Employment Insurance (EI)

Reasons and decision

Persons in attendance

Appellant: X. Q.

Introduction

[1] On July 14, 2015, the General Division of the Social Security Tribunal of Canada (Tribunal) determined, among other things, that benefits under the Employment Insurance Act (EI Act) were not payable.

[2] An application for leave to appeal the General Division decision was filed with the Tribunal’s Appeal Division on August 11, 2015, and leave to appeal was granted on May 25, 2016.

[3] The General Division had determined that the claimant (Appellant) voluntarily left her employment without just cause within the meaning of the EI Act and dismissed her appeal regarding a disqualification imposed pursuant to sections 29 and 30 of the EI Act. In addition, the General Division found that the Respondent had correctly imposed a penalty pursuant to section 38 of the EI Act but that it did not properly exercise its discretion regarding the amount of the penalty. The General Division reduced the penalty to $1.

[4] Leave to appeal was granted on the grounds that the General Division may have based its decision on an error of law or an error of mixed fact and law, i.e. paragraphs 58(1)(b) and (c) of the Department of Employment and Social Development Act (DESD Act).

[5] After leave to appeal was granted, the Respondent reviewed the matter and made a concession on the issues of penalty and violation. In submissions filed on May 26, 2016, the Respondent noted “the evidence demonstrates an adequate and credible explanation which shows the false or misleading statement was not knowingly made and concedes the penalty. In light of the concession, the Commission also submits that the notice of violation is no longer maintained and must be conceded as well.”

[6] By letter dated July 4, 2016, the Tribunal requested that the parties consider entering into an agreement consenting on the disposition of the issues of notice of violation and penalty. The Tribunal also requested that the Appellant provide submissions on the issue of voluntary leaving, which was the only outstanding issue on the appeal. The parties did not respond to this request and notice of a hearing was sent to the parties in October 2016.

[7] This appeal proceeded by teleconference for the following reasons:

1. The complexity of the issues under appeal;
2. The information in the file, including the need for additional information; and
3. The requirement under the Social Security Tribunal Regulations to proceed as informally and quickly as circumstances, fairness and natural justice permit.

[8] The Respondent advised in writing prior to the Appeal Division hearing that it would not attend the teleconference hearing.

Issues

[9] Did the General Division base its decision on an error of law or an error of mixed fact and law?

[10] Should the Appeal Division dismiss the appeal, give the decision that the General Division should have given, refer the case back to the General Division for reconsideration or confirm, rescind or vary the decision of the General Division?

The law

[11] According to subsection 58(1) of the DESD Act, the only possible 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.

[12] Leave to appeal was granted on the basis of an error of law or of mixed fact and law as follows (reference to paragraphs from the leave to appeal decision):

[15] Here, the GD found that it was the Applicant’s personal choice to quit. However, it is unclear whether the GD based its decision on its finding that the Applicant took the position that she did not quit. This erroneous finding of fact may have affected the GD’s decision regarding the issues of voluntary leaving, penalty and violation.

[16] On the issue of penalty, the GD found that the penalty was correctly imposed by the Commission but that it did not properly exercise its discretion. These appear to be contradictory findings.

[17] The GD decision referred to the Federal Court of Appeal decision in Mootoo v. Canada (Minister of Human Resources Development), 2003 FCA 206, for the principle that if the trier of fact is of the view that the claimant really did not know that the representation was false, there is no violation of the penalty provisions of the EI Act.

[18] The GD found that the Commission did not properly consider that the Applicant “honestly believes that if she reported wrongly it was due to miscommunication as her English is not perfect”. If the GD accepted the Applicant’s evidence on this point, it is unclear how it could have concluded that the Applicant knew that the representation was false. The GD noted, at paragraph [39] of its decision, that the Applicant “was very forthcoming with her testimony”.

[19] While an applicant is not required to prove the grounds of appeal for the purposes of a leave application, at the very least, an applicant ought to set out some reasons which fall into the enumerated grounds of appeal. Here, the Applicant has identified grounds and reasons for appeal which fall into the enumerated grounds of appeal.

[20] On the ground that there may be an error of law or an error of mixed fact and law, I am satisfied that the appeal has a reasonable chance of success.

