Commission Wins Appeal: General Division Made Legal Error

OUTCOME: Allowed

Citation: Canada Employment Insurance Commission  v  LG , 2026  SST  204 Social Security Tribunal of Canada Appeal Division Decision Appellant: [redacted] Representative: [NAME] Respondent: [redacted] [NAME] decision dated December 24, 2025 (GE-25-3322) Tribunal member: [NAME] of hearing: Teleconference Hearing date: March 17, 2026 Hearing participants: Appellant Appellant’s representative Respondent Decision date: May 25, 2026 File number: AD-26-28 On this page Decision Overview Preliminary matters Issue Analysis Conclusion Decision [ 1 ] The Canada Employment Insurance Commission’s appeal is allowed. The [NAME] made a legal error because it didn’t consider binding case law from the Federal Court. [ 2 ] To fix the error, I will substitute with my own decision. The Claimant, [RESPONDENT]. got earnings which need to be allocated to her Employment Insurance claim. Overview [ 3 ] The [APPELLANT] applied for Employment Insurance regular benefits. While she was receiving benefits, she reported to the Commission that she got other money. [ 4 ] The Commission decided that she had received earnings and allocated them to her claim. Footnote 1 This resulted in a notice of debt for the overpayment of benefits. Footnote 2 The [APPELLANT] appealed to the [NAME]. [ 5 ] The [NAME] allowed the Claimant’s appeal. It decided that the money she got wasn’t earnings, so it wouldn’t be allocated to her EI claim. Footnote 3 [ 6 ] The Commission appealed to the Appeal Division, arguing that the [NAME] made a legal error because it didn’t consider binding case law. Footnote 4 Preliminary matters The parties submitted post-hearing written arguments [ 7 ] At the Appeal Division hearing, I asked the Commission to provide a summary of the Claimant’s earnings for the relevant periods and to explain how they were allocated. This wasn’t new evidence and was located in various spots in the file record. [ 8 ] The Commission offered to provide a written summary after the hearing and did so by the deadline. Footnote 5 The Claimant reviewed the Commission’s submission and got a chance to reply in writing. Footnote 6 Her response was shared with the Commission. Footnote 7 I don’t have jurisdiction to deal with the weeks the Commission didn’t reconsider [ 9 ] The law says that I can only consider issues that have been decided by the Commission and appealed to the Tribunal. Footnote 8 [ 10 ] The Commission issued their reconsideration decision on November 20, 2025. Footnote 9 It says that their decision on the earnings issue is maintained. The decision itself doesn’t summarize the weeks they reviewed, but there are other documents in the file record that show this. Footnote 10 [ 11 ] There was evidence in the file that the Claimant got additional money on other weeks. For example, the file record shows that the Claimant may have received additional money for the weeks of June 15-21, 2025; June 20–28, 2025; October 26 to November 1, 2025; November 2—8, 2025; November 16–22, 2025 and November 23‑29, 2025. Footnote 11 [ 12 ] It wasn’t clear to me whether the Commission had reconsidered the above weeks, so I wrote to the parties to ask them. Footnote 12 Specifically, I asked for submissions about my jurisdiction to consider the above weeks in paragraph 11. [ 13 ] The Commission argued that they didn’t review those weeks for earnings, so there is no jurisdiction to consider them. Footnote 13 Instead, the Commission says that their arguments before the [NAME] and the file record show the specific weeks they considered. Footnote 14 [ 14 ] The Claimant argues that the Appeal Division should consider all of the monies she has reported to the Commission to-date. She says it’s more efficient and fairer to deal with the totality of her earnings in these proceedings. Footnote 15 [ 15 ] I don’t have jurisdiction to deal with the weeks the Commission didn’t reconsider, specifically the weeks listed in paragraph 11 above. The Commission will have to first render a reconsideration decision on those specific weeks set out above. If the Claimant isn’t satisfied with the Commission’s reconsideration decision, then she can appeal it to the [NAME]. [ 16 ] My decision will only focus on the weeks that the Commission reconsidered in their decision dated November 20, 2025. For further clarity, I only have jurisdiction to consider the following weeks: May 11–17, 2025, May 25–31, 2025; June 1-7, 2025; July 13–19, 2025, August 10–16, 2025 and September 14–20, 2025. Issue [ 17 ] Did the [NAME] make a legal error by not considering binding case law from the Federal Court? Analysis [ 18 ] The law sets out the types of errors that the Appeal Division can consider. Footnote 16 The Commission argues that the [NAME] made a legal error. Footnote 17 If that’s established, then I can intervene. Footnote 18 [ 19 ] The [NAME] makes a legal error when it ignores an argument it has to consider, doesn’t give adequate reasons for