Summary of Issue: By Reason Of Separation

Decision A0159.13 Full Text of Decision A0159.13

The claimant worked for Ford until March 18, 2011 and on termination of his employment, he received a severance pay in the amount of $125,000. He then worked for General Dynamics until March 16, 2012. The Commission determined that the severance pay from Ford constituted earnings within the meaning of the EIR and should be allocated starting March 18, 2011 (the date of his termination with Ford). The FCA determined that the lump sum severance payment of $125,000 constituted “earnings” that must be allocated following termination of employment, pursuant to the EIR. The FCA also confirmed that the $125,000 payment from Ford was not a payment from a supplemental unemployment insurance plan for the purposes of section 37 of the EIR.

Decision A0453.12 Full Text of Decision A0453.12

The claimant was laid off in April 2009. He received an amount as severance pay and for vacation pay. He attended at a Commission office to apply for benefits and he was told that he would have to wait to apply for benefits since he har received a severance pay. On a subsequent visit in June 2009, he was informed that he would qualify immediately for benefits. When he received cheques for the period from April to June 2009, he tried to return the cheques to the Commission as the claimant knew that he had to wait to collect benefits because he had received a severance pay. He was informed that he could not return the cheques. The Commission then attempted to calculate how the severance pay and vacation pay should be allocated. However, the Commission used the wrong amount as the normal weekly earnings. The only issue in this judicial review application is whether the Umpire correctly determined the questions of law and whether his application iof the facts to the law was reasonable. The application for judicial review is dismissed. The FCA's decision can be found at this address: http://decisions.fca-caf.gc.ca/fca-caf/decisions/en/item/64485/index.do

Decision 74797 Full Text of Decision 74797

The issue before the BOR had been a correct allocation of earnings. The Brd were in error in law when they failed to apply s. 36(9) of the EI Regulations, which provides that the allocation begins with the week of the layoff or separation from employment. In this case, the claimant stopped working for his former employer in March of 2008 but he was separated from that employment when the company closed in January of 2009. The separation monies were paid to the claimant in February 2009 and because the separation occurred when the company closed in January, these earnings had to be allocated from January to October in accordance with s. 36(9) of the Regulations. The appeal by the Commission is allowed by the Umpire.

Decision 74720 Full Text of Decision 74720

Mr. X claims the BOR erred in the allocation of monies receive as he was no longer an employee of the company when the monies were determined and paid out pursuant to a settlement agreement. It is recognized that settlement agreements that are connected to a separation of employment may have an amount that is not calculated as earnings under the Act. The Board determined that despite the view of the settlement held by the claimant, there was no evidence to support his claim, the funds were paid out as separation monies. Clearly the money paid out to the claimant by the employer was in recognition of the termination of the employer-employee relationship. The claimant’s appeal is dismissed by the Umpire.

Decision A0007.06 Full Text of Decision A0007.06

The Umpire and the BOR have correctly concluded that the amount of $14,903.86 received by the claimant from a trustee in bankruptcy represented a payment of $8,221.17 for vacation pay and a payment of $6,682.69 for severance pay. The two amounts constituted earnings within the meaning of section 35 of the EIR, and these earnings were to be allocated in accordance with subsection 36(9) of the EIR. The FCA ruled that it cannot intervene in the findings of fact made by the Umpire and the BOR unless these findings are unreasonable (Budhai and Dunsmuir).

Decision 49309 Full Text of Decision 49309

Claimant laid off on 29-11-1996, but it was not until November 1997 that the employer, in accordance with the Act respecting Labour Standards, paid him his full pay in lieu of notice. Earnings allocated effective November 1996 and decision upheld by the Umpire. It is the reason or grounds for payment and not the date of payment that determines when the allocation should be done. This money was payable when the claimant could legally demand payment.

Decision 49308 Full Text of Decision 49308

Claimant laid off in July 1997 but elected not to receive his severance pay immediately in order to retain his recall rights with employer. Final separation occurred in 1999. Monies considered earnings and allocated from July 1999 i.e. at the time of the permanent termination of employment. Decision maintained by Umpire. Reference made to FCA in Walford (A-0263.78) and CUBs 43198 and 24614.

