Employment Insurance Act (S.C. 1996, c. 23)

Marginal note:Types of insurable employment

• 5 (1) Subject to subsection (2), insurable employment is

  • (a) employment in Canada by one or more employers, under any express or implied contract of service or apprenticeship, written or oral, whether the earnings of the employed person are received from the employer or some other person and whether the earnings are calculated by time or by the piece, or partly by time and partly by the piece, or otherwise;

  • (b) employment in Canada as described in paragraph (a) by Her Majesty in right of Canada;

  • (c) service in the Canadian Forces or in a police force;

  • (d) employment included by regulations made under subsection (4) or (5); and

  • (e) employment in Canada of an individual as the sponsor or co-ordinator of an employment support measure other than one referred to in paragraph 59(c) or (d).

• Marginal note:Excluded employment

  (2) Insurable employment does not include

  • (a) employment of a casual nature other than for the purpose of the employer’s trade or business;

  • (b) the employment of a person by a corporation if the person controls more than 40% of the voting shares of the corporation;

  • (c) employment in Canada by Her Majesty in right of a province;

  • (d) employment in Canada by the government of a country other than Canada or of any political subdivision of the other country;

  • (e) employment in Canada by an international organization;

  • (f) employment in Canada under an exchange program if the employment is not remunerated by an employer that is resident in Canada;

  • (g) employment that constitutes an exchange of work or services;

  • (h) employment excluded by regulations made under subsection (6); and

  • (i) employment if the employer and employee are not dealing with each other at arm’s length.

• Marginal note:Arm’s length dealing

  (3) For the purposes of paragraph (2)(i),

  • (a) the question of whether persons are not dealing with each other at arm’s length shall be determined in accordance with the Income Tax Act; and

  • (b) if the employer is, within the meaning of that Act, related to the employee, they are deemed to deal with each other at arm’s length if the Minister of National Revenue is satisfied that, having regard to all the circumstances of the employment, including the remuneration paid, the terms and conditions, the duration and the nature and importance of the work performed, it is reasonable to conclude that they would have entered into a substantially similar contract of employment if they had been dealing with each other at arm’s length.

• Marginal note:Regulations to include employment

  (4) The Commission may, with the approval of the Governor in Council, make regulations for including in insurable employment

  • (a) employment outside Canada or partly outside Canada that would be insurable employment if it were in Canada;

  • (b) the entire employment of a person who is engaged by one employer partly in insurable employment and partly in other employment;

  • (c) employment that is not employment under a contract of service if it appears to the Commission that the terms and conditions of service of, and the nature of the work performed by, persons employed in that employment are similar to the terms and conditions of service of, and the nature of the work performed by, persons employed under a contract of service;

  • (d) employment in Canada by Her Majesty in right of a province if the government of the province waives exclusion and agrees to insure all its employees engaged in that employment;

  • (e) employment in Canada by the government of a country other than Canada or of any political subdivision of the other country if the employing government consents;

  • (f) employment in Canada by an international organization if the organization consents; and

  • (g) the tenure of an office as defined in subsection 2(1) of the Canada Pension Plan.

• Marginal note:Regulations to include persons in business

  (5) The Commission may, with the approval of the Governor in Council and subject to affirmative resolution of Parliament, make regulations for including in insurable employment the business activities of a person who is engaged in a business, as defined in subsection 248(1) of the Income Tax Act.

• Marginal note:Regulations to exclude employment

  (6) The Commission may, with the approval of the Governor in Council, make regulations for excluding from insurable employment

  • (a) any employment if it appears to the Commission that because of the laws of a country other than Canada a duplication of contributions or benefits will result;

  • (b) the entire employment of a person who is engaged by one employer partly in insurable employment and partly in other employment;

  • (c) any employment if it appears to the Commission that the nature of the work performed by persons employed in that employment is similar to the nature of the work performed by persons employed in employment that is not insurable employment;

  • (d) the employment of a member of a religious order who has taken a vow of poverty and whose remuneration is paid directly or by the member to the order;

  • (e) any employment in which persons are employed hardly at all or for nominal remuneration; and

  • (f) any employment provided under regulations made under section 24 or under an employment support measure other than one referred to in paragraph 59(c) or (d).

• Marginal note:Defining certain expressions

  (7) The Commission may, with the approval of the Governor in Council, make regulations defining, for the purposes of this section, the expressions casual nature, government, in relation to a government of a country other than Canada or of a political subdivision of the other country, and international organization.