Employment Insurance (EI)

Reasons and decision

Decision

[1] The Tribunal grants leave to appeal to the Appeal Division of the Social Security Tribunal.

Introduction

[2] On September 24, 2016, the General Division of the Tribunal determined that pursuant to section 35 of the Employment Insurance Regulations (Regulations), the amount received by the Respondent did not constitute earnings and did not need to be allocated.

[3] The Applicant requested leave to appeal to the Appeal Division on October 11, 2016.

Issue

[4] The Tribunal must decide if the appeal has a reasonable chance of success.

The law

[5] According to subsections 56(1) and 58(3) of the Department of Employment and Social Development Act (DESD Act), “an appeal to the Appeal Division may only be brought if leave to appeal is granted” and “the Appeal Division must either grant or refuse leave to appeal”.

[6] Subsection 58(2) of the DESD Act provides that “leave to appeal is refused if the Appeal Division is satisfied that the appeal has no reasonable chance of success”.

Analysis

[7] Subsection 58(1) of the DESD Act states that the only grounds of appeal are the following:

1. (a) The General Division failed to observe a principle of natural justice or otherwise acted beyond or refused to exercise its jurisdiction;
2. (b) The General Division erred in law in making its decision, whether or not the error appears on the face of the record; or
3. (c) The General Division based its decision on an erroneous finding of fact that it made in a perverse or capricious manner or without regard for the material before it.

[8] In regards to the application for permission to appeal, the Tribunal needs to be satisfied that the reasons for appeal fall within any of the above grounds of appeal and that at least one of the reasons has a reasonable chance of success, before leave can be granted.

[9] The Applicant, in support of the application for leave to appeal, submits the following:

• Money which is paid for the relinquishment of reinstatement rights is not considered earnings for EI purposes and not allocated. Three conditions must exist, namely the right to reinstatement must exist, reinstatement must be sought and money must be paid to compensate for the relinquishment of that right - Canada (AG) v. Warren, 2012 FCA 74;
• The evidence before the General Division does not show the right to reinstatement existed or that the Respondent was paid money to relinquish that right. The evidence shows that the Respondent accepted the settlement money rather than pursue his grievance of wrongful dismissal. The money was paid with conditions that the reason for separation would be changed, reference would be provided, both parties would refrain from ‘disparaging’ comments and the employer would be free from any future claims.
• The General Division erred in allowing the Respondent’s appeal on the basis that there was a right to reinstatement and that the money was paid for relinquishing his right ‘to seek’ reinstatement.

[10] After reviewing the docket of appeal, the decision of the General Division and considering the arguments of the Applicant in support of the request for leave to appeal, the Tribunal finds that the appeal has a reasonable chance of success. The Applicant has raised grounds of appeal regarding the interpretation and application of sections 35 and 36 of the Regulations by the General Division that could possibly lead to the reversal of the disputed decision.

Conclusion

[11] The Tribunal grants leave to appeal to the Appeal Division of the Social Security Tribunal.