Employment Insurance Program Definitions
Access code – Your access code is the four-digit code printed in the shaded area of your benefit statement. You need to have it with you whenever you want to obtain information about your benefit claim and when you submit your reports. Your access code is used to identify you and ensure confidentiality of the information you provide. Store your access code in a safe place, separately from your Social Insurance Number.
Average insurable earnings – The average income earned on which EI contributions were paid. It is used to calculate the weekly benefit rate to which you are entitled.
Capital expenditures - costs or expenditures made to acquire or improve the assets of a business. Capital expenditures include the cost of buying land, buildings, equipment, computers, and vehicles, repaying the principal amount on a loan, and buying a franchise. The assets purchased benefit the business and are used to earn revenue, not only during the period when they were purchased but into the future. The cost of purchasing or improving assets - that is, a capital expenditure - is not an operating expense.
Co-adventurer in a business, regardless of the legal form of the business, has an interest in it with others and is involved personally in activities considered necessary to operate the business. It makes no difference whether the business is registered or incorporated. This interest in the business can take many forms, from money given or invested to an expectation of gaining from the profits.
Contract for services - an arrangement between a worker and another party or payer to do a specified job or task for an agreed upon rate or price. The work is usually to be completed within a specified time frame. The method for accomplishing the work is determined by the independent worker and not the payer, meaning there is no employer–employee relationship. Independent workers assume a chance of profit and a risk of loss and establish the overall cost of the work they are going to do before they are engaged. Individuals hired under a contract for services are considered to be self-employed.
Contract of service - an arrangement, either written or verbal, where an employee agrees to work on a full-time or part-time basis for an employer. The employee performs duties for the employer, in return for a salary or some other form of remuneration. The employer controls and directs the manner in which the employee carries out the duties to be performed.
Designated economic regions – Parts of Canada with high unemployment rates where special measures have been put in place to provide workers with increased access to EI benefits.
Farmer - either an individual working alone or an individual engaged in a partnership, corporation, or cooperative association who is or intends to be engaged in farming in Canada.
Farming - involves producing field-grown and horticultural crops (cultivated and uncultivated), raising livestock, poultry, and fur-bearing animals, producing eggs, milk, honey, maple syrup, tobacco, fibre, wood from woodlots, and fodder crops, and producing or raising any other prescribed thing or animal.
Full work week - considered to be at least the same number of hours worked by other regular workers in that occupation.
Hours of insurable employment – Hours for which employees receive insurable earnings. For example, each hour worked by employees, for which remuneration is received, is insurable.
Independent worker - someone who works under a contract for services rather than a contract of service.
Independent workers include tradespersons, truck owners, taxi drivers, real estate agents, salespeople, and professional workers (including doctors, lawyers, accountants, or other professionals who carry on activities in their own business or practice and who do not work in an employer–employee relationship).
Interruption of earnings – An interruption of earnings occurs when, following a period of employment with an employer, an insured person is laid off or separated from that employment and has a period of seven or more consecutive days during which no work is performed for that employer and no earnings arise from that employment.
Just cause – Depending on the circumstances, the following reasons may be just cause for leaving your employment voluntarily:
- you are a victim of sexual or other harassment, or you are a victim of discrimination because you belong to an association, organization, or union of workers;
- you need to accompany your spouse or dependent child to another residence;
- you are a victim of discrimination;
- your working conditions are dangerous to your health and safety;
- you need to care for a child or a member of your immediate family;
- you have reasonable assurance of other employment in the immediate future;
- your wages or salary have been significantly changed, or your employment conditions have changed to the extent that they have significantly impacted your wages or salary;
- you are asked to work an unreasonable amount of overtime or your employer refuses to pay you for the overtime work;
- your duties have changed significantly;
- you experience antagonism with a supervisor, and you are not primarily responsible for the antagonism;
- your employer has certain practices that are contrary to law; or
- you are unduly pressured by your employer or your co-workers to leave your employment.
Labour force attachment – The 52-week period immediately preceding the qualifying period. It corresponds to the number of hours for which a person was a member of the labour force. This includes performing work, receiving earnings, receiving benefits or compensation, participation in an approved training or other program, serving a waiting period, or participation in a labour dispute.
Leaving employment voluntarily without just cause – You took the initiative to end your employment without considering all the reasonable alternatives available to you to keep your job.
