Archived 2005 - Digest of Benefit Entitlement Principles

The following information is out of date.

 

CHAPTER 18 -  Archived October 2005

FALSE OR MISLEADING STATEMENTS 

18.1.2    A VIOLATION

The Act¹  clearly states that a person accumulates a violation when the Commission issues a notice of violation. A notice of violation is issued as a result of the imposition of any monetary or non-monetary sanction or court judgement on or after June 30, 1996. The violation in turn gives rise to the application of the increased entrance requirements sanction². The exception is a disclosure made under the disclosure policy. Although this disclosure results in a warning letter (a non-monetary sanction), this circumstance does not include a notice of violation.

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1. EIA 7.1(4). 

2. See Section 18.5.3 “The Increased Entrance Requirement Sanction”. 

18.4.0    VIOLATIONS

As stated earlier¹ there is a violation whenever a notice of violation is issued as a result of the imposition of a sanction, monetary or not, or there is a court judgement against the claimant, the employer, or anyone acting on their behalf. The exception is the sanction i.e., the warning letter issued as a result of a disclosure under the Disclosure Policy.

The date of the violation is the date the notice of violation is issued; a violation does not exist until a notice of violation is issued. Claimants who have accumulated violations in the 260 weeks prior to the establishment of their benefit period or since June 30, 1996 whichever comes first, are subject to the increased entrance requirements sanction. When referring to the 260-week period it is the date the notice of violation is issued that is considered.

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1. see 18.1.2, " A Violation."

18.4.1    Application of Violations

A notice of violation is issued when a sanction, monetary (a penalty) or non-monetary (a warning letter), is imposed pursuant to the provisions imposing penalties on claimants or anyone acting on their behalf, on an employer or a person pretending to be or act for an employer, or a penalty under Part II of the Act because the person perpetrated a fraudulent or misleading act or omission¹. The issuance of this notice of violation constitutes a violation.

A notice of violation issued for a warning letter is a violation but not a classified violation². This means that on its own a warning letter or any number of warning letters will not increase the entrance requirements for a claimant. It will however have the effect of increasing the number of insurable hours required when a classified violation follows the warning letter. The violation will be classified a subsequent violation.

A violation that occurs within 260 weeks of a previous violation is a subsequent violation. It does not matter if the second violation is the result of a notice of violation issued for acts or omissions committed before the first violation.

Once a violation has been characterized as a subsequent violation it remains a subsequent violation for a period of 5 years from the date of its establishment as a subsequent violation, or until the establishment of two subsequent benefit periods, whichever occurs first. Should the previous violation be overruled on appeal, the subsequent violation is re-classified and becomes a first violation.

A violation accumulated in the 260 weeks prior to the establishment of a benefit period or since June 30, 1996, whichever is first, causes the increased entrance requirements sanction provision³ to apply for the next two initial claims for benefit established for that claimant. However, a violation outside the 260 weeks period prior to the establishment of the benefit period, not followed by another violation i.e. a subsequent violation within that 260 week period, has no effect on the entrance requirements.

A disclosure made under the Disclosure Policy is not a violation since the warning letter sent in this instance does not include a notice of violation.

When a person is found guilty of one or more offences under the Act or Regulations as a result of an act or omission mentioned in the Act⁴, a notice of violation is issued and constitutes a violation. The same will occur when a person is found guilty under the criminal code as a result of an act or omission relating to the application of the Act.

Every time the Commission imposes a penalty on an insured person and issues a notice of violation, a violation exists for that insured person and is classified depending on the value of violation. A violation can be accumulated by any insured person mentioned under the relevant sections of the Act⁵, and may include any person acting on behalf of a claimant or employer or a person pretending to be or act for an employer.

When the Commission imposes a monetary penalty or a warning letter on an insured person acting for a claimant and issues a notice of violation to that person who acted on behalf of the claimant, a violation exists for that person. The value of the violation is determined using the total amount of the overpayment, real and estimated, created for the claimant. Third party violations are also classified⁶.

Although a penalty can be imposed on a corporation⁷, it cannot be followed by a notice of violation because only insured persons can accumulate violations. When a sanction is imposed on the officer, director or agent of the corporation⁸, a notice of violation is issued provided they are insurable persons. These persons accumulate a violation classified on the basis of the value of the violation.

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1. EIA 38; EIA 39; EIA 41.1; EIA 65.1;
2. see 18.4.2, "Classification of the Violation";
3. EIA 7.1;
4. EIA 135; EIA 136;
5. EIA 38; EIA 39; EIA 41.1; EIA 65.1;
6. see 18.4.2, "Classification of the Violation";
7. EIA 39;
8. EIA 39; EIA 41.1.

