By James Bone
The Canadian government studied and established the first building blocks of our current social safety net in the early 1940s, during the Second World War. The government was looking to avoid or abate a repetition of Canada’s experience of increased unemployment when soldiers returned from the First World War, especially in manufacturing with the end of wartime production and the resulting lower demand. One of the ideas that it seized upon was unemployment insurance: a mandatory program to which both employees and employers would contribute based on a given employee’s wages; if the job was lost, that person would have some guarantee of a continued income for a specified period. The legislation establishing the program received royal assent in August 1940 and took effect on July 1, 1941. While unemployment insurance has been modified and reformed since then, the essence remains the same under the present Employment Insurance program.
At the time, of course, there was no computer-based record keeping, and a means had to be devised to show not only that payments for contributions had been made but also that a given employee was entitled to coverage. The most common method of proving that taxes or fees had been paid for government services during the late 19th and early 20th centuries was through the use of revenue stamps. Similar to postage stamps, revenue stamps specify the amount of money paid to purchase the stamp and the tax or fee that they were created to pay for. When used, revenue stamps were cancelled by an official to indicate that their value had been used for the intended purpose. Unemployment insurance stamps were available for purchase at post offices, and employers were required to withhold a set proportion of an employee’s wage, while also making their own contributions, to purchase these stamps. The stamps would then be affixed to booklets, generally kept with the human resources or management unit of a company, and then submitted annually to the local Unemployment Insurance Commission office. Each employee would have a booklet every year held by each employer for whom he or she worked. To ensure that the wages withheld were going toward the purchase of unemployment insurance stamps, employees were permitted by law to inspect their booklets twice a month.
At the launch of the unemployment insurance program, many forms of employment were not eligible for coverage. These included agriculture, fishing, forestry and logging, hunting and trapping, air and water transportation services, medicine, nursing, teaching, military, police, and civil services. Over time, more forms of employment were made eligible for coverage. Most notably, in 1957 employment in the fishing industry was covered, providing a much-needed income guarantee to people in the newly confederated province of Newfoundland and throughout the Maritimes. At first, existing stamps were overprinted with the image of a fish to indicate their intended use in the fishing industry. In later years, fishing unemployment insurance stamps were issued without an overprint.
Among the various types of revenue stamps used by federal and provincial governments, unemployment insurance stamps are relatively scarce. This is because under the program’s legislative act and regulations, it was illegal to sell unused stamps, and only an employer or an employer’s human resources designate could be in lawful possession of unused stamps. Further, most of the booklets and used stamps submitted to the Unemployment Insurance Commission as well as most of the unused stamps were intentionally destroyed after their designated five years of retention. Also, unsold stamps were returned from post offices to the Unemployment Insurance Commission for destruction once they were no longer eligible to be sold, which happened when changes to unemployment insurance premiums required stamps to be issued in new denominations.
The Danny Leong collection
It is thus fortunate that Library and Archives Canada was able to acquire the Danny Leong Unemployment Insurance Stamp collection (R15771), which includes more than 11,000 stamps, unemployment insurance booklets from all the years of their use, and other associated materials. Both Danny Leong and his widow, Violet Anne Leong, were employees of the Unemployment Insurance Commission in British Columbia. Through this employment, Danny Leong was able to collect specimens of the stamps and booklets that were no longer needed for business use, training or reference in the office.
Most of the stamps in this collection are pre-cancelled specimens, printed by the Canadian Bank Note Company in Ottawa and forwarded to the Unemployment Insurance Commission as examples of stamps to be issued and sold at post offices. The collection also includes specimen and used insurance booklets, possibly retained for training purposes. The most curious item is a singular engraved die proof dated March 1959. This unique proof is for a never-issued agriculture unemployment insurance stamp—as mentioned above, agriculture was not covered by unemployment insurance during this period. Evidently, consideration was given to including agricultural work in the program, and this consideration was serious enough to have involved having a stamp for that purpose designed and engraved. In discussion of this item, Yves Baril attributed the work as most likely that of the Canadian Bank Note Company’s letter engraver Donald Mitchell, while the design appears to be that of Harvey Prosser, with supervision by John Francis Mash.
The use of revenue stamps and unemployment insurance booklets to record payments for insurance continued until the early 1970s. Thereafter, the program was reformed with computerized records and the first issuing of Record of Employment forms, which are still in use. Most importantly, the 1971 reform of the Unemployment Insurance Act made coverage almost universal regardless of industry. The final issue of unemployment insurance stamps, printed in 1968, went mostly unused, with only a few used examples having ever been found by collectors. Of interest to both those who study philately and labour history in Canada, the Danny Leong Unemployment Insurance Stamp collection is available for consultation at Library and Archives Canada. For further reading on Canadian revenue stamps, including unemployment insurance stamps, Edward Zaluski’s Canada Revenues is an outstanding resource.
James Bone is an archivist in the Social Life and Culture Private Archives Division of the Archives Branch at Library and Archives Canada.