave benefit, those advising recipients are also left scrambling as they face questions.

The Workers Action Centre in Toronto had to pull down its online fact sheet Thursday night and was frantically poring over the legislation to provide answers on Friday, said executive director Deena Ladd.

“We just try to manage all the phone calls as quickly as possible and just walk people through the process and the steps,” she said of the centre’s work over the pandemic. 

“But first, we’re just trying to make sure we understand what those steps are and partly we will have to go through those steps ourselves to be able to give the accurate advice.”

The Canada Revenue Agency is to administer the new recovery benefit, but couldn’t say Friday how to get it because Parliament hasn’t approved it. A spokesman said those eligible for the Canada Recovery Benefit should sign up for the CRA’s “My Account” as well as direct deposit to get benefits quickly when they’re available.

The bottom line

Putting a floor on benefits equal to that of the CERB is going to mean two million people won’t see their incomes fall, said David Macdonald, a senior economist at the Canadian Centre for Policy Alternatives. Some might even get more on EI than they did on the CERB.

But that largely depends on a smooth transition and making sure no one falls through the cracks, Macdonald said.

“You need the enabling legislation passed for the million people that are going to end up on these new Canada recovery programs, which has not been passed,” he said.

“We’re coming up to the end of one program without these new programs even being programs yet.”

This report by The Canadian Press was first published Sept. 27, 2020.

Jordan Press, The Canadian Press