2 November 2004 External T.I. 2004-0100861E5 - Determination of Insurable Earnings

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.

Principal Issues: Follow-up question to file 2004-008188 regarding insurability of a taxable benefit, arising to an employee from meals provided free of charge by a restaurant employer, for purposes of Employment Insurance.

Position: Final determination remains to be made by the CPP/EI Eligibility Division of the Revenue Collections Branch at the relevant Tax Services Office, however, the ordinary meaning of the word "board" would appear to connotate something more than the provision of a meal to an employee by a restaurant employer during the employee's work shift.

Reasons: The CPP/EI Eligibility Division is the area authorized to make such determinations in accordance with section 90 of the Employment Insurance Act. General consideration of the ordinary meaning of the word "board" in the absence of an express definition thereof in the relevant regulations and legislation.

2004-010086
XXXXXXXXXX A.A. Cameron
(613) 347-1361
November 2, 2004

Dear XXXXXXXXXX:

We are writing further to our recent telephone conversation (Cameron/XXXXXXXXXX) in which you asked for our written views as to the "legal basis" for certain comments made in our letter to you of October 21, 2004 (our file 2004-008188). In particular, our comment that, while the authority to make a final determination rested with the CPP/EI Eligibility Division of the Revenue Collection Branch at the relevant Tax Services Office, it was our understanding that the provision of meals free of charge by a restaurant to an employee thereof during their work shift would generally not be considered to constitute "board" for purposes of the Insurable Earnings and Collection of Premium Regulations (the "EI Regulations") to the Employment Insurance Act (the "EI Act").

Our Comments

Under paragraph 2(3)(a) to the EI Regulations, the "earnings" that an insured person has from insurable employment does not include:

...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...

The word "board" as used in the above provision is not defined in either the EI Regulations or the EI Act. In addition, to our knowledge existing jurisprudence has not specifically addressed the meaning to be assigned that word in this context. In the absence of an express definition of a term used in a particular legislative context, the courts generally look to what has been referred to as the "ordinary meaning" of the word in question but having regard to the legislative context in which the term is found.

Dictionaries are often consulted as a method to determine this ordinary meaning. The word "board" has been defined, in part, in various dictionaries as follows:

"Daily meals furnished to a guest at an inn, boardinghouse, or other lodging"

Black's Law Dictionary, 8th edition

"the provision of regular meals, usu. with accommodation, for payment"

				Concise Oxford Dictionary, 9th Edition and
				The Canadian Oxford Dictionary

"daily meals esp. when furnished for pay"

				Merriam-Webster's Collegiate Dictionary, Tenth Edition

In our view, the above definitions suggest that the word "board" would generally connotate something more than the provision of a meal by a restaurant to an employee thereof during their work shift (which, as noted in our earlier letter, we understand would generally be considered analogous to a subsidized meal provided by an employer in an employee dining room or cafeteria). In any case, as with the comments provided in our earlier letter, these are general comments only with the authority to make a final determination resting with the CPP/EI Eligibility Division of the Revenue Collection Branch at the Vancouver Island Tax Services Office to whom any further queries regarding your specific situation should be directed.

These comments are provided in accordance with the practice described in paragraph 22 of Information Circular 70-6R5, dated May 17, 2002.

We trust that these comments will be of assistance.

for Director
Reorganizations and Resources Division
Income Tax Rulings Directorate
Policy and Planning Branch