Executive Summary: Key Legal and Evidentiary Issues

• Applicant received $8,000 in CERB payments but earned more than $1,000 in each of the four relevant eligibility periods, disqualifying her under the Canada Emergency Response Benefit Act.

• New evidence (bank statements in Exhibit B) was deemed inadmissible as it was not before the Officer when making the original decision.

• The $1,000 income threshold requirement existed in legislation from the time of enactment, and the Officer had no discretion to depart from statutory eligibility criteria.

• Procedural fairness was upheld as the Applicant was informed of eligibility requirements and given opportunity to respond through the CRA verification process.

• Standard of review applied was reasonableness for the merits of the decision and correctness for procedural fairness issues.

• Applicant's arguments regarding lack of knowledge of eligibility rules and payment of taxes on CERB amounts were not relevant to the Officer's statutory task.

Background and facts of the case

Guiseppina Di Lello applied for the Canadian Emergency Response Benefit (CERB) in 2020 and subsequently received payments totalling $8,000 for CERB periods between April 12, 2020, and August 1, 2020. At the time, she was employed in a part-time position at Scotiabank and in a self-employment position with the Probation and Parole Office in Guelph, Ontario. Commencing in April 2020, she was unable to work because of the COVID-19 pandemic, although she received payments from Scotiabank from April to July of 2020 in relation to sick days and vacation days.

By letter dated March 31, 2022, the CRA required the Applicant to provide documents confirming her eligibility for those payments. The Applicant provided documents on May 2, 2022, but by letter dated April 28, 2023, a CRA officer advised her she was not eligible because she received more than $1,000 of employment or self-employment income during each of the relevant periods and/or that she did not stop working or have her hours reduced related to COVID-19. She requested a second review and, in a letter dated October 11, 2023, provided written submissions and further documentation, acknowledging she had earned more than $1,000 per month but disputing the requirement to repay the $8,000. She noted she had claimed her CERB payments as income, had paid $4,500 towards her income tax for the 2020 taxation year, and was up-to-date in her tax payments.

The CRA's eligibility determination

On August 20, 2024, the Officer sent a letter advising the Applicant she was not eligible for the CERB because she earned more than $1,000 of employment or self-employment income during the applicable payment period and/or she did not stop working or have her hours reduced for reasons related to COVID-19. The Officer calculated the Applicant's gross income for each relevant four-week period: Period 2 (April 12, 2020 to May 9, 2020) was $1,542.39; Period 3 (May 10, 2020 to June 6, 2020) was $1,492.39; Period 4 (June 7, 2020 to July 4, 2020) was $1,101.6; and Period 5 (July 5, 2020 to August 1, 2020) was $1,328.04. Each amount exceeded the $1,000 threshold.

Legislative framework and eligibility requirements

Under the Canada Emergency Response Benefit Act, a worker is eligible for an income support payment if the worker ceases working for reasons related to COVID-19 for at least 14 consecutive days within the four-week period in respect of which they apply for the payment, and they do not receive, in respect of those consecutive days, subject to the regulations, income from employment or self-employment. The Income Support Payment (Excluded Nominal Income) Regulations provide that such income is excluded from the application of subparagraph 6(1)(b)(i) of the CERB Act if the total of such income received in respect of the consecutive days on which they have ceased working is $1,000 or less. The CERB Act came into force on March 25, 2020, the day in which it received royal assent. The Regulations came into force on April 16, 2020. The Court noted that prior to the introduction of the $1,000 threshold, any income at all would have disqualified an applicant.

Issues regarding new evidence

The Respondent argued that the Court should disregard information contained in Exhibit B to the Affidavit of the Applicant, which consists of bank statements dating to periods in 2020, because they were not before the Officer when the decision was made. The Respondent filed an affidavit affirmed by the Officer on November 14, 2024, in which the Officer states that they have reviewed the Applicant's Affidavit and, in making the Decision, did not review the bank statements attached as Exhibit B. The Court accepted this submission and stated it would not take Exhibit B into account in reviewing the reasonableness of the Decision. However, the Court noted that nothing substantive turns on this issue, as the Applicant has not argued that the Exhibit B bank statements support a conclusion as to levels of income different than those that the Officer identified in the Decision.

Analysis of reasonableness and procedural fairness

The Applicant argued she met the requirements for CERB eligibility that had been communicated at the time she applied, asserting she had no knowledge at that time of a requirement that an applicant have received less than $1,000 in each relevant period, and that the Decision is therefore unreasonable. The Court stated it is not disputing the veracity of the Applicant's assertion that she thought she was eligible when she applied. However, the Court held that what matters for purposes of the Court's review of the reasonableness of the Decision is the applicable law at the relevant time. The Officer was applying the requirements of the applicable legislation and, as the Respondent submits, in conducting the review of the Applicant's eligibility, as permitted by sections 10 and 12 of the CERB Act, the Officer had no room to depart from the eligibility criteria set out in the legislation. Therefore, considerations such as the fact that the Applicant exceeded the $1,000 threshold by only small amounts, declared the CERB payments she received when she filed her 2020 tax return, or made relevant tax payments were not relevant to the Officer's task in making the Decision.

Regarding procedural fairness, the Court found that at the commencement of the process, the CRA sent the Applicant a letter dated March 31, 2022, which explained that she was not eligible to receive the CERB if she earned over $1,000 in an application period and identified the sort of documentation she should provide in order to support her eligibility. The evidence in the record of correspondence and subsequent written and oral communications between the CRA and the Applicant demonstrate that she was aware of the requirement that she had to satisfy in responding to the CRA's verification process and had an opportunity to attempt to satisfy that requirement. The Court agreed with the Respondent that the Applicant was afforded requisite procedural fairness.

Ruling and outcome

The Federal Court, presided over by the Honourable Mr. Justice Southcott, dismissed the application for judicial review on February 2, 2026. The Court found the Decision is intelligible and supported by the record before the Officer and is therefore reasonable. Despite the Applicant's able and courteous advocacy on her own behalf in this application, she has not demonstrated that the decision is unreasonable or that she was deprived of procedural fairness. The Respondent, the Attorney General of Canada, prevailed in this application. Notwithstanding this, the Respondent is not claiming costs against the Applicant, and therefore no costs were awarded against her.