March 12, 1935

UNEMPLOYMENT INSURANCE

MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION


Right Hon. Sir GEORGE PERLEY (Acting Prime Minister) moved the third reading of Bill No. 8, to establish an unemployment and social insurance commission, to provide for a national employment service, for in- Unemployment Insurance surance against unemployment, for aid to unemployed persons, and for other forms of social insurance and security, and for purposes related thereto. He said: Mr. Speaker, I believe the Minister of Justice (Mr. Guthrie) has an amendment to move.


CON

Hugh Guthrie (Minister of Justice and Attorney General of Canada)

Conservative (1867-1942)

Hon. HUGH GUTHRIE (Minister of Justice):

Mr. Speaker, I move:

That Bill No. 8 to establish an unemployment and social insurance commission, to provide for a national employment service, for insurance against unemployment, for aid to unemployed persons, and for other forms of social insurance and security, and for purposes related thereto be referred back to the committee of the whole with instructions to amend' section 33 of the bill by inserting the following subsection immediately after subsection

"(2) Proceedings under subsection (1) of this section may at the instance of an employed person be instituted by the commission on behalf of such employed person."

Amendment agreed to and the house went into committee, Mr. Morand in the chair.

On section 33-Civil proceedings by employee against employer for neglect to comply with act.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
IND

Alan Webster Neill

Independent

Mr. NEILL:

Would you read the amendment that is proposed, Mr. Chairman?

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

Raymond Ducharme Morand (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Conservative (1867-1942)

The CHAIRMAN (Mr. Morand):

It is moved that this bill be referred back to committee of the whole with instructions to amend section 33 by inserting the following subsection immediately after subsection (1):

(2) Proceedings under subsection 1 of this section may at the instance of an employed person be instituted by the commission on behalf of such employed person.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

George Halsey Perley (Minister Without Portfolio)

Conservative (1867-1942)

Sir GEORGE PERLEY:

Mr. Chairman, in thinking over this matter, which was discussed very fully the other day in committee, I have come to the conclusion that the sections of the act are quite sufficient and strong enough to make sure that the contributions from both the employer and employee are properly gathered in, taken care of and handed over to the commission.

I would draw the attention of members of the committee to the provisions of sections 18 and 34 which should ensure at all times that the necessary stamps will be actually affixed to the books so that the money will be available to the commission. Section 18 gives power to the governor general in council to make regulations regarding the preparation and issue of the stamps. It also gives power to the governor in council to make regulations effecting the payment and collection of these contributions by means of stamps, and power 82582-103

also to make regulations prescribing in great detail the time and conditions under which these stamps may be affixed or impressed. Furthermore paragraph (c) of subsection 2 of section 18 provides the widest possible power of inspection that can be thought of and for the delivery up of unemployment books and everything of that kind in order to make sure that these stamps are properly affixed in accordance with the law. In fact, the commission can go as far as they wish to make sure that the stamps are placed on the books week by week.

Then if hon. members will refer to section 34 they will see that it provides sweeping powers for the inspectors. I do not see how those powers could possibly be made any wider, and I feel that this section is a great safeguard to the employees in order to make sure that their contributions go into the proper channels.

Then by subsection 2 of section 31 very stringent provisions are enacted for the punishment of any person, whether employer or employee, who does not comply with the act. As a matter of fact, as I read subsection 2 of section 31 the employer would be liable to a fine of $50 or imprisonment in gaol for three months for every offence that he committed under this act; for instance, if he kept back 25 cents of the stamp money that he collected from his employees and did not put the stamps on the books, I take it that for every such offence he would be liable to a fine of 850. So as I see it, there is nothing more that can be done to make sure that this money goes into the proper channels.

Now coming to the section which is under review, section 33, I take it, Mr. Chairman, that anyone who has examined the provisions of the bill which I have cited this afternoon will agree that everything possible is done to ensure the carrying out of the provisions of this bill and the regulations made under it. Fines and imprisonment may be meted out to any employer who does not properly carry out the provisions of the bill. It seems evident to me that the successful enforcement of this proposed act depends entirely upon the carrying out of these provisions, which are so broad and so stringent.

Coming more particularly to subsection 1 of section 33, as I said to the committee the other day, an examination of the debates on the British bill discloses that the working of this provision has been going on in England since 1920 without any serious objection. It would appear from that, that it is seldom necessary for workmen to try to avail themselves of this civil right which is given to

Unemployment Insurance

them by the British act and by this section. In other words, as I understand this section, if some offence is committed the employer, just the same as the employee, is liable to fine and imprisonment and to all the penalties under this act. The commission must see to it that the regulations are strictly enforced, and then no difficulty will arise; but should one arise, the workman has the right of civil action as well. It is simply right that is given to him in addition to all the provisions and conditions that are inserted in this bill to make sure that the employer turns in the money as he is bound to do.

