Date: 19991210
Docket: 98-555-UI; 98-774-UI; 98-556-UI
BETWEEN:
LAUNA KYDD-LAROCHELLE,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
AND
BETWEEN:
CAREY HAMEL-SCROCHENSKI, LAURIE HALIWYZ-WAY,
Appellants,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
O'Connor, J.T.C.C.
[1] These appeals were heard on common evidence on November 3, 1999 at Regina, Saskatchewan.
Issue
[2] The issue is whether the Appellants, members, as Speech Language Pathologists, of the support staff employed by the Board of Education of the Regina School Division No. 4 of Saskatchewan ("School Board"), were employed under contracts of service with the School Board during the summer break in 1997 with the result that they would be entitled to employment insurance benefits with respect to the summer break period.
Facts
[3] The Appellants are members (Speech Language Pathologists) of the support staff employed by the School Board.
[4] The School Board did not generally provide work during the months of July and August for the Appellants.
[5] The school year for schools operated by the School Board is usually from the end of August to the end of June ("Normal School Year").
[6] The Appellants have been working for the School Board for the Normal School Year since August 28, 1995 for Ms. Larochelle and September, 1991 for the other two Appellants.
[7] The Appellants did not provide any services to the School Board during the summer break.
[8] The basic terms and conditions of the Appellants' contracts of employment ("Contracts") were set forth in a standard printed schedule (Exhibit A-3), annexed to the letters of the School Board offering employment to the Appellants (Exhibit A-2).
[9] The letters offering employment provide essentially as follows:
We hereby offer you the position of Speech/Language Pathologist with the Board of Education of the Regina School Division No. 4 of Saskatchewan, on a fulltime basis, effective August 28, 1995, under the following conditions of employment:
1) You will be placed in the appropriate increment level for the Master's Degree, as set out in the enclosed salary schedule. This salary will be paid in ten equal monthly instalments (July and August are excepted). In addition, you will be entitled to receive a monthly car allowance applicable to the percent of time employed.
2) We are enclosing a schedule of school days for the 1995-96 year for your reference.
3) The office hours of work will be as arranged with Mrs. Cathy Arthur-MacDonald, Program Consultant, Speech and Hearing.
4) The parties agree that this agreement may be terminated by either party at any time with 30 days notice in writing to the other party.
The Speech/Language Pathologist' Salary Schedule outlines the conditions of employment further as well as the various benefits you are entitled to as an employee with our Board.
[10] The Salary Schedule contains the following provisions:
SPEECH LANGUAGE PATHOLOGIST SALARY SCHEDULE
|
Annual Salary Effective August 25, 1996 |
|||||||||
|
Years of Experience |
0 |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
|
Bachelor Degree |
Various amounts are provided |
||||||||
|
Master Degree |
Various amounts are provided |
||||||||
|
Annual Salary Effective following December 31, 1996 |
|||||||||
|
Years of Experience |
0 |
1 |
2 |
3 |
4 |
5 |
6 |
7 |
8 |
|
Bachelor Degree |
Various amounts are provided |
||||||||
|
Master Degree |
Various amounts are provided |
||||||||
2. Employment is subject to a one-year probationary period.
3. Incremental credit shall be granted on the first of the month following completion of the equivalent of one year of full service with pay. Ten months of full-time service with this Board shall constitute a year for incremental purposes. Part-time employees shall have their days of service prorated.
4. Salary is payable in ten equal monthly installments (July and August excepted) at the end of each month of employment. The annual salary rates quoted shall include the payment of all holiday pay.
...
6. Days of work shall coincide with the teaching days of each school year, including institute days. Any annual holidays as may be provided under The Labour Standards Act shall be taken during the periods of school closure at the Christmas, Spring, and Summer vacation times as provided by The Education Act.
...
8. Sick Leave: Annual Sick Leave Allowance shall be 20 days. The annual unused portion can be accumulated to a total of 180 days, exclusive of the current year's 20 days. The entitlement is prorated for part-time employees.
...
15. Employees are requested to give at least four (4) weeks written notice in the event of terminating their contracts of employment with the Board. Termination by the Board will be in accordance with provisions of The Labour Standards Act.
16. Employees may be requested to work additional days. For each additional day worked, the employee shall be paid in accordance with the daily rate determined on the basis that each additional day's wage shall be 1/200th of the annual salary payable.
17. Term of Agreement: This Agreement shall be in force and effect on and from January 1, 1995 up to and including December 31, 1996, and shall continue to apply until revised or terminated. Either party may, not less than thirty days nor more than ninety days before the expiry date hereof, give notice in writing to the other party to terminate this Agreement or negotiate a revision thereof.
