Claimant’s son 'hired' him and paid his salary out of a sense of obligation
The Federal Court of Appeal has upheld a claimant's entitlement to disability benefits, finding that his disability remains severe despite having "substantially gainful" earnings.
In Canada (Attorney General) v. Ibrahim, 2023 FCA 204, Sabet Ibrahim stopped working as a pharmacist due to chronic back pain caused by a car accident. He had been receiving a Canada Pension Plan (CPP) disability benefit as his disability was "severe," rendering him "incapable of regularly pursuing any substantially gainful occupation."
In 2020, the Minister of Employment and Social Development terminated his pension because he earned amounts over the "substantially gainful" threshold, and consequently, his disability was no longer "severe."
Ibrahim requested a consideration of the cessation of benefits, which the Minister denied. The general division of the Social Security Tribunal (SST) dismissed Ibrahim's appeal.
The SST's appeal division ruled in Ibrahim's favour, finding that he was engaged in benevolent employment and not an "occupation." Accordingly, despite "substantially gainful" earnings, Ibrahim continued to have a "severe" disability and was entitled to a disability pension.
The Attorney General elevated the matter to the Federal Court of Appeal on an application for judicial review.
The federal court of appeal explained that to qualify for a CPP disability pension, an individual must have a disability that is both "severe" and "prolonged." Furthermore, the court said the concept of "benevolent employment" was in the Canada Pension Plan Adjudication Framework.
The framework stated that in determining work capacity, there may be rare circumstances where an individual received earnings from employment. However, because they worked for a "benevolent employer," their performance and productivity may be limited or non-existent. The document further explained that even though such an individual may work regular hours and earn income over "substantially gainful" amounts, the individual could still be considered to have a "severe" disability because they are "incapable" of working in a competitive workforce.
The framework defined a "benevolent employer" as someone who will vary the job conditions and modify their expectations of the employee in keeping with their limitations.
The general division found that Ibrahim's part-time sedentary work in his son's business was "substantially gainful" and not benevolent and that accordingly, Ibrahim's disability was no longer "severe."
On the other hand, the appeal division ruled that notwithstanding Ibrahim's earnings from working in his son's business, he remained "incapable regularly or pursuing any substantially gainful occupation."
The federal court found that the appeal division applied the general principles of statutory interpretation and was alive to the essential elements of the text, context, and purpose of the relevant provisions of the CPP and the Regulations.
The appeal division concluded that a substantially gainful "occupation" does not include benevolent employment. The tribunal explained a person could be incapable regularly of pursuing any substantially gainful occupation and still have a friend or family member who creates a "job" for them or pays them more than the market requires for their work. The appeal division said the earnings are "not really from an occupation." Further, the appeal division said that similar to an inheritance and investment income, benevolent employment "doesn't tell us anything about a claimant's capacity for pursuing any substantially gainful occupation."
The federal court agreed with the appeal division that an "occupation" within the meaning of the CPP does not include benevolent employment. The federal court noted that the appeal division used a contextual and purposive analysis of the provision and provided reasons for interpreting the term. It determined that a "substantially gainful occupation" must be a "real" occupation, which benevolent employment is not. The federal court ultimately found that the appeal division's interpretation was reasonable.
The court found that Ibrahim's son "hired" him to work in the son's business. The court said that Ibrahim's son employed him out of a sense of obligation rather than due to a need for his services. The job was created for Ibrahim.
The court also found that Ibrahim worked "from the couch," advising his son on bookkeeping, human resources, and inventory management. He did some light paperwork, organizing mail and receipts. Ibrahim testified that he could work two to three hours daily, but his hours varied depending on his pain. His salary did not depend on the hours worked but on the amount necessary to pay his bills.
Accordingly, the appeal division concluded that Ibrahim's employment was benevolent and not an "occupation." His working arrangement was not "anything like a job in the competitive workforce."
Accordingly, the federal court ruled that it was reasonable for the appeal division to conclude that Ibrahim's employment was benevolent and, consequently, was not an "occupation." The court found the appeal division's decision was reasonable.
