[OFFICIAL ENGLISH TRANSLATION]
2001-3728(EI)
BETWEEN:
JEAN RENÉ ST-JEAN,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Appeal heard on July 11, 2002, at Matane, Quebec, by
the Honourable Deputy Judge S. J. Savoie
Appearances
For the Appellant: The Appellant himself
Counsel for the Respondent: Marie-Claude Landry
JUDGMENT
The appeal is dismissed and the Minister's decision is confirmed in accordance with the attached Reasons for Judgment.
Signed at Grand-Barachois, New Brunswick, this 26th day of August 2002.
|
"S. J. Savoie" |
D.J.T.C.C.
Translation certified true
on this 16th day of December 2003.
Sophie Debbané, Revisor
[OFFICIAL ENGLISH TRANSLATION]
Date: 20020826
Docket: 2001-3728(EI)
BETWEEN:
JEAN RENÉ ST-JEAN,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
REASONS FOR JUDGMENT
Savoie, D.J.T.C.C.
[1] This appeal was heard on July 11, 2002, at Matane, Quebec.
[2] This is an appeal concerning the insurability of the appellant's employment with the Quebec government, hereinafter the payer, during the period in issue, that is, from May 15 to November 13, 2000, within the meaning of the Employment Insurance Act (the "Act").
[3] On July 16, 2001, the Minister of National Revenue (the "Minister") informed the appellant of his decision that the employment was insurable from May 15 to October 30, 2000. It was also determined that the appellant had 847 hours of insurable employment and a total of $14,213.68 in insurable earnings during that period. The appellant's appeal does not concern the insurability of his employment but concerns the Minister's decision with respect to the appellant's period of employment and the total number of insurable hours accumulated during the period.
[4] In rendering his decision, the Minister relied on the following assumptions of fact:
[TRANSLATION]
(a) The payer hired the appellant as a term employee for the period from May 15, 2000, to May 15, 2001.
(b) The appellant held a position as a tax audit technician.
(c) On October 30, 2000, the appellant received a letter from the payer informing him that the department was terminating his probation period and his employment on November 13, 2000, at 4:30 p.m.
(d) On October 30, 2000, the appellant handed in his magnetic card that gave him access to the department's offices.
(e) The appellant did not render any services to the payer between October 31 and November 13, 2000.
(f) On November 2, 2000, the appellant received a record of employment from the payer indicating 917 insurable hours and a total of $14,213.68 in insurable earnings; the record of employment indicated October 30, 2000, as the "last day worked" by the appellant with the payer.
(g) On March 8, 2001, the appellant received an amended record of employment from the payer indicating 917 hours and a total of $14,213.68 in insurable earnings; the record of employment no longer indicated the last day "worked" by the appellant.
[5] The appellant admitted the assumptions of fact set out in subparagraphs 8(a) to (c) and (f) of the Reply to the Notice of Appeal and denied those set out in subparagraphs 8(d), (e) and (g) as written. At the hearing, the parties agreed to change the year indicated in subparagraph 8(e), from 2001 to 2000.
[6] The appellant stated that he had never received from the employer a magnetic card giving him access to the department's offices.
[7] In response to the assumption set out in subparagraph 8(e) of the Reply, the appellant stated that his immediate supervisor had assigned him duties to be performed from his home during the two weeks ending on November 13, 2000, at 4:30 p.m., and that this work consisted of staying at his home and being available to provide information on his previous files.
[8] On October 30, 2000, the appellant cleaned out his files and as of that date he did not perform any work on his existing files and did not receive any others from the employer.
[9] The second record of employment, dated March 8, 2001, did not indicate the appellant's last day of work as did the record dated November 2, 2000. It was established that this change had been made at the appellant's request.
[10] At issue is the interpretation of the appellant's two weeks of notice, that is, from October 31 to November 13, 2000: whether the hours paid for that period are insurable even though the appellant did not render any service after October 30, 2000. The notice period was set out in the collective agreement.
[11] "Insurable earnings" are defined in subsections 2(1) and 2(2) of the Insurable Earnings and Collection of Premiums Regulations, which read in part as follows:
(1) For the purposes of the definition "insurable earnings" in subsection 2(1) of the Act and for the purposes of these Regulations, the total amount of earnings that an insured person has from insurable employment is
(a) the total of all amounts, whether wholly or partly pecuniary, received or enjoyed by the insured person that are paid to the person by the person's employer in respect of that employment, and
...
(2) For the purposes of this Part, the total amount of earnings that an insured person has from insurable employment includes the portion of any amount of such earnings that remains unpaid because of the employer's bankruptcy, receivership, impending receivership or non-payment of remuneration for which the person has filed a complaint with the federal or provincial labour authorities, except for any unpaid amount that is in respect of overtime or that would have been paid by reason of termination of the employment.
