Digest of Benefit Entitlement Principles Chapter 24 - Section 9

24.9.0 Sickness benefits

The Employment Insurance Act does not use a specific term to designate the type of benefits paid in case of an inability to work by reason of illness, injury or quarantine. The term sickness benefits has been adopted to refer to these type of benefits (EIA 152.03(1)):

Subject to this Part, a self-employed person who ceases to work as a self-employed person because of a prescribed illness, injury or quarantine and who would be otherwise working, is entitled to receive benefits while unable to work as a self-employed person for that reason.

A further provision is contained in subsection 152.03(4) of the Employment Insurance Act, which states:

A self-employed person, other than one referred to in subsection (1.1), is not entitled to benefits under subsection (1) if, were it not for the prescribed illness, injury or quarantine, the self-employed person would be deemed, in accordance with the regulations, to be not working.

The provisions in subsections 152.03(1) and 152.03(4) of the Act infer that sickness benefits are not paid to all claimants or in all circumstances. Instead, they are subject to the following specific conditions and provisions detailed below.

24.9.1. First entitlement condition: while a person is unable to work

The purpose of sickness benefits is to provide temporary income support to those individuals who are unable to work by reason of illness, injury or quarantine (EIA 152.03(1); section 11.2.1 of the Digest). However, it need not be a complete inability to work.

Given that for self-employed workers, a week of unemployment is defined as a reduced work week (by more than 40% of time devoted to the business), the terminology 'while unable to work', carries the same conditions for the purposes of self-employment special benefits (section 24.6.2 of the Digest). 

The Commission is authorized to make regulations prescribing what information a person must provide to prove their inability to work because of illness, injury or quarantine pursuant to subsection 152.03(1) of the Act. A self-employed person must obtain, at their own expense, a medical certificate signed by a doctor or other medical practitioner that attests to the incapacity, the start date, and the probable duration of the incapacity. Further information on this requirement is detailed in sections 11.2.2 and 11.2.3 of the Digest.

24.9.2 Second entitlement condition: be otherwise working

When applying for sickness benefits, an individual must declare that, if not for their illness, they would otherwise be working in the normal activities of their business or normal activities which support the continuation of their business (EIA 152.03(4); EIR 30(2)).

Claimants receiving parental benefits, compassionate care or family caregiver benefits who wish to convert to sickness benefits, and who provide proof of incapacity, are exempt from showing they would otherwise be working in the normal activities of their business or normal activities that support the continuation of their business.

A person may wish to take advantage of a period of incapacity to take a short-duration training course or spend the period of convalescence away from home, such as a cottage or relatives' area of residence. Because such situations would not have arisen if the individual had been able to work, it cannot be said that the claimant has not proven that they would otherwise be working for that period. On the other hand, in the case of a stay outside Canada, entitlement to benefits would be determined under a separate section of the EI legislation (section of the Digest).

There may be situations where the otherwise working condition is not met. For example, self-employed persons who have temporarily halted their self-employment and later are affected by illness, injury or quarantine cannot usually prove that they would be otherwise working unless their inability to work has delayed a planned return to their business activities. In this case, they may be able to demonstrate that they would be otherwise working if not for their incapacity, but only from the original date set for their return to their business activities.

Another situation is where a self-employed worker discontinued their self-employment altogether (through, for example, a sale or closure of the business or in the event of a bankruptcy) and subsequently filed for self-employment sickness benefits. The legislated otherwise working criteria would not be met. If not for their illness, individuals in these circumstances would not be working in self-employment or working by supporting the continuation of a business.

Self-employed individuals who carry out their self-employment entirely during certain periods of the year would not be able to meet the condition that they would otherwise be working were it not for their illness, injury, or quarantine during the times of the year when they would normally not do any work at all. This does not include periods when they would be performing the normal activities for the continuation of their business (section of the Digest). Otherwise working: supporting the continuation of a business

A business may experience a slowdown or a temporary closure. In Canada, this is often the result of the dramatic seasonal weather variances. However, despite a business' temporary seasonal slowdown or closure, self-employment activities often continue which support the continuation of the business (EIR 30(2)). Activities of this nature include advertising, marketing, bookkeeping, human resources-related activities, making operational repairs or improvements to buildings and/or equipment, etc.

