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Citation: 2004TCC49
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Date: 20040210
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Dockets: 2000-2453(EI), 2000-983(EI),
2000-985(EI), 2000-2054(EI), 2000-2055(EI),
2000-2057(EI), 2000-2059(EI), 2000-2060(EI),
2000-2061(EI), 2000-2063(EI), 2000-2062(EI),
2000-2064(EI), 2000-2066(EI), 2000-2065(EI),
2000-2067(EI)
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BETWEEN:
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SERVICES AGRO MÉCANIQUE INC.,
JACQUES TREMBLAY, NADINE LEBLOND,
BENOÎT ROY, SÉBASTIEN ROY,
MARTINE CÔTÉ, VALÈRE JALBERT,
GUY ROUSSEAU, STÉPHANE AUBUT,
STÉPHANE APRIL, ALEX FOURNIER,
RÉMI TREMBLAY, CLAUDE TREMBLAY,
MICHEL TREMBLAY, DENIS LÉVESQUE,
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Appellants,
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and
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THE MINISTER OF NATIONAL REVENUE,
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Respondent.
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[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR JUDGMENT
Angers J.
[1] These
appeals involve 14 workers employed by the Appellant, Service Agro
Mécanique Inc. (S.A.M.). Five of them are appealing from a determination by the
Minister of National Revenue (the Minister) dated February 7, 2000, that
their employment was not insurable on the ground that they would not have
entered into a substantially similar contract of employment if they had been
dealing with each other at arm's length, within the meaning of the Unemployment
Insurance Act (UIA) or the Employment Insurance Act (EIA), as the
case may be. The appellant workers affected by this decision are the Appellants
Claude Tremblay, Jacques Tremblay, Michel Tremblay, Rémi Tremblay and Nadine Leblond.
The other nine appellant workers are appealing from a decision made by the
Minister on the same date determining their insurable weeks, insurable hours
and insurable earnings for the purposes of the UIA or the EIA, as the case may
be, during their respective periods of employment in issue in this case, while
they were working for S.A.M.
[2] For
the purposes of the trial, therefore, the Appellants have been divided into two
groups: one for which the issue was the non-arm's length relationship, and the
other for which the issue was the period of insurable employment. The appeals
were heard on common evidence.
[3] S.A.M.
was incorporated on April 12, 1976. It operates a business selling and
maintaining farm equipment at two locations: one in St‑Clément, Quebec,
and the other in St‑Pascal. Quebec. The business operates year-round, but
the peak period is between April and December. Depending on the period in
issue, the shareholders were Gaétan Tremblay, now deceased, his wife Monique
Roy and their sons Pierre, Claude, Rémi and Jacques Tremblay. It is admitted
that the parties were not dealing with each other at arm's length in the five
cases in which that is the issue. I will therefore deal with those five cases
first.
Claude Tremblay
[4] Claude
Tremblay was employed by the payor as a salesperson during the periods in
issue, from May 9, 1993, to November 4, 1995, and from
November 5, 1995 to December 31, 1996. In his letter dated
February 7, 2000, the Minister determined that this Appellant's employment
during those periods, while he was working for S.A.M., was not insurable within
the meaning of the UIA and the EIA on the ground that the Appellant and S.A.M.
would not have entered into a substantially similar contract if they had been
dealing with each other at arm's length. In making his determination, the
Minister relied on the following assumptions of fact, which were admitted or
denied as indicated below. Subparagraphs (a) through (e) of
paragraph 5 were admitted; they represent facts already set out in these Reasons
and are therefore not reproduced here.
[TRANSLATION]
(f) On
May 10, 1993, the payor issued a record of employment to the Appellant showing
that the first day of work was April 13, 1992, and the last day was
May 7, 1993. (admitted)
(g) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(h) On May 10,
1993, the Appellant applied for and received employment insurance benefits. (admitted)
(i) On
November 3, 1995, the payor issued a second record of employment to the
Appellant showing that the first day of work was July 19, 1993, and the
last day was November 3, 1995. (admitted)
(j) The payor
issued that record of employment allegedly to enable the Appellant to take
parental leave, but he did not stop working. (denied)
(k) On
November 6, 1995, the Appellant applied for and received parental benefits.
(admitted)
(l) The periods
of employment shown on the Appellant's two records of employment do not
correspond to the actual periods of employment. (denied)
(m) The Appellant
and the payor entered into an arrangement so that the Appellant could obtain
benefits to which he was not entitled and the payor could have a salesperson
year-round at little expense. (denied)
[5] During
the periods in issue, Claude Tremblay was a salesperson selling cowshed and
dairy farm equipment. He has worked for S.A.M. since 1980. During the periods
in issue, his office was in St‑Clément. He received a salary of $500 per
week for a 44-hour week. His work consisted in soliciting customers, finding
new customers, travelling and organizing demonstrations on site or on a producer's
premises. He testified that during the periods when he was unemployed his
brother Pierre worked at S.A.M. as a salesperson. However, he admitted that
when a customer called during those periods, a message was taken and he called
the customer back himself. According to Mr. Tremblay, the customers
trusted the salesperson who had solicited them and he looked after his
customers himself.
[6] On
May 7, 1993, his father decided to terminate his employment. The record of
employment shows that there was a shortage of work. The witness admitted that
he went back to S.A.M. after he was laid off. He testified that he went back to
stay in touch with his employer. He went in to solve problems, even though that
was not arranged, and also to close sales. He explained that this did not take
much of his time because the preliminary work had already been completed. He
was not paid for that work.
[7] The
Appellant Claude Tremblay lives a few doors away from his employer and did not
work at the St‑Pascal branch during the periods in issue.
[8] Contradicting
Claude Tremblay's testimony that his father had decided to lay him off, the
minutes of a meeting of the S.A.M. board of directors (Exhibit I‑1) dated
May 6, 1993, show that this was a decision of the board of directors.
Item 2 in the minutes reads as follows:
[TRANSLATION] Claude will receive
his record of employment for May 10 and Jacques will receive his at the end of
the summer.
[9] The
minutes of a second meeting of the S.A.M. board of directors dated June 14,
1993 (Exhibit I‑2), again at item 2, read as follows:
[TRANSLATION] Claude is still in a
period of unemployment; Jacques will be unemployed at the end of the summer.
[10] It is admitted by S.A.M. that it pleaded guilty on May 25, 2000,
to 29 counts of issuing false records of employment to a large majority of
the Appellants, contrary to the UIA and the EIA. One of the counts referred to
the second record of employment issued to the Appellant Claude Tremblay and
related, in particular, to the date of the first day of work, July 19, 1993. The
Appellant is aware of this fact but did not admit the error.
[11] Claude Tremblay's employee identification number at S.A.M. is 6. The Respondent
introduced two notebooks containing a number of invoices on which the Appellant's
number is shown and the dates fall within his two periods of unemployment.
Other invoices issued during the same periods bear the Appellant's initials.
Although the last day of work stated on his first record of employment was
May 7, 1993, there is an invoice dated May 10, 1993, showing his
number, and he admits that the customer called him on that date and he went to
run an errand for S.A.M. in Rivière-du-Loup. He was not paid for that. There
are similar documents for the second period of employment. At the end of
cross-examination, the Appellant admitted that he performed some services in
1993, 1994 and 1995, during his periods of unemployment, without being paid,
and that his availability cards did not show that he had worked. In fact, in his
statement, he admitted that when he was receiving benefits in 1993 and 1995, he
carried on his activities for S.A.M., but at a slower pace. He called this
part-time work, since he was no longer prospecting. The Appellant had a vehicle
year-round and had his travel expenses reimbursed during his periods of
part-time work.
[12] The Respondent called Bruno Arguin, an appeals officer at the Canada
Customs and Revenue Agency since 1994. His work consists in examining
determinations made by the Department of Human Resources Development regarding
the insurability of employment. In this case, he declared the employment of the
Appellant Claude Tremblay to be not insurable because he was not dealing with
the employer at arm's length. He prepared a table (Exhibit I‑6) showing
the periods of unemployment of the Appellant Claude Tremblay and showing, for
each day of the week during those periods, the number of documents that bore either
the Appellant's employee number or his initials. For example, for May 10,
1994, there are four documents attributable to the Appellant, which are found
in Exhibits I‑4 and I‑5. Certain documents clearly show that
Claude Tremblay was present, since there are hours of work allocated to him in
the documents. The table also shows the amounts he was paid, based on the
payroll book. The table shows documents attributable to the Appellant for
nearly every day during his periods of unemployment.
[13] Mr. Arguin said that from this exercise he was able to conclude
that the Appellant was present on the employer's premises nearly every day, and
that based on the number of documents found and the employer's written
statements, a lot of work was done on a volunteer basis. In addition, the
Appellant Claude Tremblay had the use of a motor vehicle year-round, and a
credit card for gasoline, and Mr. Arguin relied on this to conclude that
the employment had never really ceased to exist and that services were still
performed during the periods of unemployment. The guilty plea entered by S.A.M.
was not considered by Mr. Arguin, because the plea was entered after February 7,
2000, the date on which the Minister's determination was made. This in fact
applies to all of the cases. On the question of the extent of the work done by
the Appellant at S.A.M., Mr. Arguin was of the opinion that the role of
salesperson involves numerous responsibilities, since the salespeople are the
ones who generate income for the company, and so a salesperson is a key person
at S.A.M.
