Law:Wage Earner Protection Program Act

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S.c. 2005, c. 47, s. 1

Assented to 2005-11-25

An Act to establish a program for making payments to individuals in respect of wages owed to them by employers who are bankrupt or subject to a receivership

(Enacted by section 1 of chapter 47 of the Statutes of Canada, 2005, in force July 7, 2008, see Si/2008-78.)

Contents

Short Title

Short title

1. This Act may be cited as the Wage Earner Protection Program Act.


Interpretation

Definitions

2. (1) The following definitions apply in this Act.

“eligible wages”

« salaire admissible »

“eligible wages” means

(a) wages other than severance pay and termination pay that were earned during the six-month period ending on the date of the bankruptcy or the first day on which there was a receiver in relation to the former employer; and

(b) severance pay and termination pay that relate to employment that ended during the period referred to in paragraph (a).

“wages”

« salaire »

“wages” includes salaries, commissions, compensation for services rendered, vacation pay, severance pay, termination pay and any other amounts prescribed by regulation.

Employers subject to a receivership

(2) For the purposes of this Act, an employer is subject to a receivership when any property of the employer is under the possession or control of a receiver.

Meaning of “receiver”

(3) In this Act, “receiver” means a receiver within the meaning of subsection 243(2) of the Bankruptcy and Insolvency Act.

Words and expressions

(4) Unless otherwise provided, words and expressions used in this Act have the same meaning as in the Bankruptcy and Insolvency Act.

Related persons

(5) Despite subsection 4(5) of the Bankruptcy and Insolvency Act,

(a) for the purposes of paragraph 6(d), an individual is considered to deal at arm’s length with a related person if the Minister is satisfied that, having regard to the circumstances — including the terms and conditions of the individual’s employment with the former employer, their remuneration and the duration, nature and importance of the work performed for the former employer — it is reasonable to conclude that the individual would have entered into a substantially similar contract of employment with the former employer if they had been dealing with each other at arm’s length; and

(b) for the purposes of subsection 21(4), individuals who are related to each other are, in the absence of evidence to the contrary, deemed not to deal with each other at arm’s length while so related.

2005, c. 47, s. 1 “2”; 2007, c. 36, s. 83; 2009, c. 2, s. 342.

Previous Version

Designation Of Minister

Power of Governor in Council

3. The Governor in Council may designate a member of the Queen’s Privy Council for Canada to be the Minister for the purposes of this Act.


Program Established

Establishment

4. The Wage Earner Protection Program is established to make payments to individuals in respect of wages owed to them by employers who are bankrupt or subject to a receivership.


Eligibility For Payments

Conditions of eligibility

5. An individual is eligible to receive a payment if

(a) the individual’s employment ended for a reason prescribed by regulation;

(b) the former employer is bankrupt or subject to a receivership; and

(c) the individual is owed eligible wages by the former employer.

(d)�(Repealed, 2009, c. 2, s. 343)

2005, c. 47, s. 1 “5”; 2007, c. 36, s. 84; 2009, c. 2, s. 343.

Previous VersionExceptions

6. An individual is not eligible to receive a payment in respect of any wages earned during, or that otherwise relate to, a period in which the individual

(a) was an officer or director of the former employer;

(b) had a controlling interest within the meaning of the regulations in the business of the former employer;

(c) occupied a managerial position within the meaning of the regulations with the former employer; or

(d) was not dealing at arm’s length with

(i) an officer or director of the former employer,

(ii) a person who had a controlling interest within the meaning of the regulations in the business of the former employer, or

(iii) an individual who occupied a managerial position within the meaning of the regulations with the former employer.

2005, c. 47, s. 1 “6”; 2007, c. 36, s. 85; 2009, c. 2, s. 344.

Previous Version

Amounts Covered By Program

Amount of payment

7. (1) The amount that may be paid under this Act to an individual is the amount of eligible wages owing to the individual up to a maximum of the greater of the following amounts, less any amount prescribed by regulation:

(a) $3,000; and

(b) an amount equal to four times the maximum weekly insurable earnings under the Employment Insurance Act.

