CUB 62474

GUY GOULARD, Umpire

The claimant worked for Tilbury Concrete Transport from June 27, 1997 until March 18, 2003 when he was dismissed. On March 27, 2003, he applied for benefits and an initial claim was established effective March 23, 2003. The claimant grieved his dismissal. The grievance was eventually settled by agreement, which provided that the claimant receive $24,000.00. The Commission determined that the settlement amount constituted earnings from employment and allocated the amount received from March 23, 2003. This resulted in an overpayment of $4,130.00.

The claimant appealed the Commission's decision to a Board of Referees which allowed the appeal. The Commission appealed the Board's decision. This appeal was heard in Windsor, Ontario on November 1, 2004. The claimant was present and was represented by his legal counsel, Mr. Michael Church, and by his Union representative, Mr. Gary Kitchen.

The terms of the Settlement Agreement between the claimant, his Union and the employer did not specify what the settlement amount was to cover, save for the following two paragraphs in the Agreement (Exhibit 6):

"The parties accept that the terms of settlement contained herein constitute a complete and final resolution of all issues raised in proceedings referred to above and the acts surrounding the Referral.

Mr. Bielich acknowledges and agrees that the payment described above includes all claims and entitlements to pay, payments required pursuant to the Employment Standards Act, the Human Rights Code and all other employment related statutes or laws, including notice, termination pay, vacation pay and severance pay. In consideration of the payment described above, Mr. Bielich hereby releases and forever discharges the Company, all related and affiliated companies and divisions and its and their Officers, Directors and Employees and Ernest Mailloux and the Applicant from any and all actions, claims and complaints which he now has, or which he may have in the future including those in any way related to his employment or the termination of that employment and with respect to the Applicant any actions under the Labour Relations Act R.S.O. 2000. In addition the Respondent and Ernest Mailloux do hereby provide the same release to the Employee."

Relying on the well established principle that moneys received from an employer by reason of a separation from employment are presumed to be earnings from the employment, the Commission allocated the full amount received pursuant to subsection 36(9) of the Employment Insurance Regulations.

On appeal, the claimant argued that the moneys received had been paid as damages and should not be considered as income from employment.

In his written submissions (Exhibit 17) as well as in his testimony before the Board, the claimant's representative stated that the moneys paid pursuant to the Settlement Agreement had been paid in exchange for the claimant's renouncing his right to return to his employment. In the written submissions, he described the antagonistic relationship between the claimant and his employer, which had eventually led to the dismissal. He pointed out that the Commission had recognized that the claimant's action did not constitute misconduct pursuant to the Act. In both the written and oral evidence, the claimant's representative stated that the moneys had been paid to make the claimant "go away and not to return".

He explained that the Labour Relations Office who had drafted the Settlement Agreement had simply followed a standard precedent and submitted that the terms used did not accurately reflect the reasons for the claimant's position in regard to the settlement. At paragraph 11 of his written submissions (Exhibit 17-4), the representative stated:

"The Labour Relations Officer did not include a statement in the Minutes of Settlement to the effect that Mr. Bielich was receiving the monies in question as damages on account of his renouncing his rights of reinstatement. However, this is the reason that the settlement in question was ultimately reached between the parties. Without the agreement to renounce his rights to return, Mr. Bielich would not have received the money in question."

The representative further stated that the claimant was in a good position of being reinstated in his position, that the employer did not want him there and had therefore paid the $24,000.00 to make sure that he would not be returning.

The Board reviewed the evidence and noted that the claimant's Union representative had been at the meeting when the claimant's grievance had been settled. The Board accepted the claimant's evidence and argument that the moneys received had been paid in exchange for his agreement not to return to his employment.

The Commission submitted that the Board erred in rejecting the evidence contained in the text of the Settlement Agreement. Counsel for the Commission argued that the Board had relied on the Union representative's written submissions which, according to the Commission, did not constitute evidence but simply submissions.

The Commission acknowledged that part of the settlement may have been paid in exchange for the claimant's renunciation of his right to reinstatement but that part of the settlement could also have been paid for other losses suffered by the claimant such as loss of salary and other benefits. The Commission submitted that the Board should have allocated the sums received to take this into account.

Counsel for the claimant submitted that the Board's decision was well founded on the evidence before the Board. He pointed out that the claimant, through his Union representative, had provided evidence that the full amount of the settlement was in exchange for his renunciation of his right to reinstatement and that this evidence had not been contradicted by the Commission or the employer.

It is common for parties on appeal before Boards of Referees to submit factual descriptions in their written arguments. When these are not contested, Boards can rely on these factual descriptions in their determination of facts. In this case, the claimant's representative had provided a detailed description of facts to explain that the claimant had a right to reinstatement and that he had pursued a reinstatement and abandoned this right in exchange of the sums received.

Mr. Church submitted that the issue under appeal was whether the Board's determination of facts was reasonable. He cited Justice Sexton in Meechan (A-610-01) that "the standard of review to be applied by an Umpire to a decision involving fact and law of the Board of Referees was that of reasonableness". And a further passage from the same Justice: "We are unable to conclude that it was unreasonable for the Board to accept the evidence by the Applicant to the effect that the damages represented compensation for the relinquishment of the right to reinstatement".

Mr. Church acknowledged that the onus was on the claimant to show that the moneys received was not related to his loss of employment and income. He submitted that the claimant had satisfied that onus by presenting uncontradicted evidence which convinced the Board, the finder of facts in employment insurance appeals, that the entire amount had been paid in exchange of a renunciation of a right to reinstatement.

I agree with the claimant that the evidence before the Board could lead the Board to reasonably arrive at its decision. The claimant's evidence was consistent: he had accepted the settlement to renounce his right to be reinstated. This was not contradicted.

An Umpire's jurisdiction is limited by subsection 115(2) of the Employment Insurance Act. Unless the Board of Referees failed to observe a principle of natural justice, erred in law or based its decision on an erroneous finding of fact made in a perverse manner or without regard for the material before the Board, an Umpire is required to dismiss an appeal.

In Le Centre de valorisation des produits marins de Tourelle Inc. (A-547-01) Justice Létourneau stated that the role of an Umpire is limited to deciding if the Board of Referees' appreciation of facts is reasonably compatible with the evidence before the Board.

The Commission has not shown that the Board of Referees erred. To the contrary, the Board's decision is well founded on a reasonable determination of facts based on the evidence before the Board.

Accordingly, the appeal is dismissed.

GUY GOULARD

UMPIRE

OTTAWA, Ontario
November 15, 2004