- If the deceased person left a court-approved will (a testamentary estate), the executor appointed in the will is considered as the legal representative. In Quebec, a notarized will does not have to be court-approved;
- If the deceased person did not leave a will (an intestate estate), but the court appointed an administrator of the estate by way of letters of administration, the administrator is considered the legal representative;
- If the total value of the estate is not large enough to justify obtaining an order or probate of the will, one of the persons authorized to inherit property of the deceased person may ask for the payment of benefits in the name of the deceased person.
Maximum yearly insurable earnings – The highest amount of income on which EI contributions can be paid.
Minor in extent - the work you do is so minimal that you are unable to make a living from it.
Six factors are considered to determine the extent of your self-employment activities when you apply for EI benefits. All of these factors will be evaluated to determine if you are working a full work week.
Factors to consider are:
- the time spent on these activities;
- the nature and amount of the capital and resources invested;
- the financial success or failure of the employment or business;
- the continuity of the employment or business;
- the nature of the employment or business (i.e., are the self-employment activities in line with your usual occupation or totally different?); and
- your intention and willingness to look for and immediately accept other work.
For example, you may normally work in a factory full time in insurable employment during the day for an employer. In addition, you also spend three to five hours a week during evenings and weekends engaged in your Internet-based business. You work out of your own home, do the work in your spare time, and you earn $200 a month. If you are laid off from your employment at the factory or stop working for another reason, you may be entitled to EI benefits, even if you have earnings from your Internet business.
Misconduct – Any inappropriate action, violation, or professional misconduct committed voluntarily or deliberately by a person who is employed by an employer. Misconduct exists when the employee’s behaviour goes against the obligations set out in the employment contract and when the employee should normally know that the actions, omissions, or professional misconduct in question could lead to dismissal.
Misrepresentation – Knowingly withholding information, making misleading statements, or misrepresenting the facts to make a false claim for benefits. If you misrepresent yourself, you could face severe monetary penalties or prosecution. This could also affect your future benefits.
Mistake – An unintentional act. Common mistakes that claimants make when filing their EI reports include:
- estimating weekly earnings instead of putting in the actual amount earned;
- forgetting to declare all the earnings received;
- writing or entering the wrong number when reporting earnings; or
- adding the number of hours or amount of earnings incorrectly.
If you notice a mistake on a completed form or report, or if there is a change in your circumstances that could affect your EI claim, inform Service Canada immediately to prevent future problems with your claim and help you avoid penalty or prosecution.
No fault of your own – You are not considered responsible for the loss of your employment. We may consider you are not responsible for the loss of your employment if:
- your employer ended your employment, but it was not a result of misconduct on your part; or
- you left your employment for reasons that could be considered just cause for leaving the employment (for example: harassment, discrimination, or dangerous working conditions).
Operating expenses - the cost of running your business, which could include expenses you incur to earn revenue, such as rent, materials, and gas, as well as allowances for depreciation on capital investments directly connected to that income. Payments for income tax or for federal or provincial pension plans cannot be deducted as operating expenses.
Partner - pools resources with one or more people to operate a business for profit. Partners are jointly liable for the partnership's obligations and debts.
Qualifying period – The shorter of:
- the 52-week period immediately before the start date of your claim; or
- the period from the start of a previous benefit period to the start of your new benefit period, if you applied for benefits earlier and your application was approved in the last 52 weeks.
Exception: In some cases, the qualifying period may be extended to a maximum of 104 weeks if you were not employed in insurable employment or if you were not receiving EI benefits.
Ready, willing, and capable of working each day – To receive EI benefits, you need to show that you are ready, willing, and capable of working each day, as defined here:
- Being “ready to work” means that your conduct shows your desire to work, but you have been unable to find a job.
- Being “willing to work” means that you are willing to accept all types of work that your abilities, skills, training, or experience enable you to do, and you are willing to accept labour market conditions (for example, going rate of pay, hours of work). This is shown with an active, documented job search.
- Being “capable of working” means that you have the physical and mental requirements to perform the duties of an employment under the same conditions as workers who usually do that type of work.
Self-employed worker - an independent worker who contracts services to companies or individuals, and who controls his or her own working hours.
Service contract - occurs when an individual is hired to provide a service to an employer or to perform a specific job or piece of work. With this type of contract, the earnings are for services performed.
Sole owner - directs all the activities of the business, assumes all authorities and obligations, and is personally liable for its business debts. A sole owner may hire someone to run the operation.
Transactional contract (transaction) - an agreement to sell goods or products to clients and customers. The contract can cover the sale of goods or products now or at a future time. With this type of contract, your earnings result from a transaction.
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