Employment Insurance (EI)

Decision

[1] The appeal is allowed. The Claimant elected to receive extended parental benefits and the election was irrevocable.

Overview

[2] The Respondent, M. L. (Claimant), applied for and received Employment Insurance (EI) maternity benefits followed by parental benefits. She selected extended parental benefits on her application for benefits, which pays a lower rate of benefits over a longer period of time.

[3] The Claimant applied for benefits in October 2021 and indicated on the application form that she wanted to receive 52 weeks of parental benefits. The Claimant received her first payment of parental benefits around February 8, 2022. That day, she contacted the Appellant, the Canada Employment Insurance Commission (Commission) to ask why the payment was lower. She was told she was receiving extended parental benefits.

[4] The Claimant asked to switch to the standard benefit option. She had only planned to take one year off from work. The Commission refused the Claimant’s request. It said that it was too late to change after parental benefits had been paid. The Claimant requested a reconsideration and the Commission maintained its decision.

[5] The Claimant successfully appealed to the General Division of the Tribunal. The General Division decided that the Claimant made a mistake when she choose extended parental benefits on the application. It found that she meant to choose standard parental benefits and that she wanted one year of maternity and parental benefits combined. Because this is what she intended, the General Division found that she elected standard parental benefits.

[6] The Commission is now appealing the General Division decision to the Tribunal’s Appeal Division. It argues that the General Division exceeded its jurisdiction, made errors of law and based its decision on an erroneous finding of fact in allowing the appeal.

[7] I have decided that the General Division erred in law. I have also decided to give the decision that the General Division should have given, which is that the Claimant elected to receive extended parental benefits and that this election was irrevocable.

Issues

[8] I have focused on the following issues:

1. a) Did the General Division err in law by failing to follow binding case law?
2. b) If so, what is the best way to fix the General Division’s error?

Analysis

[9] I can intervene in this case only if the General Division made a relevant error. So, I have to consider whether the General Division:^{Footnote 1}

• failed to provide a fair process;
• failed to decide an issue that it should have decided, or decided an issue that it should not have decided;
• misinterpreted or misapplied the law; or
• based its decision on an important mistake about the facts of the case.

Background

[10] There are two types of parental benefits:

• Standard parental benefits – the benefit rate is 55% of an applicant’s weekly insurable earnings up to a maximum amount. Up to 35 weeks of benefits is payable to one parent.
• Extended parental benefits - the benefit rate is 33% of an applicant’s weekly insurable earnings up to a maximum amount. Up to 61 weeks of benefits is payable to one parent.

[11] The Claimant made an application for maternity and parental benefits effective October 17, 2021.^{Footnote 2}

[12] The Claimant indicated that she wanted to receive parental benefits immediately after maternity benefits. She chose the option for extended parental benefits. The Claimant was asked how many weeks of benefits she wished to receive and she chose 52 weeks from the drop down menu.^{Footnote 3}

[13] The Claimant’s first payment of extended parental benefits was issued on February 4, 2022.^{Footnote 4} The Claimant received the payment in her account on February 8th and contacted the Commission that day to request to change to standard parental benefits.^{Footnote 5} 

[14] The Commission refused the Claimant’s request. The Commission said that it was too late for the Claimant to change options because she had already received parental benefits. The Claimant made a request for reconsideration but the Commission maintained its decision.

The General Division decision

[15] The General Division allowed the Claimant’s appeal. It found that the Claimant made a mistake when she chose extended parental benefits on her application form and intended to choose the standard parental benefit.^{Footnote 6}

[16] The General Division found that the Claimant chose the extended option on her application form but there was evidence that conflicted with this choice.^{Footnote 7} It accepted the Claimant’s testimony that she intended to take one year off from work and chose the extended option believing she was selecting 52 weeks of parental and maternity benefits combined.^{Footnote 8}

[17] The General Division found that the Claimant’s intention to choose standard benefits was supported by the fact that she contacted the Commission as soon as she received her first payment of extended benefits.^{Footnote 9} The General Division accepted that the Claimant planned to take one year of leave from her job. She provided a letter from her employer, which supports that she intended to take a one-year leave.^{Footnote 10}

[18] The General Division found that it must consider all relevant evidence when determining which option the Claimant chose on her application for benefits.^{Footnote 11} The General Division found that the Claimant intended to choose standard parental benefits.^{Footnote 12}

[19] The General Division found that the Claimant chose extended benefits on her application form but this was the only evidence that suggested she intended to chose extended benefits.^{Footnote 13} It found that this evidence was outweighed by the evidence that supported her intention to take one year of maternity and parental benefits combined.^{Footnote 14}

[20] Based on all of the evidence, the General Division found that the Claimant intended to choose standard benefits. Because this was her intention, it found that the Claimant actually elected to receive standard parental benefits.^{Footnote 15}

The Commission’s appeal to the Appeal Division

[21] The Commission argues that the General Division made several errors in its decision. It makes the following arguments:

• The General Division erred in law by effectively changing the Claimant’s election from extended to standard after benefits had been paid to her;
• The General Division exceeded its jurisdiction by determining what option the Claimant elected;
• The General Division erred in law by failing to hold the Claimant to her obligation to know her rights and entitlements; and
• The General Division erred in law by failing to follow relevant case law from the Federal Court.

