SST Partially Allows EI Benefit Eligibility Appeal

OUTCOME: Allowed in Part

[TRANSLATION] Citation: MS  v  Canada Employment Insurance Commission , 2026  SST  296 Social Security Tribunal of Canada Appeal Division Decision Appellant: [redacted] Respondent: [redacted] Representative: [COUNSEL] under appeal: [NAME] decision dated October 31, 2025 (GE‑25‑2666) Tribunal member: [NAME] of hearing: In person Hearing date: March 31, 2026 Hearing participants: Appellant Respondent’s representative Decision date: April 15, 2026 File number: AD-25-779 On this page Decision Overview Issues Preliminary matters Analysis Remedy Conclusion Decision [ 1 ] The appeal is allowed in part. [ 2 ] The claims dated December 16, 2018, December 20, 2019, and December 26, 2021, are cancelled because no earnings stopped within the meaning of the law for at least seven days in a row. [ 3 ] But earnings stopped within the meaning of the law for at least seven days in a row for the claims dated December 20, 2020, December 25, 2022, and December 20, 2023. Overview [ 4 ] The [APPELLANT] works as an accountant for a company her husband owns. [NAME] [COMPANY]. [ 5 ] An investigation by the Commission showed that after the Claimant was laid off in December, she made deposits and issued cheques for the company while unpaid. After being unpaid for a few weeks, she started reporting that she worked two hours a week for the company. [ 6 ] The [APPELLANT] argued that she didn’t believe these hours had to be reported because it was a family company and she was only doing her husband, the company owner, a favour. She argued that she stopped working in December, at the end of each season. [ 7 ] The Commission decided that the [APPELLANT] made false statements by stating that she didn’t do any unpaid work during the benefit periods of December 24, 2023, December 25, 2022, December 26, 2021, December 20, 2020, and December 22, 2019. It established overpayments for the periods between 2019 and 2023. The Commission also imposed penalties totalling $13,190. [ 8 ] On reconsideration, the Commission upheld the initial decisions on the overpayment for the periods between 2019 and 2023. But it replaced the $13,190 penalties with warnings. [ 9 ] The [APPELLANT] disagreed and appealed to the Tribunal’s [NAME]. [ 10 ] The [NAME] accepted the Commission’s suggestion not to cancel the benefit periods starting December 20, 2019, and December 20, 2023. For the other benefit periods, it decided that the [APPELLANT] kept working for the company, paid or unpaid, for at least two hours a week. [ 11 ] The [NAME] found that for the other periods, the Claimant didn’t meet the requirements of section 14(1) of the Employment Insurance Regulations  ( EI  Regulations). So, the benefit periods of December 25, 2022, December 26, 2021, and December 20, 2020, had to be cancelled. And the Claimant had to pay back the benefits. [ 12 ] The Claimant got permission to appeal the Tribunal’s [NAME] decision to the Appeal Division. She argues that the [NAME] made an error of fact and law. [ 13 ] The Claimant’s appeal is allowed in part. Issues [ 14 ] Did the Claimant meet the requirements of section 14(1) of the EI  Regulations for the benefit periods of December 16, 2018, December 20, 2019, December 20, 2020, December 26, 2021, December 25, 2022, and December 20, 2023? [ 15 ] Should a penalty be imposed on the Claimant? Preliminary matters [ 16 ] At the start of the hearing, I gave the Claimant the chance to consult a lawyer because of the large amounts involved and the possibility that the Commission’s concession before the [NAME] might be cancelled. She chose to represent herself and stated that she was ready to go ahead. [ 17 ] To decide this appeal, I went ahead and listened to the recording of the [NAME] hearing that took place on October 22, 2025. Analysis [ 18 ] The [APPELLANT] argues that she doesn’t understand the [NAME] decision because she ends her season during the Christmas break and starts again in January for a few hours a week. This is because the company is closed and has no activity. [ 19 ] The [APPELLANT] argues that she has been working for her partner’s company for at least 10 years and that she always stopped working for 2 to 3 weeks, or even 4 weeks, after the company closed in December. She argues that she always reported her work hours. [ 20 ] The [NAME] said in its decision that the [APPELLANT] acknowledged that she kept working for the company, paid or unpaid, for at least two hours a week. So, there was no break in the employment relationship. [ 21 ] I find that the Claimant didn’t say that before the [NAME]. She disputed the Commission’s position that writing and depositing cheques when the company was closed counted as work that prevented her earnings from stopping under the meaning of the law. [ 22 ] The [APPELLANT] testified that she always stopped working for two to three weeks between December and January because the company was shut down. She testified going back to work two hours a week after the [NAME] started their operations again because she had to do the payroll and deductions. She reported the two hours in her claimant reports as soon as she went back to work. Footnote 1 [ 23 ] So, I am of the view that the [NAME] based its decision on an erroneous finding of fact that it made in a perverse or capricious manner or without regard for the material before it. [ 24 ] I am also of the view that the [NAME] made an error of law by accepting the concession the Commission made for the 2019 and 2023 claims. This is because the Claimant was on vacation outside Canada during the qualifying period for each claim. No earnings stopped within the meaning of the law because she wasn’t let go or stopped working for her employer. [ 25 ] Finally, I am of the view that the [NAME] made an error of jurisdiction because it didn’t decide the issue of penalties imposed by the Commission. [ 26 ] Considering these errors, I am justified in intervening. Remedy [ 27 ] Since the parties had the chance to present their positions before the [NAME], I am of the view that the file is complete. So, I will give the decision that the [NAME] should have given. Footnote 2 Did the Claimant meet the requirements of section 14(1) of the EI  Regulations for the benefit periods of December 16, 2018, December 20, 2019, December 20, 2020, December 26, 2021, December 25, 2022, and December 20, 2023? [ 28 ] An [NAME] qualifies for benefits if the person: a) has had an interruption of earnings from employment b) has had during their qualifying period at least the number of hours of insurable employment set out in the following table in relation to the regional rate of unemployment that applies to the person [ 29 ] An interruption of earnings happens when the following three conditions are met:

1) The claimant is laid off or leaves their job 2) The claimant hasn’t worked for seven days in a row 3) The claimant hasn’t received any earnings from that job Footnote 3 [ 30 ] [NAME] important to note that, before the [NAME], the Commission argued that it was only the fact that she didn’t stop working for her employer and that she didn’t stop working for a period of at least seven days in a row that led to cancelling the benefit periods. That was the ground the Commission set out and that the Claimant disputed before the [NAME]. [ 31 ] I note that the Commission even said that it didn’t cancel the benefit periods because the Claimant got benefits (ongoing earnings from employment). Footnote 4 [ 32 ] It has been decided that work a claimant did voluntarily for their employer after being let go or laid off doesn’t result in earnings having stopped under the EI  Act. Footnote 5 [ 33 ] A Commission [NAME] questioned the [APPELLANT], an accounting clerk. [ 34 ] The [APPELLANT] stated that she was the person who prepared the cheques and was the only one responsible for the company’s deposits. She performed these duties, which were normally part of her work as the company’s accounting clerk, unpaid. She stated that she didn’t issue post-dated cheques. She acknowledged that an employee who wasn’t related to the company owner would not show up to work to perform such duties unpaid. On reconsideration, she stated that she agreed with what was said in the interview reports. Footnote 6 Claim dated December 16, 2018 [ 35 ] In support of her claim, the Claimant provided a Record of Employment ( ROE ) stating that she worked from April 30 to December 14, 2018. And she stated [translation] “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 36 ] The Claimant reported working two hours a week starting the week of January 6, 2019. [ 37 ] For the weeks between December 16, 2018, and January 5, 2019, the evidence shows that the Claimant made deposits on December 18, December 24, 2018, and January 4, 2019. And she issued cheques on December 20, December 24, December 27, December 28, January 3, and January 4, 2019. [ 38 ] Because the Claimant kept performing part of her regular duties, there weren’t seven days in a row without work, even though she didn’t get any earnings. So, she didn’t stop providing services to her employer for the benefit claim dated December 16, 2018. [ 39 ] This means that this benefit period should be cancelled. Claim dated December 20, 2019 [ 40 ] In support of her claim dated December 20, 2019, the Claimant provided a ROE stating that she worked from April 29 to December 20, 2019. And she stated [translation] “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 41 ] The Claimant reported working two hours a week starting the week of January 5, 2020. [ 42 ] For the weeks between December 19, 