Bankruptcy and receivership

(2) If the former employer is both bankrupt and subject to a receivership, the amount that may be paid is the greater of the amount determined in respect of the bankruptcy and the amount determined in respect of the receivership.

2005, c. 47, s. 1 “7”; 2007, c. 36, s. 86; 2009, c. 2, s. 345.

Previous Version

Application For Payment

Application

8. To receive a payment, an individual is to apply to the Minister in the manner and during the period provided for in the regulations.

2005, c. 47, s. 1 “8”; 2007, c. 36, s. 87.

Previous VersionMinister’s determination of eligibility

9. If the Minister determines that the applicant is eligible to receive a payment, the Minister shall make the payment.

2005, c. 47, s. 1 “9”; 2007, c. 36, s. 87.

Previous VersionNotification

10. The Minister is to inform the applicant of their eligibility or ineligibility to receive a payment.

2005, c. 47, s. 1 “10”; 2007, c. 36, s. 87.

Previous Version

Review By Minister

Request for review

11. An applicant who is informed under section 10 may request a review of their eligibility or ineligibility, as the case may be.

2005, c. 47, s. 1 “11”; 2007, c. 36, s. 87.

Previous VersionReview

12. The Minister may confirm, vary or rescind a determination of eligibility made under section 9. If the Minister varies the determination, the Minister shall make any payment resulting from the variation.

2005, c. 47, s. 1 “12”; 2007, c. 36, s. 87.

Previous VersionReview is final

13. Subject to the right of appeal under section 14, the Minister’s confirmation, variation or rescission, as the case may be, is final and may not be questioned or reviewed in any court.

2005, c. 47, s. 1 “13”; 2007, c. 36, s. 87.

Previous Version

Appeal To Adjudicator

Appeal on question of law or jurisdiction

14. The applicant may appeal the decision made by the Minister under section 12 to an adjudicator only on a question of law or jurisdiction.

2005, c. 47, s. 1 “14”; 2007, c. 36, s. 87.

Previous VersionAppointment of adjudicator

15. An appeal is to be heard by an adjudicator appointed by the Minister.

Appeal on the record

16. The appeal is to be an appeal on the record and no new evidence is admissible.

2005, c. 47, s. 1 “16”; 2007, c. 36, s. 88.

Previous VersionAdjudicator’s decision

17. The adjudicator may confirm, vary or rescind the decision made by the Minister under section 12. If the adjudicator varies the decision, the Minister shall make any payment resulting from the variation.

2005, c. 47, s. 1 “17”; 2007, c. 36, s. 88.

Previous VersionCopies of decision

18. The adjudicator must send a copy of his or her decision, and the reasons for it, to each party to the appeal.

No review by certiorari, etc.

19. No order may be made to review, prohibit or restrain and no process entered or proceeding taken to question, review, prohibit or restrain in any court — whether by way of injunction, certiorari, prohibition, quo warranto or otherwise — an action of an adjudicator under this Act.

2005, c. 47, s. 1 “19”; 2007, c. 36, s. 89.

Previous VersionDecision is final

20. The adjudicator’s decision is final and may not be questioned or reviewed in any court.

2005, c. 47, s. 1 “20”; 2007, c. 36, s. 89.

Previous Version

Administration

Duties of Trustees and Receivers

General duties

21. (1) For the purposes of this Act, a trustee or a receiver, as the case may be, shall

(a) identify each individual who is owed eligible wages;

(b) determine the amount of eligible wages owing to each individual;

(c) inform each individual other than one who is in a class prescribed by regulation of the existence of the program established by section 4 and of the conditions under which payments may be made under this Act;

(d) provide the Minister and each individual other than one who is in a class prescribed by regulation with the information prescribed by regulation in relation to the individual and with the amount of eligible wages owing to the individual; and

(e) inform the Minister of when the trustee is discharged or the receiver completes their duties, as the case may be.

Compliance with directions

(2) A trustee or receiver shall comply with any directions of the Minister relating to the administration of this Act.

