Friday, December 21, 2012

Canada - Foreign Worker Entitled to Loss of Earnings While Work Permit Extension Pending

By Sergio Karas, karas@karas.ca

In another twist to the lengthy delays that foreign workers must endure when applying for extensions of their status at the Citizenship and Immigration Case Processing Center in Vegreville, Alberta, a recent worker’s compensation decision held that an employee performing modified work duties, acting in good faith in attempting to renew his Work Permit, was entitled to loss of earnings benefits for a period in which he was laid off because the employer thought that his Work Permit was not valid.

In Decision No. 822/11[1], the Ontario Workplace Safety and Insurance Appeal Tribunal allowed an appeal by a foreign worker from a decision of a Case Manager denying loss of earnings benefits on the basis that the worker did not provide the employer with appropriate documentation of his renewed Work Permit during the period of the lay off. The worker was employed as a labourer. He injured his right shoulder when he was pulling a hydro cable. The Worker’s Safety and Insurance Board (WSIB) granted him entitlement for a right shoulder strain. He received the appropriate treatment and then returned to modified work with the accident employer. The employee was a foreign worker in Canada and was in the process of seeking permanent residence. He had a valid temporary Work Permit issued by Citizenship and Immigration Canada (CIC) which expired on July 27, 2009. On August 13, 2009, the employer laid him off until the worker would provide a new Work Permit on the basis that the employer assumed that he was not entitled to work in Canada. The worker returned to work to modified duties on September 17, 2009, the day after he received his new Work Permit. The worker requested that the WSIB grant him loss of earnings attributable to the period of his layoff. A Case Manager denied the worker entitlement to benefits for the approximately four weeks of the layoff on the basis that the reason for his wage loss during that period was not compensable, since the worker was not legally entitled to work in Canada. A reconsideration requested by the worker’s representative also resulted in a negative decision, even though he indicated that the worker had “implied status” during the time in question because he had filed a request for an extension of his Work Permit and its processing was not yet completed. Nevertheless, the request for reconsideration was denied on the basis that the worker did not provide the employer with appropriate documentation of his renewed Work Permit until after he returned to work. A further objection to the Appeals Review Officer (ARO) also resulted in a negative decision. However, the Ontario Workplace Safety and Insurance Appeal Tribunal allowed the appeal.

The tribunal noted that there was no dispute that the worker required modified work due to his injury, and that the employer did in fact provide suitable modified work before and after the period of loss of earnings in dispute. The main question was whether the worker’s legal status prevented him from performing the modified work, which the employer offered him during the period in question, and which he confirmed in his testimony was suitable and was able to do.

The worker claimed that he applied for an extension of his Work Permit on May 28, 2009, before the expiration of his previous permit. He contended that he had “implied status” thereby allowing him to continue working while his application for renewal of the Work Permit was being processed. It must be noted that it is CIC policy that applicants who file a Work Permit extension request prior to the expiry of their permit indeed have “implied status” until a decision is made by the Case Processing Centre. On the other hand, the employer argued that it stopped providing modified work and laid off the worker on August 12, 2009 when it became aware that his Work Permit had expired and the worker had not advised the employer that he had applied for its renewal. The worker agreed that the employer acted in compliance with the law by not employing the worker while its managers understood that his status in Canada was in question. However, that was an incorrect interpretation from their part. The worker provided the tribunal with a copy of his application to extend his Work Permit showing payment of the required filing fee of $150.00 on May 28, 2009, and testified that he told his foreman that he had applied to renew his permit two months prior to the expiry of his previous Work Permit.

The tribunal found it reasonable and sufficient that the worker would have advised his foreman of his Work Permit renewal application with the expectation that he would have passed on the information to the company administration. Even if he had not advised the employer at the time, the tribunal noted that the employee’s representative who filed the extension request faxed the employer a copy of the application on August 12, 2009. The employer advised that it had no clear protocol for maintaining records for such information at the time and it appears that, therefore, the communication between the worker’s representative and the employer was not handled appropriately. The worker also testified that he had indeed applied for a previous extension without any difficulties, continuing to work while his application was pending on that occasion. The tribunal found that the worker complied with his obligations and took the necessary steps to keep the employer informed of his efforts to maintain his legal status in Canada, and that he remained willing and able to perform the modified work.

The tribunal noted that the employer raised the issue that the worker’s Social Insurance Number had expired together with the Work Permit, and that therefore the worker was not legally able to work and should not be entitled to loss of earnings benefits during the period in question. The tribunal held that the lack of a valid Social Insurance Number was not an issue at the time and that it lacked the capability of verifying whether a person can be paid after a Social Insurance Number has expired. 

Based on the evidence, the tribunal held that the worker took all the steps that he could and acted appropriately to keep the employer informed of his efforts to maintain his legal status and was therefore entitled to loss of earnings benefits for the period in question. However, the tribunal also held that the employer acted in good faith in suspending the worker’s employment during that time as this was a novel situation and it appeared that there was some confusion within the company about how to handle it. Then, the employer should not be penalized with the cost of the claim.

This case highlights the importance for employers to have the appropriate protocol in place to track the status of foreign workers in their employ. Had the employer obtained legal counsel from an immigration lawyer and explained the situation thoroughly, it would have been advised that the worker had indeed the ability to continue to work while his application for a Work Permit extension was pending, as the worker indeed had “implied status”. This would have saved the employer considerable time, effort and cost in dealing with the situation. Employers must endeavor to maintain good records and make inquiries of the foreign workers as to the steps they have taken to maintain their status in Canada. Employers must be proactive in assisting their foreign workers to pursue their applications deliberately and well in advance of the expiry of their Work Permits to avoid unnecessary headaches and unpleasant situations, and the cost and time required in dealing with situations that can put a strain on their relationship.


[1] Decision No. 822/11
[Names of Parties are Not Published] [2011] O.W.S.I.A.T.D. No. 1148