Therefore, despite a slowdown or temporary closure in the business, if there were activities of this nature being conducted within the context of the self-employment at the time when the self-employed person became unable to work, it can be said that the self-employed worker, if not for their illness, would be otherwise working.

24.9.3 Sickness benefits within the maternity period

A pregnant woman may request and be entitled to self-employment sickness benefits during the maternity period (section 24.10.2 of the Digest; EIA 152.03(1.1)).  Although pregnancy and childbirth are not considered to be illnesses, complications with respect to either may be.

The claimant must demonstrate that they are unable to work because of complications due to their pregnancy or childbirth, or because of an unrelated illness and that except for their inability to work, they would be otherwise working.

To receive sickness benefits, the person must obtain, at their own expense, a medical certificate signed by a medical doctor or other medical professional that attests to the incapacity, the start date, the probable duration of the incapacity (section 24.9.1 of the Digest; EIR 40(1)).

Once an inability to work (or an ability to work is considerably lessened) is proven, a claim is dealt with according to the principles applicable to any self-employed person requesting sickness benefits.

A pregnancy that is terminated within the first 19 weeks is considered an illness for the purposes of the Act and must be treated as such (EIR 40(5)).The claim in this case, would be considered for sickness benefits rather than maternity benefits.

24.9.4 Payment of sickness benefits Waiting period

A one-week waiting period must be served when an initial benefit period is established and before sickness benefits can be paid (EIA 152.15). When out of Canada

A person who is temporarily unable to work may plan to spend part of their convalescence in milder climates outside Canada or, conversely, a person who is outside Canada suddenly becomes unable to work. However, the Act provides as follows (EIA 152.2(b)):

Except as may otherwise be prescribed, a self-employed person is not entitled to receive benefits for any period during which the person

  1. is an inmate of a prison or similar institution; or
  2. is not in Canada.

An exception to this provision is provided in Employment Insurance Regulations 55.01(a). A self-employed person is not disentitled from receiving benefits when the person is outside Canada for the purpose of undergoing, at a hospital, medical clinic or similar facility outside Canada, medical treatment that is not readily or immediately available in the self-employed person's area of residence in Canada. The hospital, clinic or facility must be accredited to provide the medical treatment by the appropriate governmental authority outside Canada.

Thus, in addition to the 2 entitlement conditions (being unable to work due to illness, injury and quarantine and be otherwise working), a person must satisfy 2 other specific conditions:

  • The person who is outside Canada must in fact be undergoing medical treatment in a hospital, medical clinic or similar facility located in a country other than Canada; and,
  • The treatment must be one that is not readily available in the claimant's area of residence in Canada. It is not necessary that the claimant be hospitalized.

It must not be a miracle treatment or any kind of cure that is claimed to be the panacea for all illnesses, but a treatment that, while not necessarily conventional, may be seen as being relatively effective and is recognized by a scientific or medical authority (See various jurisprudence).

There are several factors that might lead someone who is unable to work to undergo medical treatment in a country other than Canada. It might be due to, amongst others: the urgency of the situation as opposed to the immediate availability of the treatment in a Canadian health institution, the proximity of the residence to the treatment centre, the supposed quality of care, or the technological advancements and expertise of certain medical science authorities or clinics renowned for the treatment of certain illnesses or for certain procedures.

A facility outside Canada that offers a treatment prescribed in Canada is considered to be an accredited facility.

The Act leaves no room for other circumstances that could occur where a person might, for personal reasons or on the recommendation of a physician, have to stay outside the country, even with a medical certificate establishing the inability to work (see various jurisprudence).

The prescription applies to a person whose inability to work arose before or while they were outside Canada. Both must show that they satisfy the 2 conditions specified in the Regulations.

The question whether the person proves that they would be otherwise working is always relevant in such a case.

[November 2023]

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