2019, and January 4, 2020, the evidence shows that cheques were issued on December 20, 2019, December 22, 2019, December 23, 2019, December 27, 2019, December 28, 2019, January 3, 2020, and January 4, 2020. [ 43 ] Because the Claimant kept performing part of her regular duties, there weren’t seven days in a row without work, even though she didn’t get any earnings. So, she didn’t stop providing services to her employer for the benefit claim dated December 20, 2019. [ 44 ] This means that this benefit period should be cancelled. Claim dated December 20, 2020 [ 45 ] In support of her claim, the Claimant provided a ROE stating that she worked from January 6 to December 18, 2020. And she stated [translation] “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 46 ] Before the [NAME], the Claimant testified that she always stopped working for two to three weeks between December and January because the company was shut down. She testified going back to work two hours a week after the [NAME] started their operations again and that she had to do the payroll and deductions. She reported the two hours in her claimant reports as soon as she went back to work. [ 47 ] The Claimant reported working two hours a week starting the week of February 7, 2021. [ 48 ] For the weeks between December 20, 2020, and February 6, 2021, the evidence shows that the Claimant made deposits on December 23, December 29, 2020, and January 11, 2021. And she issued cheques on December 23, December 24, December 29, December 30, 2020, January 4, and January 5, 2021. [ 49 ] The evidence before the [NAME] doesn’t support a finding that the Claimant provided services to the employer in the weeks between January 17 and February 6, 2021. [ 50 ] Because there is no evidence of service in the weeks between January 17 and February 6, 2021, I have to find that earnings stopped for this benefit period. Claim dated December 26, 2021 [ 51 ] In support of her claim, the Claimant provided a ROE stating that she worked from February 8 to December 24, 2021. And she stated [translation] “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 52 ] The Claimant reported working two hours a week starting the week of January 23, 2022. [ 53 ] For the weeks between December 26, 2021, and January 22, 2022, the evidence shows that the Claimant made deposits on January 3, January 14, and January 21, 2022. And she issued cheques on December 29, 2021, and January 3, 2022. [ 54 ] Because the Claimant kept performing part of her regular duties, there weren’t seven days in a row without work, even though she didn’t get any earnings. So, she didn’t stop providing services to her employer for the benefit claim dated December 26, 2021. [ 55 ] This means that this benefit period should be cancelled. Claim dated December 25, 2022 [ 56 ] In support of her claim, the Claimant provided a ROE stating that she worked from January 24 to December 23, 2022. And she stated “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 57 ] Before the [NAME], the Claimant testified that she always stopped working for two to three weeks between December and January because the company was shut down. She testified going back to work two hours a week after the [NAME] started their operations again and that she had to do the payroll and deductions. She reported the two hours in her claimant reports as soon as she went back to work. [ 58 ] The Claimant reported working two hours a week starting the week of January 22, 2023. [ 59 ] For the weeks between December 25, 2022, and January 21, 2023, the evidence shows that the Claimant made deposits on December 24, 2022, and January 9, 2023. And she issued a cheque on January 3, 2023. [ 60 ] The evidence before the [NAME] doesn’t support a finding that the Claimant provided services to the employer in the weeks of January 14 and 21, 2023. [ 61 ] Because there is no evidence of service in the weeks of January 14 to 21, 2023, I have to find that earnings stopped for this benefit period. Claim dated December 20, 2023 [ 62 ] In support of her claim dated December 24, 2023, the Claimant provided a ROE stating that she worked from January 26 to December 22, 2023. And she stated [translation] “Shortage of work/End of season or contract” as the reason she was separated from her job. [ 63 ] Before the [NAME], the Claimant testified that she always stopped working for two to three weeks between December and January because the company was shut down. She testified going back to work two hours a week after the [NAME] started their operations again and that she had to do the payroll and deductions. She reported the two hours in her claimant reports as soon as she went back to work. [ 64 ] The Claimant reported working two hours a week starting the week of January 21, 2024. [ 65 ] For the weeks between December 24, 2023, and