its decision, misinterprets the law, uses an incorrect legal test, or doesn’t follow a court decision it has to follow. The determination of earnings and allocation of earnings for benefit purposes [ 20 ] If a person receives earnings for the same period that EI benefits were paid or are payable, then the amount of EI benefits available may be impacted. [ 21 ] The Employment Insurance Regulations ( EI Regulations) sets out for what purposes amounts paid or payable to a person are to be considered earnings, what amounts are earnings and how to allocate amounts that are earnings. Footnote 19 [ 22 ] Section 35(1) of the EI Regulations broadly defines employment as: (a) any employment whether insurable or not under any express or implied contract for services or contract or employment (b) any self-employment, whether on the claimant’s own account or in partnership or co-adventure; and (c) tenure of an office as defined in s.2(1) of the [NAME] ([NAME]). Footnote 20 [ 23 ] Earnings to be taken into account are the “entire income of a claimant arising out of any employment.” Footnote 21 [ 24 ] The amounts that are determined to be earnings based on section 35 of the EI  Regulations are allocated as set out in section 36 of the EI Regulations. The period that earnings are allocated, and the manner of the allocation depends on the reason that the earnings were paid or payable. [ 25 ] If the amounts are not considered earnings under section 35, then they are not subject to the allocation provisions. Footnote 22 The [NAME] decided the money the Claimant got wasn’t earnings, so they weren’t subject to allocation [ 26 ] The [NAME] decided that the applicable provision was s.35(1)(a) of the EI  Regulations. Footnote 23 This provision defines employment whether insurable or not under any express or implied contract for services or contract or employment. [ 27 ] The [NAME] also reviewed sections 35(1)(b) and 35(1)(c) but found that neither applied in this case. Footnote 24 [ 28 ] The [NAME] found that the [APPELLANT] got money from [COMPANY] of [NAME] ([COMPANY]). It determined that she was paid money in the form of honoraria for volunteering as a Board Director with [COMPANY]. Footnote 25 It found that the money she got covered preparation, attendance and participation at meetings. Footnote 26 [ 29 ] The [NAME] concluded that the Claimant wasn’t engaged in employment with [COMPANY]. Instead, it found that she was a volunteer and the money she got wasn’t income arising from any employment. Footnote 27 It also found there wasn’t an express or implied contract of service either. Footnote 28 Since the money she got wasn’t earnings, it wouldn’t be allocated to her EI claim. The Commission argues that the [NAME] made a legal error because it didn’t consider binding case law [ 30 ] The Commission argues that the [NAME] made a legal error because it failed to consider binding case law from the Federal Court of Appeal, specifically the decisions in [NAME]  v  Canada ([NAME] [NAME]) , A-771-88 and [NAME]  v  Canada ([NAME] [NAME]) , A-986-88. [ 31 ] The Commission also argues that the [NAME] didn’t explain why it found that the Claimant’s work didn’t meet the definition of employment under s.35(1)(a) except to say that it was voluntary in nature. Footnote 29 [ 32 ] I asked the Commission about s.35(1)(c) because it refers to tenure of office and I wanted to know whether it was applicable in this case since the [APPELLANT] was a Board Director with [COMPANY]. I pointed out that the [NAME] had also referred to this provision it in its decision when it concluded that the Claimant’s volunteer work didn’t meet the definition of office. Footnote 30 [ 33 ] The Commission restated that the [NAME] correctly found that s.35(1)(c) wasn’t applicable in this case because she didn’t meet the criteria set out in that section. [ 34 ] The Commission maintains that the applicable provision is s.35(1)(a) because the Claimant was employed under an express or implied contract for her services. The [APPELLANT] argues that the [NAME] didn’t make any legal errors [ 35 ] The [APPELLANT] argues that there was no employment relationship and there was no intention to work for remuneration, expectation of economic gain, or any of the essential indicators of an employment relationship. [ 36 ] She restated that the money she got from [COMPANY] was nominal, not negotiated, not reflective of time or expertise, and didn’t approximate her wages. But rather, it was a token of appreciation. Footnote 31 And she maintains there was neither an express nor implied contract of service. [ 37 ] She says that she didn’t provide services for the purpose of remuneration and didn’t expect to derive any financial advantage. Her participation in board meetings happened during regular working hours, so she had to forego paid clinical work at a rate of $180 per hour. This resulted in an economic loss for her. [ 38 ] I asked the Claimant if she had reviewed the [NAME] decisions which had been submitted