[13] The legislative provisions relating to “just cause” for voluntary leaving within the meaning of the EI Act are set out in section 29. Paragraph 29(c) states that “just cause for voluntarily leaving an employment or taking leave from an employment exists if the claimant had no reasonable alternative to leaving or taking leave, having regard to all the circumstances, including any of the following: […]” and subparagraphs (i) to (xiv) set out a list of the circumstances.

[14] It is generally accepted that subparagraphs (i) to (xiv) of paragraph 29(c) are not exhaustive. A claimant need not necessarily fit into one of these categories in order for there to be a finding of “just cause”: Canada (A.G.) v. Lessard, 2002 FCA 469; Canada (A.G.) v. Campeau, 2006 FCA 376.

[15] The wording “if the claimant had no reasonable alternative to leaving” is the crux of the issues on appeal before the Appeal Division.

[16] The powers of the Appeal Division include but are not limited to substituting its own opinion for that of the General Division. Pursuant to subsection 59(1) of the DESD Act, the Appeal Division may dismiss the appeal, give the decision that the General Division should have given, refer the matter back to the General Division for reconsideration in accordance with any directions that the Appeal Division considers appropriate or confirm, rescind or vary the General Division’s decision in whole or in part.

Submissions

[17] The Appellant submitted that she had no reasonable alternative to leaving her employment when she did and that her decision to leave the job at EB Games was a reasonable one. Her arguments can be summarized as follows:

1. She had just cause under subparagraphs 29(c)(i) to (xiv);
2. Her income at EB Games was low, her transportation costs to get to that job were significant, and she could not make a living;
3. She left EB Games to pursue something better;
4. She was told that she would be laid off from EB Games and did not want to have that on her employment record, so she quit before she could be laid off;
5. She did not conceal anything from the Respondent; when she did not have hours, she reported zero hours to the Respondent; and
6. She did not expect the Respondent n to notify her a year later that she was in violation and subject to a penalty.

[18] The Respondent submitted that the Appellant left her employment due to a personal choice and that she had other reasonable alternatives to quitting when she did. More specifically, the Respondent argued:

1. The Appellant could have continued to work while building her graphic design portfolio and looking for work in the field of graphic design;
2. There were no findings of fact in the General Division’s decision that were erroneous; and
3. The Appellant simply repeats the arguments that she raised before the General Division.

[19] The Respondent conceded on the issues of penalty and notice of violation. The notice of violation that was issued pursuant to section 7.1 of the EI Act and the penalty imposed pursuant to section 38 of the EI Act will not be maintained. In essence, the Respondent has conceded that the General Division erred in law or in mixed fact and law on these two issues.

Standard of review

[20] The parties made no submissions on the applicable standard of review.

[21] The Federal Court of Appeal determined, in Canada (A.G.) v. Jewett, 2013 FCA 243, Chaulk v. Canada (A.G.), 2012 FCA 190, and in other cases, that the standard of review for questions of law and jurisdiction in Employment Insurance appeals from the Board of Referees (Board) is that of correctness, while the standard of review for questions of fact and mixed fact and law is reasonableness.

[22] Until recently, the Appeal Division had been considering a decision of the General Division a reviewable decision by the same standards as that of a decision of the Board.

[23] However, in Canada (A.G.) v. Paradis; and Canada (A.G.) v. Jean, 2015 FCA 242, the Federal Court of Appeal indicated that this approach is not appropriate when the Tribunal’s Appeal Division is reviewing appeals of Employment Insurance decisions rendered by the General Division.

[24] The Federal Court of Appeal, in Maunder v. Canada (A.G.), 2015 FCA 274, referred to Jean, supra, and stated that it was unnecessary for the Court to consider the issue of the standard of review to be applied by the Appeal Division to decisions of the General Division. The Maunder case related to a claim for a disability pension under the Canada Pension Plan.

