Value of Lodging and Meals for IRB Purposes

In the License Appeal Tribunal decision, B. L. J. and The Co-Operators Insurance Company (18-012005/AABS), the adjudicator was required to determine if meals and free housing provided by an employer should be considered in an applicant’s employment income.

The applicant was involved in a motor vehicle accident on September 24, 2016.  At the time of the accident, the applicant was employed as a cook at a restaurant owned by her sister and brother-in-law.  After the accident, the applicant was unable to work for several months and they received income replacement benefits (“IRBs”).

Due to the demands of their pre-accident employment, the applicant was unable to return to their pre-accident employer, as such, during February 2017, the applicant commenced volunteering at a residence for assisted living (“residence”).  The applicant had previously worked at the residence, but not in the year leading up to the accident.  After volunteering, the applicant was offered a job at the residence, working part-time for 20 hours per week.  The applicant’s duties at the residence included answering phones, booking drivers, talking to residents about their needs and assisting in the kitchen.

The owner of the residence, provided the applicant with a two-bedroom residential unit (almost next door to the residence) free of charge and meals at the residence commencing in the summer of 2018.  The applicant stated that the owner of the residence offered the apartment due to her limited income and because they are friends.

The respondent challenged the applicant with surveillance evidence of her daily activities.  The respondent showed the applicant attending the residence for 10 to 12 hours a day, 5 days a week – significantly more than the 20 hours per week they were employed for.  The applicant agreed that she spends a lot of time at the residence, however, beyond the 20 hours per week, she would be unpaid for spending more time at the residence.  The applicant genuinely enjoyed spending time and talking with the residents.

The adjudicator was tasked with the issue of IRB quantum for the income earned subsequent to the accident and whether the free rent and meals from residence should be included as income.  The respondent submitted that the quantum of the IRBs should consider the applicants salary, plus the rent free living and three meals a day, 5 days a week.  The respondent calculated that this would be approximately $31,380 per year, which is greater than the applicant’s pre-accident income of $27,186 as reported for tax purposes during the year before the accident.

At the hearing, there was no accounting evidence or expert evidence submitted on the value of meals consumed while working, nor was any case law brought forward.  As such, the adjudicator ruled that the value of the meals at the residence should not increase the applicant’s employment income so that it would reduce her IRBs owed.  With respect to the housing, the adjudicator considered the free rent as a gift.  Since the apartment was given to the applicant rent free and without conditions tied to employment, the adjudicator ruled that the value of rent should not increase the applicant’s employment income.

Accordingly, the applicant’s IRBs were to be reduced solely by the employment income earned at the residence (i.e. 20 hours per week) and no deduction for any of the meals provided or housing accommodations.

Read the decision in full detail here:

B. L. J. and The Co-Operators Insurance Company (18-012005/AABS)