18.5.0    SANCTIONS

In order to deter and prevent abuse and fraud, the Commission may resort to sanctions such as penalties that are monetary in nature, or warning letters a non-monetary sanction or prosecution. With one exception¹, imposition of a sanction gives rise to a violation² that in turn causes the application of the increased  entrance requirement sanction³. Sanctions are generally used in a progressive manner, taking into account the gravity of the offence and recidivism and are intended to take away any financial advantage that may have been derived from the false statement, act or omission and to discourage subsequent abuse.

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1. see 18.1.2, " A Violation";
2. see 18.4.0, "Violations";
3. see 18.5.3, "The Increased Entrance Requirements Sanction."

18.5.1 The Warning Letter–A Non-Monetary Sanction

The warning letter is a non-monetary sanction, it is considered to be a penalty, and may give rise to application of the increased entrance requirement sanction. The warning letter may be the preferred sanction when there are exceptional circumstances surrounding the statements made, or when the claimant, the employer, or a person acting on their behalf, takes advantage of the Commission's disclosure policy. In the latter case, the warning letter does not give rise to the increased entrance requirements sanction.

A warning letter is also appropriate when the offence occurred beyond the 36-month period during which a penalty (a monetary sanction) may be imposed. However the warning letter cannot be issued beyond 72 months of the date of event¹.

The fact that a warning letter was issued is particularly significant with respect to recidivism² and the decision to issue a warning letter is subject to appeal.

The fact that an offence did not result in an actual or possible overpayment does not mean that the warning letter is the only recourse open to the Commission. It may be that an overpayment was only avoided due to the Commission's vigilance or rapid intervention. In light of the circumstances and of the type of offence, imposing a penalty may sometimes be warranted even in the absence of an overpayment.

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1. EIA 41.1; see 18.5.2, "The Penalty–A Monetary Sanction";
2. see 18.4.0, "Violations."

18.5.2    The Penalty–A Monetary Sanction

The penalty is a monetary sanction that may in some cases be more effective than prosecution. However a monetary penalty can only be imposed during a very specific period, that is within the thirty-six month¹ period after the date on which the offence was committed. Even though a monetary penalty cannot be imposed after thirty-six months, the time frame for rendering a decision, such as an allocation of earnings, is seventy-two months where it is determined that statements were falsely made.

It is because of the serious nature of such a measure that parameters exist in order to have penalty amounts that are commensurate with the recidivism rate and the seriousness of the offence and in order to ensure a certain degree of uniformity on the national scale. The Act² provides that the Commission may impose a penalty in respect of each false or misleading statement³. Maximum penalty amounts have been set in respect of claimants⁴, employers⁵, those receiving financial assistance under employment measures⁶ and situations of undeclared earnings⁷. To increase its deterrent effect, the Commission progressively increases the amount of the penalty on the basis of the recidivism factor. In these situations, a penalty may be imposed for each week in the claimant’s period of eligibility for maternity and parental benefits, and apprenticeship courses or apprenticeship programs authorized under Section 25(1)(a) of the Act ⁸.

Any offence committed more than once over the last six years whether it arose from a disclosure or resulted in a warning letter, a penalty or prosecution is considered to be recidivism on the part of the claimant, the employer or other party acting on their behalf. This point is especially important when the time comes to fix the amount of the penalty.

In order to consider recidivism, two notions must be present for the intent of this policy:

1) the claimant, employer or person acting on their behalf, must have been subjected to a prosecution, a penalty or a warning letter; and

2) the claimant must have been duly notified in writing that any subsequent discrepancy would be more severely punished. The expression "any subsequent   discrepancy" here means any additional offence discovered by the Commission after the person has been notified of the consequences of such non-disclosure, regardless of when the offence was committed.

The fact that an offence has been committed before or after notification is of little importance. The person has two options: either take advantage of the disclosure policy to avoid having a penalty imposed, or take the risk of disclosing nothing in the hope that the Commission will not discover the other offences. The consequences of choosing not to disclose the information may result in more severe penalties. However, as in any case of recidivism, the claimant may contest the notice and its consequence on the determination.

We cannot over emphasize the importance that the insurance officer examine and evaluate carefully the reasons that led to the claimant committing the offence. This is a fundamental exercise that the officer must take on each and every time he or she is called upon to decide on an offence, whether it is the first, second or any subsequent offence.

