Will CERB/CRB reduce my no-fault benefits?

Updated January 2022

As predicted in my recent blog, the issue of whether the Canada Recovery Benefit (CRB) and the Canada Emergency Response Benefit (CERB) is deductible from an income replacement benefit (IRB) did not end with Foster vs. Aviva General Insurance (2021 ONLAT 19-014657/AABS). The Licence Appeal Tribunal released the reconsideration decision, Foster v Aviva Gen. Ins. Co., 2021 CanLII 117413 (ON LAT), on November 17, 2021, after the applicant requested a reconsideration of the Tribunal’s decision that the CRB/CERB were deductible from his IRB payable under Statutory Accident Benefits Schedule (SABS). The request for reconsideration was granted. Vice-Chair, Jesse A Boyce, agreed that a legal error had been made by the Tribunal – and that CRB/CERB payments are in fact not deductible from an IRB. Accordingly, the applicant was entitled to keep his full income replacement benefit in the amount of $400.00 per week.

In short, Vice-Chair Boyce found that CRB/CERB does not fall under the definition of “gross employment income” in section 4(1) of the SABS (i.e. “salary, wages and other remuneration from employment”). Therefore it cannot be deducted from an IRB payment received following a motor vehicle collision. More specifically, Vice-Chair Boyce concluded that CRB/CERB eligibility is not tied to an individual’s employment status. The benefit is not calculated with reference to income from employment, as everyone eligible receives the same amount. CRB/CERB payments are not made by an employer but as part of an ad hoc government relief program paid by the Canada Revenue Agency. Finally, CRB/CERB is not akin to employment insurance benefits, as they are not paid under the Employment Insurance Act but rather under the Canada Emergency Response Benefit Act.

There are important practical implications of this reconsideration decision for those who are injured in a motor vehicle collision and eligible to receive both CRB/CERB and an income replacement benefit. They will now be able to receive the full amount of their entitlement to both benefits without deductions.  

Initial Predictions from October 2021

In March of 2020, in response to the global pandemic, the federal government introduced the Canada Emergency Response Benefit (CERB) for those who had “stopped working because of reasons related to COVID-19”. If you were eligible for CERB, you could receive weekly payments of $500.00. After CERB ended in October 2020, the Canada Recovery Benefit (CRB) was implemented. It provides income support for those who are “directly affected by COVID-19”. If you’re eligible, the CRB is available for up to a maximum of fifty-four weeks. It starts at $900.00 every two weeks and then ramps down to $540.00 every two weeks.

Since CERB/CRB was introduced, our clients who have been injured in motor vehicle collisions and also had their employment impacted by the COVID-19 pandemic, have been asking us whether this benefit will affect their entitlement to income replacement benefits under the Statutory Accident Benefits Schedule (SABS). If you haven’t already seen my video on statutory accident benefits, these are no-fault benefits which are provided under the SABS to those who are injured in an accident involving the use or operation of a motor vehicle. They are mandated in Ontario, therefore all motor vehicle insurance policies will provide you with access to statutory accident benefits. One of the benefits available to you is an income replacement benefit if you are unable to work due to your injuries from the accident. It provides a weekly benefit of up to $400.00 (unless you have purchased optional benefits). While arguably the benefits should not offset one another, the SABS doesn’t provide a clear answer to this question and there was no case law from the Licence Appeal Tribunal which directly addressed this – until now!

Foster v Aviva General Insurance (2021 ONLAT 19-014657/AABS)  was released by the License Appeal Tribunal on September 15, 2021. The most significant takeaway from this decision is that Adjudicator Ferguson found that CERB/CRB is akin to remuneration from employment, and therefore it is to be deducted from an income replacement benefit under the SABS. It is the first decision to have considered the interaction between these two benefits since the beginning of the COVID-19 pandemic and the introduction of CERB. Another important takeaway from this decision is that Adjudicator Ferguson agreed that CERB is only available to those who have lost their employment due to the pandemic, however he did not consider this mutually exclusive of the applicant’s accident-related symptoms. In other words, he declined to conclude that it wasn’t the accident that caused the applicant to lose his job just because he was already in receipt of CERB (which is only available to those who are not working due to the pandemic). This confirmed that there are certain circumstances, such as in this case, where both an accident and COVID-19 could be found to have impacted your employment and you could receive both CERB/CRB and an income replacement benefit.

The applicant in this case was injured in a motor vehicle collision in 2019 and applied for benefits under the SABS, including an income replacement benefit and chiropractic treatment. These benefits were denied by his insurance company and an application was submitted to the Licence Appeal Tribunal to resolve this dispute. The Tribunal held that the chiropractic treatment that the applicant was applying for was not reasonable or necessary, however due to the applicant’s concussion symptoms, it was found that he suffered a substantial inability to perform his workplace duties after the accident and he was therefore entitled to receive a weekly income replacement benefit. By way of background, the applicant was a self-employed sub-contractor who did drywall taping and plastering. He had obtained this job through a family connection and had worked in it for many years prior to his accident. After the accident, the applicant’s concussion symptoms prevented him from carrying out many of his routine tasks at work, although his employer was particularly accommodating and supportive of his limitations and permitted him to continue working with modified duties and hours. Unfortunately, due to the financial pressures associated with the onset of the pandemic, the applicant’s employer decided that he was no longer able or willing to accommodate the applicant in his position and he was laid off. Adjudicator Ferguson commented that this was an unusual situation in which the applicant’s substantial inability to perform his duties preceded his unemployment by a significant amount of time and he owed this to the applicant’s benevolent employer. After Adjudicator Ferguson determined that the applicant was entitled to an income replacement benefit, the parties asked the Tribunal the question that many of us have been waiting for it to be asked – whether the CERB/CRB received by the applicant is deductible from his income replacement benefits. Adjudicator Ferguson concluded that it is deductible. His rationale is that CERB/CRB is much like employment insurance (EI) benefits in the context of the SABS, as both benefits provide a bridge to individuals out of work. EI benefits are considered deductible from an income replacement benefit at 70%, as they are included in the definition of gross employment income in section 4(1) of the SABS. 

So, as it now stands, if you have been injured in a collision and your employment has been directly affected by COVID-19, there are circumstances where you may be eligible to receive CRB and an income replacement benefit. However, it seems that you will unfortunately not be entitled to keep the full amount of both benefits. Pursuant to the Tribunal’s characterization of CERB/CRB as “remuneration from employment” which falls under “gross employment income” under the SABS, your income replacement benefit will likely be reduced by 70% of your CERB/CRB benefit. While this isn’t the initial answer we had hoped for for our clients, it is likely that the issue of the deductibility of CERB/CRB from income replacement benefits is far from over. There’s a considerable argument to be made that CERB/CRB is not received “as a result of being employed after the accident” which is required under the wording of section 7(3) for gross employment income to be deducted from income replacement benefits. In addition, earlier this year, the Superior Court of Justice in Iriotakis v. Peninsula Employment Services Limited, 2021 ONSC 998, held that CERB was not deductible from damages in a wrongful dismissal civil action, as it cannot be considered in the same light as EI benefits when it is not paid into by either employee or employer.

I will definitely be keeping my eyes open for further decisions coming from the License Appeal Tribunal on this issue. If you have been injured in a motor vehicle accident, it is important that you talk to a personal injury lawyer to ensure that you are maximizing the amount of income support available to you.