Duty to assist

(3) A person, other than one described in subsection (4), who has or has access to information described in paragraph (1)(d) shall, on request, provide it to the trustee or the receiver, as the case may be.

Duty to assist — payroll contractors

(4) In the case of a person who is dealing at arm’s length with and providing payroll services to a bankrupt or insolvent person, they shall provide a description of the information that they do not have access to, an estimate of the cost of providing the information that they have and an estimate of the cost of providing the information that they only have access to.

2005, c. 47, s. 1 “21”; 2007, c. 36, s. 89; 2009, c. 2, s. 346.

Previous VersionFees and expenses

22. (1) The trustee’s or receiver’s fees and expenses, in relation to the performance of their duties under this Act, are to be paid out of the estate of the bankrupt employer or the property of the insolvent employer, as the case may be.

Minister to pay fees and expenses

(2) The Minister shall, in the circumstances prescribed by regulation, pay the fees or expenses that are prescribed by regulation.

2005, c. 47, s. 1 “22”; 2007, c. 36, s. 89.

Previous Version

Powers of Minister

Directions to trustees and receivers

23. (1) The Minister may give directions to trustees and receivers in respect of the perform­ance of their duties under this Act.

Directions not statutory instruments

(2) A direction given by the Minister is not a statutory instrument within the meaning of the Statutory Instruments Act.

Power to summon, etc.

24. (1) For the purposes of the administration of this Act, the Minister may

(a) summon any person before him or her and require the person to give evidence, orally or in writing, and on oath or, if the person is entitled to affirm in civil matters, on solemn affirmation;

(b) require any person to provide the Minister with any information or document that the Minister considers necessary; and

(c) require any person to provide an affidavit or a statutory declaration attesting to the truth of any information provided by the person.

Taking oaths, etc.

(2) Any person, if designated by the Minister for the purpose, may administer oaths and take and receive affidavits, statutory declarations and solemn affirmations for the purpose of or incidental to the administration of this Act. Every person so designated has, with respect to any such oath, affidavit, declaration or affirmation, all the powers of a commissioner for administering oaths or taking affidavits.

Acceptance of oaths, etc.

(3) The Minister may, for the purposes of administering this Act, accept any oath admin­istered or any affidavit, statutory declaration or solemn affirmation taken or received by any person who has the powers of a commissioner for taking affidavits and who is an officer or employee of

(a) a department or other portion of the federal public administration specified in any of Schedules I, IV and V to the Financial Administration Act; or

(b) a department of the government of a province.

Inspections

25. (1) A person designated by the Minister for the purpose may, at any reasonable time, enter any place in which he or she reasonably believes there is any information or document relevant to the administration of this Act and may, in that place,

(a) inspect any books, records, electronic data or other documents that he or she reasonably believes may contain information that is relevant to the administration of this Act;

(b) use or cause to be used any computer system to examine any data contained in or available to the computer system;

(c) reproduce or cause to be reproduced any record from the data in the form of a print-out or other intelligible output;

(d) take any document or other thing from the place for examination or, in the case of a document, for copying; and

(e) use or cause to be used any copying equipment to make copies of any documents.

Prior authorization

(2) If any place referred to in subsection (1) is a dwelling-house, the designated person may not enter the dwelling-house without the consent of the occupant, except under the authority of a warrant issued under subsection (3).

Warrant to enter dwelling-house

(3) A judge may issue a warrant authorizing the designated person to enter a dwelling-house subject to the conditions specified in the warrant if, on ex parte application, the judge is satisfied by information on oath that

(a) there are reasonable grounds to believe that the dwelling-house is a place referred to in subsection (1);

(b) entry into the dwelling-house is necessary for any purpose related to the administration of this Act; and

(c) entry into the dwelling-house has been, or there are reasonable grounds to believe that entry will be, refused.

