8.0 Future Program Options for TAGS Clients

Funds for the TAGS program may run out as early as May 1998. This has caused concern for those affected and for both levels of Government. With the fishery operating at a reduced level of activity, the post-TAGS income situation for many is uncertain. In the past, income earned in the fishing industry was supported and/or supplemented by UI/EI income received; furthermore, fisheries earnings provided access to UI/EI. Alternative employment opportunities tend to be scarce, and in some instances, virtually non-existent in areas where fishing is the main source of employment. Thus, without a resumption of fishing activity many could have neither earnings potential nor access to EI.

Steps have been taken by the Federal Government to reduce the potential number of persons who might not be able to access EI. As a measure to facilitate entrance to EI for those who might be affected by the program's labour market attachment criteria, an exception has been made for TAGS clients. If the rules were enforced, TAGS clients who have not had attachment to the labour force would require 910 hours of work to access the EI program (see Box "EI Labour Force Attachment Rules").

It has been announced that, effective July 6, 1996 and until December 31, 1997, TAGS clients will be permitted to use weeks of TAGS benefits as labour force attachment when applying for EI. The relaxation of the attachment regulations will provide all TAGS clients access to EI who have the minimum 420 hours.

This measure will not eliminate the attachment hurdle for all clients. This results from variations in the duration of labour market participation amongst clients. For example, about 38 percent of TAGS clients have found employment and qualify for EI in the last year without the change. Some of the remaining 62 percent have found year round employment and do not require EI; others have more than 910 hours and could readily enter the EI program; also some might not be able to attain the 420 hours needed to meet the minimum qualifications and thus will be unable to benefit from the exemption. Those who are most likely to benefit are those who have between 420 and 910 hours of employment. The exemption would grant these people access to EI without their having to find the full complement of 910 hours that would have been needed prior to the granting of labour force attachment.

Due to many factors, it is not possible to predict the precise number of TAGS clients who will be able to qualify for EI as a result of the relaxation of the criteria for labour force attachment. Examples of such factors might be: the amount of employment clients find between the current and the future date when they might wish to file for EI; individuals may be able to qualify but choose not to file for personal reasons; some may leave the Province or access full time employment where EI is not needed, etc. These and many other factors make it impossible to determine how many TAGS participants will ultimately qualify for EI.

The EI Act defines a new entrant or re-entrant to the labour force as a person who during the 52 week period prior to the qualifying period(1) accumulated less than 490 hours of labour force attachment(2). The EI rules require new entrant/re-entrants to meet more stringent qualifying criteria than those that are not considered to be new entrants/re-entrants (regular qualifiers). If the rules were to be fully enforced for TAGS clients, those who are considered to be a new entrant/re-entrants would need 910 hours of work in order to qualify for EI, whereas regular qualifiers would only require 420 hours. New entrant/re-entrants filing for fisher's EI would require $5,500 in fishing income before being able to qualify; regular qualifiers would only require $2,500 in fishing income (the criteria are the same for non-TAGS clients). It is believed that some TAGS clients would have difficulty finding this amount of work with the fisheries still closed.

1. Qualifying period is the 52 week period prior to the date on which they apply for EI.

2. Weeks of employment, EI, training, workers compensation, disability, etc. can be used as weeks of labour force attachment.

To help ease the transition from TAGS to other programs that might be available through HRDC, training options have also been made available through the EI Reach Back provision. Under this provision, persons classified as EI Reach Back can participate in training and certain other EI program features as well as clients eligible for EI. Reach Back status is established if a client is not currently eligible for EI but had an EI claim that ended within three years prior(1) to the time they apply for access to a HRDC program. (For the purpose of this analysis, the reference period used to determine EI eligibility/Reach Back status was May 22, 1994, to May 17, 1997).

In July 1996, it was announced that active programming (the provision of training and other adjustment measures) under TAGS would be discontinued. The purpose of this was to re-direct program funds in order to extend the duration of TAGS income support for as long as possible. Analysis indicates, nonetheless, that the majority of TAGS clients can still take advantage of HRDC's regular programs because of their current eligibility status as an EI claimant or through their determination as EI Reach Back clients.

It is estimated that approximately 60 percent of clients in Newfoundland and Labrador would be considered EI eligible or EI Reach Back. Thus 13,530 of the 22,530 currently eligible for TAGS can participate in the various HRDC programs available to regular clients, including training and employment interventions. The related table shows that this proportion is of the same order of magnitude as has been noted for those who have already exhausted their benefits. A smaller proportion (46 percent) of those who have exited the program are EI eligible/Reach Back. Many in this group are those who took advantage of an early retirement and/or licence retirement option. Thus, they are not comparable to those who are currently eligible or have exhausted their benefits.


Eligibility status

of Clients*

EI Eligible/
Reach Back**

EI Eligible/
Reach Back

Currently Eligible Clients




Duration Exhausted












* As of May 30, 1997
** As of May 17, 1997
The number of clients who are EI eligible/Reach Back varies throughout areas of the Province. Figure 7 illustrates the proportions for the HRCCs (see Appendices 3.1, 4.1 and 5.1 for details relating to CCS, HRCC and Economic Zone areas). Between 81 and 90 percent of clients associated with the Marystown, Grand Falls and Port aux Basques HRCC areas would be considered EI eligible or Reach Back. The map also shows that the proportion of EI eligible or Reach Back is also high in other HRCC areas.

The differences in the proportions of EI eligible/Reach Back are derived from the interplay of a variety of factors specific to different regions. Also, in areas where the fisheries were closed at a later date (regions not covered by NCARP), a larger number of clients tend to fall into the three year Reach Back status determining period because they were eligible for UI more recently. In some areas fisheries are more diversified and workers are able to catch species such as pelagics, lobsters and other shellfish, etc. which provide them with employment, and thus access to EI. Analysis indicates that proximity to stronger and more diversified non-fishery labour markets (such as in the St. John's area) has not been as important a factor in determining EI eligible/Reach Back status as the diversification of fisheries and the level and duration of fishing activity that has taken place in other areas. The regional proportions of EI eligible/Reach Back clients results from combinations of these occurrences and other factors within the various areas.



of Clients**

Number of
EI Eligible/
Reach Back***

EI Eligible/ Reach Back





















* excludes exited clients such as those who accepted Early Retirement or Licence Retirement.
** As of May 30, 1997.
*** As of May 17, 1997.

There are also large variances in the percentage of clients who are EI eligible or EI Reach Back by year of TAGS exhaustion. The highest percentage of clients is seen for 1999 (66 percent). These clients had a stronger historic attachment to the fisheries that have been closed and/or are attached to fisheries that have diversified into mainly non-groundfish species in recent years.

The table also reflects a notable situation for those who exhausted in TAGS in 1996. The proportion of these clients who are EI eligible/Reach Back compares closely with the group who have the longest attachment to the fishery. This is an interesting situation since the 1996 group were the first to exhaust their eligibility because of their lack of attachment to the fisheries. This anomaly occurs because, although the individuals had a relatively minor attachment to the fishery, they had an attachment to other non-fisheries sources of employment. Their weak attachment to the fishery was offset by access to alternative labour markets which has ultimately made them one of the most EI eligible/Reach Back groups.

The Federal Cabinet has committed to conducting a review of post-TAGS issues. Consultations with provincial governments are expected to begin in the fall, 1997.

1. The Reach Back provision considers claims that begin within 5 years prior to the date when the request is filed in the case of parental claimants.

Figure 7