I say to the committee that I have looked over this bill carefully since the discussion the other day, and in my opinion it is all right as it is, but in deference to the arguments that have been put forward by some of the members of this house it is our desire to make this bill just as free from defects as possible, particularly when it comes to safeguarding the interests of the employee, for whose benefit, after all, this bill is intended. I have therefore talked it over with some of my colleagues and we have come to the conclusion that it would not impair the effective provisions of the bill for enforcing payments if an amendment were made in accordance with the one that was suggested by the Minister of Justice (Mr. Guthrie) when this bill was referred back to the committee for the purpose of inserting this provision. I suppose the amendment had better be moved by the Minister of Justice.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

Raymond Ducharme Morand (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Conservative (1867-1942)

The CHAIRMAN:

Mr. Guthrie moves:

That section 33 of the bill be amended by inserting the following subsection:

"(2) Proceedings under subsection (1) of this section may at the instance of an employed person be instituted by the commission on behalf of such employed person."

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
UFA

Edward Joseph Garland

United Farmers of Alberta

Mr. E. J. GARLAND (Bow River):

Stripped of all unnecessary verbiage, this amendment simply suggests that the employee, under subsection 3, may ask the commission to take action to recover as a civil debt the amount that the employer has failed or neglected to pay over and which he has already collected from the employee. Now, in my opinion this proposed amendment only, in the most meagre and indeed almost utterly minute fashion, meets the objections to which the acting Prime Minister refers. Our objections to section 33 are principally twofold. First, it definitely implies a loss of benefit to the employee in the event of default on the part of the employer to pay over the amounts collected by him from the employee, and we say that under no circumstances should an employee, who in good faith has paid over his contri-

bution, be rendered liable. Once the default has taken place, once the employer has neglected or failed to make payment of the amounts paid to him by the employee, there should be no responsibility whatever on the employee to bring suit; that responsibility should rest solely with the commission itself. So that on both these grounds the proposed amendment fails utterly to meet the claims made by hon. members on this side of the house who have addressed themselves to the discussion of this section. I see no value particularly in this amendment, other than that it does give the employee, after he has suffered a loss to which he should never be submitted under the bill, the right to ask the commission to bring suit so that the commission may recover moneys already due to the commission itself. It is a perfectly absurd provision. The amendment proposed from this side would have cleared up the whole matter, and if the government had been sincere in its wish to protect the interests of the employee and to insist on the obligations of the commission, it would have accepted the amendment we suggested.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink

Amendment agreed to. Section as amended agreed to. Bill reported. Sir GEORGE PERLEY moved the third reading of the bill.


LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):

I noticed in one of the local papers of Saturday an article which Stated that a division was expected on what the article termed the constitutional angle of the measure, referring to this particular bill with respect to unemployment insurance. One of the headings of the article reads:

Report Liberal leader will move unemployment insurance bill be referred to supreme court.

The article itself says:

The government is certain to reject Mr. King's suggested amendment ...

-giving certain reasons. It goes on to say:

Likewise it was reported that several Liberals intend to speak and also vote against the bill on third reading.

I would not call your honour's attention to this particular article were it not for the fact that I have seen similar articles in the press in other parts of the country, all intended to create the impression that the Liberal opposition is determined if possible to thwart the enactment of this and other measures of social legislation by raising the constitutional issue whenever opportunity presents itself, and that we intend to divide

Unemployment Insurance

the house on that score on the third reading. Before the bill was introduced at all I did make clear that from our point of view it would be preferable in every way that the question of the competence of this parliament to enact social legislation being introduced should be settled in the first instance by obtaining an opinion from the supreme court. We believed that had that step been taken and a favourable opinion secured we might have proceeded with a greater sense of security in dealing with this legislation, knowing that when it was enacted

it would be enforceable. But I took

care when the bill itself was actually brought in not to discuss that aspect of the matter more than was necessary, and other members on this side did the same When the bill was in committee I did suggest an amendment to the effect that the opinion of the supreme court should be obtained. I did that in committee because it was a less formal stage; and I thought it was necessary to have on record somewhere, in a formal way, the vieiw of the opposition as to the desirability of obtaining an opinion in advance if it were possible so to do. But having done that I now feel that I have placed myself on record in a manner which can no longer be open to question or doubt, and it is not my intention to move any amendment on the third reading. I do wish however at the present time to make a statement which once and for all will put clearly before hon. members and the country the exact position of the Liberal opposition towards this social legislation. What I have to say, in order that it may be set forth as concisely and exactly as possible, I have thought well to reduce to the form of a statement which I shall read with care. I wish to make it clear that what I am saying now in reference to this unemployment insurance measure has reference also to the eight hour day bill which we were discussing yesterday and will have reference as well to the bill with respect to the minimum wage, of which there is notice of a resolution on the order paper. Our attitude is the same towards all these measures.

