Executive Summary: Key Legal and Evidentiary Issues

• Nahid Mukta sought judicial review of a CRA decision finding her ineligible for CERB during four of the six periods she applied for, due to exceeding the $1,000 income threshold and not demonstrating a stoppage of work or reduction in hours due to COVID-19

• Pandemic Pay received from the Ontario provincial government was counted as employment income, pushing the Applicant over the eligibility limit in certain periods

• Income overages in two periods were minor — $30.59 and $43.58 — yet the Court held that neither the CRA nor the judiciary can create "wiggle room" around Parliament's threshold

• Ontario legislation restricting long-term care workers to a single facility reduced the Applicant's hours, but this did not override the income-based disqualification under the CERB Act

• Procedural fairness was not breached, as the Applicant received multiple opportunities to respond in writing and during a call with the reviewing Officer

• The application for judicial review was dismissed with no costs awarded to either party

Background and employment circumstances

Nahid Mukta, a front-line healthcare worker in Ontario, was employed at both a hospital and a long-term care facility prior to March 2020, working 60 to 70 hours bi-weekly. When she was let go from her job at the long-term care facility, her hours were reduced to 30 to 35 hours bi-weekly. According to Ms. Mukta, this was due to legislation referred to as the Limiting Work to a Single Long-Term Care Home, O. Reg. 146/20, which provided that an employee of a long-term care home could not also be employed by a health service provider. In addition to her income from the hospital, she received an amount from the Ontario provincial government due to the high-risk nature of her work as frontline staff during the pandemic, known as "Pandemic Pay."

CERB applications and payments received

Ms. Mukta received a total of $12,000 in CERB payments during four periods: April 12 to May 9, 2020; July 5 to August 1, 2020; August 2 to August 29, 2020; and August 30 to September 26, 2020. She alleged that she applied for CERB in good faith and received some of her pay only after she submitted her CERB applications. She further alleged that the Pandemic Pay could not have been anticipated when she applied for CERB, nor was it guaranteed. As an employee of a health service provider, she noted that it was difficult to stay under the $1,000 threshold because her shifts were variable, and she had no control over her hours or income.

The legislative framework and the $1,000 income threshold

Under paragraph 6(1)(a) and subparagraph 6(1)(b) of the Canada Emergency Response Benefit Act, SC 2020, c 5, s 8, a worker is eligible for CERB if the worker, whether employed or self-employed, ceases working for reasons related to COVID-19 and does not receive income from employment or self-employment, allowances, money or other benefits, or any other income prescribed by regulation during that period. Section 1 of the Income Support Payment (Excluded Nominal Income) Regulations, SOR/2020-90, creates an exception: any income received by a worker for employment or self-employment 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 first and second level reviews by the CRA

By letter dated March 11, 2022, the first reviewer requested documents from Ms. Mukta to support her eligibility, stating that the information on file showed she had earned over $1,000 during the periods she received CERB. The first reviewer determined that the Applicant was ineligible and notified her via a letter dated February 21, 2024. The reasons given were that she earned more than $1,000 of employment income and had not demonstrated that she stopped working or had reduced hours due to COVID-19. Ms. Mukta then requested a second review and made submissions dated March 17, 2024, May 13, 2024, June 29, 2024, and August 11, 2024. She stated that where she exceeded the $1,000 threshold, it was because of an unexpected surplus that was deposited into her account. She also complained that she was notified by the CRA that she did not qualify for CERB long after receiving the benefit with no prior indication of her ineligibility or warning that she would have to return the benefit. On June 6, 2025, the second-level review Officer found that the Applicant was not eligible for CERB during the Periods because she earned more than $1,000 in employment income and did not stop working nor have reduced hours for reasons related to COVID-19. On June 12, 2025, the Applicant received a Notice of Redetermination stating she is required to pay $8,000 minus any amounts she was paid that had not yet been processed, and that she was eligible for CERB from May 10, 2020 to July 4, 2020, but not during the Periods.

The Applicant's arguments on judicial review

Ms. Mukta, who represented herself, advanced three arguments before the Federal Court. First, she argued that the repayment requirement is based on minor and unforeseeable income overages of $30.59 for the August 29, 2020 to September 26, 2020 period, and $43.58 for the period July 4, 2020 to July 31, 2020, and that the rigid application of the $1,000 threshold in these instances undermines the remedial intent of the CERB Act. Second, she submitted that her CERB applications include income she could not have foreseen, whether because of the unpredictability of her shifts or the CRA's improper inclusion of her Pandemic Pay as regular income, which she says is not analogous to regular wages because it was a temporary supplement for extraordinary risk. Third, she argued that her reduction in hours was a direct result of pandemic restrictions and therefore meets the statutory requirement of having stopped working or reduced her hours due to COVID-19.

The Court's analysis and treatment of Pandemic Pay

Madam Justice Whyte Nowak applied the reasonableness standard of review as set out in Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65, and assessed procedural fairness on a standard akin to correctness per Canadian Pacific Railway Company v Canada (Attorney General), 2018 FCA 69. On the merits, the Court acknowledged sympathy for the Applicant but agreed with the Respondent that the Officer was required to apply the income threshold in section 1 of the Excluded Nominal Income Regulations. Relying on Coscarelli v Canada (Attorney General), 2022 FC 1659, the Court held that the $1,000 income limit was chosen by Parliament and neither the CRA nor the Court can rewrite the eligibility criteria to create "wiggle room." With respect to the Pandemic Pay, the Court found it was not unreasonable for the Officer to include it in the calculation of the Applicant's income as it is income received from employment, and the Applicant's suggestion that it should be excluded as it is not "regular income" is not supported by a plain reading of subparagraph 6(1)(b)(i) of the CERB Act, which draws no such distinction. The Court also noted that the Officer found the Applicant ineligible because she was required to meet the requirements of both paragraphs 6(1)(a) and 6(1)(b) of the CERB Act, and the fact that she ceased working at the City of Toronto does not change the fact that her earnings exceeded the $1,000 threshold for the Periods.

Procedural fairness and the delay concern

On the question of procedural fairness, the Court agreed with the Respondent that the Applicant was not denied procedural fairness. She was advised of her ineligibility and provided with multiple opportunities to respond to the first reviewer's findings in writing and on a call with the Officer on June 2, 2025. Although the Applicant considered it unfair for the CRA to have notified her of her ineligibility so many years after she applied, the Court noted that subsection 13(1) of the CERB Act allows the Minister of Employment and Social Development to commence an action or proceeding to recover money owed under the CERB Act within six years of the date when the money became due and payable. The Court further noted that the CERB Act does not permit the Minister to consider compassionate factors or financial hardship.

Ruling and outcome

The Federal Court dismissed the application for judicial review, finding that Ms. Mukta had not met her onus of showing a basis for the Court's intervention. The Respondent, the Attorney General of Canada, did not request costs, and none were awarded. The CRA's Notice of Redetermination requiring the Applicant to pay $8,000 minus any amounts she was paid that had not yet been processed remains in effect; however, the Court itself did not specify a final repayment amount.