CUB 65974

PAUL ROULEAU, Umpire

This is an appeal by the Canada Employment Insurance Commission from a decision of the Board of Referees which held that the banked overtime hours paid to the claimant should not be allocated for the period of leave taken by the claimant but allocated for the period the services were performed pursuant to subsection 36(5) of the Employment Insurance Regulations.

A claim for benefits was established for Mr. Lauzon effective December 21, 2003 (exhibit 2). The Record of Employment submitted in support of the application indicated that the claimant had been employed with the City of Winnipeg from April 8 to November 7, 2003 (exhibit 3). He then returned to work for the employer on April 7, 2004 and continued to file his reporting cards and declared his earnings until he was again laid off on November 5, 2004. Mr. Lauzon provided the Commission with a record of the overtime hours he had worked in 2004 which was a total of 181.75 hours from May 28 to November 3, 2004. He also indicated that commencing November 8, 2004 he would be paid his banked overtime hours at a rate of 40 hours per week. Mr. Lauzon was paid banked overtime from November 8 to December 9, 2004 (exhibits 4, 5 & 6).

The Commission contacted the employer who stated that the claimant was advised he would be laid off on November 5, 2004 and that he requested that he be paid his banked overtime hours until they ran out. It was also confirmed that Mr. Lauzon was aware that he would be receiving his full pay until December 9, 2004 (exhibits 7, 8 & 9).

The Commission advised the claimant that the banked overtime hours would be allocated for the weeks of November 7 to December 5, 2004 (exhibit 10). The claimant requested that the Commission reconsider its decision and allocate the banked overtime hours to the weeks that the overtime had been worked (exhibit 14). The Commission again contacted the employer who advised that all employees have the choice to either take a monetary pay out or time off for the banked overtime. Employees who choose to take time off stay on the payroll with full employee benefits. The employees can take a monetary payout or time off at any time during the year. If at the end of the year the banked overtime is not used up it is paid out. The employer provided the Commission with a copy of the agreement between the City of Winnipeg and its employees regarding the options available to employees to take their banked overtime (exhibits 18, 19 & 21). The claimant confirmed that he had the choice of having his overtime paid in a lump sum or paid out as normal weekly earnings and that he chose to have his overtime paid out in weekly increments as of the date he was laid off (exhibit 20).

Based on this information, the Commission notified the claimant that there was no change to its decision. Mr. Lauzon appealed to the Board of Referees which allowed his appeal stating its reasons as follows:

The Board finds that the claimant has correctly reported his banked overtime hours when he made his bi-weekly reports. In doing so, he included both the dollar amount of regular hours and overtime hours. The E.I. Act requires a claimant to report in this manner and therefore Mr. Lauzon complied fully. The Act states that overtime hours are to be reported and allocated to the period when they were worked, not when payment is received, as per E.I. Regulation 36(4). This is what should occur in this case, and the earnings should not be allocated to the period of his lay-off as was done. In CUB 63128 the Umpire allowed the claimant's appeal whose circumstances are similar to those of Mr. Lauzon. Another similar decision can be found in CUB 30018.

The Commission now appeals to an Umpire on the grounds that the Board erred in fact and in law in rendering its decision. It is the Commission's position that as a result of the negotiated agreement the employees had the option of accumulating the overtime hours worked and taking paid leave for the accumulated overtime. The Commission submits that overtime so accumulated is payable for the period of leave where services are not required to be performed and as such must be allocated to the period of leave for which they are paid. The Commission argues that the Board erred when it ignored that the claimant had requested that his employer pay out his accumulated overtime hours in bi-weekly increments starting from the date he was laid off and also ignored that the claimant continued to be entitled to his employee benefits for the period of leave which he was being paid his overtime hours at his normal weekly earnings.

I am not prepared to interfere with the Board's decision. It's conclusion was based on a reasonable assessment of the evidence and the proper application of the law to its findings of fact. The Board followed the decision in CUB 30018, wherein the Umpire stated as follows:

In the present case, the amounts paid were not paid "under a contract of employment without the performance of services". They were paid for services which had been performed at an earlier time but for which the claimant had chosen not to take payment until later. The earnings in question became payable when the services were performed. The employer makes it quite clear that the claimant could have chosen to have had them paid to him at the date they were earned, or at any time subsequent thereto. It was entirely within the claimant's discretion. Also, leaving the money with the employer did not create for him leave entitlements of any kind nor were they to be claimed in connection with any leave period.

The Board of Referees also relied on CUB 63128 wherein the Commission conceded that the allocation of banked earnings should be considered as earnings during the period of employment.

For these reasons, the Commission's appeal is dismissed.

Paul Rouleau

UMPIRE

OTTAWA, Ontario
June 8, 2006