Michel Tremblay
[14] The periods covered by Michel Tremblay's appeal are July 5 to
November 26, 1993, June 6 to September 16, 1994, May 1 to
September 29, 1995, May 6 to September 20, 1996, and May 12 to
October 17, 1997. In his letter dated February 7, 2000, the Minister
determined that the employment of the Appellant Michel Tremblay during those
periods was not insurable within the meaning of the UIA and the EIA on the
ground that the Appellant and S.A.M. would not have entered into a
substantially similar contract if they had been dealing with each other at arm's
length. In making his determination, the Minister relied on the following assumptions
of fact, which were admitted or denied as indicated below. The facts already
set out in these Reasons are not repeated here.
[TRANSLATION]
(g) On
November 26, 1993, the payor issued a record of employment to the
Appellant showing that the first day of work was July 5, 1993, and the
last day was November 26, 1993. (admitted)
(h) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(i) On
May 3, 1994, the Appellant applied for and received unemployment insurance
benefits. (admitted)
(j) On September
19, 1994, the payor issued a second record of employment to the Appellant
showing that the first day of work was June 6, 1994, and the last day was
September 16, 1994. (admitted)
(k) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(l) On or about
September 16, 1994, the Appellant applied for and received unemployment
insurance benefits. (admitted)
(m) On October 3,
1995, the payor issued a third record of employment to the Appellant showing
that the first day of work was May 1, 1995, and the last day was
September 29, 1995. (admitted)
(n) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(o) On
October 4, 1995, the Appellant applied for and received unemployment
insurance benefits. (admitted)
(p) On
September 20, 1996, the payor issued a fourth record of employment to the
Appellant showing that the first day of work was May 6, 1996, and the last day
was September 20, 1996. (admitted)
(q) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(r) On
September 23, 1996, the Appellant applied for and received employment
insurance benefits. (admitted)
(s) On
October 17, 1997, the payor issued a fifth record of employment to the
Appellant showing that the first day of work was May 12, 1997, and the last day
was October 17, 1997. (admitted)
(t) The record
of employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(u) On October
20, 1997, the Appellant applied for and received employment insurance benefits.
(admitted)
(v) The periods
of employment shown on the Appellant's five records of employment do not
correspond to the actual periods of employment. (denied)
(w) The Appellant
and the payor entered into an arrangement so that the Appellant could obtain
benefits to which he was not entitled and the payor could have a salesperson
year-round at little expense. (denied)
[15] The Appellant Michel Tremblay was employed by S.A.M. as a farm
machinery salesperson. He held shares in S.A.M. until 1993. He continued to be
employed by S.A.M. although from 1993 to 1999 he operated a snow removal
business. He lives in St-Clément and his home is a three-minute walk from
S.A.M.'s place of business. According to the documents submitted, the Appellant
was unemployed during periods from the end of October or November to May of the
following year, and sometimes from the end of September until early June, depending
on the claim.
[16] During the first period in issue, the Appellant worked 40 to
45 hours a week. He met with the sales manager, his brother Pierre Tremblay,
every morning, to plan his day. He was laid off on November 26, 1993, as
his father and his brother Pierre had agreed. He admitted that during his
period of unemployment he met with customers he had solicited during the
summer. He said that because he knew he could earn income amounting to
25 percent of his weekly benefits without that income being deducted from
his benefits, he reported the income he earned during that period. He added
that he continued to perform services for S.A.M. and to see his brother Pierre at
S.A.M. during his periods of unemployment.
[17] When the Appellant Michel Tremblay worked, he reported it on his
unemployment cards. The same scenario was played out during 1995, 1996 and
1997, for approximately the same periods.
[18] The Appellant's salary at S.A.M. was based on total sales the previous
year, that is, overall performance for the year, which therefore included sales
made outside the period of employment.
[19] The records of employment (Exhibit I‑7) show that the
reason for the termination of employment was a shortage of work. The Appellant stated
that in his case there was a significant reduction in the work, in that 85 percent
of his sales were made in the spring and fall.
[20] According to a table prepared by Mr. Arguin (Exhibit I‑10)
and the corresponding documents (Exhibit I‑8), the Appellant made
sales which are attributed to him because of his initials or signature on
purchase orders or invoices prepared outside the periods of employment in all
of the periods in issue. The Appellant said that he was aware of the
investigation by Human Resources Development Canada and the charges laid
against S.A.M., including four relating to his periods of employment, but said
he did not know the details of all that.
[21] In his statutory declaration, the Appellant Michel Tremblay said that starting
when he paid himself a weekly salary from his own business he longer recorded
the hours he worked for S.A.M., because in any event his business was paying
him. He later added that he worked an average of zero to five hours per week
for S.A.M. in the winter.
[22] In relation to this appeal, Bruno Arguin produced a table similar to
the one prepared in the case of Claude Tremblay. He referred to documents
prepared outside the periods of employment, for all the periods in issue, on
which there was an indication that they were attributable to the Appellant, and
he reproduced all of the monthly sales by the Appellant and the S.A.M. payroll
book. As an example, Mr. Arguin noted an S.A.M. sale made on December 1,
1993, and attributed to the Appellant, when the record of employment shows that
his employment with S.A.M. ended on November 26, 1993. The tale also shows
that according to the payroll book, the Appellant was paid $204.80 on
December 4, 1993, and received no salary for the following weeks. However,
for the week of December 12, there were eight sales or contracts with
indications that they were attributable to him. The Appellant made $68,552 in
sales in April 1994 but received no salary, according to the payroll book.
Mr. Arguin concluded that the Appellant continued to perform services for
S.A.M. after his employment terminated without being paid. He considered the
services performed by the Appellant to be significant, since they were
performed at S.A.M.'s place of business, and so the employment relationship
between the Appellant and S.A.M. was never really terminated.
Rémi Tremblay
[23] The periods covered by this appeal are March 21, 1993, to
February 28, 1998, and March 1 to December 31, 1998. In his letter
dated February 7, 2000, the Minister determined that the employment of the
Appellant Rémi Tremblay during those periods was not insurable within the
meaning of the UIA and the EIA on the ground that the Appellant and S.A.M.
would not have entered into a substantially similar contract if they had been
dealing with each other at arm's length. In making his determination, the
Minister relied on the following assumptions of fact, which were admitted or
denied as indicated below. The facts already set out in these Reasons are not
repeated here.
[TRANSLATION]
(f) On March 22,
1993, the payor issued a record of employment to the Appellant showing that the
first day of work was July 8, 1991, and the last day was March 19,
1993. (admitted)
(g) The record of
employment was allegedly issued because of a shortage of work, but the
Appellant continued to perform services for the payor. (denied)
(h) On March 23,
1993, the Appellant applied for and received employment insurance benefits. (admitted)
(i) On March 2,
1998, the payor issued a second record of employment to the Appellant showing
that the first day of work was June 7, 1993, and the last day was February 27,
1998. (admitted)
(j) The payor
issued that record of employment allegedly to enable the Appellant to take
parental leave, but he did not stop working for the payor. (denied)
(k) On March 3,
1998, the Appellant applied for and received parental benefits. (admitted)
(l) The periods
of employment shown on the Appellant's two records of employment do not
correspond to the actual periods of employment. (denied)
(m) The Appellant
and the payor entered into an arrangement so that the Appellant could obtain
benefits to which he was not entitled and the payor could have a manager
year-round at little expense. (denied)
[24] The Appellant was employed by S.A.M. as a parts clerk and then as "service
manager". His employment was in St-Clément and he lived about eight miles
from his place of work. He was laid off because of a shortage of work on March
19, 1993. He returned to work on June 7, 1993, and worked until
February 27, 1998. He stopped working on that date to take parental leave,
and a second record of employment was issued. The Appellant stated that his
employer did not require that he be present while on leave, but said that he
went in of his own accord at various times. He therefore admitted performing
services for his employer and going to the employer's premises to do that. On
cross-examination, he could not specify, for either of the two periods in
issue, the exact number of hours for the services he performed. He contended
that the services were performed on a volunteer basis. His employee number is 333.
[25] As in the two previous cases, a series of documents was introduced on
which the Appellant's identification number of signature appears, for periods
when he was not an employee of S.A.M. There are credit card statements in his
name and the name of S.A.M., for purchases made during the Appellant's periods
of unemployment. He explained this by saying that he may have run errands for
S.A.M. and that he bought gasoline for it. He admitted that he prepared other
invoices on the employer's premises, but said that other employees may also
have written his identification number on them. His signature appears on a
Purolator waybill dated outside his period of employment. He therefore admitted
performing services for S.A.M., but stated that they were performed of his own
free will.
[26] Bruno Arguin prepared a table (Exhibit I‑35) based on which
he concluded that a number of documents attributed to the Appellant were
prepared during his periods of unemployment in the two periods in issue. The
payroll book shows that the Appellant was not paid for any of that work. For
example, Mr. Arguin noted that for March 22, 1993, there are
11 documents that bear the Appellant's number, 333. He therefore concluded
that the period of the Appellant's employment did not correspond to what was
shown on the record of employment and that the reason for this situation was that
the parties were not dealing with each other at arm's length.
