Digest of Benefit Entitlement Principles Chapter 2 - Section 4

2.4.0 No work while under contract

It is sometimes difficult to determine whether there is an interruption of earnings when a person who is under contract, does not perform any services during a given period, or when the person completely stops working but still remains under contract with the employer. The wording of the agreement between the parties will need to be considered to fully understand the situation. The Commission must ensure that the purpose of the agreement is not to avoid the application of the EI legislation as it was intended (FCA A-769-90, CUB 18566).

2.4.1 Terms of the contract

Any decision on an allocation or an interruption of earnings is based on the contractual agreement between the employer and employee. The key considerations would be the effective date and duration of the contract, as well as the period for which the earnings in question are payable.

As well, in the case of a contract of employment covering a period where the performance of services is not always required or rendered, the Federal Court of Appeal stated the following : (FCA A-951-90, CUB 18718; FCA A-769-90, CUB 18566).

  1. the allocation of earnings paid under such a contract must be made over the period for which the earnings were payable rather than to the time the employee performed the services or obligations. The fact that services were not performed during certain periods is irrelevant;
  2. the allocation of earnings must be so allocated even if the contract is concluded at a date later than the period for which it was payable. The allocation, then, covers a retroactive period that is earlier than the date the contract was concluded;
  3. the fact that the employer delayed in paying the earnings which were to have been regularly paid during the period for which it was payable cannot lead to a conclusion that the contract began only when the earnings were paid.

Such situations could occur in the teaching field where employment contracts may start or end on dates which do not coincide with the dates work is actually performed, or where services are not performed during the entire period covered by the contract or for which the earnings are paid. However, different rules apply in the case of teachers, which are defined in the regulations as those who teach in a pre-elementary, an elementary or a secondary school, including a technical or vocational school (EI Regulation 33).

Leaving employment or being fired may terminate the contractual obligations before a contract expires and result in an interruption of earnings.

[ February 2019 ]

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