[11] The Appellants also produced Exhibit A-1 which reads as follows:
Regina Public Schools
1600 4th Avenue
Regina
S4R 8C8
May 26, 1997
MEMO TO: Non-Teaching 10 Monthly Paid Permanent Employees
FROM: Christine Montgomery, Supervisor of Payroll
RE: Record of Employment at School Year End
______________________________________________________
We have recently been advised by Human Resources Development Canada (HRDC) that our non-teaching employees who have a continuing contract, are paid in ten monthly installments, are required to work the teaching days in each school year and who are entitled to continued benefit coverage during the summer months while not working, should be issued a Record of Employment at the end of each school year.
Therefore, we shall be preparing and issuing a Record of Employment to you at the end of this school year. This does not mean that your contract has been terminated. The Record of Employment is being issued to you, because there is considered to be an interruption of earnings from school year end until your return to work at the beginning of the 1997/98 school year.
Questions regarding your eligibility for Employment Insurance benefits during this period should be directed to the local HRDC office.
[12] The School Board did not notify the Appellant that her employment with it had been terminated as of June 28, 1997 nor was she laid off but it issued the Record of Employment (Exhibit A-1).
[13] The Appellant did not notify the School Board that she was terminating her employment with it as of June 28, 1997.
[14] The School Board advised the Appellant that the Normal School Year would commence on August 26, 1997 and the Appellant commenced performing services for the School Board on and after that date.
[15] The Appellant did not have to apply to the School Board for a job for the Normal School Year beginning August 26, 1997.
Submissions
[16] The Appellants point to the Exhibits and argue that they were not employed during the summer break since they did not work and received no pay during that period.
[17] Counsel for the Respondent submits the Appellants' contracts of employment were on an annual basis, even though they did not work and received no pay during the summer period.
Analysis and Decision
[18] The Federal Court of Appeal in Re Petts et al. and The Umpire Under Section 92 of The Unemployment Insurance Act, [1974] 2 F.C. 225 held that section 158 of the Regulations, dealing with teachers and the summer period, was not a valid exercise of the powers conferred by section 58(h) of the Act, the section authorizing the enactment of Regulations.
[19] At p. 234, Jackett, C.J. stated:
Any regret that I might otherwise have had because I have reached that conclusion is eliminated by the fact that I have not been able to conceive of any problem in connection with the non-teaching period of teachers that is not adequately dealt with by s. 2(1)(n) [the section defining "interruption of earnings"] and s. 21(2) [the section dealing with when a period off is not a period of unemployment]. Whether a teacher receives one-twelfth of his annual salary at the end of each month of the year, one-tenth at the end of each of 10 months of the year, or, as in Alberta, one-twelfth at the end of each of nine months and three-twelfths at the end of a 10th month, if his contract of service continues throughout the year, there has been no "lay-off" or "separation form ... employment" giving rise to an "... interruption ... in ... earnings" and he is receiving his "usual remuneration"; and I do not, therefore, conceive of the circumstances in which s. 158, or some similar provision, is necessary to avoid payment of unemployment benefits to teachers who are not out of work in the ordinary acceptation of that expression.
[20] Petts is cited with approval in the Supreme Court of Canada decision in Dick et al. v. Deputy Attorney General of Canada, [1980] 2 S.C.R. 243.
[21] Further, in Attorney General of Canada v. Lori Fox (1989) 103 N.R. 315 the Federal Court of Appeal stated as follows:
From the definition of "employment" in s. 2 of the Unemployment Insurance Act ... as elaborated on in s. 57(1) of the Regulations ..., the relationship of employer and employee and the existence of employment are not dependent on the actual performance of services under the contract of employment. It is sufficient that a contact of employment exists, which is the situation in this case.
In CUB 16774 In the matter of a Claim by Singh, David Reed J., acting as an Umpire stated:
The claimant in this case was not remunerated on a weekly or other periodic basis. The contract was for a year. The salary paid was expressed to be an annual salary. Whether during the football season or outside of it there would be weeks during which the claimant would not receive any money because the times at which his salary instalments were paid to him depended upon the football schedule and not on other timing considerations. Thus "his usual remuneration" was paid by reference to a system under which there would be weeks during which he received no salary instalment because no games were played that week. The payment schedule contemplated this type of irregularity. Therefore, I do not think the claimant has proven that he suffered an interruption of earnings. The weeks during which he received no salary instalment were part of the planned procedure pursuant to which he received "his usual remuneration".
[22] The Contracts were to be effective as of January 1, 1995 and remain in force and effect up to and including December 31, 1996 and from year to year thereafter.
[23] The most relevant provisions of the Employment Insurance Act and the Regulations are:
2.(1) In this Act,
...
"employment" means the act of employing or the state of being employed;
...