Jacques Tremblay
[27] The periods covered by this appeal are January 30, 1994, to
November 16, 1996, and November 17, 1996, to December 31, 1997. In his
letter dated February 7, 2000, the Minister determined that this Appellant's
employment during those periods was not insurable within the meaning of the UIA
and the EIA on the ground that the Appellant and S.A.M. would not have entered
into a substantially similar contract if they had been dealing with each other
at arm's length. In making his determination, the Minister relied on the
following assumptions of fact, which were admitted or denied as indicated
below. The facts already set out in these Reasons are not repeated here.
[TRANSLATION]
(l) The
Appellant drew employment insurance benefits until March 15, 1997. (admitted)
(m) From January
30, 1994, to December 31, 1997, the Appellant never stopped working for
the payor. (admitted)
(n) The Appellant
received unemployment insurance or employment insurance benefits, as the case
may be, while he was performing services for the payor on an ongoing basis. (denied)
(o) The Appellant
and the payor entered into an arrangement so that the Appellant could obtain
benefits to which he was not entitled. (denied)
[28] During the periods in issue, the Appellant was employed by S.A.M. as a
representative, and he held that position until December 1998. He was also the
manager of the St-Pascal branch. In January 1994, because business was rather
slow, the Appellant testified, his father decided that he would be laid off on
January 28, 1994. The record of employment shows the reason as a shortage
of work. The second record of employment shows that the Appellant returned to
work on May 7 of that year. During his period of unemployment he was not
replaced. For the second period of unemployment, from November 15, 1996,
to March 15, 1997, he was replaced by the Appellant Denis Lévesque. During
the periods of unemployment, S.A.M. continued to provide Jacques Tremblay with
a car, and during the first period it continued to provide him with
accommodation.
[29] The Appellant testified that he received his instructions from his
father, but said that during the periods of unemployment he received no
instructions. However, he admitted that he had a cellular telephone and that
S.A.M.'s customers had his personal telephone number, and so he was contacted
by them during his periods of unemployment. He said he worked only when needed,
because S.A.M.'s business had slowed down. He stated that he performed services
of his own free will, in order to maintain personal relationships with
customers, and most importantly to retain their trust.
[30] His employee number is 26. Exhibits I‑15 and I‑16
contain a series of documents on which his number appears, and which represent
various S.A.M. transactions during the Appellant's periods of unemployment. An
annual association fee was paid by S.A.M. during his first period of
unemployment.
[31] The Respondent produced three other excerpts from the minutes of
meetings of the S.A.M. board of directors. The January 10, 1994, minutes,
at item 15, say that for unemployment that winter, Jacques was next on the
list. The Appellant was at that meeting, but says he was not aware of the list
in question. He said that this simply meant that he was the next one to be
unemployed.
[32] In the minutes of the S.A.M. board of directors meeting on May 6,
1993, there is a discussion of unemployment in which it is said that Claude
would receive his record of employment for May 10, while Jacques would receive
his at the end of the summer. In the minutes of June 14, 1993, it says that
Claude was still in a period of unemployment and that in Jacques' case he was
scheduled to be unemployed at the end of the summer. When the Appellant was
questioned about these statements, he said it showed foresight on the part of
the board of directors. He also admitted that the minutes indicate that it was
the board of directors who decided layoffs, and not their father.
[33] The Respondent produced three books of documents showing the Appellant's
employee number. According to Mr. Arguin, those documents show that the
Appellant was regularly present at S.A.M. During his periods of unemployment,
he could be reached by cellphone and had a car provided by S.A.M., and during
the first period he also had accommodation provided. The Appellant's statements
and the number of transactions on which his number appears led Mr. Arguin
to conclude that the Appellant never stopped working for S.A.M.
Nadine Leblond
[34] The period covered by this appeal is April 14 to June 21, 1997. The Minister determined that the
employment of the Appellant during those periods was not insurable within the
meaning of the EIA on the ground that the Appellant and S.A.M. would not have
entered into a substantially similar contract if they had been dealing with
each other at arm's length. In making his determination, the Minister relied on
the following assumptions of fact, which were admitted or denied as indicated
below. The facts already set out in these Reasons are not repeated here.
[TRANSLATION]
(e) The Appellant
is the spouse of Jacques Tremblay. (admitted)
(f) The Appellant
was paid $10 an hour. (admitted)
(g) On June 23,
1997, the payor issued a record of employment to the Appellant showing that she
had worked 186 hours and received earnings of $1860 during the period from
April 14 to June 20, 1997. (admitted)
(h) The record of
employment does not reflect reality in terms of the period worked, the number
of hours and the remuneration paid. (denied)
(i) In fact, the
Appellant worked for the payor from January 7 to June 20, 1997, for a
total of 265 hours, and was paid $2650. (denied)
(j) From
January 7 to April 13, 1997, the Appellant drew employment insurance
benefits. (admitted)
(k) The Appellant's
alleged period of work does not coincide with the period actually worked by the
Appellant. (denied)
(l) The Appellant
and the payor entered into an arrangement so that the Appellant could obtain
benefits to which she was not entitled. (denied)
[35] The Appellant is the spouse of Jacques Tremblay and was employed by
S.A.M. as a secretary. Ms. Leblond did not testify. According to Jacques Tremblay, the
Appellant was employed by S.A.M. in 1997, although he seemed not to recall the
exact year. According to the record of employment, she started on April 14
and finished on June 20, 1997, and worked 186 hours during that period.
Another record of employment shows that she worked for CRDI‑KRTB from
July 22 to November 26, 1996, and another shows that she worked for
the Commission scolaire Jean Chapais from October 17, 1996, to
June 24, 1997, for a total of 130.22 hours. It is admitted that from
January 7 to April 13, 1997, she received employment insurance benefits.
[36] The Appellant's statutory declaration was submitted in evidence. In
the declaration she admits that she performed services for S.A.M. during her period
of unemployment and did not report it on her employment insurance cards. In
fact, she recorded the time she spent at S.A.M. during the period from
January 7 to April 13, 1997, using the time clock. In her
declaration, she explains the situation by saying that she was not performing
the same duties during the period when she filled out the time cards as when
she did not fill them out. She added that when she was simply doing a favour,
she was not paid. However, she admitted that the first day of work shown on the
record of employment issued by S.A.M. was false.
[37] Mr. Arguin submitted a table showing a series of documents and
deposit slips that can be connected with the Appellant, and also a series of
time cards showing the hours the Appellant spent at S.A.M. while she was
receiving employment insurance benefits. Those facts are the basis on which the
Minister determined that her employment was excluded from insurable employment
because she was not dealing with the employer at arm's length and because she
was regularly present at the premises of S.A.M. Mr. Arguin counted
265 hours of work done during the period when she was receiving employment
insurance benefits.
[38] Pierre Tremblay is the sales manager and a representative at S.A.M. He
has been employed by S.A.M. since 1980, and has seen its sales rise from
$1.2 million to $10 million today. He is the person who entered a
guilty plea to the 29 charges laid against S.A.M. in relation to false
records of employment. He stated that in reality, S.A.M. had been misled, in
that the circumstances in which the guilty plea was entered were, according to
S.A.M., that the employees' return dates meant their permanent return, and that
was why it pleaded guilty.
[39] Pierre Tremblay reiterated that his brothers and Ms. Leblond were
not paid by S.A.M. during their periods of unemployment and that they worked on
a volunteer basis. He explained that there was no list of employees who were to
be unemployed, and that Janel April, the internal bookkeeper, often used odd
expressions in writing up the S.A.M. minutes.
[40] According to Pierre Tremblay, his brothers and Ms. Leblond were
treated like the other employees, except for the fact that they were provided
with vehicles. He explained that the employees' presence on the employer's
premises during their periods of unemployment was because S.A.M. is like the local
gathering place, where people get together.
[41] On cross-examination, he admitted that there is a personal
relationship between an employee and the customers, particularly in the case of
his brother Jacques, and he acknowledged that even during a period of
unemployment there were still duties associated with the position. He also
admitted that Guy Rousseau and Valère Jalbert, two employees who are
appellants in this case, came by the S.A.M. office and performed services
during their periods of unemployment. He denied that hours were banked while
the employees were unemployed, but said there was a little system in place to bank
hours for employees so they could take an occasional break.
The law
[42] The Appellants' onus in the appeals discussed above is to establish,
on a balance of probabilities, that the Minister exercised his discretion
inappropriately when he determined that, having regard to all the
circumstances, the payor and the Appellants would not have entered into a
substantially similar contract of employment if they had been dealing with each
other at arm's length. As the Federal Court of Appeal held in Canada v.
Jencan Ltd., [1997] F.C.J. No. 876 (Q.L.), [1998] 1 F.C. 187, the
Appellants must establish that the Minister acted in bad faith or for an
improper purpose or motive, or failed to take into account all the relevant
circumstances, as expressly required by subparagraph 3(2)(c)(ii) of
the Unemployment Insurance Act and paragraph 5(3)(b) of the Employment
Insurance Act, or took into account an irrelevant factor, as the case may
be.