It is the experience that we have acquired thus far that enables us to evaluate whether extenuating circumstances are present in any offence. Without limiting the possible circumstances that could reduce the amount of the penalty or even result in no penalty at all, these could include lack of education, language difficulties, misunderstanding of the legislative provisions, a claimant under emotional or financial stress due to personal health problems or family illness, etc.

Agents must not consider only the above-noted extenuating circumstances, but in fact take into account all the circumstances that, in their view, may have influenced the actions of the person who is guilty of an offence. Agents thus have more flexibility in applying the policy on penalties.

As can be seen, circumstances that may influence the seriousness of an offence are numerous and vary considerably from one person to another. Furthermore, mitigating circumstances are not only considered on first offences and repeat offenders cannot automatically be excluded from consideration of a reduced penalty by reason of mitigating circumstances. In these cases, any such consideration must be weighed against the fact that the claimant had been previously warned.

1. EIA 40; EIA 65.1;
2. EIA 38;
3. S. Smith (A-330-93, CUB 22527);
4. EIA 38(2);
5. EIA 39;
6. EIA 65.1;
7. EIA 19(3);
8. EIR 26.1

18.5.2.1   Penalty Amounts–Claimants

The Commission has set three ceilings¹ to be used in determining the penalty amount for the claimant. The claimant's penalty will be 100 percent of his or her weekly rate of benefit at the time of the infraction for the first offence. A second offence will result in a penalty of 200 percent of the weekly rate of benefit, and
any subsequent offence will result in a penalty of 300 percent. The penalty rate will of course be the same for every offence committed in the context of a single fraud. If there is more than one rate of benefit in the same benefit period, the penalty will be calculated using the rate of benefit in the week of the infraction.

Care should be taken not to mechanically apply these percentages². They may be appropriate if no explanation is given for the offence but any mitigating circumstances that are provided by the claimant or that are evident on the file must be taken into consideration. All factors existing before or at the time a penalty is imposed that may affect its appropriateness are relevant to determining its amount³. In such circumstances the penalty rate will be lower than the ceilings.

The fixed levels of 100%, 200% and 300% will of course have to be respected for first offences and repeat offences, but where mitigating circumstances are present; agents will not be limited by the amount of the overpayment. Depending on the particular circumstances of each case, the amount of the penalty may be less than the overpayment.

This flexibility will also help avoid situations where the courts question the way in which the Commission has exercised its discretionary power. This is particularly true for repeat offences where the automatic application of a 200% or 300% penalty results in an inordinate penalty which may seem proportionate to the overpayment and the seriousness of the offence⁴.

There may be situations where the claimant has appealed that the Commission has imposed a penalty of 200% or 300% of the benefit rate because of an earlier warning letter or a previous penalty. Where the claimant's appeal has been granted, any subsequent penalty rate that was determined should also be reviewed.

The guidelines governing the duties of investigation clerks and agents in deciding cases involving the allocation of earnings have also been called into question on many occasions. In the interests of consistency, it has been decided that for first offences and only for such cases, if the amount of the overpayment is less than the claimant's rate of benefit, the claimant does not explain the false or misleading statement, and the file contains no evidence of mitigating circumstances, the amount of the penalty will be reduced to the amount of the overpayment. Where a claimant does provide an explanation or where the file does contain extenuating circumstances, agents must take these into consideration and may reduce the penalty even further.

In addition, the policy on penalties in cases involving the use of a false record of employment (ROE) is more specific. The policy of course applies not only to those who submit false ROEs but also to those who do not submit all of their ROEs in order to receive a higher rate of benefit. Since the legal basis is essentially the same, a similar approach may be used. For the purpose of the application of the policy, a false ROE is one on which the hours and/or earnings are falsified to get a benefit period established and/or a higher benefit rate.

In such cases, agents may impose a penalty for each of the  claimant's statements completed during the benefit period.  Clearly, the decision must take into account the entitlement  principles set out in this chapter, any mitigating circumstances and the possibility of a repeat offence.

Finally, it cannot be overemphasized that all extenuating circumstances must be fully documented on the file. This information is essential for providing explanations to the claimant and, especially, for the purposes of an appeal. Although the Commission has the discretion to impose a penalty, it still has to demonstrate that it properly exercised its discretion in light of all relevant considerations.

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1. EIA 38;
2. Jurisprudence Index/penalties/Commission policy/;
3. L. Morin (A-681-96, CUB 28068A);
4. Jurisprudence Index/penalties/Commission policy/.

