Digest of Benefit Entitlement Principles Chapter 10 - Section 5

10.5.0 Earnings

The legislation requires that all claimants who are claiming regular benefits prove that they are available for work and unable to obtain suitable employment (EIA 18(1)(a)). They may be required to prove that they are making reasonable and customary efforts to obtain suitable employment (EIA 50(8)). Claimants have always been expected to broaden their willingness to seek and accept less favourable wages as the length of time they are unemployed and claiming benefits increases.

A claimant may be restricting to a wage rate for a specific type of employment in which there is a very limited possibility of obtaining work. In this case, it is important to obtain information concerning the prevailing rates of pay in the area where work is being sought, as well as concerning the occupation the claimant is prepared to accept.

If a claimant restricts their availability for work to a level of earnings that is not within the prevailing wage rate in the claimant’s area of work, for the type of work being sought, they will be disentitled from regular benefits until those restrictions are removed if:

  1. this is an actual restriction and not just a preference (Digest 10.4.3.1)
  2. they have been warned that such a restriction is unacceptable (Digest 10.4.2)
  3. they are unwilling to change their expectations

10.5.1 Preferences, restrictions and warnings

In response to a question regarding the level of earnings a claimant is prepared to accept, it is not uncommon for a claimant to respond by specifying earnings that are consistent with or close to past experience and qualifications. One should avoid drawing hasty conclusions from an answer to such a question. This does not necessarily mean that the claimant is imposing an absolute restriction and will not accept anything less (Digest 10.4.3.1). It is quite normal for a person to look for gainful employment and start with high expectations, leaving room for later concessions.

Similarly, in an effort to reply to direct and specific questions on a form or questionnaire, or to give the information within the limited space provided, a person may not have had the opportunity to clarify what appears to be a somewhat definite and firm answer.

Personal efforts made to obtain employment at a lower level of earnings, or the acceptance of employment at a lower wage, may be an indication that the wage originally specified was a preference rather than a restriction.

As indicated in section 10.4.2 of this Digest, the Commission will continue its long-standing practice of warning claimants whose availability may be restricted in some way, of the implications of those restrictions. Depending on the severity of those restrictions, a reasonable period of time to look for work within those restrictions may be granted. The claimant will be advised of the specific period of time, if any, during which they may restrict their availability to within their expectations, and that once that period ends, they will be expected to remove their restrictions. At that time, if they do not comply, they will be disentitled from benefits.

10.5.2 Extreme restrictions

Keeping in mind that the EI program is designed to compensate workers who are involuntarily unemployed, it is not reasonable for a claimant to expect to collect benefits while restricting their availability to only jobs that offer higher wages than those received in the past. Such a demand not only severely reduces chances of re-employment in the near future but, in addition, strongly indicates a lack of sincere interest on the part of the individual, in ending the period of unemployment.

Once a claimant has had a reasonable period of time to explore the chances of obtaining employment, they will be expected to lower their expectations. If they continue to insist on a rate of pay as high as their last employment, this will generally be considered unreasonable. Similarly, a restriction to a rate of pay which is lower, but still high enough to make the short-term prospects of re-employment unlikely, is also an undue restriction.

10.5.3 Exceptions

In certain situations, the Commission is not required to allow a reasonable period of time to explore the chances of obtaining employment at a rate of pay equal to that received at the last employment. This would occur in cases where it is clear that no possibilities of obtaining that wage with other employers, exist. In fact, a restriction to a rate of pay which one has no reasonable hope of obtaining could imply that one has little or no interest in becoming re-employed. In these cases, a disentitlement would be imposed from the start date of the benefit period, if the claimant was not willing to remove the restriction.

For example, where a claimant who is restricting to their previous wage after leaving employment in an industrial city to move to an area where the wage rates are much lower; a claimant retired from employment which paid the highest rates in the area; a claimant is seeking employment following a lay-off from seasonal employment, and expects a rate which they have no chance of obtaining during the off-season; a claimant left highly paid employment in a line of work so limited or specialized that there are no other such opportunities in the area (CUB 51724).

10.5.4 Less favourable financial situation

A claimant is not expected to seek and accept employment if, by accepting the offered earnings, they are placed in a less favourable financial situation than the lesser of:

  • their financial situation while receiving benefits, or
  • the financial situation they were in during their qualifying period

For example, and taking into account the claimant’s EI benefits including any working while on claim earnings provisions, otherwise suitable employment is not suitable and does not have to be sought or accepted, if the casual or part-time nature of the employment means that on-going transportation and child care expenses are so high that the claimant would be put in a less favourable financial situation by accepting the employment (Digest 9.3.4).

If a claimant is restricting their availability for work to a level of earnings that exceeds the legislative definition of suitable employment, they will be disentitled from regular benefits until they meet those requirements, if:

  • this is an actual restriction and not just a preference
  • they have been warned that such a restriction is unacceptable
  • they are unwilling to change their expectations

[September 2019]

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