[12] In her report on an appeal (Exhibit I-4), Johanne Nicol, an Appeals Officer with the Canada Customs and Revenue Agency, stated, inter alia, the following:
[TRANSLATION]
According to Jean-René St-Jean's record of employment, he received $14,213.68 including his base salary, $1,054.73 in vacation pay and $1,004.50 representing two weeks' notice.
The payer therefore deducted employment insurance premiums in the manner prescribed in section 67 of the Act, which indicates that a person employed in insurable employment shall pay, by deduction, a premium equal to their insurable earnings multiplied by the rate set by the Commission. This is mandatory. The premium is based on the total amount of the compensation and not on the remuneration paid for the hours worked.
Accordingly, there is no doubt that the $1,004.50 amount is insurable; however, we must verify whether this amount confers entitlement to insurable hours, since there were no hours worked during the two weeks of notice.
[13] Section 9.1 of the Employment Insurance Regulations provides:
Where a person's earnings are paid on an hourly basis, the person is considered to have worked in insurable employment for the number of hours that the person actually worked and for which the person was remunerated.
[14] According to the aforementioned report on an appeal (Exhibit I-4), that section was interpreted by the Minister as follows:
[TRANSLATION]
... no insurable hours can be granted ... for the period from October 31, 2000, to November 13, 2000, because the worker did not work any hours. The amount paid was an indemnity and was not for the performance of work.
[15] Moreover, section 10.1 of the Employment Insurance Regulations provides:
Where an insured person is remunerated by the employer for a period of paid leave, the person is deemed to have worked in insurable employment for the number of hours that the person would normally have worked and for which the person would normally have been remunerated during that period.
[16] According to the Minister's interpretation of that section, the amount thus paid by the employer could not include remuneration for a period of paid vacation since the worker had already received vacation pay equivalent to 10-1/2 days acquired since May 15, 2000.
[17] On page 7 of that same report, the Minister's interpretation continues as follows:
[TRANSLATION]
"This is not a continuation of salary as we encounter when the employer or employee enters into an agreement whereby the employer agrees to continue paying a salary even though it does not expect the employee to report for work or to render services. The employer was required to pay this amount under the collective agreement. It could also have notified the worker that his contract was ending on November 13, 2000, and could have kept him employed until the last day, which would have given the worker insurable hours.
[18] In the Minister's view, this was an indemnity provided for under the collective agreement and was not an amount relating to the performance of services. This amount is insurable but does not result in any insurable hours. Clause 11-49.02 (Exhibit A-1) of the collective agreement provides as follows:
[TRANSLATION]
The Deputy Minister shall give notice to casual and seasonal employees who have accumulated three (3) months of service before they are dismissed or laid off for more than six (6) months when the dismissal or layoff occurs before the expiration of their anticipated period of employment.
The length of such notice is one (1) week if the anticipated period of employment is less than one (1) year and two (2) weeks if it is one (1) year or more.
[19] It must be noted that the appellant expended a great deal of time and effort on his case; this is shown by the evidence filed as Exhibit A-1, which sets out his case in detail. This exhibit includes correspondence with his employer and with the Minister's officers, the amended record of employment, the decision by the board of referees and a letter from his section head; in short, the position taken by the parties in support of the appellant's contention that the period of notice was in fact worked and that the hours of work it contains are therefore insurable. Armed with all these documents contained in Exhibit A-1, the appellant is asking this court to intervene and to rule on the issue in his favour. However, the Minister argues that the decision-making authority lies with him and not with the board of referees or with the other parties called by the appellant in support of his position.
[20] The courts have previously heard cases similar to this one. Some of the judgments cited by the Minister shed some light on the interpretation of the applicable legislation in this case. In Gagné v. Canada (Minister of National Revenue - M.N.R.), [1997] T.C.J. No. 1357, Judge Tardif of this court ruled in favour of the appellant (a decision overturned on appeal) in circumstances similar to those of the case under review and wrote as follows at paragraph 11 et seq.:
The Minister relied on a decision by Pierre Denault J., the umpire in Rachel Lamontagne, dated May 31, 1988, in which he concluded as follows:
[TRANSLATION]
It remains to be seen whether the board of referees was right to consider "that the week's notice of termination may be regarded as a week of insurable employment."
Section 36(6) of the Regulations states:
Sec. 36(6) Notwithstanding Subsection 35(4), for the purposes of Part II of the Act, a claimant shall not be deemed to have had a greater number of weeks of insurable employment in any one employment period than the number of weeks or part weeks that fall between the first and last dates of that employment.
The application of this section in practice leads me to conclude that money paid to an employee in lieu of notice but without the employee actually working operates to increase insurable earnings in that pay period but cannot count as an additional week of insurable employment.