18.5.2.3   Penalty Amounts–Situations of Undeclared Earnings

In the case of undeclared earnings¹, the maximum penalty that can be imposed on the claimant is either:

three times the amount by which the benefits were reduced because of undeclared earnings; or,

if benefits were not paid for some other reason, three times the amount of benefit that would have been reduced except for this reason.²

If no benefit period was established, the maximum penalty for a claimant is calculated at three times the maximum rate of weekly benefits in effect when the act or omission occurred.

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1. EIA 19(3);
2. EIA 38.

18.6.0    DISCLOSURE POLICY

The Commission has a policy to encourage a person guilty of abusing or defrauding the Employment Insurance Program to disclose the offences for which he or she is responsible. This is the disclosure policy.

The admission, however, must be authentic in that it must not be related in any way to an investigation already under way. In addition, the facts on the file must confirm that the offence would have led to a penalty or prosecution had there been no disclosure policy.

The person who takes advantage of this policy will not face a monetary penalty or prosecution under the Act and Regulations. Furthermore, the claimant may take advantage of this policy as often as he or she wants as long as the criteria of the policy are met.

The Investigation and Control Officer and the Insurance Officer are responsible for determining whether the criteria of the disclosure policy have been met. If so, a warning letter will be sent each time the person takes advantage of the policy to notify the claimant of the Commission's decision not to impose a monetary penalty or initiate a prosecution. This step is important because the warning letter confirms the Commission's conclusion that an offence within the meaning of the Act has been committed.

It should be borne in mind that each warning letter signals a repeat offence and that should the Commission later discover another offence, the fact that a repeat offence is involved must be taken into consideration when determining the amount of the penalty. Also, as stated earlier, the issuance of a warning letter in the context of the Disclosure Policy does not constitute a violation.

In the event the Investigation and Control Officer and the Insurance Officer do not agree on the recommendation to accept or refuse a disclosure and the disagreement cannot be resolved at the first level (Supervisors Insurance and Investigation and Control), the case should be reviewed by the Human Resources Canada Centre (HRCC) Manager before referral to Regional Office.

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CHAPTER 14 -  Archived June 2005

TEACHERS

14.1.0    INTRODUCTION

The Commission has always maintained its intention not to pay benefits to teachers during non-teaching periods. Until 1980, prior to the decision of the Supreme Court in the case of J.S. Dick ¹, teachers were considered to be not unemployed for the duration of their contract and moneys were allocated to the non-teaching periods ².

The Supreme Court, in the matter of J.S. Dick, determined that no part of a teacher's salary is to be allocated to the non-teaching periods. Accordingly, teachers are said to have a separation from employment, an interruption of earnings, and have no earnings for the duration of the non-teaching periods.

The Commission, however, maintained its intention not to provide regular benefits during the non-teaching periods to teachers who are unemployed only for the duration of the non-teaching periods. The position of the Commission was reinforced by regulation ³.

Teachers continue to claim benefits during their non-teaching periods. This chapter is intended to clarify the entitlement of teachers for these non-teaching periods.

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1. J.S. Dick (S-267-77, CUB 4556A);
2. G. Petts (A-166-74, CUB 03538);
3. EIR 33.

14.2.0    AUTHORITY AND DEFINITIONS

Under the authority of the Act¹, the disentitling provision as defined by Regulation² is restrictive in that it is applied to a specific group of teachers, also defined by Regulation, within the occupation and is applicable for defined periods.

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1. EIA 54(j);
2. EIR 33.

14.2.1 Teaching Defined

Teaching is defined and restricted by Regulation¹ to pre-elementary, elementary and secondary school teachers, including teachers with technical or vocational schools. The definition applies to anyone who teaches at those levels, or schools, regardless of the time spent in teaching or the subject being taught.

Moreover, the definition is not applied only to teachers employed in schools under provincial or municipal boards. It includes teachers in independent or private schools. However, it does not include teachers at other levels, such as university professors, and college teachers, who are subject to the same rules as other claimants².

As well, the Regulation³ does not apply to other school board employees, who although part of the education systems, are not in the "occupation of teaching". Without being exhaustive, the list could include school principals (except when the principal is a "teaching principal"), administrative and clerical staff, maintenance technicians, teachers' assistants⁴, care givers in a day care environment, and school bus drivers.

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1. EIR 33;
2. P. Frenette (A-951-90, CUB 18718); G. Sylvain (A-769-90, CUB 18566);
3. EIR 33;
4. S. Sepinwall (A-961-87, CUB 14181).