[43] The description of the roles of the Minister and the Court was stated
by the Federal Court of Appeal in Légaré v. Canada, [1999] F.C.J.
No. 878 (Q.L.). Mr. Justice Marceau summarized the situation as
follows, at paragraph 4:
The Act requires the Minister to make a determination
based on his own conviction drawn from a review of the file. The wording used
introduces a form of subjective element, and while this has been called a
discretionary power of the Minister, this characterization should not obscure
the fact that the exercise of this power must clearly be completely and
exclusively based on an objective appreciation of known or inferred facts. And
the Minister's determination is subject to review. In fact, the Act confers the
power of review on the Tax Court of Canada on the basis of what is discovered
in an inquiry carried out in the presence of all interested parties. The Court
is not mandated to make the same kind of determination as the Minister and thus
cannot purely and simply substitute its assessment for that of the Minister:
that falls under the Minister's so-called discretionary power. However, the
Court must verify whether the facts inferred or relied on by the Minister are
real and were correctly assessed having regard to the context in which they
occurred, and after doing so, it must decide whether the conclusion with which
the Minister was "satisfied" still seems reasonable.
[44] The Federal Court of Appeal reiterated its position in Pérusse v.
Canada, [2000] F.C.J. No. 310 (Q.L.). Referring to the passage from Légaré
quoted above, Mr. Justice Marceau added, at paragraph 15:
The function of an appellate judge is thus not simply
to consider whether the Minister was right in concluding as he did based on the
factual information which Commission inspectors were able to obtain and the
interpretation he or his officers may have given to it. The judge's function is
to investigate all the facts with the parties and witnesses called to testify
under oath for the first time and to consider whether the Minister's
conclusion, in this new light, still seems "reasonable" (the word
used by Parliament). The Act requires the judge to show some deference towards
the Minister's initial assessment and, as I was saying, directs him not simply
to substitute his own opinion for that of the Minister when there are no new
facts and there is nothing to indicate that the known facts were misunderstood.
However, simply referring to the Minister's discretion is misleading.
Analysis
[45] The common denominator in the cases in this category is the fact that
each record of employment explains the Appellants' layoff as resulting from a
shortage of work, with the exception of two records of employment in which the
reason shown for the termination was parental leave, and that in all cases the
Appellants continued to perform services for their employer during their
periods of unemployment. The frequency with which they were present at the
employer's premises and the number of services performed are therefore the nub
of the issue between the parties. In fact, counsel for the Appellants argued
that the Minister did not take the investigation far enough, and so his
conclusions regarding the nature of the work performed during the periods of
unemployment are based solely on assumptions. Counsel argued that the Minister
has to present sufficient and convincing evidence, and that in this case the
evidence is insufficient for the Minister to conclude that the Appellants were
present at the S.A.M. workplace to an extent sufficient to support the
conclusion that they continued to work there.
[46] The Appellants' testimony did not satisfy me that they were present at
the S.A.M. workplace just to do a few hours of work on a volunteer basis, or to
serve certain customers they had met during their periods of employment. They
also did not satisfy me that they were acting of their own free will. In my
opinion, each of them tried to minimize their involvement in S.A.M.'s business,
when the evidence appears to show that things went on as if there had been no
layoffs. The number of business transactions conducted by each of the
appellants, as Mr. Arguin's testimony and the documentary evidence he
submitted show, prove conclusively that the Appellants were present at S.A.M. during
their periods of unemployment. There may have been occasions when another
employee used one of the Appellants' employee numbers, but I do not believe
that this could have happened very often when measured against the volume of
documents and transactions identified by Mr. Arguin.
[47] In the case of the Appellant Claude Tremblay, there are two periods of
unemployment. During both periods, he continued to use the car and credit card
provided by his employer. His first period of unemployment, from May 10,
1993, to July 19, 1993, was right in the middle of S.A.M.'s peak period.
It is therefore difficult to claim a shortage of work. In his case and in the
case of the Appellant Jacques Tremblay, the minutes of the S.A.M. board of directors
meetings (see paragraphs 8 and 9 of these Reasons) prompt us to ask
whether the layoffs of these Appellants were genuinely because of a shortage of
work.
[48] In the case of the appeal by Michel Tremblay, there were several
periods of unemployment. That Appellant admitted that during each period he
performed services for S.A.M. Michel Tremblay was a salesperson and his salary
was based on total sales for the previous year, which therefore included the
sales he made outside his periods of employment. The evidence presented by
Mr. Arguin clearly shows that this Appellant made sales for S.A.M. during
his periods of unemployment, and that he did so without being paid, with the exception
of one paycheque he received on December 4, 1993. There was a significant
volume of sales during certain months when he was not paid. In my opinion,
these are not normal terms and conditions of employment that can support
entitlement to claim under the UIA or EIA scheme.
[49] The Appellant Rémi Tremblay had two periods of unemployment. The first
was because of a shortage of work and the second was for parental leave. As in
the preceding cases, there are a number of documents connecting this Appellant
to business transactions conducted for S.A.M. during those periods, and there
are also documents showing credit card purchases made on behalf of S.A.M. Given
the volume of transactions discovered in the course of the investigation, it is
difficult to accept the Appellant's explanation that this was work done on a
volunteer basis. In a family business, work may be done on that basis when a
person has seasonal employment that has particular characteristics. In my
opinion, that is not the case here. Rather, this is a situation in which
advantage was taken of the employment insurance system to have the company's employees
paid during periods when it was less busy.
[50] The case of the Appellant Jacques Tremblay is similar. There are two
periods of unemployment where he kept the car provided by his employer and
continued to have accommodation provided by the employer, and the use of a
cellphone. In this case, we also have the same minutes relating to the periods
of unemployment as we saw in the case of the Appellant Claude Tremblay, and we
also have documentary evidence similar to what was submitted in the other cases
to establish the activities the other Appellants engaged in at S.A.M.
[51] The Appellant Nadine Leblond did not testify. Her statutory
declaration admits that she performed services during her period of
unemployment and that the first day of work shown on her record of employment is
false. A time card on which the hours she worked for S.A.M were recorded,
during the period when she was receiving employment insurance benefits,
confirms her presence at work.
[52] Having regard to all of the facts heard
at the trial, it is impossible for me to conclude that the Minister's
determination was not reasonable. The Appellants' testimony is not sufficient
to constitute new evidence from which I could conclude that the Minister failed
to have regard to those factors. In this case, there is sufficient concrete
evidence that it is impossible to conclude that the Minister exercised his
discretion solely by relying on assumptions. In the circumstances, the Minister's
determination still appears to be reasonable. For those reasons, the appeals by
the five Appellants referred to in the preceding paragraphs are dismissed.
The nine other cases
[53] The parties agreed that two typical cases
would be used to dispose of all of the appeals in the nine cases in question.
Four of the nine Appellants testified.
Guy Rousseau
[54] The Appellant Guy Rousseau is appealing from the
determination made by the Minister on February 7, 2000, informing him that
his employment at S.A.M. was insurable but that the insurable weeks, insurable
hours and insurable earnings, for the purposes of the UIA and the EIA, were as
follows:
|
Periods
of work
|
Insurable
earnings
|
Insurable
weeks
|
|
Jan.1 to Dec.
31, 1993
|
12,691
|
52
|
|
Jan.1 to Dec.
31, 1994
|
15,994
|
52
|
|
Jan.1 to Dec.
31, 1995
|
15,744
|
52
|
|
Jan.1 to Dec.
31, 1996
|
15,708
|
52
|
[55] The facts on which the Minister relied are set out in the Amended
Reply to the Notice of Appeal, and were admitted or denied as indicated below.
(a) The payor was
incorporated on April 12, 1976, and operates a farm machinery sales and
maintenance business. (admitted)
(b) The payor has
two places of business, one in St-Clément and the other in St-Pascal, and
employs 25 people. (admitted)
(c) The payor
operates year-round, with its busiest period being between April and December
each year. (admitted)
(d) The Appellant
was employed by the payor as a parts clerk. (admitted)
(e) There are
invoices and time cards on which the Appellant's name, initials or employee
number appear that are dated outside the periods shown on the records of
employment. (denied)
(f) The records
of employment do not represent the actual periods of work. (denied)
(g) The records
of employment do not represent the actual number of insurable weeks or hours.
(denied)
(h) The records
of employment do not represent the actual insurable earnings. (denied)
(i) The
Appellant continued to perform services for the payor outside the periods shown
on the records of employment. (denied)
(j) On December 17,
1993, the payor issued a record of employment to the Appellant showing that the
first day of work was June 7, 1993, and the last day of work was December 17,
1993, that the period of work consisted of 28 insurable weeks and that insurable
earnings totalled $8,301.00 for the last 20 weeks. (admitted)
(k) In 1993, the
Appellant actually worked from January 1 to December 31, and
that period consisted of 52 insurable weeks with insurable earnings of $12,691.00.