January 20, 2024, the evidence shows that the Claimant made deposits on December 31, 2023, and January 17, 2024. And she issued a cheque on December 28, 2023. [ 66 ] The evidence before the [NAME] doesn’t support a finding that the Claimant provided services to the employer in the week of January 7 to 13, 2024. [ 67 ] Because there is no evidence of service in the weeks of January 7 to 13, 2024, I have to find that earnings stopped for this benefit period. Should penalties be imposed on the Claimant? [ 68 ] [NAME]’s only requirement for imposing a penalty is that of knowingly, that is, with full knowledge of the facts, making a false or misleading statement. So, the absence of intent to commit fraud isn’t relevant. Footnote 7 [ 69 ] The Federal Court of Appeal has said that the burden of proof shifts as soon as a claimant wrongly answers a very simple question or questions on a report. [ 70 ] In this case, the question the Claimant had to answer was, [translation] “Did you work or receive any earnings during the period of this report? This includes work for which you will be paid later, unpaid work , or self-employment.” Footnote 8 [ 71 ] So, it was up to the [APPELLANT] to explain why she gave incorrect answers. She had to prove that she didn’t know her answers were incorrect. As the Federal Court of Appeal noted in [NAME] , the subjective knowledge test considers objective factors. [ 72 ] Before filling out each report, the Claimant was told that providing false information on her account was considered fraud and punishable by law. She also testified that the answers she gave about being absent from work were correct for each week of unemployment while she kept performing part of her regular duties. [ 73 ] The Claimant stated that she was the person who filled out the cheques and the only one responsible for the company’s deposits. [ 74 ] These duties were normally part of her work as the company’s accounting clerk. She performed them, unpaid, during her benefit periods. [ 75 ] Even though the Claimant insists that she made deposits to do her husband a favour while going about her personal activities, and that she wrote cheques [translation] “on a corner of a table,” she could not ignore the fact that these were part of her regular duties for which her employer normally paid her. [ 76 ] The Claimant also acknowledged that an employee who wasn’t related to the company owner would not show up to work to perform such duties unpaid. [ 77 ] I can’t allow the Claimant to avoid an administrative penalty when she knew that the reports she filled out weren’t accurate. [ 78 ] As for imposing the non-monetary penalty, the Commission argues that it used its discretion judicially because it considered all the circumstances relevant to the case when setting the penalty amount. It considered that, for each of the six benefit claims, a non‑monetary penalty in the form of a warning letter was enough to deter her. The overpayment resulting from imposing the monetary penalties was lowered from $13,190 to $0. [ 79 ] I see no reason to intervene with how the Commission used its discretion. Conclusion [ 80 ] The appeal is allowed in part. [ 81 ] The claims dated December 16, 2018, December 20, 2019, and December 26, 2021, are cancelled because no earnings stopped under the meaning of the law for at least seven days in a row. [ 82 ] But earnings stopped within the meaning of the law for at least seven days in a row for the claims dated December 20, 2020, December 25, 2022, and December 20, 2023. Footnotes Footnote 1 Listen to the recording of the [NAME] hearing from 00:15:58 to 00:16:16, and from 00:19:57 to 00:20:17. Return to footnote 1 referrer Footnote 2 See section 59(1) of the Department of Employment and Social Development Act . Return to footnote 2 referrer Footnote 3 See section 14(1) of the Employment Insurance Regulations ; [NAME]  v  Canada ([NAME] [NAME]) , 2007  FCA  82; and Canada ([NAME] [NAME])  v  [NAME] , A-559-89. Return to footnote 3 referrer Footnote 4 See GD4-11. For this reason, I don’t accept the Commission’s arguments to the Appeal Division that the Claimant got benefits and vacation pay, which also prevented her earnings from stopping. The Commission doesn’t have the discretion to choose one reason and then rely on another in an appeal. See CUB 21648, CUB 15223, and CUB 11076. Return to footnote 4 referrer Footnote 5 See CUB 18989, CUB 14230A, CUB 13130, and CUB 11215. Return to footnote 5 referrer Footnote 6 See GD3-550 to GD3-555, and GD3-597 to GD3-600. Return to footnote 6 referrer Footnote 7 See Canada ([NAME] [NAME])  v  [NAME] , 2017  FCA  104. Return to footnote 7 referrer Footnote 8 See Canada ([NAME] [NAME])  v  [NAME] , 1995 CanLII 3601 ( FCA ); and Canada ([NAME] [NAME])  v  [NAME] , 1995 CanLII 3558 ( FCA ). Return to footnote 8 referrer