14.2.2    Non-Teaching Period Defined

The non-teaching period is defined as the period that occurs annually, at regular or irregular intervals, during which no work is performed by a significant number of people engaged in teaching¹. Non-teaching periods generally include the summer break, Christmas, and the mid-winter or spring break. The Regulation applies to a disentitlement within the non-teaching periods only and is not applicable outside these periods as other sections of the Act apply.

A statutory holiday is not in itself a non-teaching period. However, a statutory holiday could fall in a non-teaching period. In such cases, they will be included and considered as part of the non-teaching period. For example, Good Friday and Easter Monday are statutory holidays, but become part of the non-teaching period when the recess includes part of the week before Good Friday and part of the week after Easter Monday.

"A significant number of people engaged in teaching" means a noticeable number of teachers in the context in which the claimant works. The Regulation must therefore be applied with respect to the non-teaching periods to which the teachers are subject. The non-teaching periods may vary among provinces and may even vary from one school to another within a region.

The test is whether it can be said that a significant number of the claimant's colleagues are not at work during the period. The criterion will not be satisfied where, in the context in which the claimant works, there is no noticeable difference in the number of people teaching between one period of the year and all the others.

Generally, a school year is comprised of teaching from September through June with July and August as the primary non-teaching period. However, year-round schooling is being introduced in a number of areas. The year-round schooling is usually divided into four instructional periods of roughly equal duration, separated by intercession periods. These intercession periods are deemed as non-teaching period for teachers working on a year-round schooling calendar.

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1. EIR 33.

14.3.0    DISENTITLEMENT AND EXCEPTIONS

The Regulation¹ applies to any teacher, as defined, who has taught for any part of his or her qualifying period. Consequently, all teachers claiming benefit during a non-teaching period are subject to disentitlement.

However, it is recognized that there are times when it is valid that benefits should be paid and the Regulation prescribes three relieving conditions, any one of which provides an exception to disentitlement. These conditions are:

• contract termination;
• teaching on a casual or substitute basis;
• entitlement based on an occupation other than teaching.

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1. EIR 33.

14.3.1 The First Exception: Contract Termination

Benefit is not payable "until his contract of employment for teaching has terminated¹". It can be said that when, at the beginning of any week of unemployment, a contract exists, the Regulation does not relieve the claimant from disentitlement². Benefit is payable for any part of a non-teaching period after the termination of a contract, provided no other contract exists or until a subsequent contract is signed or effective.

The determination of whether or not a contract of employment has terminated must be made whenever evidence to that effect is presented. A contract will be considered as no longer in effect on the day following the last day of the contract, provided it is not renewed.

A contract in teaching can be either written or verbal. Where a claimant was under a verbal contract, and that contract is no longer in effect the day following the last day worked, the claimant is relieved from disentitlement effective the day following the last day worked³.

A teacher in a repetitive ten-month contract will be considered to have a termination of the contract at the end of the teaching period. If, however, a contract for the next teaching period is signed or agreed to with the same school board prior to the termination, relief from disentitlement cannot be found. If during the non-teaching period, a contract for the next teaching period is signed with the same school board, the teacher will no longer meet the provisions of the Regulation⁴ as of the date of the signature.

When a teacher is employed under separate consecutive contracts, the claimant is not relieved of the disentitlement unless there is a period of time during which the teacher is not actually under a contract. The offer does not need to be in writing, such as a new contract; it could be a simple understanding that the employment for teaching will continue after the non-teaching period.

There may be situations where, after a contract has terminated, a teacher will sign a new contract during the non-teaching period with an effective date in the non-teaching period. In such cases, the teacher will no longer satisfy the first exempting provision as of the effective date or the date of signature of the new contract, whichever is later. A contract signed after the non-teaching period will have no retroactive effect on the entitlement of the past non-teaching period.

A contract of employment does not terminate when a teacher is either suspended or on an approved leave of absence with or without pay⁵, such as educational, sabbatical, sick, maternity, or any type of leave, including deferred salary or self-funded leave⁶.

Under the terms and conditions of a collective agreement, it may occur that employee benefits, such as medical or dental benefits, continue after termination. Consequently, it cannot be accepted, based solely on the presence of continuing employee benefits that the contract is continuing. A contract may be considered as terminated in such situations when the continuation of fringe benefits is part of the termination conditions.

Application of this Regulation⁷ is not restricted to full-time teaching. Consequently, the continuation of any contracts for teachers must be considered, even for those who share a position to teach half year. In these situations, unless the teacher can demonstrate contract termination, a disentitlement must be maintained.

Teachers who do not meet the first exception will need to satisfy the second or third exception to prove entitlement to benefits during the non-teaching period.