(denied)
(l) On
December 20, 1994, the payor issued a record of employment to the
Appellant showing that the first day of work was May 2, 1994, and the last
day of work was December 16, 1994, that the period of work consisted of 33
insurable weeks and that insurable earnings totalled $8,968.00 for the last
20 weeks. (admitted)
(m) In 1994, the
Appellant actually worked from January 1 to December 31, and
that period consisted of 52 insurable weeks with insurable earnings of $15,994.00.
(denied)
(n) On
December 15, 1995, the payor issued a record of employment to the
Appellant showing that the first day of work was May 8, 1995, and the last
day of work was December 15, 1995, that the period of work consisted of 32
insurable weeks and that insurable earnings totalled $8,940.00 for the last
20 weeks. (admitted)
(o) In 1995, the Appellant
actually worked from January 1 to December 31, and that period
consisted of 52 insurable weeks with insurable earnings of $15,744.00. (denied)
(p) On
December 6, 1996, the payor issued a record of employment to the Appellant
showing that the first day of work was May 20, 1996, and the last day of
work was December 6, 1996, that the period of work consisted of 29 insurable
weeks and that insurable earnings totalled $9,546.00 for the last 20 weeks.
(admitted)
(q) In 1996, the
Appellant actually worked from January 1 to December 31, and
that period consisted of 52 insurable weeks with insurable earnings of $15,708.00.
(denied)
(r) On December 22,
1997, the payor issued a record of employment to the Appellant showing that the
first day of work was December 23, 1996, and the last day of work was
December 19, 1997, that the period of work consisted of 1,420,50 insurable
hours and that insurable earnings totalled $16,232.30. (admitted)
(s) In 1997, the
Appellant actually worked from January 1 to December 19, and
for that period had insurable earnings of $15,557.00. (denied)
[56] The Appellant's records of employment correspond to paragraphs (j),
(l), (n), (p) and (r) above. In spite of the fact that he was paid at an hourly
rate, his weekly salary was fixed and corresponded to a 40-hour to 45-hour
week. According to the Appellant, he worked full weeks when he was at work.
During periods of unemployment, he regularly did part-time work and was paid.
He reported everything on his unemployment cards. He admitted that he also
performed services without being paid during his periods of unemployment. When
he was on the premises, he sometimes accepted deliveries and performed
services. He always worked at the head office in St-Clément and he lived
20 kilometres from his place of work. The Appellant had recorded his hours
on a time card using the time clock, four times a day, since he started working
at S.A.M.
[57] He therefore admitted that services were performed without pay and he
considered it all to be work done on a volunteer basis. Gaétan Tremblay, the
father of the Tremblay Appellants, was the person who decided when the
Appellant would be paid. The Appellant's employee number is 44.
[58] The Respondent submitted five books each containing a series of invoices
and other documents, over 400 in total, on which the Appellant's employee
number or signature appears. The documents show dates that correspond to the
Appellant's periods of unemployment during the years 1993 to 1997, inclusive. The
Appellant explained this by saying that he was on the S.A.M. premises and he
signed purchase orders [TRANSLATION] "on the fly", as he put it. He also explained that another
employee may have used his employee number, just as he himself may have used
another employee's number.
Valère Jalbert
[59] The Appellant Valère Jalbert is appealing from the determination made
by the Minister on February 7, 2000, informing him that his employment
with S.A.M. was insurable but that the insurable weeks and insurable earnings for
the purposes of the UIA and the EIA were as follows:
|
Periods
of work
|
Number
of
weeks
|
Insurable
earnings
|
|
Mar. 19,
1995, to Jan. 27, 1996
|
41 weeks
|
$15,227
|
|
Jan 28,
1996, to Jan. 25, 1997
|
52 weeks
|
$14,187
|
|
Jan 26, 1997,
to Dec. 31, 1997
|
52 weeks
|
$17,277
|
[60] The facts on which the Minister relied are set out in the Amended
Reply to the Notice of Appeal and were admitted or denied as indicated below.
(e) Invoices and
time cards on which the Appellant's name, initials or employee number appear
are dated outside the periods shown on the records of employment. (denied)
(f) The records
of employment do not represent the actual periods of work. (denied)
(g) The records
of employment do not represent the actual number of insurable weeks or hours.
(denied)
(h) The records
of employment do not represent the actual insurable earnings. (denied)
(i) The
Appellant continued to perform services for the payor outside the periods shown
on the records of employment. (admitted)
(j) On November 10,
1995, the payor issued a record of employment to the Appellant showing that the
first day of work was April 3, 1995, and the last day of work was November 10,
1995, that the period of work consisted of 31 insurable weeks and that
insurable earnings totalled $9,600.00 for the last 20 weeks. (admitted)
(k) On October 30,
1996, the payor issued a record of employment to the Appellant showing that the
first day of work was May 13, 1996, and the last day of work was October 25,
1996, that the period of work consisted of 24 insurable weeks and that
insurable earnings totalled $10,000.00 for the last 20 weeks. (admitted)
(l) On January 25,
1997, the payor issued a record of employment to the Appellant showing that the
first day of work was December 11, 1996, and the last day of work was January
24, 1997, that the period of work consisted of 25 insurable hours and that
insurable earnings totalled $200.00. (admitted)
(m) In fact, the
Appellant performed services for the payor on an ongoing basis from March 19,
1995, to December 31, 1997. (denied)
(n) the Appellant's
insurable earnings totalled $15,227.00 for 1995, $14,187.00 for 1996 and
$17,277.00 for 1997. (admitted)
[61] The dates shown on this Appellant's records of employment correspond
to the dates shown in paragraphs (j), (k) and (l) above. He worked about
40 hours a week and was paid at an hourly rate. The Appellant stated that
during his periods of unemployment he worked at the request of S.A.M., and
sometimes of his own free will, as a favour. He added that he worked between
five and 30 hours a week during his periods of unemployment. He said he
worked a minimum of five hours, because he worked more or less all the time. He
added that from 1995 to 1997 he took no vacation.
[62] He was supervised by Gaétan Tremblay and used the time clock punch-in
system. His employee number was 1.
[63] On cross-examination, he stated that the dates on the records of
employment might not be accurate. He recognized his initials on a work summary
that appears on page 4 of Exhibit I‑33, which corresponds to an
invoice that appears on page 1 of Exhibit I‑33. He admitted
that he was not paid for the work week that corresponds to the hours shown on
the summary and could not say whether he was in fact paid for that work.
[64] In another book, Exhibit I‑34, there are hours worked in
March and April 1996 and invoiced in October 1996. In March 1996, the Appellant
was not on the payroll. Exhibits I‑33 and I‑34, as well as the
tables prepared by Bruno Arguin, the appeals officer, show that the Appellant
Valère Jalbert worked hours in weeks that were outside the period of
employment shown on the records of employment, for which he was not paid or was
paid very little, considering the number of hours worked. His employment was
thus extended, according to the invoices and purchase orders that appear in
Exhibits I‑33 and I‑34.
Stéphane April
[65] Stéphane April's appeal also relates to the number of insurable weeks
and insurable earnings for the purposes of the UIA and the EIA while he was
employed by S.A.M. The Minister determined the insurable periods, weeks and
earnings, in his determination dated February 7, 2000, to be as follows:
|
Periods
of work
|
Insurable
weeks
|
Insurable
earnings
|
|
May 9, 1994, to Jan. 6, 1995
|
35 weeks
|
$18,850, of which $11,350 was for the last
20 weeks
|
|
May 1 to Nov. 3, 1995
|
27 weeks
|
$17,550, of which $13,000 was for the last
20 weeks
|
|
May 13 to Dec. 20, 1996
|
32 weeks
|
$17,957.39, of which $11,200 was for the
last 20 weeks
|
[66] The facts on which the Minister relied are set out in the Amended
Reply to the Notice of Appeal and were admitted or denied as indicated below.
(d) The Appellant
was employed by the payor as a truck driver. (admitted)
(e) On January 6,
1995, the payor issued a record of employment to the Appellant showing that the
first day of work was May 9, 1994, and the last day of work was January 6,
1995, that the period of work consisted of 35 insurable weeks and that
insurable earnings totalled $11,350.00 for the last 20 weeks. (admitted)
(f) On November 3,
1995, the payor issued a record of employment to the Appellant showing that the
first day of work was May 1, 1995, and the last day of work was November 3,
1995, that the period of work consisted of 27 insurable weeks and that
insurable earnings totalled $11,300.00 for the last 20 weeks. (admitted)
(g) On December 23,
1996, the payor issued a record of employment to the Appellant showing that the
first day of work was May 13, 1996, and the last day of work was December 20,
1996, that the period of work consisted of 32 insurable weeks and that
insurable earnings totalled $11,200.00 for the last 20 weeks. (admitted)
(h) The Appellant
performed services for the payor in some weeks before and after the periods
shown on the records of employment but for less than 15 hours per week,
and the weekly earnings were less than $156.00 in 1994, $163.00 in 1995 and $150.00
in 1996. (denied)
[67] The Appellant Stéphane April has been employed by S.A.M. since
April 14, 1994. He stated that he sometimes worked for his employer when
he was unemployed. He said he reported his income in those cases. In his
statutory declaration (Exhibit A-20), he admitted that the first day of
work, May 9, 1994, shown on the first record of employment, is incorrect,
because he had worked a few hours before the date in question. He stated that Rémi Tremblay
was the one who controlled his time when he did not punch in using the time
clock, and that the first day of work shown on the records of employment for
1995 and 1996 was incorrect. He sometimes made trips outside those periods for S.A.M.