by the Commission in advance of the hearing. I invited her to provide arguments about the cases. She explained that she had reviewed the case law but found them hard to decipher. Even so, she says these decisions don’t seem to apply in her case. The [NAME] made a legal error because it didn’t consider binding case law [ 39 ] The [NAME] has to follow decisions from the Federal Court and Federal Court of Appeal which bind the Tribunal in similar cases. [ 40 ] The [NAME] based its finding on the fact that the Claimant was a volunteer and there was no express or implied contract, so the honoraria she got wasn’t earnings. Footnote 32 But it didn’t consider binding case law, specifically the [NAME] decisions, and that resulted in making a legal error in this case. [ 41 ] The [NAME] decision says that in order for assistance or voluntary effort to be authentic, the person would not be able to derive any economic benefit. [ 42 ] The [NAME] decision, citing the [NAME] decision, says that for a person to be deemed to have worked for an employer, it is essential that some kind of employer-employee relationship exists between them. Further, it states that this kind of relationship implies that some form of remuneration, direct or indirect, immediate or eventual. [ 43 ] One of the questions the [NAME] had to answer was whether the said work was really unpaid, namely if the Claimant did not really expect to derive any financial benefit from it. [ 44 ] The undisputed evidence shows that the Claimant in this case was receiving money for preparing, attending and participating in meetings with [COMPANY]. And in exchange for the performance of services, she got money which was set at a per diem rate based on the time spent and task. [ 45 ] The [NAME] ought to have considered the [NAME] decisions to decide whether her volunteer position was authentic and when it was analyzing the relationship between the Claimant and [COMPANY]. [ 46 ] Since I have found the [NAME] made a legal error, I will now consider how to fix that error. Footnote 33 I don’t need to consider any other errors raised. Fixing the error [ 47 ] To fix the error, I can send the matter to the [NAME] or give the decision the [NAME] should have given. Footnote 34 In doing so, I can make any necessary factual findings. Footnote 35 [ 48 ] The Commission and Claimant agree that I should substitute with my own decision, but they want different outcomes. [ 49 ] Both parties have provided written arguments about the actual earnings for the weeks identified below. The Claimant doesn’t dispute that she got money from [COMPANY], but there are two weeks where she doesn’t agree with the amounts determined by the Commission. Footnote 36 I will substitute with my own decision and give the decision the [NAME] should have given [ 50 ] I will substitute with my own decision. I am satisfied that the parties got a full and fair opportunity to present their cases before the [NAME]. And the record is also complete. [ 51 ] I find that the Claimant was engaged in employment as defined by the EI  Regulations. There is a relationship between [COMPANY] and the Claimant where she derives an economic benefit. I’ve considered the following: a) She volunteers for [COMPANY] and is paid money to attend meetings, training and professional development activities, as well as meeting preparation. b) She submits a report to [COMPANY] making a claim for money in exchange for the performance of her services. c) [COMPANY] pays her a fixed amount based on the hours she claims. This amount is set out by [COMPANY]. For example, 3 hours or less is paid $75.00 for attendance or per diem $300.00. Footnote 37 [ 52 ] Applying the [NAME] decisions, I find that the Claimant in this case was deriving an economic benefit for the performance of services to [COMPANY]. The facts in this case don’t show that the Claimant’s work for [COMPANY] was truly voluntary and that she didn’t expect to derive any financial benefit from it. There is an employment relationship between them, and she is expecting to be paid. Instead, these are signs pointing to an express or implied contract with [COMPANY]. [ 53 ] I find that the Claimant received earnings for the following periods. The evidence shows that the Claimant got earnings for the performance of services for the following weeks from [COMPANY]: The Week of Amount Pages May 11–17, 2025 $225.00 GD5-6 & GD3-14 May 25–31, 2025 $150.00 G5-6 & GD3-14 June 1–7, 2025 $375.00 GD5-6 & GD3-14 July 13–19, 2025 *Disputed $150.00 GD5-10 August 10–16, 2025 $75.00 GD5-10 & GD3-26 September 14–20, 2025 *Disputed $1,087.50 GD5-9 to GD5-10 [ 54 ] There are two weeks identified above where the parties disputed the amount of earnings (the week of July 13–19, 2025 and September 14–20, 2025). [ 55 ] The Commission says the Claimant got $188.00 for the week of July 13–19, 2025 and $1,312.50 for the week of September 14–20, 2025. Footnote 38 [ 56 ] The [APPELLANT] argues that those amounts are wrong because she only got $150.00 for the week of July 13–19, 2025 and $937.50 the week of September 14–20, 2025. Footnote 39 [ 57 ] I find that the Claimant got $150.00 of earnings for the week of July 13–19, 2025. Footnote 40 This is consistent with the detailed report she made to [COMPANY] as set out at page GD5-10. I preferred this evidence because it provides a lot more detail about what she did on those dates. Footnote 41 I gave no weight to the discussion the Commission had with [COMPANY] because their numbers don’t align with her reports. Footnote 42 [ 58 ] I also find the Claimant got a total of $1,087.50 for the week of September 14‑20, 2025. Footnote 43 This is also set out at page GD5-10 where she completed her report to [COMPANY]. For the same reason stated earlier, I preferred this evidence over the Commission’s discussion with [COMPANY]. To be clear, I have excluded the amounts listed for July 2025 and August 2025 that were also listed on that report. [ 59 ] I have determined that the Claimant was engaged in employment and that the earnings she got were income arising out of any employment. The amounts above set out in paragraph 53 are in fact earnings for benefit purposes based on s.35(1) of the EI  Regulations. These earnings must be allocated to her benefit period based on s.36(4) of the EI Regulations, so I have allocated them to the weeks she performed the services. Conclusion [ 60 ] The Commission’s appeal is allowed. The [NAME] made a legal error and didn’t consider binding case law. I have fixed the error and decided that the Claimant was engaged in employment, got earnings, and they must be allocated to her EI claim. Footnotes Footnote 1 See Commission’s reconsideration decision at page GD3-29. Return to footnote 1 [NAME] 2 See notices of debt at pages GD3-15 to GD3-16, GD3-18 to GD3-22. Return to footnote 2 [NAME] 3 [NAME] decision at pages AD1-8 to AD1-12. Return to footnote 3 [NAME] 4 See Application to the Appeal Division at pages AD1-1 to AD1-12. Return to footnote 4 [NAME] 5 See pages AD7-1 to AD7-3. Return to footnote 5 [NAME] 6 See page AD8-1. Return to footnote 6 [NAME] 7 See page AD10-1. Return to footnote 7 [NAME] 8 See sections 112 and 113 of the Employment Insurance Act ( EI Act). Return to footnote 8 [NAME] 9 See page GD3-29. Return to footnote 9 [NAME] 10 See pages GD3-14; GD3-26; GD3-27 and GD4-1 to GD4-5. Return to footnote 10 [NAME] 11 See pages GD5-1 to GD5-14. Return to footnote 11 [NAME] 12 See pages AD11-1 to AD11-3. Return to footnote 12 [NAME] 13 See pages AD12-1 and GD3-29. Return to footnote 13 [NAME] 14 See pages GD4-1 to GD4-5. Return to footnote 14 [NAME] 15 See page AD13-1. Return to footnote 15 [NAME] 16 See section 58(1) of the Department of Employment and Social Development Act ( DESD Act). Return to footnote 16 [NAME] 17 See section 58(1)(b) of the DESD Act. Return to footnote 17 [NAME] 18 See section 59(1) of the DESD Act. Return to footnote 18 [NAME] 19 See sections 35 to 36 of the Employment Insurance Regulations (Regulations). Return to footnote 19 [NAME] 20 See section 35(1) of the EI Regulations. Return to footnote 20 [NAME] 21 See section 35(2) of the EI Regulations. Return to footnote 21 [NAME] 22 See section 36(1) and (2) of the EI Regulations. Return to footnote 22 [NAME] 23 See paragraphs 16–17 of the [NAME] decision. Return to footnote 23 [NAME] 24 These provisions deal with any self-employment, and the tenure of an office as defined in s.2(1) of the [NAME] . Return to footnote 24 [NAME] 25 See paragraphs 11 and 14 of the [NAME] decision. Return to footnote 25 [NAME] 26 See paragraph 15 of the [NAME] decision. Return to footnote 26 [NAME] 27 See paragraph 18 of the [NAME] decision. Return to footnote 27 [NAME] 28 See paragraph 15 of the [NAME] decision. Return to footnote 28 [NAME] 29 See pages AD3-1 to AD3-5. Return to footnote 29 [NAME] 30 See paragraph 17 of the [NAME] decision. Return to footnote 30 [NAME] 31 See page AD6-1. Return to footnote 31 [NAME] 32 See paragraphs 15 and 18 of the [NAME] decision. Return to footnote 32 [NAME] 33 See section 58(1)(b) of the DESD Act. Return to footnote 33 [NAME] 34 See section 59(1) of the  DESD  Act. Return to footnote 34 [NAME] 35 See section 64 of the DESD Act. Return to footnote 35 [NAME] 36 The parties dispute the amount of earnings for the weeks of July 13–19, 2025 and September 14–20, 2025. See page AD10-1. Return to footnote 36 [NAME] 37 See page GD5-10. Return to footnote 37 [NAME] 38 See pages AD7-1 to AD7-3. Return to footnote 38 [NAME] 39 See page AD10-1. Return to footnote 39 [NAME] 40 See page GD5-10. For July 16, 2025 - $75.00 + $75.00 = totalling $150.00. Return to footnote 40 [NAME] 41 See pages GD3-26 and GD3-27. Return to footnote 41 [NAME] 42 See pages GD3-26 and GD3-27. Return to footnote 42 [NAME] 43 See page GD5-10. For September 14, 2025—$75.00; September 16, 2025—$150.00; September 17, 2025—$112.50; September 18, 2025—$300.00 and $150.00; September 19, 2025—$300.00, totalling $1,087.50. Return to footnote 43 [NAME]