"interruption of earnings" means an interruption that occurs in the earnings of an insured person at any time and in any circumstances determined by the regulations;
5(1) Subject to subsection (2), insurable employment is
(a) employment in Canada by one or more employers, under any express or implied contract of service or apprenticeship, written or oral, whether the earnings of the employed person are received from the employer or some other person and whether the earnings are calculated by time or by the piece, or partly by time and partly by the piece, or otherwise;
...
7(1) Unemployment benefits are payable as provided in this Part to an insured person who qualifies to receive them.
7(2) An insured person, other than a new entrant or a re-entrant to the labour force, qualifies if the person
(a) has had an interruption of earnings from employment;
(b) has had during their qualifying period at least the number of hours of insurable employment set out in the following table in relation to the regional rate of employment that applies to the person.
...
11(1) A week of unemployment for a claimant is a week in which the claimant does not work a full working week.
11(2) A week during which a claimant's contract of service continues and in respect of which the claimant receives or will receive their usual remuneration for a full working week is not a week of unemployment, even though the claimant may be excused from performing their normal duties or does not have any duties to perform at that time.
11(3) A week or part of a week during a period of leave from employment is not a week of unemployment if the employee
(a) takes the period of leave under an agreement with their employer;
(b) continues to be an employee of the employer during the period; and
(c) receives remuneration that was set aside during a period of work, regardless of when it is paid.
...
Regulations
14.(1) Subject to subsections (2) to (7), an interruption of earnings occurs where, following a period of employment with an employer, an insured person is laid off or separated from that employment and has a period of seven or more consecutive days during which no work is performed for that employer and in respect of which no earnings that arise from that employment, other than earnings described in subsection 36(13), are payable or allocated.
...
(4) Where an insured person is employed under a contract of employment under which the usual remuneration is payable in respect of a period greater than a week, no interruption of earnings occurs during that period, regardless of the amount of work performed in the period and regardless of the time at which or the manner in which the remuneration is paid.
...
(6) A period of leave referred to in subsection 11(3) of the Act does not constitute an interruption of earnings, regardless of the time at which or the manner in which remuneration is paid.
...
36.(8) Where a vacation pay is paid or payable to a claimant for a reason other than a lay-off or separation from an employment, it shall be allocated as follows:
(a) where the vacation pay is paid or payable for a specific vacation period or periods, it shall be allocated
(i) to a number of weeks that begins with the first week and ends not later than the last week of the vacation period or periods, and
(ii) in such a manner that the total earnings of the claimant from that employment are, in each consecutive week, equal to the claimant's normal weekly earnings from that employment; and
(b) in any other case, the vacation pay shall, when paid, be allocated
(i) to a number of weeks that begins with the first week for which it is payable, and
(ii) in such a manner that, for each week except the last, the amount allocated under this subsection is equal to the claimant's normal weekly earnings from that employment.
[24] The most relevant provisions of the Contracts are cited above.
[25] With respect to vacations, section 166 of The Education Act, 1995 being Ch. E-0.2 of the Statutes of Saskatchewan, 1995, as amended, provides as follows:
166(1) The following vacation periods are to be observed:
(a) a Christmas vacation, which is to commence not later than December 23 and end not earlier than January 2, both days inclusive;
(b) a spring vacation, which is to be the five days following Easter Sunday;
(c) a summer vacation that is at least six consecutive weeks from the last school day in one school year to the first school day in the following school year and that ends no earlier than the first Monday in August.
[26] The Appellants were under contracts of service covering the period from January 1, 1995 to at least December 31, 1997. Although not receiving pay, they remained entitled during the summer break to the various benefits provided under the Contracts. The summer break is a vacation period. The Appellants were clearly not laid-off and clearly did not terminate their own employment. Their Contracts continued during the summer break notwithstanding that no services were rendered nor income received during that break. Also, it is clear from the Contracts that the Appellants were paid on an annual (12 month) basis notwithstanding that the instalments were paid during the 10 months of the Normal School Year.
[27] The School Board indicated in Exhibit A-1 that it would issue a Record of Employment and implies that employment benefits may be available in respect of the summer period. However, that document is not decisive of the issue. Moreover, it specifically states that the Record of Employment does not mean the contract has been terminated.
[28] The cases related to teachers may not be totally determinative because there is a Regulation (s. 33) specifically applicable to teachers. However, the reasons for the decisions in the teachers' cases and in Singh would appear to support the Respondent's position. Moreover, in Petts the Federal Court of Appeal held the then Regulation on teachers to be invalid and based its decision on the provisions of the Act.
[29] Also section 166 of The Education Act makes it clear that the summer break is a vacation period, i.e., not a lay-off period. In other words, there was no interruption of earnings as contemplated by section 2(1) of the Act and section 14 of the Regulations.
[30] For all of the foregoing reasons the appeals are dismissed and the determinations of the Minister are confirmed.
Signed at Ottawa, Canada this 10th day of December 1999.
"T.P. O'Connor"
J.T.C.C.