In fact, he worked almost every week while he was receiving unemployment
insurance benefits, but he did not want to receive more than he was entitled
to, so he sometimes did a favour for his employer, just as the employer might
also do him a favour. For example, he explained, he might make a trip for his
employer with one of his friends and the employer only paid for his meals, just
as he might take his employer's snow blower to clear his driveway.
[68] The appeals officer examined the records of employment and the payroll
to determine whether this Appellant's employment was insurable during certain
periods, having regard to the number of hours of work done per week and the
earnings paid. Based on this, he adjusted the earnings paid during the periods
of employment, and the result of that exercise is in the letter from the
Minister submitted as Exhibit I‑40.
Martine Côté
[69] This Appellant is the spouse of Pierre Tremblay. Her employment with
S.A.M. is insurable and the appeal relates to the number of insurable weeks, insurable
hours insurable earnings for the purposes of the UIA
and the EIA. The Minister
determined the insurable periods, weeks and earnings, in his determination
dated February 7, 2000, to be as follows:
|
Periods of
work
|
Insurable
earnings
|
Insurable
weeks
|
|
Jul. 4 to Sept. 11, 1993
|
3,788.31
|
10
|
|
Sept. 19 to Nov. 6, 1993
|
2,267.51
|
7
|
|
Nov. 14 to Dec. 31, 1993
|
2,267.51
|
7
|
|
Jun. 19 to Jan. 13, 1995
|
9,717.50
|
30
|
|
May 28, 1995, to Jan. 1, 1996
|
10,689.69
|
33
|
|
May 26 to Nov. 23, 1996
|
9,488.98
|
26
|
|
Dec. 1, 1996, to Jan. 4, 1997
|
1,619.65
|
5
|
|
Jan. 5 to Jan. 24, 1997
|
971.79
|
|
|
Feb. 16 to Mar. 8, 1997
|
81.00
|
|
|
Mar. 16 to Apr. 12, 1997
|
139.00
|
|
|
Apr. 20 to Dec. 31, 1997
|
10,045.28
|
|
[70] The facts on which the Minister relied are set out in the Amended
Reply to the Notice of Appeal, and were admitted or denied as indicated below.
(d) The Appellant
was employed by the payor as a secretary. (admitted)
(e) On
January 5, 1994, the payor issued a record of employment to the Appellant showing
that the first day of work was July 5, 1993, and the last day of work was December 31,
1993, that the period of work consisted of 24 insurable weeks and that
insurable earnings totalled $7,027.00 for the last 20 weeks. (admitted)
(f) For the
period referred to in the preceding paragraph, the Appellant was engaged in
insurable employment: (denied)
|
Periods of work
|
Insurable earnings
|
Insurable weeks
|
|
July 4, 1993,
to September 11, 1993
|
$3,788.31
|
10 weeks
|
|
September 19, 1993,
to November 6, 1993
|
$2,267.51
|
7 weeks
|
|
November 14, 1993,
to December 31, 1993
|
$2,267.51
|
7 weeks
|
(g) On January 16, 1995, the payor issued a record
of employment to the Appellant showing that the first day of work was June 20,
1994, and the last day of work was January 13, 1995, that the period of
work consisted of 30 insurable weeks and that insurable earnings totalled $6,478.00
for the last 20 weeks. (admitted)
(h) For the
period referred to in the preceding paragraph, the Appellant was engaged in
insurable employment: (denied)
|
Periods of work
|
Insurable
earnings
|
Insurable weeks
|
|
from June 19, 1994,
to January 13, 1995
|
$9,715.50
|
30 weeks
|
(i) On January 12, 1996, the payor issued a
record of employment to the Appellant showing that the first day of work was May 29,
1995, and the last day of work was January 12, 1996, that the period of work
consisted of 33 insurable weeks and that insurable earnings totalled $6,479.00 for
the last 20 weeks. (admitted)
(j) For the period referred to in the
preceding paragraph, the Appellant was engaged in insurable employment: (denied)
|
Periods of work
|
Insurable earnings
|
Insurable weeks
|
|
from May 28, 1995,
to January 12, 1995
|
$10,689.69
|
33 weeks
|
(k) On January 27, 1997, the payor issued a
record of employment to the Appellant showing that the first day of work was May 27,
1996, and the last day of work was January 24, 1997, that the period of
work consisted of 34 insurable weeks and that insurable earnings totalled $7,221.00
for the last 20 weeks. (admitted)
(l) For the period referred to in the preceding
paragraph, the Appellant was engaged in insurable employment: (denied)
|
Periods of work
|
Insurable earnings
|
Insurable weeks
|
|
from May 26, 1996,
to November 23, 1996
|
$ 988.98
|
26 weeks
|
|
from December 1, 1996
to January 4, 1997
|
$1,619.65
|
5 weeks
|
|
from January 5, 1997
to January 24, 1997
|
$ 971.79
|
|
(m) From July 4, 1993, to January 24,
1977, the Appellant performed services for the payor in some weeks before
and after the periods shown on the records of employment but for less than
15 hours a week, and the weekly earnings were lower than $149.00 in 1993,
$156.00 in 1994, $163.00 in 1995 and $150 in 1996 for the following periods: (denied)
|
from March 21, 1993, to July 3, 1993
|
|
from January 23, 1994, to February 5, 1994
|
|
from February 20, 1994, to February 26,
1994
|
|
from April 3, 1994, to April 9, 1994
|
|
from May 1, 1994, to June 18, 1994
|
|
from January 29, 1995, to February 11,
1995
|
|
from February 19, 1995, to March 11, 1995
|
|
from March 26, 1995, to April 15, 1995
|
|
from April 23, 1995, to May 13, 1995
|
|
from February 4, 1996, to February 10,
1996
|
|
from February 25, 1996, to March 2, 1996
|
|
from March 17, 1996, to March 30, 1996
|
|
from April 7, 1996, to May 25, 1996
|
(n) On January 21, 1998, the payor issued a record
of employment to the Appellant showing that the first day of work was February 20,
1997, and the last day of work was January 16, 1998, that the period of
work consisted of 1,067 insurable hours and that insurable earnings totalled
$8,597,47. (admitted)
(o) In fact, regarding the period
referred to in the preceding paragraph, the Appellant was actually
engaged in insurable employment …: (denied)
|
Periods of work
|
Insurable earnings
|
|
from February 16, 1997
to March 8, 1997
|
$ 81.00
|
|
from March 16, 1997
to April 12, 1997
|
$ 139.00
|
|
from April 20, 1997
to December 31, 1997
|
$ 10,045.28
|
(p) The Appellant was not employed by the payor
in the following periods: (denied)
|
from September 12, 1993, to September 18,
1993
|
|
from November 7, 1993, to November 13,
1993
|
|
from January 2, 1994, to January 22, 1994
|
|
from February 6, 1994, to February 19, 1994
|
|
from February 27, 1994, to April 2, 1994
|
|
from April 10, 1994, to April 30, 1994
|
|
from January 15, 1995, to January 28,
1995
|
|
from February 12, 1995, to February 18, 1995
|
|
from March 12, 1995, to March 25, 1995
|
|
from April 16, 1995, to April 22, 1995
|
|
from May 14, 1995, to May 27, 1995
|
|
from January 14, 1996, to February 3, 1996
|
|
from February 11, 1996, to February 24, 1996
|
|
from March 3, 1996, to March 16, 1996
|
|
from March 31, 1996, to April 6, 1996
|
|
from November 24, 1996, to November 30,
1996
|
|
from January 26, 1997, to February 15, 1997
|
|
from March 9, 1997, to March 15, 1997
|
|
from April 13, 1997, to April 19, 1997
|
[71] The Appellant stated that she worked an average of 35 hours a week
during her periods of employment, for all of the years in issue, that is, from
1993 to 1997. She worked full-time in May and June of each year. Because she
lived a few doors away from S.A.M.'s place of business, she occasionally
performed services outside her periods of employment, when she went for a walk.
For example, she handled the mail for S.A.M. or lent a hand when she went by,
if it was busy. She did not punch in on those occasions, and was not paid. Her
statement said that she was on standby during the periods when she was working
part-time and she did not record her time with the time clock. The hours during
which she performed services without being paid were not reported on her
unemployment cards.
[72] The appeals officer did the same exercise as in the case of the
Appellant Stéphane April. After examining the records of employment and the
payroll, he adjusted the periods of work, the earnings and the insurable weeks.
The result is what is shown in the letter from the Minister dated
February 7, 2000 (Exhibit I‑41).
Denis Lévesque
[73] This appeal deals with the Appellant's number of insurable weeks, for the purposes of the UIA and the EIA, while he was employed by
S.A.M., from December 22, 1996, to October 31, 1997. In his
determination dated February 7, 2000, the Minister determined the insurable weeks for the period in issue,
relying on the following assumptions of fact, which are admitted or denied, as
the case may be.