Based on this decision, the respondent maintained that this week was not insurable; counsel stated that the insurability of employment depended on the performance of work. As the appellant had not physically performed his usual work during the week in question, she concluded that the appeal should be dismissed.
...
What is generally meant by work or the doing of work is the performance of physical and/or mental activities, performance of which is useful to and assists in achieving a desired result which the payer giving out the work wishes to achieve. Ensuring the consistency of or coordinating and planning the work are the responsibility of the person who has the right of control, who may have all kinds of requirements which he or she regards as useful or necessary to the desired end.
What happens if the holder of this power of control decides to require his or her subordinate not to be involved in performing any physical or mental task for what he or she considers to be the good of the business? It may be that the boss will decide that the success of the business requires that the subordinate individual be excluded from "productive" activities. This is essentially a real, concrete manifestation of the payer's authority. The worker cannot be penalized for complying with the authority to which he is subject. The appellant does not have to suffer any penalty resulting from a choice in which he was not involved. For my part, I believe that the appellant essentially complied with the orders and directions of his employer.
For these reasons, the appeal is allowed in that the week of April 18 to 25 is an insurable week.
[21] This case was appealed before the Federal Court of Appeal, [2000] F.C.J. No. 927, and that court stated as follows in a judgment dated June 15, 2000:
In our opinion, the trial judge had no cause to conclude, from the admissions filed in the record of the Tax Court of Canada, that the employment relationship between the respondent and his employer had not been ended as of April 18, 1996.
The application for judicial review will be allowed, the decision rendered by the Tax Court of Canada set aside and the matter referred back to the Court for redetermination on the assumption that the respondent did not hold an insurable employment during the week of April 19 to 25, 1996, with costs.
[22] In a judment dated October 4, 1999, Judge Cuddihy of this court examined a similar case in Hutton v. Canada (Minister of National Revenue - M.N.R.), [1999] T.C.J. No. 655, and stated as follows at paragraph 2 et seq.:
This is an appeal from a decision by the Minister of National Revenue (the "Minister") of February 23, 1998, where it was determined that the employment of Eric Hutton (the "Appellant") with the Newfoundland Legal Aid Commission (the "Payor") from June 30 to July 23, 1997, was insurable employment within the meaning of paragraph 5(1)(a) of the Employment Insurance Act (the "Act").
The Minister also determined that the lump sum payment made to the Appellant at the termination of his employment with the Payor on July 23, 1997, was considered as "insurable earnings", however, there were no insurable hours pursuant to paragraph 9.1 of the Employment Insurance Regulations (the "E.I. Regulations").
...
Therefore, the Appellant was paid for 135 hours of work, ... which formed part of his earnings during his pay period. For that same pay period he received three months of salary in lieu of notice which formed the second part of his earnings. These two sources of total earnings were his insurable earnings with which was calculated the mandatory premium which was deducted by his employer. Because the premium was calculated on the Appellant's insurable earnings as defined in the Act does not have the effect of qualifying the Appellant for an additional number of hours of work derived from the payment of the three months of salary in lieu of notice. This lump sum payment is considered an earning but not equal to a number of hours worked. The only hours actually worked were those described in the record of employment.
In other words benefits are payable for hours actually worked. Premiums for these benefits are calculated on the insurable earnings which include, as in this case, the remuneration paid for the hours actually worked and the three months of salary paid in lieu of notice. Since the Appellant did not actually work any hours for the Payor after July 23, 1997, he could not be deemed to have worked in insurable employment after that day.
The legislation indicates that insurable employment is a period of time where work was actually accomplished and paid for. It also defines "insurable earnings" as the basis upon which the premium for insurable employment is calculated.
[23] The appellant made a valiant effort in presenting his case. However, this court has no choice but to apply the rule of law, the legislation and the case law. Ruling in favour of the appellant would have required that Parliament be inspired with greater compassion. Such was not the case, and this court is bound by the case law cited above.
[24] This court must therefore conclude, in light of the foregoing, that the appellant held insurable employment within the meaning of the Act during the period from May 15 to October 30, 2000, since during that period the appellant and the payer were bound by a contract of service within the meaning of paragraph 5(1)(a) of the Act.
[25] This court also finds that, in accordance with the provisions of section 9.1 of the Employment Insurance Regulations, the appellant accumulated 847 hours of insurable employment with the payer during the period at issue because he did not render any service to the payer after October 30, 2000.
[26] As a result, the appeal is dismissed and the Minister's decision is confirmed.
Signed at Grand-Barachois, New Brunswick, this 26th day of August 2002.
|
"S. J. Savoie" |
D.J.T.C.C.
Translation certified true
on this 16th day of December 2003.
Sophie Debbané, Revisor