This may be an appropriate moment at which to make a general statement with respect to those measures of social legislation being introduced by the government, which, under judicial interpretation of the distribution of powers between the dominion parliament and the provincial legislatures, we believe to be beyond the legislative competence of this parliament.

Where we hold the opinion that it is not competent for this parliament, without pre-92582-103}

vious amendment of the British North America Act or by agreement with the provinces, to enact certain of those measures, we base our opinion upon past judicial decisions, as well as upon judicial opinion. We assert the view we do because it is the view which, until the present year, has been held by the provinces and the dominion alike, and believed to have been unanimously held by members of both houses of parliament.

We are now, for the first time, being informed by the government that it has been advised by the law officers of the crown that recent decisions of the privy council justify the opinion that the legislation in question is within the competence of the dominion parliament, in other words, is intra vires, where formerly it was held to be ultra Vires. The Prime Minister (Mr. Bennett) has given what, in his opinion, are additional reasons why the legislation should be so considered.

We still believe that in a matter of such importance the best method of relieving uncertainty, of avoiding unnecessary disturbance of business, and of determining jurisdiction in accordance with our national tradition, is by taking an advisory opinion from the supreme court, or by a constitutional amendment. The government must assume sole responsibility for adopting a more arbitrary and uncertain procedure.

The Liberal party approves the principle of the social legislation thus far introduced and desires to see it in operation. We refuse to be manoeuvred into a position of opposition to this legislation. We refuse, also, by voting against the legislation, to raise directly an election issue of provincial rights.

The sole responsibility for raising the issue of provincial rights rests upon the present administration by its subordination of constitutional propriety, and the long-run objectives of national unity and cooperation, to considerations of party strategy. We believe the attempt of the government to make a controversy over provincial rights a major issue of the coming elections would, if successful, endanger the unity of the dominion.

All legislation is subject to the determination of its validity by the courts. It is certain that the validity of the legislation in question will be determined by the courts, and, in the last resort, by the judicial committee of the privy council. Its validity cannot be determined by this parliament; neither can it be determined by the result of a general election. Least of all, can legislation that is ultra vires the dominion parliament be made intra vires by either the assertion or the assumption of authority on the part of the government.

Unemployment Insurance

If the privy council declares that the jurisdiction in any of the measures submitted rests with the provinces, it can only be transferred to the dominion by a constitutional amendment. It is for this reason that we believe that the government, some time ago, and certainly before introducing the legislation, should have sought a determination of the question of jurisdiction, and, if such were required, obtained the necessary constitutional amendment. We leave it to the judgment of hon. members of this house whether, in the eventuality of the present legislation being declared by the privy council ultra vires of this parliament, the path of constitutional amendment has been made easier by the arbitrary procedure adopted by the government.

If parliament possessed the jurisdiction, we would vote for the measures of social legislation thus far introduced. The position at present, therefore, is -that by the conflict between what is now given, as their opinion, by the Minister of Justice (Mr. Guthrie) and the Prime Minister, and what in previous years was expressed as their opinion, we do not know that parliament does not possess Ihe jurisdiction. That, as the Prime Minister himself has said, can only be determined by the decision of the privy council on the particular legislation. This is the safeguard provided by our constitution against the arbitrary appropriation by the dominion of provincial powers. We propose, therefore, to vote for these measures, subject to this continuing constitutional safeguard, which is implicit in the provisions of our federal constitution, and which cannot, by any form of words, be evaded by the present administration.

May I add that were we to vote against any of these measures, simply because of the belief we entertain on the score of jurisdiction, it would be made to appear that we are opposed to legislation as set forth in the terms of the labour convention and general principles associated with the League of Nations and incorporated in the conditions of peace, whereas, at the national Liberal convention in 1919, the Liberal party accepted in their entirety, in the spirit in which they had been framed, and in so far as the special circumstances of the country would permit, the terms of the labour convention and the general principles associated with the League of Nations and incorporated in the conditions of peace.

For us to oppose these measures would also be to adopt a course at direct variance to that which we followed when the Liberal party was last in office, at which time the Liberal

[Mr. Mackenzie Iving-1

administration bad already begun negotiations with the several provinces with a view to the enactment of similar measures, and, I might add, when the Liberal party introduced and had passed through the House of Commons the act respecting old age pensions.