The General Division erred in law by failing to follow binding case law

[22] In its decision, the General Division considered the Federal Court decision of Karval v Canada (Attorney General) (Karval).^{Footnote 16} The General Division found that there were significant factual differences between the facts in that decision and the Claimant’s circumstances.^{Footnote 17} However, it did not refer to or apply the Federal Court’s findings regarding the clear references to benefit rate and irrevocability of an election on the application form.

[23] The Commission argues that this is an error of law. The Claimant argues that the General Division considered the Karval decision and correctly distinguished it on the facts. The Claimant highlights that the evidence is that case did not suggest a clear intention by the claimant to choose standard benefits. In her case, the Claimant’s evidence overwhelming demonstrates that she always planned to take a one-year leave from work. 

[24] The Claimant also points to the fact that she contacted the Commission on the same day that the payment was received. In Karval, the claimant waited many months to contact the Commission. The Claimant argues that the Karval decision was considered and distinguished by the General Division and there was no error of law.

[25] In the Karval decision, the Federal Court found that it is the responsibility of claimants to carefully read and try to understand their entitlement options. If they are unclear, they should ask the Commission. It found that the questions on the application form are not objectively confusing and the explanations on the form are not lacking in information.^{Footnote 18}

[26] The Federal Court in Karval stated that the different benefit rates (55% of weekly earnings for standard and 33% for extended) and the irrevocability of the election are both clearly stated on the application form.^{Footnote 19}

[27] The Karval decision is binding jurisprudence. This means that the General Division was required to consider it. If the General Division chose not to follow the principles in Karval, it needed to explain why.^{Footnote 20} 

[28] The General Division explained that the facts in Karval were different because the claimant in that case asked for 61 weeks of extended benefits and only asked to switch to standard after 6 months of receiving parental benefits. The claimant in that case did not have evidence to support that it was always her intention to take a one-year leave from work.

[29] The General Division referred to the comments in Karval that it is fundamentally the responsibility of a claimant to carefully read and try to understand their entitlement options. I also stated that the decision says claimants who are unclear about their entitlements should contact the Commission.^{Footnote 21}

[30] The General Division referenced these comments from Karval but then found that the Claimant’s circumstances were different. It found that the Claimant chose 52 weeks of extended benefits because she was confused by the questions on the application form.^{Footnote 22} It did not explain why it was not following the guidance from the Federal Court, which states that claimants who are confused should contact the Commission.

[31] The Karval decision states that a claimant who carefully reads the application form would see that the benefit rate for extended benefits will be reduced to 33% of weekly earnings. The claimant would also read that their choice is irrevocable once benefits have been paid.^{Footnote 23}

[32] In a recent decision from the Federal Court of Appeal in Canada (Attorney General) v Hull (Hull), the Court found that the principles in Karval applied despite factual differences.  In that case, the claimant also requested 52 weeks of extended parental benefits, wanting one year of maternity and parental benefits combined. The Court confirmed the principle from Karval that “there is no legal remedy available to claimants who base their election on a misunderstanding of the parental benefit scheme.”^{Footnote 24}

[33] The General Division found that the Claimant mistakenly selected extended benefits wanting to claim 52 weeks of combined pregnancy and parental benefits. The General Division erred in law by failing to follow the binding Federal Court decision in Karval when making this determination.

[34] As I have found that the General Division erred, I do not have to address the balance of the Commission’s arguments.

I will fix the General Division’s error by giving the decision it should have given

[35] At the hearing before me, both parties argued that, if the General Division made an error, then I should give the decision the General Division should have given.^{Footnote 25}

[36] I agree. I find that this is an appropriate case in which to substitute my own decision. The facts are not in dispute and the evidentiary record is sufficient to enable me to make a decision.

The Claimant elected to receive extended parental benefits and the election was irrevocable

[37] The Appeal Division and the General Division have issued a number of decisions concerning the election of standard or extended parental benefits. In many of these decisions, the Tribunal has considered which type of benefits the Claimant actually elected. Where there is conflicting information on the application form, the Tribunal has determined which election the Claimant is more likely to have chosen. In other cases, the Tribunal has considered the Claimant’s intention in making the election.

[38] The recent decision of the Federal Court of Appeal in Hull, considered the proper interpretation of sections 23(1.1) and 23(1.2) of the EI Act. Section 23(1.1) is the section that says a claimant must elect standard or extended benefits when they make a claim for parental benefits. Section 23(1.2) says that the election is irrevocable once benefits are paid.

[39] In Hull, the claimant had selected the option of extended parental benefits on her application form and requested 52 weeks of parental benefits, following maternity benefits. The claimant received extended parental benefits for several months before realizing her mistake. She had been confused by the application form and had intended to receive one year of maternity and parental benefits combined. The General Division found, on a balance of probabilities, that she had elected to receive standard parental benefits.