Orders if entry not authorized

(4) If the judge is not satisfied that entry into the dwelling-house is necessary for any purpose related to the administration of this Act, the judge may, to the extent that access was or may be expected to be refused and that information or documents are or may be expected to be kept in the dwelling-house,

(a) order the occupant of the dwelling-house to provide the Minister, or a person designated by the Minister for the purpose, with reasonable access to any information or document that is or should be kept in the dwelling-house; and

(b) make any other order that is appropriate in the circumstances to carry out the purposes of this Act.

Duty to assist

26. The owner or person in charge of a place that is entered by the designated person and every person found there must

(a) give the designated person all reasonable assistance to enable him or her to exercise his or her powers and perform his or her duties; and

(b) provide the designated person with any information relevant to the administration of this Act that he or she requires.

Information to be made available to Minister

27. Despite subsection 139(5) of the Employment Insurance Act, personal information relating to an applicant that is collected or obtained by the Canada Employment Insurance Commission must, if requested by the Minister, be made available to the Minister to determine the applicant’s eligibility to receive a payment under this Act.

2005, c. 47, ss. 1 “27”, 140.

Previous Version28. (Repealed, 2005, c. 47, s. 140)

Previous VersionSocial Insurance Number

29. No person may knowingly use, communicate or allow to be communicated a Social Insurance Number that was obtained for a purpose related to an application for a payment under this Act except for the purpose of the administration or enforcement of this Act or the Income Tax Act.

2005, c. 47, s. 1 “29”; 2007, c. 36, s. 90.

Previous VersionDelegation

30. The Minister may delegate to any person the exercise of any power or the performance of any duty or function that may be exercised or performed by the Minister under this Act.

Audit of applications

31. (1) Subject to subsections (2) to (4), the Minister may, on his or her initiative, conduct an audit of any application for payment under this Act.

Applications with payment

(2) An audit of an application in respect of which a payment was made may be conducted at any time within three years after the day on which the payment was made.

Exception

(3) If the Minister has reasonable grounds to believe that a payment was made on the basis of any false or misleading information, an audit of the application in respect of which the payment was made may be conducted at any time within six years after the payment was made.

Other applications

(4) An audit of an application in respect of which no payment was made may be conducted at any time within three years after the day on which the applicant was sent a notice informing the applicant that he or she was not eligible to receive a payment.

Determination of overpayment

32. (1) If the Minister determines that an individual received a payment in an amount greater than the amount that they were eligible to receive, the Minister shall send them a notice

(a) informing them of the determination; and

(b) specifying the amount that they were not eligible to receive.

Debt due to Her Majesty

(2) The amount specified in the notice constitutes a debt due to Her Majesty in right of Canada and may be recovered by the Minister of National Revenue.

Certificate of default

(3) The amount of any debt referred to in subsection (2) that remains unpaid 30 days after the day on which the notice is sent may be certified by the Minister, and registration of the certificate in the Federal Court has the same effect as a judgment of that Court for the amount specified in the certificate and all related registration costs.

2005, c. 47, s. 1 “32”; 2007, c. 36, s. 91.

Previous VersionGarnishment

33. If the Minister is of the opinion that a person is or is about to become liable to pay an amount to an individual who is indebted to Her Majesty under section 32, the Minister may, by written notice, order the person to pay to the Receiver General on account of the individual’s liability all or part of the amount otherwise payable to the individual.

2005, c. 47, s. 1 “33”; 2007, c. 36, s. 91.

Previous VersionNo payment or partial payment

34. If the Minister determines that an individual did not receive all or part of a payment that they were eligible to receive, the Minister shall make a payment to them in an amount equal to the amount that they did not receive.

2005, c. 47, s. 1 “34”; 2007, c. 36, s. 92(E).

Previous Version

Financial Provisions

Payments out of C.R.F.

35. There may be paid out of the Consolidated Revenue Fund all payments authorized to be made under this Act.

Subrogation

36. (1) If a payment is made under this Act to an individual in respect of unpaid wages, Her Majesty in right of Canada is, to the extent of the amount of the payment, subrogated to any rights the individual may have in respect of the unpaid wages against

(a) the bankrupt or insolvent employer; and

(b) if the bankrupt or insolvent employer is a corporation, a director of the corporation.