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1. EIR 33(2)(a);
2. EIR 33(2)(a);
3. EIR 33(2)(a); M. Gauthier (A-128-95, CUB 26838); E. Taylor (A-681-90, CUB 14246A);
4. EIR 33(2)(a);
5. J.S. Dick (S-267-77, CUB 4556A);
6. EIA 11(3), S. Oram (A-676-93, CUB 23386);
7. EIR 33.

14.3.2    The Second Exception: Casual or Substitute

If the disentitlement has not been relieved under the first exception, we must look to the requirements of the second exception¹ to see if relief is possible. This provision² provides that benefit is not payable "unless his employment in teaching was on a casual or substitute basis". The relief is based on the nature of the claimant's teaching employment in the qualifying period, that is, casual or substitute teaching. It does not apply if the teacher was neither substitute nor casual.

The words "casual" or "substitute" must be given their dictionary meaning that may differ from particular definitions found in provincial legislation or labour agreements.

"On a casual basis" refers to teaching for a short period of time and for a limited, intermittent and temporary purpose. For the purpose of the Regulation³ it can be said that casual teaching means irregular, occasional or incidental teaching. If the employment involves filling an unexpected or temporary absence for a short period, and if the employment can be cancelled at any time, it is of a casual nature.

"On a substitute basis" means the replacement of a teacher who is away. There are no limits placed on the length of time that a teacher can replace another without losing her or his status as a substitute. The School Board may fill a lengthy vacancy, on a substitute basis, with the same teacher year after year or with different teachers.

Claimants employed in teaching on a casual or a substitute basis, for any part of the qualifying period, and who, since the beginning of, or prior to, the non-teaching period signed a regular teaching contract for the following school year, are entitled to benefits during any non-teaching periods that fall within their current benefit period.

It may happen that a teacher under a leave of absence has both regular teaching and casual or substitute teaching in the qualifying period. A teacher whose employment in teaching was on a casual or substitute basis for most of the employment in teaching during the qualifying period may qualify⁴, not withstanding the fact that there was full-time teaching in the qualifying period.

In one specific case, a claimant, under a contract to work full-time from September to January of each year, taught as a substitute teacher from January to March, and worked on a casual and substitute basis from March to June. The Umpire ruled that, notwithstanding the fact that the teaching contract had not terminated, the teacher satisfied the provision of the Regulation⁵ because there was a teaching period on a casual or substitute basis. That decision was maintained by the Federal Court of Appeal⁶.

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1. EIR 33(2)(b);
2. EIR 33(2)(b);
3. EIR 33;
4. EIR 33(2)(b);
5. EIR 33(2)(b);
6. B. Lewis (A-475-89, CUB 17053).

14.3.3 Exception: Occupation Other than Teaching

A teacher may be entitled to benefits if he or she has, during the qualifying period, worked in an occupation other than teaching¹.

In order to be entitled, the claimant must fulfill the qualifying conditions using employment other than teaching. For example, teaching at the post-secondary or university level, which is employment other than teaching as defined in the Regulation, could be accepted.

The qualifying conditions to receive benefits require that a person have a sufficient number of weeks of insurable employment in other employment than teaching in the qualifying period to establish a benefit period and have an interruption of earnings from employment in which the claimant worked at other than teaching.

If a teacher is entitled to benefit pursuant to the Regulation², the benefit rate payable during the non-teaching periods will be based only on the non-teaching employment upon which he or she qualified³.

Should the claimant be entitled to benefits subsequent to the non-teaching period, the rate of benefit will be adjusted by taking into account all employment in the qualifying period.

Claimants who were employed in an occupation other than teaching, during part of their qualifying period, and signed a contract to teach on a regular part-time or full-time basis for the following school year, would still be entitled to benefits during the non-teaching periods comprised in their benefit period.

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1. EIR 33(2)(c);
2. EIR 33(2)(c);
3. EIR 33(3).

14.4.0    SPECIAL BENEFITS

Teachers are entitled to maternity and parental benefits during both the teaching and non-teaching periods, provided all entitlement criteria for the payments of maternity or parental benefits are met¹.

Sickness benefits are payable during the teaching period only, including situations where the claimant's illness during the teaching period extends over to the non-teaching period, or where the illness during the non-teaching period extends over to the teaching period. Sickness benefits are not payable to teachers during the non-teaching periods unless one of the three conditions found in the Regulation² is met.

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1. EIR 33(2);
2. EIR 33(2).

