Citation: 2009 TCC 125
Date: 20090323
Docket: 2008-2634(EI)
BETWEEN:
MILDRED SPILLER,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
REASONS FOR JUDGMENT
Bédard J.
[1]
This is an appeal
against a decision by the respondent that from July 30, 2006 to July 27,
2007 (the “relevant period”), Ms. Karen Tower (the “worker”) accumulated
2,203 insurable hours and that, for the last 27 pay periods of the relevant
period, she received $11,220.12 in insurable earnings while working for Mrs.
Mildred Spiller (the “payer”).
[2]
The facts on which the
respondent relied to explain and justify his decision are set out in
paragraph 5 of the Reply to the Notice of Appeal, as follows:
a)
The Appellant is an elderly person who required
home’s [sic] care;
b)
Mr. Garry [sic] Spiller, son of the Appellant, represent
[sic] the Appellant;
c)
On April 1st, 2006, the Appellant and
the Worker signed a contract of employment;
d)
The Worker has hired by the Appellant’s son,
Garry [sic] Spiller, as caregiver in the home of the Appellant;
e)
The contract only specified that the Worker
shall work 32 hours per week for a salary of $315 per week without any other
specification except other than the fact that she had to take care of the
Appellant from 8 AM to 5 PM;
f)
[B]oth parties agree that, during the period
under review, the Worker provided services as an employee of the Appellant;
g)
[T]he tasks of the Worker were to monitor the
Appellant, accompany her at [sic] the shopping center and at the Foyer Dorval,
ensure that she was taking his [sic] medication, prepare meals, wash the dishes,
doing laundry, cleaning the bathroom, help the Appellant to dress and to go to
bed;
h)
The Appellant said that, during the period under
review, the Worker worked from Sunday 5 PM to Thursday 5 PM; 4 days
per week, 8 hours per day for a total of 32 hours per week;
i)
In addition to her salary of $315 per week, the
Worker requested an allowance in view of the fact that she had a van that could
be used for errands and shopping;
j)
Both parts [sic] agreed that the Worker will [sic]
receive an allowance of $152 every 2 weeks as a weekly personal care
supplement of $76 per week and an addition [sic] $34 per week as a car
allowance advance;
k)
During the period under review, the Worker
received a weekly cheque of $425 from the Appellant;
l)
In her notice of appeal, the Worker says she was
doing much more that 32 hours a week because she had to monitor the
Appellant 24 hours a day;
m)
Following her layoff, the Worker claims [sic] to
[sic] the Payer 120 hours per week over 5 days;
n)
[T]he Worker did not complete any time sheet and
did not record her alleged hours of work;
o)
[T]he Worker holds no evidence or document who [sic]
can certify her claim;
p)
[T]he Worker did not made [sic] a complaint to
the Commission des Normes du Travail (the Commission) to receive her alleged
full salary from the Appellant;
q)
[T]he Payroll statement of the Appellant
confirms that the Worker received a net salary of $425 per week divided as
follow [sic]: a net salary of $275.56, a personal allowance of $140 and a car
allowance of $9.44;
r)
From [sic] the total of $425 per week paid to
the Worker, the respondent considers that only the amount of $9.44, paid as a
car allowance, is not to [sic] part of the insurable earnings of the Worker;
s)
During the last 27 pay periods of the
period under review, the Respondent established the total insurable earnings of
the Worker at $11,220.12 ($425 - $9.44 = $415.56 X 27 periods) as per the Insurable
Earnings and Collection of Premiums Regulations[;]
t)
During the period under review, the Respondent
established the total insurable hours of the Worker at 2,203
($415.56/$10.00 = 41.56 hours per week X 53 periods = 2,203 hours) as
per the Employment Insurance Regulations.
[3]
The facts alleged in
subparagraphs 5a), 5b), 5c), 5d), 5e), 5f), 5g), 5h), 5i), 5k), 5n), 5p) and
5q) were admitted. The facts alleged in subparagraphs 5j), 5r), 5s) and 5t)
were denied. The applicant was not aware of the facts alleged in subparagraphs
5l), 5m) and 5o).
Issue
[4]
I would point out
immediately that the appellant’s representative stated at the hearing that the
worker’s insurable hours were no longer at issue. Consequently, the only point
at issue in this case is the amount of the worker’s insurable earnings for the
last 27 pay periods of the relevant period. More precisely, the only point
at issue here involves determining whether the allowance ($140 per week)
received by the worker (the “personal allowance”) is part of her insurable
earnings.
Appellant’s position
[5]
The appellant’s position
is reflected in paragraphs 4 and 5 of the written declaration on behalf of the
appellant (Exhibit A-1) prepared by her accountant. These paragraphs read as
follows:
4. In addition she was given a weekly
allowance for Personal Assistance at Home paid by the SAAQ due to Mrs Spillers [sic]
disability (hydrocephaly) caused by an automobile accident in 1998. Ms Tower
understood that this was a separate allowance, non taxable and non insurable to
the employer that was passed on to her in recognition for the additional care
required due to Mrs Spiller’s disability[.]
5. The SAAQ clearly indicated that the
Personal Care Allowance of $78 per week [was] non‑taxable provincially
and federally and therefore non‑insurable. The same applies to the
Federal Guaranteed Income Supplement (GIS) from which the remaining $62 of the
$140 allowance was paid. (source Nancy Dubé – SAAQ Compensation Officer (Phone:
418 646 9884) and GIS information line 1 800 2 9914).
In other words, the appellant maintains that the
personal allowance is not part of the worker’s insurable earnings for the
purposes of the Employment Insurance Act (the “Act”) since the
appellant was simply passing on to the worker (flow-through principle) the two allegedly
non‑taxable (for the purposes of the Income Tax Act) allowances she
was receiving during the relevant period.
Analysis and Conclusion
[6]
In order to determine
the insurable earnings for the purposes of the Act we must refer to subsections 2(1)
and (3) of the Insurable Earnings and Collection of Premiums Regulations
(the “Regulations”), which read as follows:
2(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
(b) the amount of any gratuities that the insured person is
required to declare to the person’s employer under provincial legislation.
[…]
(3) For the purposes of subsections (1) and (2), “earnings”
does not include
(a) any non-cash benefit, other than the value of either or
both of any board or lodging enjoyed by a person in a pay period in respect of
their employment if cash remuneration is paid to the person by their employer
in respect of the pay period;
(a.1) any amount excluded as income under
paragraph 6(1)(a) or (b) or subsection 6(6) or (16) of the Income
Tax Act;
[…]
[7]
Subsection 2(1) of the Regulations
provides that all amounts received or enjoyed by the insured person that are
paid to the person by the person’s employer in respect of insurable employment
are insurable earnings for the purposes of the Act. The only exceptions
to that general principle are listed in subsection 2(3) of the Regulations.
In the present case, the personal allowance received by the worker was clearly
paid to the worker by the appellant in respect of insurable employment and I
see no provision in subparagraph 2(3) of the Regulations that could
apply so as to exclude the personal allowance from “insurable earnings”. The
fact that money used to pay the personal allowance came from the two allegedly non‑taxable
allowances received by the appellant is simply irrelevant.
[8]
As a result, the appeal
is dismissed.
Signed at Ottawa, Canada, this 23th day of March 2009.
“Paul Bédard”
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