Restaurant industry braces for EI rate increase, but avoids a full-blown
hurricane

OTTAWA, Sept. 30 /CNW/ - Today's employment insurance announcement by Finance Minister Flaherty improves a bad situation, but restaurant operators will still be hit with a $100-million increase on their payroll tax bill next year.

"The Minister has heard us and we're pleased he is taking steps to bring the runaway EI premium train under control," says Garth Whyte, president and CEO of the Canadian Restaurant and Foodservices Association. 

"In an industry like ours that invests in people, not machinery, payroll taxes are a huge issue. Today we've been told the EI hurricane threat has been downgraded from level 5 to level 2."

Over the past several months, CRFA has lobbied the federal government on behalf of its members to freeze EI rates, rather than discourage hiring by raising payroll taxes. CRFA has also argued that Ottawa must fund any EI shortfalls out of general revenues.  If not, employers and employees will be paying a huge price down the road when EI rates are increased to make up for a shortfall in the EI fund.  

Canada's $60-billion restaurant industry employs more than one million people.

For further information:

Prasanthi Vasanthakumar, Communications Specialist, 416-649-4254 or [email protected]