Date: 19980129
Docket: 97-1212-UI
BETWEEN:
MARIE-CLAUDE BIRON,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Reasons for Judgment
G. TREMBLAY J.T.C.C.
Point at issue
[1] The question is whether during the period from October 26, 1995 to October 26, 1996 the amount received from the Commission de la santé et de la sécurité au travail (hereinafter "the CSST") is insurable earnings.
[2] The appellant worked with the Centre de réadaptation Le Bouclier as an audiologist. She became pregnant and applied for preventive partial withdrawal commencing on March 3, 1996, and this was granted until October 26, 1996. She worked one day a week and was paid $395.96 every two weeks. For the other days, she was paid by the CSST. According to the respondent, the appellant received the non-insurable amount of $10,860 from the CSST. During the last 20 weeks of her employment she also received $6,005 in salary from her employer, and this was accordingly insurable. The appellant maintained that the money received from the CSST totalling $10,860 should be included in insurable earnings in the same way as the $6,005 received from her employer.
Burden of proof
[3] The appellant has the burden of showing that the respondent's assessments are incorrect. This burden of proof results from several judicial decisions, including the judgment of the Supreme Court of Canada in Johnston v. Minister of National Revenue.[1]
[4] In Johnston, the Court held that the facts assumed by the respondent in support of the assessments or reassessments are also assumed to be true until proven otherwise. The facts assumed by the respondent in the instant case are set out in subparagraphs (a) to (k) of paragraph 5 of the Reply to the Notice of Appeal. That paragraph reads as follows:
[TRANSLATION]
5. In making his determination, the respondent Minister of National Revenue relied, inter alia, on the following facts:
(a) The payer operates a rehabilitation clinic in the Joliette region. [admitted]
(b) During the period at issue the appellant worked for the payer as an audiologist. [admitted]
(c) The appellant's employment with the payer was insurable employment. [admitted]
(d) The appellant was pregnant and asked for partial withdrawal (preventive leave) commencing on March 3, 1996. [admitted]
(e) The appellant was on preventive partial withdrawal from March 3 to October 26, 1996. [admitted]
(f) From March 3 to October 26, 1996 the appellant worked one day a week and received pay of $395.96 every two weeks for her day's work. [admitted, except that she took vacation in the summer (two days)]
(g) For the other days a week the appellant was on preventive withdrawal and received compensation directly from the CSST. [admitted]
(h) During the period from July 14 to August 3, 1996 the appellant received nothing from the CSST as the payer paid her the salary for her annual vacation. [admitted]
(i) During the last 20 weeks of the period at issue, from May 12 to October 26, 1996, the appellant received pay from the payer totalling $6,005. [admitted]
(j) Between March 3 and October 26, 1996 the appellant received a total from the CSST of $10,860.39, which was not insurable. [admitted as to the amount of $10,860.39, denied as to the remainder]
(k) The record of employment issued by the payer clearly shows the appellant's total earnings in the last 20 weeks of her employment, namely $6,005. [admitted]
Facts in evidence
[5] In addition to the foregoing admissions the evidence consisted of the appellant's testimony, the testimony of Édith Boucher for the respondent and Exhibits A-1, A-2, I-1 and I-2.
Appellant's testimony
[6] As Exhibit A-1 the appellant filed 25 pages giving a summary of the facts regarding her employment, and in particular the various amounts involved.
There was no issue as to the amounts shown in the Reply to the Notice of Appeal, except that the appellant did not understand how the respondent did not accept the $10,860 paid by the CSST as insurable earnings.
[7] Her opinion was based largely on the fact that officers or persons working for the respondent told her that if the CSST had paid the amount to her employer and the employer had paid it to her, it would have been insurable. According to them, it would then have been regarded as earnings on the employer's T4 form.
[8] Édith Boucher, the witness for the respondent, is an insurability officer. She is the person whose work involves determining whether amounts received from the CSST were insurable income. In arriving at her decision she relied on s. 3(1) of the Unemployment Insurance (Collection of Premiums) Regulations.
[9] In her testimony the appellant also explained that in addition to receiving money from the CSST she had 20 weeks of maternity leave. She received 93 percent of her salary plus the unemployment insurance maternity allowance, $180 a week. In all she received $628 net weekly.
In addition, she was entitled to 10 weeks' parental leave. That leave had to be taken after the child was born and before it was one year old. The appellant said she took five weeks' leave in the summer of 1997. However, she was receiving only $180 a week at the time. If the amounts received from the CSST had been regarded as insurable she would have received $378 a week at that time.
