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Ontario auto claim reduces employment insurance sickness benefits: federal judge

October 20, 2021   by Greg Meckbach

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An Ontario auto claimant is facing a reduction in federal employment insurance (EI) benefits because she was getting income replacement benefits with her auto insurer.

In 2019, Antonina Sennikova was involved in a motor vehicle accident that prevented her from returning to work. As a result, she got IRB from Aviva General Insurance Company in Ontario, Federal Court Justice William Pentney wrote in Sennikova v. Canada (Attorney General).

At one point, the Canada Employment Insurance Commission found that the federal government overpaid Sennikova in sickness benefits (part of federal EI) because she was also getting auto income replacement from Aviva.

Justice Pentney’s Sept. 22, 2021 ruling upholds a decision of the Social Security Tribunal of Canada. Aviva is not a party to Sennikova’s federal court case because it is a dispute with the federal government over deducting auto insurance benefits from employment insurance benefits.

Sennikova had applied with the federal court for judicial review of the decision of the Social Security Tribunal Appeal Division, which upheld a ruling of the Social Security Tribunal, General Division. The end result is that her EI sickness benefits are reduced because of her auto income replacement benefits.

The federal Employment Insurance Regulations go into detail on how EI is calculated.

There are some sources of income which are deducted from EI. With some exceptions, the amount to be deducted from EI payable includes “payments a claimant has received or, on application, is entitled to receive from a motor vehicle accident insurance plan provided under a provincial law in respect of the actual or presumed loss of income from employment due to injury, if the benefits paid or payable under the [federal Employment Insurance Act] are not taken into account in determining the amount that the claimant receives or is entitled to receive from the plan.”

Sennikova had argued that when the federal regulation stipulates “motor vehicle accident insurance plan provided under a provincial law,” that regulation is not referring to Ontario, in which private insurers provide auto accident benefits using policy wording stipulated in provincial regulation. Instead, Sennikova contended that federal EI regulation is actually referring to auto accident benefits in provinces in which a crown corporation has a monopoly.

In Quebec, auto liability is written by private insurers however the Société de l’assurance automobile du Québec (SAAQ) provides accident benefits. British Columbia, Manitoba and Saskatchewan have crown corporations with monopolies on basic auto coverage, while Alberta, Ontario and Atlantic Canada have privately-run auto.

So in her federal court case, Sennikova says she did not have a “motor vehicle accident insurance plan provided under a provincial law” because she had a private contract of insurance with Aviva, which she paid for herself. She argued that her auto insurance contact with Aviva was about automobile insurance, not employment.

But the Social Security Tribunal of Canada found that a payment will be treated as earnings if it is made to a claimant under a motor vehicle insurance scheme regulated by the provincial government that provides for the payment of benefits for loss of wages. The tribunal found that the payments did not need to be made directly by the government and that the insurance scheme did not need to be provincially run. All that was required was that the payments be made under or pursuant to a provincially regulated scheme, wrote Justice Pentney.

The federal court has the power to overturn a ruling of the Social Security Tribunal Appeal Division if it finds the decision is unreasonable, wrote Justice Pentney.

In upholding the ruling, Justice Pentney said he is not persuaded that any of Sennikova’s arguments point to the kinds of errors or flaws that would make the decision of the Social Security Tribunal Appeal Division unreasonable.

“The Appeal Division applied the right law, took into account the key facts, and explained its reasoning in a careful, logical, and coherent way. That is what reasonableness review requires, and I can find no basis to interfere with the decision.”

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