14.5.0    AVAILABILITY

Teachers are no different than other claimants as far as their rights and obligations are concerned. They must prove that they are capable of and available for work and unable to obtain suitable employment for any working day of a benefit period, including any non-teaching period for which they are claiming benefits.

Teachers need to demonstrate that, during the non-teaching period, they are willing and able to accept immediately any offer of suitable employment and that no restrictions exist that would limit their employment opportunities¹.

Generally, few teaching opportunities exist during a non-teaching period. Therefore, as with any other claimant in a similar situation, teachers must show that they are actually seeking a type of work which they can reasonably hope to obtain², particularly when one considers that some non-teaching periods are spread over many weeks.

The concept of a reasonable period of time to find teaching employment will therefore not be applied during the non-teaching periods³. The availability alleged by the claimant must be supported by actions and evidence as required of any claimant. A teacher must, during the non-teaching periods, seek work in other fields in which there are currently employment opportunities.

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1. J.J. Campbell (A-706-84, CUB 8980);
2. see 10.8.3, "Seasonal Workers";
3. see 10.6.9, "School-Related Occupations."

14.6.0    INTERRUPTION AND ALLOCATION OF EARNINGS

Teachers are said to have a separation from employment, have no earnings and have an interruption of earnings for the duration of the non-teaching period in question, provided it lasts at least seven days¹. Furthermore, no part of a teacher's salary is to be allocated to the non-teaching period².

Generally, the decisions pertaining to the interruption and allocation of earnings and the weeks of unemployment are subject to the terms and conditions of the employment contract. It can therefore be concluded, based on the regular rules of entitlement, that the earnings paid pursuant to such a contract must be allocated to the period for which they are paid.

Accumulated sick leave credits are earnings and shall be allocated as prescribed³.

There is an interruption of earnings, outside the non-teaching periods, when a teacher completely ceases to work but still remains under contract with the employer. It is the wording of the agreement binding the parties that will govern the situation, unless there is a suspicion that the sole purpose of the agreement is to elude the application of any part of the EI Act and Regulations.

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1. EIR 14;
2. J.S. Dick (S-267-77, CUB 4556A);
3. EIR 36; J.A. Pomerleau (A-674-90, CUB 18440); R. Lavallée (A-691-90, CUB 18458).

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5.5.2    Payments Supplemental to Employment Insurance Benefits - Archived June 2005

Often employers wish to supplement their employees' EI benefits during a period of unemployment to make up the difference between the EI benefits and their employees' normal wages while employed. As these payments are moneys arising out of employment, they would be earnings to be deducted from EI benefits.

The Commission has recognized the benefit of such payments which have advantages for both parties. It helps the employee maintain a standard of living during a period of unemployment and it helps the employer maintain a skilled work force during a period of temporary lay-off. As a result, the Commission has made regulations that exempt these types of payments from being considered earnings under certain circumstances.

Two types of payments which are intended to supplement EI benefits have been specifically excluded from consideration as earnings. The first type relates to those supplemental payments that are made by an employer to an employee during a period of unemployment due to a temporary stoppage of work, training, illness, injury or quarantine.¹ The second type relates to supplemental payments that are made by an employer to an employee by reason of pregnancy or for the care of a child or children referred to in subsection 23(1) of the Act.²

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1. EIR 37; see 5.5.2.1, "Approved Supplemental Unemployment Benefit Plan";
2. EIR 38; see 5.5.2.2, "Payments by Reason of Pregnancy or for the Care of a Child." 

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5.5.2.2    Payments by Reason of Pregnancy or for the Care of a Child- Archived June 2005

Payments may be made by an employer during a period of leave for maternity or child care. In order for these payments to be excluded from consideration as earnings, they must meet the following conditions:

• the payments must be made by reason of pregnancy, or for the care of a child or children referred to in subsection 23(1) of the Act, or any combination of these reasons;
• when combined with the claimant's weekly rate of employment insurance benefits, the payment does not exceed the claimant's normal weekly earnings from his or her employment; and
• the payment does not reduce the claimant's accumulated sick leave, vacation leave, severance pay or any other accumulated credits from his or her employment.¹

When there is dual employment, only that portion of the benefit rate and the normal weekly earnings from the employer that pays the top up are to be considered.

Any payment made under a plan that does not meet all of these conditions is treated as earnings and is allocated to the weeks in respect of which the payments are paid or payable.²

_______________________

1. EIR 38;
2. EIR 36(12).

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5.7.2.4    Supplemental Unemployment Benefits Plan— Criteria Not Met  - Archived June 2005

Employers may supplement their employees' EI benefits during periods of unemployment due to a temporary stoppage of work, training, illness, injury, quarantine, maternity, or care-of-a-child leave. These supplemental payments make up the difference between the claimant's EI benefit and the employee's normal wages while employed.