[40] The Court in Hull stated:

The question of law for the purpose of subsection 23(1.1) of the EI Act is: does the word “elect” mean what a claimant indicates as their choice of parental benefit on the application form or does it mean what the claimant “intended” to choose?^{Footnote 26}

[41] The Court found that a claimant’s election is what they choose on their application form, and not what they may have intended.^{Footnote 27} It also found that once payment of parental benefits has started the election cannot be revoked, by the claimant, the Commission, or the Tribunal.^{Footnote 28}

[42] Applying the Court’s decision in Hull to the Claimant’s circumstances, it is clear that she elected to receive extended parental benefits. This was the option chosen on the application form. She chose to receive extended parental benefits for 52 weeks. Once the payment of those benefits began, the election was irrevocable.

[43] The Claimant argues that there is overwhelming evidence that her intention was to choose a total of one year of benefits. Her ROE is clear that she is taking a one-year leave of absence and this was confirmed in a letter from her employer. She chose 52 weeks of benefits from the drop down menu on the application form because this aligned with the total number of weeks of leave she planned to take.

[44] The Claimant argues that the application form is not clear, otherwise there would not be so many appeals on this issue. She says that the election of extended benefits was a mistake. Unlike in Karval, she always planned to take a one-year leave. She contacted the Commission the same day that she received the deposit in her account of the extended parental benefits, which distinguishes her circumstances from those in Hull and Karval.

[45] The Claimant argues that she has been prejudiced. She will have received far fewer benefits than she is entitled to when she returns to work in October 2022.

[46] The Claimant also referred to the purpose of the legislation as discussed by the Federal Court of Appeal in Hull. She says that no one will be prejudiced by allowing her to receive standard parental benefits as this was what always intended by both her and her employer.

[47] The Claimant argues that the application form is not clear and does not state that the election is irrevocable, only that it cannot be changed once benefits are paid. She says that a layperson should not have to read complicated legislation to understand their entitlements. She argues that it is contrary to the purpose of the legislation to find that she cannot make a change to election because she received one payment.

[48] It is clear that the Claimant did not intend to ask for 52 weeks of extended parental benefits after 15 weeks of maternity benefits. I agree with the General Division and the Claimant that the evidence suggests that it was always her intention to take a one-year leave from work. Unfortunately, the Federal Court of Appeal in Hull has made it clear that the box chosen on the application form, and the number of weeks, are the election regardless of what a claimant may have intended.

[49] I have considered whether the evidence that the Claimant provided from her employer, confirming that she plans to return to work after on year, has any impact on her election. This letter and her testimony supports that she wanted one year of maternity and parental benefits combined. It also conflicts with the choice to receive 52 weeks of extended benefits after maternity benefits for a total of 67 weeks.

[50] In Hull, the Court stated that there is only one reasonable interpretation of section 23(1.1) of the EI Act.^{Footnote 29} It found that the choice of standard or extended on the application form, along with the number of weeks a claimant wants to claim, is the election. It found that this is the evidence of the election a claimant makes and the Commission is not involved in determining whether a claimant has selected the right option.^{Footnote 30}

[51] The Court in Hull stated that the election is the choice that the Claimant makes on their application, for standard or extended parental benefits. I understand that the Claimant’s planned return to work date contradicts this choice. However, the legislation requires that a choice between standard and extended benefits be made when applying for benefits and the Federal Court of Appeal has stated that this is the Claimant’s election even if it is not what she intended.^{Footnote 31}

[52] Parliament chose not to include any exceptions to the irrevocability of the election. It is unfortunate for the Claimant that a simple mistake on an application form can have significant financial consequences for her. Her circumstances are sympathetic. However, I must apply the law as it is written.^{Footnote 32} I find that the legislation and the case law confirm that an election cannot be revoked on the basis of a mistake. 

[53] I have also considered the Claimant’s arguments that her circumstances are different from those in Hull because she contacted the Commission the same day that the first payment of extended benefits was received. The Court in Hull confirmed that the choice made by a claimant cannot be changed after payment is received. There is nothing in the legislation or case law to suggest that receiving only one payment changes the application of the law.

[54] In Hull, the Court stated:

[…] once the choice of parental benefit and the number of weeks are chosen on the application form, and upon payment of those benefits, it is impossible to change, alter, undo or revoke the choice. Therefore, the act of the payment of benefits renders the election irrevocable.^{Footnote 33}

[55] A claimant is permitted to change their election after the application form is submitted but before parental benefits have been paid. Claimants can create an account with Service Canada to review the start date and the benefit rate of their maternity and parental benefits. This does provide the ability for claimants to ensure that the choice they made on their application form was the choice that they intended.

[56] I understand that the Claimant’s election of extended parental benefits was a mistake. She intended to choose standard parental benefits. However, the Federal Court of Appeal has made it clear that her intention at the time that she filled out the form is not relevant to her election.

[57] The Claimant chose extended parental benefits on her application form. This was her election and, after benefits were paid to her, it became irrevocable.

Conclusion

[58] The appeal is allowed. The Claimant elected extended parental benefits and the election was irrevocable.