An altitude of opposition to these measures might, moreover, suggest that we were not favourable to uniformity of legislation with respect to such matters as unemployment and other forms of social insurance, maximum working hours, minimum wages, "sweating," and the like, whereas, when in office, we sought to effect a national minimum of industrial standards in the only way, short of a constitutional amendeiment, which it was believed was possible to effect that end, namely, by agreement between the provinces, effected as a result of conference.

An attitude of opposition might also suggest that we were unfavourable to a constitutional amendment, which would permit of the establishment, under federal authority, of a national unemployment insurance scheme, and a national minimum of labour standards. The direct apposite, of course, is the case. We have repeatedly urged that the British North America Act should be so amended as to confer upon this parliament, subject to essential safeguards, the necessary authority to enact such measures of social legislation as may be in the national interest.

We do not propose to permit the adoption by the government of a method which, for the reasons mentioned, we believe will prove to be ineffective to place us in a false position as to our aim and desire to achieve, by the only method which we believe to be effective, a purpose upon which all hon. members seemingly are now agreed. That method we shall yet pursue, and that aim w'e shall yet attain, when the inadequacy of the method now being adopted with respect to social legislation has been made apparent, and is proven to be insufficient to serve the government's professed ends with respect to its measures of social legislation and, what we believe to be, the government's real purpose in introducing the measures in their present form, at the present time.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

George Halsey Perley (Minister Without Portfolio)

Conservative (1867-1942)

Sir GEORGE PERLEY (Argenteuil):

The right hon. gentleman has put forward a carefully prepared statement of his case in regard to this bill, but I am not a lawyer and therefore do not propose to discuss that memorandum. But I wish to say this ;to the country and to my right hon. friend: This matter has already been thoroughly discussed in this house, and the position of the government was put forward by the Prime Minister (Mr. MARCH 12, 1935

Unemployment Insurance

Bennett) himself in no uncertain terms at the time the resolution was originally introduced. The answer to what my right hon. friend has advanced will be found in the report of the debate of that day.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
LAB

James Shaver Woodsworth

Labour

Mr. WOODSWORTH:

Mr. Speaker-

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
?

Some hon. MEMBERS:

Order. The debate is closed.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

Pierre Édouard Blondin (Speaker of the Senate)

Conservative (1867-1942)

Mr. SPEAKER:

The hon. member may go ahead.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
LAB

James Shaver Woodsworth

Labour

Mr. WOODSWORTH:

Am I in order, Mr. Speaker?

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
CON

Pierre Édouard Blondin (Speaker of the Senate)

Conservative (1867-1942)

Mr. SPEAKER:

Yes.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
LAB

James Shaver Woodsworth

Labour

Mr. J. S. WOODSWORTH (Winnipeg North Centre):

I think I should like to congratulate the leader of the opposition (Mr. Mackenzie King) on having so successfully negotiated a very sharp corner.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
LIB

William Lyon Mackenzie King (Leader of the Official Opposition)

Liberal

Mr. MACKENZIE KING:

I do not know Whether my hon. friend is referring to what I am trying to do for him. I might raise the point that the debate is closed because the leader of the government who introduced the motion has already spoken, but I hope my action in not raising that point may result in my hon. friend having his chance to go ahead.

control. Under this bill he is to be compelled to pay a premium, but he may lose his right to benefit, and even under the amended form he must take the initiative and may still be liable to loss. I do not think that is fair. I do not want to traverse the ground that has been gone over again and again in the discussion in committee, but I beg to move:

That Bill No. 8 be not now read a third time but that it be referred back to the committee of the whole for the purpose of amending it by striking out subsection (1) of section 33 and inserting therefor the following:

"Section 33, subsection (1):

"Where an employer has failed or neglected to pay any contributions which under this part of this act he is liable to pay in respect of any employed person in his employment, or has failed or neglected to comply, in relation to any such person, with the requirements of any regulations relating to the payment and collection of contributions, this failure or neglect on the part of the employer shall not be taken as reason for loss in whole or in part of the unemployment benefit to which the employee would have been entitled under this part of the act, and the commission shall be entitled to recover from the employer as a civil debt a sum equal to the amount of the contributions which he collected or failed or neglected to pay to the commission."

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink
?

Some hon. MEMBERS:

Out of order.

Topic:   UNEMPLOYMENT INSURANCE
Subtopic:   MEASURE TO ESTABLISH AN UNEMPLOYMENT AND SOCIAL INSURANCE COMMISSION
Permalink

March 12, 1935