Decision 40302 Full Text of Decision 40302

Following the plant closure, clmts received a lump sum they could invest into becoming a member of a co-operative or in a pension plan. Referring to the statement made fy FC in Tashereau (A.795.92), Umpire found that this amount constituted earnings subsequent to the layoff, regardless of the method of investment chosen by clmts.

Decision A-0106.96 Full Text of Decision A-0106.96

Lay-off on 14-12-90. One year later, on 15-12-91, final closing of the plant and separation incentive paid to the claimant in accordance with the Labour Standards Act. Allocation of severance pay retroactively from 16-12-90. Umpire was of the view that the payment was the result of the plant closure and that the amount should be allocated only as of 15-12-91. **Decision overturned by the FCA, which determined that the liability to pay arose from the Labour Standards Act. The FCA noted that the regulations on earnings paid or payable by reason of lay-off or separation from an employment apply not only to permanent loss of employment but also to temporary stoppage of work. Disctinction made between this case and judgment rendered by FCA in King (A-486-95).

Decision 35046 Full Text of Decision 35046

Supplement of $16,896.88 paid to claimant by Dept. of National Defence under the Civilian Reduction Program and allocated under R.58(9). It was suggested that part of the supplement be allocated under R.58(15). Denied. Held that monies were paid by reason of a separation from the employment.

Decision A-0704.95 Full Text of Decision A-0704.95

Teacher who received $545 as accumulated sick leave when her employment contract expired. Umpire found that Kinkead (A-217-93) applied, that the compensation was a direct result of the work contract and that the separation merely provided the opportunity. Judgment overturned by the FCA. The FCA reiterated its position taken in Kinkead, explaining that the Umpire had shifted the focus. Payment was made "as a result of" the separation, within the meaning of the text, when it became due and payable upon actual termination of the employment. The obligation it was intended to fulfil was only potential as long as the job continued and would only materialize, becoming liquid and payable, when the employment actually came to an end.

Decision 29246 Full Text of Decision 29246

Teacher who at the end of her employment contract receives $545 for accumulated sick leave. Held that KINKEAD applies, that the contract is the direct cause for the compensation and that the termination of employment is only the occasion.

Decision 29168 Full Text of Decision 29168

KINKEAD explained. If the 1990 vacation pay was not paid because of the employer's poor payment practices and the payment in 11-91 was merely made "on the occasion of" the separation from employment, rather than by reason of it, then those amounts should not be allocated as earnings.

Decision 27140 Full Text of Decision 27140

The lump sum payment would not have been payable if the pension had not been terminated due to financial difficulties which brought about the closure of the mine. Thus, the payment of monies arises out of the severance of the employer-employee relationship and also falls within the ambit of 58(9).

Decision 23924 Full Text of Decision 23924

Refer to: A-0076.94

Decision A-0076.94 Full Text of Decision A-0076.94

Compensatory pay for statutory holidays. The sum became payable to claimant and was paid to her as a consequence of her layoff. It follows that, regardless of the nature of those earnings and of the period in respect of which they were payable, they had to be allocated pursuant to ss. 58(9).

Decision 24593 Full Text of Decision 24593

Claimant's vacation pay from 1972 to 1982 held by mutual agreement and not paid to claimant until upon separation from employment in 1990. Held that the monies are to be allocated following the last day worked. [NOTE: KINKEAD case decided by FC on 16-5-94 not referred to]

Decision A-0217.93 Full Text of Decision A-0217.93

The employer's failure to pay the vacation pay when it became due and payable and the fact that it was paid in full at the time of the employee's separation does not alter the nature of the payment made "at the time" of separation into a payment made by "reason" of that separation.**The 4% vacation pay, payable every 15 weeks pursuant to the work contract, was not paid. Total amount paid after 37 weeks upon termination. The amount due and payable (re the first 30 weeks) prior to the termination was not paid by reason of the layoff; the balance was paid.**It does not necessarily follow merely from the fact that under the work contract, vacation pay became due and payable before the day of the lay-off, payment is made "at the time" rather than "by reason" of the separation. Considerations must be given to all provisions of the contract.**The time at which vacation is paid may well coincide with that of the layoff, without the payment being made by reason of that event. The day of the layoff therefore, constitutes the time and not the cause of the payment.

Decision 20723A Full Text of Decision 20723A

Refer to: A-0217.93