Employment Insurance (EI)

Decision

[1] The appeal is allowed in part. The Appellant received earnings. But the Canada Employment Insurance Commission (Commission) didn’t allocate (in other words, assign) those earnings to the right weeks when she reported them.

Overview

[2] The Appellant was contracted to teach a course from September 5, 2021, to December 19, 2021. During that time, she received Employment Insurance (EI) benefits. She declared her earnings in her biweekly reports. The Commission determined that she didn’t declare her earnings in the right weeks.

[3] On October 29, 2021, the Appellant’s employer paid her a lump sum of $1,570. This money was in addition to her regular wages and was based on the number of students in the course. The Commission decided that the money is “earnings” under the law because the Appellant received it for wages as compensation for hours worked.^{Footnote 1}

[4] The law says that all earnings have to be allocated to certain weeks. What weeks earnings are allocated to depends on why you received the earnings.^{Footnote 2}

[5] The Commission allocated the lump sum payment to the weeks of October 3, 2021, and October 10, 2021, at $785 per week. This caused an overpayment of $575.

[6] The Appellant says she paid the debt owing on March 22, 2023, but she disagrees with the Commission’s decision. She says the earnings should be allocated to the last two weeks of the month—October 16 to October 30, 2021, when she received the money.

Issues

[7] I have to decide the following two issues:

1. a) Is the money that the Appellant received earnings?
2. b) If the money is earnings, did the Commission allocate the earnings correctly?

Analysis

Is the money that the Appellant received earnings?

[8] Yes, the $1,570 that the Appellant received is earnings. Here are my reasons for deciding that the money is earnings.

[9] The law says that earnings are the entire income that you get from any employment.^{Footnote 3} The law defines both “income” and “employment.”

[10] Income can be anything that you got or will get from an employer or any other person. It doesn’t have to be money, but it often is.^{Footnote 4}

[11] Employment is any work that you did or will do under any kind of service or work agreement.^{Footnote 5}

[12] The Appellant’s employer paid her $1,570. The Commission decided that this money was payment for the work the Appellant did. So, it said that the money is earnings under the law.

[13] The Appellant agrees that the money is earnings. She says it was a one-time payment her employer gave her because the number of students in her class was higher than expected. She started teaching with 40 students, and, at the end of the enrolment deadline, there were 70 students in her class. She says she would have received more money if there were 100 students registered and less money if there were 60.

[14] The Appellant also says this lump sum payment applies to all contract instructors with a higher-than-expected number of students registered in their classes. The payment is based on a calculation, but she doesn’t know the exact formula.

[15] For income to be considered earnings, the income must be earned by labour or given in return for work, or there has to be a “sufficient connection” between the employment and the sum received.^{Footnote 6}

[16] I am satisfied the lump sum payment was for work that the Appellant was expected to do or had done, as a result of having more students to teach. This means the payment was sufficiently connected to her employment and the work she did. So, I find that the $1,570 is earnings.

Did the Commission allocate the earnings correctly?

[17] The law says that earnings have to be allocated to certain weeks. What weeks earnings are allocated to depend on why you received the earnings.^{Footnote 7}

[18] The Appellant says the $1,570 was a lump sum payment for teaching a higher number of students than expected. Her contract said she would receive a total of $8,599.57 from September 1, 2021, to December 31, 2021, based on an enrolment of 40 students. When enrolment closed at the end of September 2021, there were 70 students registered. Her employer calculated how much the extra pay would be at the end of September, when it had final enrolment numbers. It paid her the total amount on October 29, 2021, in a lump sum payment.

[19] The Appellant says that the Commission didn’t allocate the earnings correctly because she didn’t receive the payment until October 29, 2023. She says the payment wasn’t for the pay period between October 1, 2021, and October 15, 2021, even though the pay stub said it was. She says that the money wasn’t regular pay and should not be treated the same way as her regular wages.

[20] The Appellant also says this isn’t consistent with the way she was paid for every other semi-monthly (twice per month) period. She usually received payment in the middle of the month for the pay period from the 1st to the 15th of each month, and payment at the end of the month for the pay period from the 16th to the month’s end.^{Footnote 8}

[21] The Appellant says the lump sum payment should be allocated to the pay period between October 16, 2021, and October 31, 2021, because that was when she received the money. She argues the earnings should be allocated to the weeks she received them because they aren’t connected exclusively to the work she did during the first half of the month of October. She says this was a one-time payment that should be allocated to when she received it.

[22] The law says that the earnings you get from an employer as compensation for work done have to be allocated to the weeks when the work is done.^{Footnote 9} It doesn’t matter when you actually receive those earnings. The earnings have to be allocated to the weeks when the work is done, even if you didn’t get those earnings at that time.

[23] I find that the lump sum payment applied to the work the Appellant did during her entire contract period. I don’t agree that the earnings should be allocated to either the pay period of October 1 to October 15, 2021, or the pay period of October 16 to October 30, 2021. The extra work the Appellant had to do wasn’t limited to a two-week period. A higher-than-expected number of students in her course increased the amount of work she did over the length of the whole course, including preparation and marking.

[24] I find that the lump sum payment of $1,570 should be allocated as earnings over the Appellant’s whole contract period of September 1, 2021, to December 31, 2021.

[25] The Appellant’s entitlement will change after the allocation is corrected. This includes the two weeks to which the Commission allocated the earnings, when it didn’t pay the Appellant any benefits. The overpayment calculation and the notice of debt dated January 21, 2023, will also need to be revised.

Conclusion

[26] The appeal is allowed in part.

[27] The Appellant received $1,570 in earnings. These earnings should be allocated from the week starting September 5, 2021, until the week ending December 25, 2021. After the Commission corrects the allocation, the Appellant’s entitlement will change.