Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues: (1) Are "top-up payments" made by a union to its members for attending rotating study sessions exempt from being included in income? The "top-up payments" are made to compensate the recipients for the loss wages they experience while attending the study sessions.
(2) Are such "top-up payments" treated in the same manner if they are made to members who perform volunteer services for the union during the study session?
(3) Are payments received from a particular union by members of another union for not crossing the picket lines of the particular union included in income?
Position: (1) Yes.
(2) Likely treated the same.
(3) No.
Reasons: (1) The attendance at a study session by union members in lieu of providing services to their employer is tantamount to a strike. The payments received from their union for attending the study session should be treated in the same manner as "strike pay" and not be included in income.
(2) It is a question of fact as to whether an individual is employed by a union. However, there would unlikely be employment in the situation where all participants to a study session are entitled to payment on the same basis for attendance and some of the attendants help with refreshments or stacking chairs after the session.
(3) Our position in paragraph 12 of IT-334R2 is in accordance with the Supreme Court decision in Wally Fries v. The Queen, 90 DTC 6662. Although Mr. Fries received payments from his union, the strike action was in support of another group of employees. I doubt that the distinction of having the strike pay paid by other than the striker's union would carry any weight in arguing that the payment was "income from a source".
April 10, 2000
Mr. Lloyd MacKay HEADQUARTERS
Trust Account Division Jacques E. Grisé
Assessment and Collections Branch 957-2059
2000-001684
Strike Pay
This is in reply to your memorandum of March 20, 2000, requesting our assistance in resolving three queries you received from the Vancouver Tax Services Office with respect to payments made by a union to their or other union members.
The first query is whether top-up payments paid to employees in a legal strike position and who are holding rotating study sessions are taxable payments. These top-up payments are made to compensate employees for the wage loss they experience during the study sessions. In our view, payments for attendance at a study session by union members in lieu of providing services to their employer, should be treated in the same manner as "strike pay" and not be included in income.
The second query is whether these top-up payments are treated in the same manner if they are made to employees who are performing volunteer services for the union during the study session. It is a question of fact as to whether an individual is employed by a union. However, there would not likely be employment in the situation where all participants to a study session are entitled to payment on the same basis for attendance and some of the attendants help out with refreshments or stacking chairs after the sessions.
The final enquiry relates to payments made by a particular union to members of another union not in a legal strike position for honouring the picket lines set up by the members of the particular union. Such payments are to compensate for wage losses as a result of not crossing the picket line. In our view, such payments should be given the same treatment as "strike pay" and not be included in the recipient's income.
We hope our comments are helpful.
John Oulton
Manager
Business, Property and Employment
Income Section III
Business and Publications Division
Income Tax Rulings Directorate
??
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 2000
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 2000
Email this Content