(d) The Appellant
was employed by the payor as a parts clerk. (admitted)
(e) There are
invoices and time cards on which the Appellant's name, initials or employee
number appear and which are dated outside the periods shown on the records of
employment. (denied)
(f) The records
of employment do not represent the actual periods of work. (denied)
(g) The records
of employment do not represent the actual number of insurable weeks or hours.
(denied)
(h) The records
of employment do not represent the actual insurable earnings. (denied)
(i) The
Appellant continued to perform services for the payor outside the periods shown
on the records of employment. (denied)
(j) On December 23,
1996, the payor issued a record of employment to the Appellant showing that his
last day of work was on December 20, 1996. (admitted)
(k) On October 30,
1997, the payor issued a second record of employment to the Appellant showing
that the first day of work was April 14, 1997, and the last day of work
was October 31, 1997. (denied)
(l) The payor issued
the records of employment (allegedly because of a shortage of work) although
the Appellant continued to work for the payor (until October 31, 1997) between
December 20, 1996, and April 14, 1997. (denied)
Stéphane Aubut
[74] The Appellant is appealing from the determination made by the Minister
on February 7, 2000 informing him that his employment with S.A.M. was
insurable for the period from March 4, 1996, to January 3, 1997, consisting
of 44 insurable weeks with insurable earnings of $17,814.30, and for the
period from January 6 to December 31, 1997, in which his insurable
earnings were $22,807.90. In making his determination, the Minister relied on
the following assumptions of fact, which were admitted or denied as indicated
below.
(d) The Appellant
was employed by the payor as a dairy equipment technician. (admitted)
(e) There are
invoices and time cards on which the Appellant's name, initials or employee
number appear and which are dated outside the periods shown on the records of
employment. (denied)
(f) The records
of employment do not represent the actual periods of work. (denied)
(g) The records
of employment do not represent the actual number of insurable weeks or hours.
(denied)
(h) The records
of employment do not represent the actual insurable earnings. (denied)
(i) The
Appellant continued to perform services for the payor outside the periods shown
on the records of employment. (denied)
(j) On March 4,
1996, the payor issued a record of employment to the Appellant showing that the
first day of work was December 1, 1990, and the last day of work was March 1,
1996, that the period of work consisted of 52 insurable weeks in the 52 weeks preceding
March 1, 1996, and that insurable earnings totalled $9,476.00 for the last
20 weeks. (admitted)
(k) On March 5,
1996, the Appellant applied for and received unemployment insurance benefits. (admitted)
(l) In fact, the
Appellant continued to perform services for the payor after March 1, 1996,
while he was receiving unemployment insurance benefits. (denied)
(m) On January 6, 1997,
the payor issued a record of employment to the Appellant showing that the first
day of work was April 15, 1996, and the last day of work was January 3,
1997, that the period of work consisted of 38 insurable weeks and that
insurable earnings totalled $9,362.00 for the last 20 weeks. (denied)
(n) On or about
January 3, 1997, the Appellant applied for and received employment
insurance benefits. (admitted)
(o) In fact, the
Appellant continued to perform services for the payor after January 6,
1997, while he was receiving employment insurance benefits. (denied)
Alex Fournier
[75] This Appellant is appealing from the determination made by the
Minister on February 7, 2000, informing him that his insurable periods,
weeks and earnings while he was employed by S.A.M. were as shown below.
|
Insurable periods in 1996:
|
July 1 to August 3
|
|
|
August 18 to October 26
|
|
|
November 3 to 9
|
|
|
November 24 to December 7
|
|
|
December 15 to 21
|
[76] These periods totalled 19 insurable weeks for which there were insurable
earnings of $5,280.
[77] Insurable periods in 1997: February 16 to March 1
March 23 to 29
April 6 to 12
April 27 to
December 26
Insurable earnings during these periods were $11,813.
[78] In making his determination, the Minister relied on the following assumptions
of fact, which were admitted or denied as indicated below.
(d) The Appellant was employed by the
payor as a mechanic. (admitted)
(e) On October 14, 1996, the
payor issued a record of employment to the Appellant showing that the first day
of work was July 1, 1996, and the last day of work was October 11,
1996, that the period of work consisted of 13 insurable weeks and that
insurable earnings totalled $4,576.00. (admitted)
(f) On December 24, 1997, the
payor issued a second record of employment to the Appellant showing that the
first day of work was November 25, 1996, and the last day of work was December
26, 1997, that the period of work consisted of 2 insurable weeks and insurable earnings
totalled $704.00 for the 1996 portion and 1,461 insurable hours and
insurable earnings of $11,688.00 for the 1997 portion. (admitted)
(g) There are invoices and time cards on which the
Appellant's name, initials or employee number appear and which are dated
outside the periods shown on the records of employment. (denied)
(h) No documentary evidence showing the worker's
presence was found for the periods: (denied)
August 4, 1996, to August 17,
1996
October 27, 1996, to November 2,
1996
November 10, 1996, to November
23, 1996
December 8, 1996, to December
14, 1996
December 22, 1996, to February
15, 1997
March 2, 1997, to March 22, 1997
March 30, 1997, to April 5, 1997
April 13, 1997, to April 26, 1997
December 27, 1997
(i) The records of employment do not represent
the actual periods of work. (denied)
(j) The records of employment do not represent
the actual number of insurable weeks or hours. (denied)
(k) The records of employment do not represent
the actual insurable earnings. (denied)
(l) The Appellant continued to perform
services for the payor outside the periods shown on the records of employment.
(denied)
(m) In 1996, the Appellant actually worked
from July 1 to August 3, from August 18 to October 26, from
November 3 to 9, from November 24 to December 7, and from
December 15 to 21, and those periods consisted of 19 insurable weeks
with insurable earnings of $5,280.00. (denied)
(n) In 1997, the Appellant actually
worked from February 16 to March 1, from March 23 to 29, from April 6
to 12 and from April 27 to December 26, and those periods consisted of 1,477 insurable
hours with insurable earnings of $11,813.00. (denied)
Benoît Roy
[79] This appeal relates to the periods of work, number of weeks and insurable
earnings while the Appellant was employed by S.A.M. In his determination, the
Minister concluded as follows on those issues:
|
Periods of work
|
Number of
weeks
|
Insurable
earnings
|
|
from February 28, 1994 to August 6, 1994
|
23 weeks
|
$8,173.74
|
|
from August 14, 1994, to October 8, 1994
|
8 weeks
|
$2,843.04
|
|
from October 23, 1994, to October 29, 1994
|
1 week
|
$ 355.38
|
|
from November 6, 1994, to November 12, 1994
|
1 week
|
$ 355.38
|
|
from November 20, 1994, to December 31, 1994
|
6 weeks
|
$2,132.80
|
|
from January 1, 1995, to July 29, 1995
|
30 weeks
|
$6,061.20
|
|
from August 6, 1995, to August 26, 1995
|
3 weeks
|
$ 606.12
|
|
from September 3, 1995, to December 23, 1995
|
16 weeks
|
$3,232.64
|
|
from December 31, 1995, to April 6, 1996
|
14 weeks
|
$2,752.40
|
|
from April 14, 1996, to May 4, 1996
|
3 weeks
|
$ 589.80
|
|
from May 12, 1996, to July 6, 1996
|
8 weeks
|
$1,572.80
|
|
from July 14, 1996, to July 20, 1996
|
1 week
|
$ 196.60
|
|
from July 28, 1996, to August 31, 1996
|
5 weeks
|
$ 983.00
|
|
from September 8, 1996, to December 28, 1996
|
16 weeks
|
$3,145.60
|
|
from December 29, 1996, to May 24, 1997
|
|
$2,710.26
|
|
from June 1, 1997, to June 28, 1997
|
|
$ 516.24
|
|
from July 6, 1997, to July 19, 1997
|
|
$ 258.12
|
|
from July 27, 1997, to December 27, 1997
|
|
$2,839.32
|
|
from December 28, 1997, to March 13, 1998
|
|
$7,260.00
|
[80] The facts on which the Minister relied are as follows. They were admitted
or denied by the Appellant as indicated below:
(d) The Appellant was employed by the
payor as a dairy equipment technician. (admitted)
(e) On August 1, 1994, the
payor issued a record of employment to the Appellant showing that the first day
of work was February 28, 1994, and the last day of work was July 29,
1994, that the period of work consisted of 22 insurable weeks and that
insurable earnings totalled $12,600.00 for the last 20 weeks. (admitted)
(f) On August 18, 1995, the payor issued a
record of employment to the Appellant showing that the first day of work was March 6,
1995, and the last day of work was August 18, 1995, that the period of work
consisted of 15 insurable weeks and that insurable earnings totalled $9,900.00.
(admitted)
(g) On December 13, 1996, the payor issued a
record of employment to the Appellant showing that the first day of work was September 9,
1996, and the last day of work was December 13, 1996, that the period of
work consisted of 14 insurable weeks and that insurable earnings totalled $9,240.00.