Maintaining an action

(2) For the purposes of subsection (1), Her Majesty in right of Canada may maintain an action in the name of the individual or Her Majesty in right of Canada.

2005, c. 47, s. 1 “36”; 2007, c. 36, s. 93.

Previous VersionAmount not assignable

37. An amount that is payable under this Act is not capable of being assigned, charged, attached, anticipated or given as security and any transaction appearing to do so is void or, in Quebec, null.

2005, c. 47, s. 1 “37”; 2007, c. 36, s. 93.

Previous Version

Offences and Penalties

Offences

38. (1) Every person commits an offence who

(a) makes a false or misleading entry, or omits to enter a material particular, in any record or book of account that contains information that supports an application under this Act;

(b) in relation to an application under this Act, makes a representation that the person knows to be false or misleading;

(c) in relation to an application under this Act, makes a declaration that the person knows to be false or misleading because of the nondisclosure of facts;

(d) being required under this Act to provide information, does not provide it or makes a representation that the person knows to be false or misleading;

(e) obtains a payment under this Act by false pretence;

(f) being the payee of any cheque issued as a payment under this Act, knowingly negotiates or attempts to negotiate it knowing that the person is not entitled to the payment or any part of the payment; or

(g) participates in, consents to or acquiesces in an act or omission mentioned in any of paragraphs (a) to (f).

Trustees and receivers

(2) Every person who fails to comply with any of the requirements of subsection 21(1), (3) or (4) commits an offence.

Limitation of prosecutions

(3) A prosecution for an offence under subsection (1) or (2) may be commenced at any time within six years after the day on which the subject matter of the prosecution arose.

Due diligence

(4) No person may be convicted of an offence under subsection (2) if the person establishes that they exercised due diligence to prevent the commission of the offence.

2005, c. 47, s. 1 “38”; 2007, c. 36, s. 93.

Previous VersionObstruction

39. (1) Every person commits an offence who delays or obstructs a person in the exercise of their powers or the performance of their duties under this Act.

Limitation of prosecutions

(2) A prosecution for an offence under subsection (1) may be commenced at any time within two years after the day on which the subject matter of the prosecution arose.

2005, c. 47, s. 1 “39”; 2007, c. 36, s. 93.

Previous VersionPunishment

40. Every person who is guilty of an offence under section 38 or 39 is liable on summary conviction to a fine of not more than $5,000 or to imprisonment for a term of not more than six months, or to both.


Regulations

Regulations

41. The Governor in Council may make regulations generally for carrying out the purposes of this Act, including regulations

(a) prescribing amounts for the purposes of subsection 2(1);

(b) prescribing reasons for the purposes of paragraph 5(a);

(c) defining “controlling interest” and “managerial position” for the purposes of section 6;

(d) prescribing an amount for the purposes of subsection 7(1);

(e) respecting the allocation of payments to the different components of wages;

(f) respecting the period during which and the manner in which applications for payments are to be made under section 8;

(g) respecting the period during which and the manner in which a review may be requested under section 11 or an appeal may be made under section 14;

(h) prescribing the classes of individuals that the trustee or receiver is not required to inform under paragraph 21(1)(c) or to whom they are not required to provide information under paragraph 21(1)(d);

(i) respecting the information that is to be provided by trustees and receivers to the Minister and to individuals for the purposes of paragraph 21(1)(d) and respecting the period during which and the manner in which that information is to be provided;

(j) respecting the period during which and the manner in which the information referred to in paragraph 21(1)(c) and subsections 21(3) and (4) is to be provided; and

(k) prescribing fees and expenses for the purposes of subsection 22(2) and the circumstances in which they are to be paid.

2005, c. 47, s. 1 “41”; 2007, c. 36, s. 94; 2009, c. 2, s. 347.

Previous Version

Review Of Act

Review

42. Within five years after the day on which this section comes into force, the Minister must cause a review of this Act and its administration and operation to be conducted, and cause a report on the review to be laid before each House of Parliament on any of the first 15 days on which that House is sitting after the review is completed.


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