Can You Collect EI When Terminated Without Cause?

Can You Collect EI When Terminated Without Cause?

Yes, you can collect employment insurance (“EI”) when you are terminated without cause. 

Mainly, EI ‘regular benefits’ were created for and exist currently to help employees who have lost their employment without cause. 

Keep in mind that the only time someone is not entitled to EI when they are terminated from work is if (1) they were not qualified in the first place or (2) if they were terminated with cause. 

Read More: What are EI Regular Benefits?

When Is Someone Qualified For EI?

Individuals are qualified for EI if:

  1. They were employed in insurable employment;
  2. They were terminated without cause;
  3. They are without work and without pay for at least seven days in a row the last calendar year.
  4. They worked for the required number of insurable employment hours in the last calendar year or since the start of their last EI claim, whichever is shorter;
  5. They are ready, willing and capable of working each day;
  6. They are actively looking for work.

What Is A Without Cause Termination?

Termination without cause is the normal kind of termination. An employer does not need a reason to terminate someone without cause. Usually, employers classify terminations without cause as “restructuring” or something to that effect. 

Examples Of Termination Without Cause:

  • Shortage of work
  • Personality conflict
  • Missed deadlines
  • Moving in a different direction
  • Closing of office
  • Arriving late to work

Even if an employee was terminated for some reason regarding their work, it doesn’t mean they were NOT terminated without cause. Minor issues at work which led to dismissal is not “just cause”. In that regard, so long as an employee’s employer treats his or her termination as “without cause”, they can still collect EI even if they did something allegedly wrong at work.

An employee will know if they were terminated without cause or with cause because his or her employer must tell them they were explicitly terminated with cause in case the employer has, in fact, alleged just cause. Accordingly, if an employer does not tell the employee he or she is explicitly terminated for cause, then, by default, the employee is terminated without cause. 

Terminations without cause occur in 99% of all terminations in my estimation. 

Jeff Dutton

How Employers Tell Service Canada About The Termination

Employers fill out ROE’s when someone is terminated from work. An ROE is the document Service Canada uses to determine if someone will get EI. 

Employers can use code E or M on the ROE for without cause dismissals, and they can write in the extra box that the circumstances to which the employee was terminated were “without cause” or for some other innocuous reason. Service Canada will always read the whole ROE to make a judgment if the termination was eligible for EI. If something seems off, Service Canada will investigate by following up with the employee and the employer.

Read More: What is a Without Cause Termination?

When Is Someone Terminated With Cause? 

With cause terminations are very rare. They are a “death sentence” employment law because if someone is terminated with cause, they don’t get severance or EI. 

When someone commits misconduct at work, and are terminated because of it, section 30(1) of the Employment Insurance Act specifies that they are disqualified from EI.

“Misconduct” refers to any inappropriate action, offence, or professional fault committed willingly or deliberately by a person while working for an employer. Misconduct occurs when an employee’s behaviour is in violation of the obligations set out in his contract of employment and when, under normal circumstances, the employee should have known that the actions, omissions or faults could result in a dismissal

Government of Canada

Thus, in terms of the EI scheme, a with cause termination is a termination because of deliberate misconduct that tends to be serious. On the contrary, a termination without cause, for the purpose of EI, is any termination without serious, deliberate misconduct.

Read More: What is a With Cause Termination? 

Conclusion

In summary, an employee absolutely can receive employment insurance (EI) if he or she was terminated without cause. In fact, EI was created, basically, for people who were terminated without cause.  

One important thing to remember in closing is that employees should apply for EI, even if they got a severance, within one month from getting terminated otherwise they could lose EI benefits. 

Severance? Call us for a free consultation about your rights if you are located in Ontario.