[25] In the matter of Hurtubise v. Canada (A.G.), 2016 FCA 147, the Federal Court of Appeal considered an application for judicial review of a decision rendered by the Appeal Division that had dismissed an appeal from a General Division decision. The Appeal Division had applied the following standard of review: correctness on questions of law and reasonableness on questions of fact and law. The Appeal Division had concluded that the General Division decision was “consistent with the evidence before it and is a reasonable one…” The Appeal Division applied the approach that the Federal Court of Appeal in Jean, supra, suggested was not appropriate, but the Appeal Division decision was rendered before the Jean decision. In Hurtubise, the Federal Court of Appeal did not comment on the standard of review and concluded that it was “unable to find that the Appeal Division decision was unreasonable.”

[26] There appears to be a discrepancy in relation to the approach that the Tribunal’s Appeal Division should take on reviewing appeals of Employment Insurance decisions rendered by the General Division, and in particular, whether the standard of review for questions of law and jurisdiction in Employment Insurance appeals from the General Division differs from the standard of review for questions of fact and mixed fact and law.

[27] I am uncertain how to reconcile this seeming discrepancy. As such, I will consider this appeal by referring to the appeal provisions of the DESD Act without reference to “reasonableness” and “correctness” as they relate to the standard of review.

[28] Consequently, I will consider whether the General Division based its decision on an error of law or an erroneous finding of fact that it made in a perverse or capricious manner or without regard for the material before it.

Analysis

[29] It is common ground that the General Division erred in law or in mixed fact and law as it relates to the issues of notice of violation and penalty.

[30] The appeal hearing focused on the one outstanding issue: voluntary leaving. This is the only issue discussed in detail below.

[31] In the General Division’s summary of the Appellant’s submissions, at paragraph 25 of that decision, the Appellant’s position is stated as “[s]he did not quit EB Games.” The Appellant reiterated before me that this was not her position. She stated that she did quit and did not try to argue the contrary.

[32] There is no dispute on the following:

1. The Appellant quit her job at EB Games, she was not laid off, and she left voluntarily;
2. The Appellant believed that she could not making a living on the income from her job at EB Games; and
3. She quit in order to pursue something she believed would be better for her future.

[33] Paragraphs [23] , [25] and [27] of the General Division decision state:

An indefinite disqualification may be applied when a claimant voluntarily leaves her employment without just cause. The test to be applied, having regard to all the circumstances, is whether the claimant had a reasonable alternative to leaving her employment when she did.

…

The submission of the Commission was that the claimant did not have just cause for leaving her employment on January 23, 2013 because she failed to exhaust all reasonable alternatives prior to leaving. The claimant failed to prove that she left her employment with just cause within the meaning of the Act.

The claimant could have continued working for EB Games while she worked on her project or sought alternative work. It was her personal choice to quit EB Games. The Member finds that the claimant failed to prove that she left her employment with just cause within the meaning of the Act.

[34] In essence, the General Division found that there were reasonable alternatives to the Appellant leaving her employment when she did (remaining in that position while she worked on her project or sought alternative work). Therefore, the Appellant did have a reasonable alternative to leaving her employment. This conclusion was not an erroneous finding of fact.

[35] The General Division is the trier of fact, and its role includes the weighing of evidence and making findings based on its consideration of that evidence. The Appeal Division is not the trier of fact.

[36] It is not my role, as a member of the Tribunal’s Appeal Division on this appeal, to review and evaluate the evidence that was before the General Division with a view to replacing the General Division’s findings of fact with my own.  It is my role to determine whether a reviewable error set out in subsection 58(1) of the DESD Act has been made by the General Division and, if so, to provide a remedy for that error. In the absence of such a reviewable error, the law does not permit the Appeal Division to intervene. It is not the Appeal Division’s role to re-hear the case.

[37] Having determined that the findings of fact asserted by the Appellant to be reviewable errors were not “erroneous findings of fact which the General Division made in a perverse or capricious manner or without regard for the material before it, in coming to its decision,” I find that the Appellant’s appeal to the Appeal Division cannot succeed under paragraph 58(1)(c) of the DESD Act. In addition, the General Division did not err in law in making its decision and, therefore, the appeal cannot succeed under paragraph 58(1)(b) of the DESD Act.

Conclusion

[38] The notice of violation and penalty are no longer maintained by the Respondent. Therefore, the appeal is allowed in respect of these two issues.

[39] The appeal is dismissed on the issue of voluntary leaving.