As these payments are moneys arising out of employment, they would be earnings to be deducted from EI benefits. However, payments made by an employer to supplement EI benefits are excluded from consideration as earnings if they are made under a Supplementary Unemployment Benefit (SUB) Plan which meets specific conditions.¹ In addition, supplemental payments made during maternity, adoption or care-of-a-child leave may be specifically excluded from consideration as earnings if they meet specific criteria. These payments are not earnings if the payment when combined with the claimants' weekly rate of benefit does not exceed their normal weekly earnings from employment and does not reduce their accumulated sick leave, vacation leave, severance pay or any other accumulated credits from employment.²

SUB plans are reviewed at the national level to determine if all required conditions are met and a list of the SUB plans that meet the conditions is maintained. Any payment made under a SUB plan that does not meet all of the conditions is treated as earnings³ and is allocated to the period for which it is payable; that is, the period of unemployment⁴.

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1. EIR 37(2);
2. EIR 38; see 5.5.2.2, "Payments by Reason of Pregnancy or for the Care of Children";
3. EIR 35(2);
4. EIR 36(5).

5.6.3    Normal Weekly Earnings from that Employment - Archived June 2005

Earnings ¹ may require allocation according to the claimant's normal weekly earnings from that employment ². Normal weekly earnings are the ordinary, usual earnings that a claimant earns on a regular basis at that employment³.

Generally, normal weekly earnings consist of the most recent gross weekly salary upon which the employer and the claimant have agreed ⁴. Where the employee is paid an hourly rate,normal weekly earnings are calculated by multiplying the number of hours normally worked by the hourly rate of pay. The gross weekly salary agreed upon may also include compensation in addition to basic wages, such as, commissions paid at regular intervals, vacation pay and holiday pay paid with each paycheque⁵, northern allowance, car allowance ⁶ and regular shift premiums.

Fringe benefits that the claimant enjoys during employment are not included in the normal weekly earnings ⁷. Such fringe benefits, which are not included in normal weekly earnings, are life insurance benefits, long-term service awards, vacation pay that is not paid periodically, and an annual incentive allowance ⁸. However, fringe benefits may be included in normal weekly earnings when allocating earnings on separation ⁹ if the calculation of the amount of compensation paid by the employer is clearly based on the fringe benefits as well as the wages ¹⁰.

The claimant's weekly salary may occasionally be increased by overtime, shift premiums, incentive or cost-of-living bonuses, irregular commissions, or other similar moneys. As well, the weekly salary may be reduced when the claimant works fewer hours than agreed or temporarily works shifts for which a premium is not paid. When this increased or decreased weekly salary occurs so often that it is considered "normal," it becomes the claimant's normal weekly earnings ¹¹. "Normal" may be considered as what has repeatedly occurred in 85 per cent of the weeks used to calculate the benefit rate. If this increased or reduced weekly salary varies from week to week, normal weekly earnings become the average of the increased or reduced weekly salary of the weeks under study.

The gross weekly salary may vary because of the pattern of work. For example, the pattern of work may require a different number of hours to be worked in each week or a different shift premium may be applicable in each week. In addition, the work pattern may include alternating weeks on and off work, or, a person may work additional hours in a week in order to earn days off. In these cases, normal weekly earnings are determined by averaging the gross weekly salary over the weeks of the work pattern.

Where there is a contract, which specifies a time period, and a specific sum paid for the total period rather than an hourly or weekly wage, normal weekly earnings are determined by taking an equal distribution of the amount over the contract period. The actual number of hours worked in any given week is not relevant in these situations when determining normal weekly earnings.

Claimants' declarations as to their weekly earnings are accepted at face value unless these amounts do not appear reasonable or there is clear evidence to the contrary. The Commission would then make the determination as to what constitute the claimant's normal weekly earnings.

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1. EIR 36(8); EIR 36(9); EIR 36(10); and EIR 36(11);
2. see 5.6.3.1, "That Employment";
3. M. Fox (A-841-96, CUB 35026);
4. CUB 14699;
5. M. Fox (A-841-96, CUB 35026);
6. M. Fox (A-841-96, CUB 35026);
7. CUB 4499;
8. M. Fox (A-841-96, CUB 35026);
9. see 5.12.10, "Fringe Benefits";
10. CUB 24992:
11. J. Cyr (A-857-77, CUB 4802).

10.11.8    Out of Canada - Archived April 2005