(admitted)
(h) On March 16, 1998, the
payor issued a record of employment to the Appellant showing that the first day
of work was October 27, 1997, and the last day of work was March 13,
1998, that the period of work consisted of 960 insurable hours and that
insurable earnings totalled $13,200.00. (admitted)
(i) From 1994 to 1998, the payor issued
incorrect records of employment to the Appellant. (denied)
(j) There are invoices and time cards on which the
Appellant's name, initials or employee number appear and which are dated
outside the periods shown on the records of employment. (denied)
(k) The records of employment do not represent
the actual periods of work. (denied)
(l) The records of employment do not represent
the actual number of insurable weeks or hours. (denied)
(m) The records of employment do not represent
the actual insurable earnings. (denied)
(n) The Appellant continued to perform services
for the payor outside the periods shown on the records of employment. (denied)
(o) In 1994, the Appellant actually worked …
|
Periods of work
|
Number
of weeks
|
Insurable
earnings
|
|
from February 28 to August 6, 1994
|
23 weeks
|
$8,173.74
|
|
from August 14 to October 8, 1994
|
8 weeks
|
$2,843.04
|
|
from October 23 to October 29, 1994
|
1 week
|
$ 355.38
|
|
from November 6 to November 12, 1994
|
1 week
|
$ 355.38
|
|
from November 20 to December 31, 1994
|
6 weeks
|
$2,132.80
|
(p) In 1995, the Appellant actually worked …
|
Periods of work
|
Number
of weeks
|
Insurable
earnings
|
|
from January 1 to July 29, 1995
|
30 weeks
|
$6,061.20
|
|
from August 6 to August 26, 1995
|
3 weeks
|
$ 606.12
|
|
from September 3 to December 23, 1995
|
16 weeks
|
$3,232.64
|
(q) In fact, the Appellant actually worked …
|
Periods of work
|
Number
of weeks
|
Insurable
earnings
|
|
from December 31, 1995, to April 6, 1996
|
14 weeks
|
$2,752.40
|
|
from April 14 to May 4, 1996
|
3 weeks
|
$ 589.80
|
|
from May 12 to July 6, 1996
|
8 weeks
|
$1,572.80
|
|
from July 14 to July 20, 1996
|
1 week
|
$ 196.60
|
|
from July 28 to August 31, 1996
|
5 weeks
|
$ 983.00
|
|
from September 8 to December 28, 1996
|
16 weeks
|
$3,145.60
|
(r) In fact, the Appellant actually worked …
|
Periods of work
|
Insurable
earnings
|
|
from December 29, 1996, to May 24, 1997
|
$2,710.26
|
|
from June 1 to June 28, 1997
|
$ 516.24
|
|
from July 6 to July 19, 1997
|
$ 258.12
|
|
from July 27 to December 27, 1997
|
$2,839.32
|
|
from December 28, 1997, to March 13, 1998
|
$7,260.00
|
Sébastien Roy
[81] This appeal relates to the same issues, that is, the Appellant's
insurable weeks, hours and earnings while he was employed by S.A.M. In his
letter of February 7, 2000, the Minister informed the Appellant of his
determination that his periods of work and insurable earnings for the purposes of the UIA and the EIA were as follows:
|
Periods of
work
|
Insurable earnings
|
|
Sept. 6 to Dec.
31, 1994
|
$
585
|
|
Jan. 1 to Dec.
30, 1995
|
$13,248
|
|
Dec. 31, 1995,
to Dec. 28, 1996
|
$10,761
|
|
Dec. 29, 1996,
to Dec. 27, 1997
|
$15,718
|
|
Dec. 28, 1997,
to June 26, 1998
|
$8,305.30
|
[82] The facts on which the Minister relied are as follows; they were
admitted or denied by the Appellant as indicated below.
(d) The Appellant was employed by
the payor as a parts clerk. (admitted)
(e) There are invoices and time cards on which the
Appellant's name, initials or employee number appear and which are dated
outside the periods shown on the records of employment. (admitted)
(f) No documentary evidence showing the
Appellant's presence was found for November 25, 1995. (denied)
(g) The records of employment do not represent
the actual periods of work. (denied)
(h) The records of employment do not represent
the actual number of insurable weeks or hours. (denied)
(i) The records of employment do not represent
the actual insurable earnings. (denied)
(j) The Appellant continued to perform services
for the payor outside the periods shown on the records of employment. (denied)
(k) On November 24, 1995, the payor issued a
record of employment to the Appellant showing that the first day of work was November
28, 1994, and the last day of work was November 24, 1995, that the period
of work consisted of 43 insurable weeks and that insurable earnings totalled $6,480.00
for the last 20 weeks. (admitted)
(l) In 1994, the Appellant actually worked
from September 6 to December 31, and for that period had insurable earnings of
$585.00. (denied)
(m) In 1995, the Appellant actually worked from
January 1 to December 31, and for that period had insurable earnings
of $13,248.00. (denied)
(n) On January 27, 1997, the payor issued a
record of employment to the Appellant showing that the first day of work was July 1,
1996, and the last day of work was January 24, 1997, that the period of
work consisted of 30 insurable weeks and that insurable earnings totalled $7,500.00
for the last 20 weeks. (admitted)
(o) In 1996, the Appellant actually worked from
January 1 to December 31, and for that period had insurable earnings
of $10,761.00. (denied)
(p) On July 17, 1998, the payor issued a
record of employment to the Appellant showing that the first day of work was February 18,
1997, and the last day of work was June 26, 1998, that the period of work
consisted of 2,158.25 insurable hours and that insurable earnings totalled $15,647.31.
(admitted)
(q) In 1997, the Appellant actually worked from
January 1 to December 31, and for that period had insurable earnings
of $15,718.00. (denied)
(r) In 1998, the Appellant actually worked
from January 1 to June 26, and for that period had insurable
earnings of $8,305.30. (denied)
[83] The appeal by S.A.M. deals with the same issues as are raised in each
of the other cases under appeal. I will therefore not reproduce the assumptions
of fact on which the Minister relied in the case of S.A.M. None of the last
five Appellants testified.
Analysis
[84] In the nine cases in issue, the issue is not whether there was
insurable employment, but what the insurable earnings, number of weeks and
periods of work were for each of the Appellants.
[85] Each of the Appellants in this second category who testified admitted
working without being paid during his or her periods of unemployment. Some of
them reported the maximum income they were entitled to earn without a reduction
in their benefits on their unemployment cards. However, all of them admitted
that the dates on their records of employment were false. Most of them
considered the services they performed without pay to have been volunteer work.
[86] The position of counsel for the Appellants is that in assessing the
cases, the Minister failed to take into consideration the part-time work a
person is entitled to do while receiving employment insurance benefits. In his
submission, the effect of that anomaly was to diminish the reliability of the
Minister's determination regarding the insurable weeks and periods worked,
since the Minister should have made the necessary distinction in his
calculations. In counsel's opinion, the records of employment are not actually
false. He reiterated that his client had pleaded guilty to the 29 counts,
believing that the issue was the determination of the periods of employment on
the basis of complete weeks, and not the inclusion of the part-time work. He
concluded by saying that his client did not engage in any banking of hours.
[87] In my opinion, the voluminous evidence submitted by the Respondent
clearly shows that the Appellants, and in particular Guy Rousseau and Valère Jalbert,
performed numerous services for S.A.M., on a regular basis and at all times,
during their periods of unemployment, and that this went beyond the hours of part‑time
work for which they were paid. It is difficult to understand how they could
describe this work, whicht they in fact admit having done, as volunteer work,
in the context of an employer-employee relationship where the parties are
dealing with each other at arm's length. In my opinion, there had to be an
incentive somewhere to motivate these employees to continue performing services
for their employer without being paid. There is evidence to suggest that S.A.M.
had a practice of banking hours for certain employees. The minutes of a board
of directors meeting held on February 25, 1992, filed as Exhibit I‑8,
suggest that hours were being banked so that certain employees could stay home
during less busy periods.
[88] A table prepared by Mr. Arguin in the case of the Appellant
Valère Jalbert (Exhibit I‑38) clearly shows that he worked long
hours during certain weeks, and the payroll book shows that he was not paid for
those hours.
[89] These things were not explained. Was the banking of hours the
incentive that persuaded an employee to devote time to his or her employer
without getting paid? It seems logical to me to say that it was, and some
scenario of the sort must have been involved.
[90] The Appellants all admitted working without pay during their periods
of unemployment. They all attempted to minimize the time they spent at work in
those periods. Given the evidence produced by the Respondent, I cannot agree
with their testimony, because in my opinion they did much more than they
suggested. I also cannot disregard the fact that the Appellant S.A.M. admitted
guilt on 29 counts of providing false information on its employees' records of
employment, including those for the Appellants in this case. If we believe Pierre
Tremblay's explanation of the reasons why S.A.M. entered a guilty plea, there
might be grounds for asking to change the plea.
[91] The Appellants have the onus of establishing on
a balance of probabilities that the Minister's determination is incorrect. It
is not sufficient to deny the assumptions of fact on which the Minister relied
in making his determination. Evidence to the contrary must be presented from
which I could conclude that the decision was wrong. In this case, there is
insufficient evidence to tip the balance in the Appellants' favour, and I must
accept the determination made by the Minister. For these reasons, all of the
appeals are dismissed.
Signed at
Ottawa, Canada, this 10th day of February 2004.
Angers
J.
Translation
certified true
on
this 26th day of March 2009.
Brian
McCordick, Translator
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