The appellant argued she was entitled to receive an amount for the other five weeks which she had not taken in leave. She maintained that it had taken too long for the respondent's decision to be made, and otherwise she would have taken it during the period allowed.
ACT, CASE LAW, ANALYSIS
[10] The provision of the Unemployment Insurance (Collection of Premiums) Regulations ("the Regulations") that covers the instant case is s. 3(1), which reads as follows:
Earnings from insurable employment
3. (1) For the purposes of this Part, a person's earnings from insurable employment means any remuneration, whether wholly or partly pecuniary, received or enjoyed by him, paid to him by his employer in respect of insurable employment except:
[11] The case law to which the respondent referred is the following:
1. Minister of National Revenue v. Alexander Visan,
[1983] 1 F.C. 820 (F.C.A.);
2. Davy Wong and Minister of National Revenue,
A-612-94 (F.C.), decision dated 20/06/95.
[12] In Alexander Visan the employee had received long-term disability benefits from an insurance company under an insurance plan provided for in his contract of employment. After discussing the applicant's argument, the Court made the following comments:
In testing the validity of this submission, the words "by his employer" ought not to be ignored or severed from the paragraph as urged by counsel for the applicant. Even if it were proper to do so, it is not, in my view, necessary. What is required is to determine the meaning of the word "remunerated" in the context in which it is used in the Regulation. The Shorter Oxford English Dictionary, 3rd edition, defines "remunerate" and "remuneration" as follows:
. . . 1. trans. To repay, requite, make some return for (services, etc.). 2. To reward (a person); to pay (a person) for services rendered or work done . . . Hence Remuneration, reward, recompense, repayment; payment, pay.
From the definition it can be seen, I think, that the character of the payment is determined by its nature. Applying that test to the payments made to the respondent, it is clear that they were not made for services rendered but, in a sense, were the opposite of payments of that kind, viz., to compensate the respondent, in part, for the loss of payments for services which he would have rendered had he not been prevented from doing so by his disability. As was said in The Queen v. The Postmaster General,1 "remuneration . . . means a quid pro quo. If a man gives his services, whatever consideration he gets for giving his services seems to me a remuneration for them." The disability payments made to the respondent in this case, as I view them, cannot be characterized as remuneration within the meaning of the Regulation.
1 (1876), 1 Q.B.D. 658 at p. 663.
[13] The Petit Robert, 1993 edition, defines "rémunération" [remuneration] as follows: [TRANSLATION] 2. Mod. Money received as price of a service, of work. see Compensation, salary.
[14] In Davy Wong the Federal Court of Appeal, after referring to s. 3(1) of the Unemployment Insurance (Collection of Premiums) Regulations and s. 57(2), again commented on this definition of "earnings":
In order for income to be considered earnings pursuant to subsection 57(2), it must "arise out of any employment". The definition of "employment" given in the same provision requires the existence of a contract. Consequently, in order for income from an employer to be earnings, it must be paid in the context of an employment contract. In this case, the payments did not form part of the applicant's employment contract. In our opinion, payments made in error do not "arise" out of employment and they do not constitute remuneration, since they are not paid pursuant to a contract of employment. The payments arrived in the hands of the applicant due to the fact that he was employed, but they were not made as part of his compensation as an employee, as a remuneration for his services under the contract of employment.
[15] The money received from the CSST in the instant case is not money resulting from work done or services rendered. If, instead of sending the money directly to the employee, the CSST had sent it to the employer, that would not have changed the nature of the money paid to "earnings". There was no work done for or service rendered to the employer.
[16] As regards the appellant's claim that she should receive cash for the five weeks which she did not take because of the respondent's delay in making a decision, the Court has no jurisdiction over that. However, in the documents filed by the appellant as Exhibit A-1 there is a letter dated May 7, 1997 from the Chief of the Appeals Division informing the appellant that the insurable earnings were $6,005, and he referred to s. 3(1) of the Unemployment Insurance (Collection of Premiums) Regulations. He also informed the appellant that if she did not agree with this decision she could appeal to the Tax Court of Canada.
The appellant should have concluded that it was safer to take the other five weeks before her child's first birthday on October 27, 1997.
Conclusion
[17] The appeal is dismissed.
Guy Tremblay
J.T.C.C.
Québec, Canada, January 29, 1998.
[OFFICIAL ENGLISH TRANSLATION]
Translation certified true on this 16th day of November 1998.
Kathryn Barnard, Revisor