The Federal Court has dismissed an application for judicial review from an individual who challenged a decision by the Canada Revenue Agency (CRA) requiring him to repay $5,500 in Canada Emergency Response Benefit (CERB) payments.
The CRA determined that the individual, identified here as S.A., was ineligible for CERB during specific periods in 2020 because he had already received employment insurance (EI) benefits for the same timeframe.
The court found the CRA’s decision to be both reasonable and procedurally fair.
Background
The CERB program, introduced in response to the COVID-19 pandemic, provided financial support to eligible workers between March 15, 2020, and October 3, 2020. Individuals who were already receiving EI benefits for the same period were ineligible for CERB. The CERB Act also mandated that ineligible recipients repay $500 for each week of overlap.
S.A. initially received EI benefits but later applied for retroactive CERB payments covering the period from July 5 to Sept. 26, 2020 (CERB periods 5–7). The CRA reviewed his claim in November 2022 and determined that he was ineligible for CERB for CERB periods 5 and 6, as well as for three weeks of period 7, due to overlapping EI benefits. Consequently, the CRA ordered S.A. to repay $5,500.
S.A. requested a redetermination, arguing that he had not received EI benefits for the period in question. In a subsequent review, the CRA reaffirmed its initial conclusion. The decision was based on confirmation from Employment and Social Development Canada (ESDC) that S.A. had received EI benefits from July 5 to September 19, 2020, though not for the final week of CERB period 7 (September 20–26).
Legal analysis
S.A. challenged the CRA’s decision on two grounds: procedural fairness and reasonableness. The court rejected both arguments.
Procedural fairness The court held that the level of procedural fairness required in CERB eligibility determinations is minimal. S.A. was informed of the CRA’s concerns during a telephone conversation in November 2022, during which a CRA employee explained that his CERB application covered July 5 to September 26, even though the payments were received in October and November. The court found that he was given an opportunity to respond, and his submissions were considered before the decision was made.
S.A. further argued that the CRA acted unfairly by initiating repayment collection efforts before issuing its final decision and by failing to consider his financial hardship. The court dismissed both claims. Under section 12(1) of the CERB Act, the Minister is required to recover ineligible payments “as soon as is feasible,” and there is no statutory provision delaying collection. Additionally, while the Manitoba Court of Appeal case Cann v Director, Fort Garry/River Heights addressed hardship in the context of social assistance clawbacks, the court found it inapplicable to CERB repayment, as the CERB Act does not include an undue hardship provision.
Reasonableness of the decision The court ruled that the CRA’s decision was reasonable, as it adhered to the clear legislative framework governing CERB eligibility. Under section 6(1) of the CERB Act, applicants were ineligible if they received EI benefits during the same period. Section 15(1) required repayment for any week in which an individual received both EI and CERB payments. S.A. acknowledged that he had received EI benefits for CERB periods 5–6 and for three weeks of period 7, which rendered him ineligible.
S.A. contended that he should be considered eligible because the CERB payments were issued after he stopped receiving EI. The court rejected this argument, affirming that CERB payments were linked to the period for which they were applied, rather than the date funds were disbursed. The court noted that this distinction had been explained to S.A. during his call with the CRA in November 2022.
The court also acknowledged that S.A. might have mistakenly applied for CERB instead of the Canada Recovery Benefit (CRB), which would have covered his situation more appropriately. However, it found that this did not constitute an error by the CRA, as S.A.’s CERB application explicitly stated the periods for which he sought benefits, and those periods overlapped with his EI payments.
Conclusion
The Federal Court dismissed S.A.’s application, ruling that the CRA’s decision was reasonable and procedurally fair. It noted that while S.A. faces financial hardship due to the repayment requirement, the CRA had stated in its decision that it offers flexible repayment options for individuals experiencing financial difficulty.
The court expressed an expectation that the CRA would adhere to this policy and work with S.A. to accommodate his circumstances. No costs were awarded.
For more information, see Abdelmaksoud v. Canada (Attorney General), 2025 FC 432 (CanLII).
