CUB 50470

IN THE MATTER of an appeal to an Umpire by the
Commission from a decision by the Board of Referees given
on June 15, 2000 in Chicoutimi, Quebec

DECISION

The Commission is appealing the unanimous decision of the Board of Referees which had unanimously upheld part of the claimant's appeal against the decision that the amount paid to the claimant (and to the other claimants involved in this representative appeal) as a Christmas bonus constituted earnings pursuant to paragraph 35(2)a) of the Employment Insurance Regulations to be allocated pursuant to subsection 36(5) of the Regulations.

The facts in the case are not disputed and are well summed up in the decision of the Board of Referees.

This appeal was heard in Chicoutimi, Quebec, on October 19, 2000. The claimant was represented by Mr. Gilbert Nadon and the Commission by Ms. Pauline Leroux.

35 (2) Subject to the other provisions of this section, the earnings to be taken into account for the purpose of determining whether an interruption of earnings has occurred and the amount to be deducted from benefits payable under section 19 or subsection 21(3), 22(5) or 23(3) of the Act, and for the purposes of sections 45 and 46 of the Act, are the entire income of a claimant arising out of any employment, including

a) amounts payable to a claimant in respect of wages, benefits or other remuneration from the proceeds realized from the property of a bankrupt employer;

36 (4) Earnings that are payable to a claimant under a contract of employment for the performance of services shall be allocated to the period in which the services were performed.

36 (5) Earnings that are payable to a claimant under a contract of employment without the performance of services or payable by an employer to a claimant in consideration of the claimant returning to or beginning work shall be allocated to the period for which they are payable.

Christmas Bonus
A regular employee laid off during the first complete work week in December (five (5) working days per week) has the right to a one (1)-day lay-off bonus at the regular rate of the occupation (eight (8) hours).

A regular employee laid off between the beginning of the second completed work week in December (five (5) working days per week) and the last working day before Christmas is entitled to a lay-off bonus of two (2) days paid at the regular rate of the occupation (eight 8 hours).

The employee affected by one or the other of the above two (2) preceding paragraphs is not entitled to the legal holidays during the Christmas season. [trans.]

Mr. Leroux submits that the Board of Referees erred in law when it determined that part of the money received by the claimant as a "Christmas bonus" constituted earnings to be allocated pursuant to subsection 36(4) of the Regulations. The Commission believes that the bonus should be allocated pursuant to section 36(5) of the Regulations.

Mr. Nadon maintains that the Board of Referees did not err. He refers to the transcript of his long argument before the Board.

Many decisions by both Umpires and the Federal Court of Appeal were presented by both attorneys. Those decisions tried to resolve problems linked to bonuses of all kinds and they of course offered various possible solutions. Two very recent decisions dealt with the matter of which paragraph of the Regulations should apply to Christmas bonuses. They are the Darren J. Smith and Louis Poirier (CUB 40806A) and Lloyd Ritchie et al (CUB 44002) cases. In the Ritchie case, Judge Grant agrees with the logic and the decision of Judge Murdoch in the Smith and Poirier case. He writes:

The claimant relied on CUB 40806A, a recent decision of Umpire Murdoch where he relied on Regulation 36(4) and not on Regulation 36(19)(b). This case dealt with the allocation of a Christmas bonus, as is the case before me.

I agree with the reasoning of Umpire Murdoch, that the lump sum should be allocated in accordance with Regulation 36(4), and not Regulation 36 (19) (b) . It was stated that the similarities between the claims of Smith and Poirier CUB 40806A are that it was a contract of employment, and the payment was linked to the performance of services.

(..)

I am prepared to follow the latest CUB decision brought to my attention, that is CUB-40806A, where Umpire Murdoch also dealt with a Christmas bonus under very similar circumstances, and made that finding. It is consistent also with the finding of the minority member of the Board.

In this matter, the decision of a minority of Board members, which became that of the Umpire, was that the Christmas bonus should have been allocated during the week in which the payment was made to the claimant pursuant to subsection 36(4) of the Regulations.

First, the decision of the Board of Referees in this instance lacked clarity. Following the logic of Judges Grand et Murdoch, I disagree with the decision of the Commission and with that of the Board.

Section 117 of the Employment Insurance Act describes the powers of the Umpire:

117. An umpire may decide any question of law or fact that is necessary for the disposition of an appeal and may

(a) dismiss the appeal;

(b) give the decision that the board of referees should have given;

(c) refer the matter back to the board of referees for re-hearing or re-determination in accordance with such directions as the umpire considers appropriate; or

(d) confirm, rescind or vary the decision of the board of referees in whole or in part.

I will therefore render the decision that the Board of Referees should have rendered. The amount of the Christmas bonus received by the claimant must be allocated to the week in which the payment was made to the claimant pursuant to subsection 36(4) of the Regulations.