Canada Gazette, Part I, Volume 156, Number 22: Social Security Tribunal Regulations, 2022

May 28, 2022

Statutory authority
Department of Employment and Social Development Act

Sponsoring department
Department of Employment and Social Development

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Executive summary

Issues: The Social Security Tribunal (SST) began operations in 2013 to replace four separate administrative tribunals. The objective of creating a single-window Tribunal was to streamline and simplify the appeal process for the Old Age Security (OAS), Canada Pension Planfootnote 1 (CPP), and Employment Insurance (EI) programs, while generating efficiencies and cost savings. OAS and CPP are collectively referred to as Income Security (IS) programs.

Since the creation of the SST, a series of reports prepared for Parliamentarians raised concerns regarding the appeals system, including the impact on clients. In response, a third-party review of the SST was conducted in 2017, which made recommendations to reorient the appeal process to focus on clients by making it simpler and more client-oriented and improving operations to reduce delays.

As part of the third-party review, Canadians and stakeholders expressed concerns over the lack of transparency in the current appeal process and noted that the system is difficult to understand and decisions are too legalistic. Proposed changes to the SST are expected to improve the appeal process.

Legislative amendments to the Department of Employment and Social Development Act (DESDA) were sought through the Budget Implementation Act, 2021, No. 1, which received royal assent on June 29, 2021. Important changes to the DESDA included:

  • Returning to a “de novo” hearing model for second levelfootnote 2 IS appeals,footnote 3 which provides appellants with a final opportunity to present new evidence in a fresh hearing with a new and final SST decision on benefit eligibility;
  • Providing the Chairperson of the SST with the authority, with approval of the Minister of ESD, to make Rules of Procedure governing the processes and procedures before the SST, to enable further streamlining of the system on an ongoing basis; and
  • Providing other changes that generate greater operational efficiency and provide support to vulnerable clients, such as ensuring parties can be represented by the representative of their choice, i.e. a non-legal representative.

Specific to this proposal, the legislative amendments also included a provision to enable the Governor in Council to prescribe in regulations the circumstances in which a hearing may be held in private.

The Rules of Procedure are better suited to address issues related to the operations and procedures of the SST. As a result, much of what is contained in the current Social Security Tribunal Regulations will no longer be required.

Description: This proposal seeks to repeal the current Social Security Tribunal Regulations and replace them with new regulations, the Social Security Tribunal Regulations, 2022, which will ensure oversight and protect EI and IS appellant rights in the following three key areas: constitutional questions, choice of format of hearing, and confidentiality of proceedings. Separate rules governing the operations and procedures of the Social Security Tribunal will be developed by the SST and will be brought into force when the current Social Security Tribunal Regulations are repealed.

The SST Rules of Procedure are being published for a 30-day consultation on the SST’s website.

Issues

The Social Security Tribunal (SST) was created in June 2012 to replace the functions formerly carried out by four separate tribunals: the Board of Referees (first level) and the Office of the Umpire (second level) for Employment Insurance (EI), and the Office of the Commissioner of Review Tribunals (first level) for Canada Pension Plan (CPP) and Old Age Security (OAS) programs, and the Pension Appeals Board (second level) for CPP. The objective was to provide an impartial two-tier quasi-judicial process for appeals of reconsideration decisions made by the Department of ESD pursuant to the EI, CPP, and OAS legislation. However, while some savings were generated, many of the changes proved to be overly legalistic, complicated, and inefficient. Among other issues, stakeholders expressed concerns that open court hearings might deter appellants from exercising their right to appeal in order to protect their privacy and stressed the importance of ensuring that appellants have the opportunity to choose their form of hearing and be informed of the options.

To address stakeholder concerns, several legislative amendments to the Department of Employment and Social Development Act (DESDA) were approved through the Budget Implementation Act, 2021, No. 1 (BIA, 2021, No. 1), which received Roy Assent on June 29, 2021. As part of these amendments, the SST Chairperson was provided the authority to make Rules of Procedure, which will enable the SST to make and update the procedural rules for appeals in a more agile and responsive manner. Given this new authority and the proposed SST Rules of Procedure, much of what is contained in the current Social Security Tribunal Regulations (SST Regulations) will no longer be required. By way of this proposal, the Minister of ESD proposes to repeal the existing regulations and to replace them with the proposed Social Security Tribunal Regulations, 2022, which will protect the following client rights: constitutional questions, choice of format of hearing, and confidentiality of proceedings.

Background

The SST was created in June 2012 and became operational on April 1, 2013, pursuant to Part 5 of the Department of Employment and Social Development Act (DESDA). The SST operates at arm’s length from the Department of Employment and Social Development (ESD).

The SST hears appeals related to EI, CPP,footnote 4 and OAS benefits. Income Security (IS) is the collective term for CPP and OAS benefits.

Following the Report of the Standing Committee on Human Resources, Skills Development, Social Development and the Status of Persons with Disabilities (HUMA) in June 2016, the Government of Canada committed to undertake a review of the SST.

A third-party firm was hired in 2017 to conduct the review and submit a report providing options for how to improve the appeal processes administered by the SST to ensure they meet the needs and expectations of Canadians. The Review was published in January 2018 and included extensive public consultations.

The Review examined SST costs, efficiency, client satisfaction, fairness and transparency. It also examined the legislative and regulatory framework, policies, organizational model, and operational processes. The findings outlined the challenges and frustrations experienced by individuals as they attempted to understand and navigate the appeal processes, often during times of financial vulnerability or while facing serious health issues. Canadians and stakeholders expressed concerns over the lack of transparency in the appeal process. They indicated that the system is hard to understand and the process and decisions too legalistic. Stakeholders also noted the lack of accountability in the current system, and the absence of real engagement with them in designing and ensuring a renewed appeal process that meets the needs of clients.

As part of broad-scale SST reforms recommended by the Review, several client-centric operational changes, which did not require legislative or regulatory amendments, were implemented beginning in 2019. These include reducing time frames to render decisions, increasing the number of published decisions, and introducing Case Navigators who assist appellants through their appeal from start to finish. Further improvements to the appeal process require legislative and regulatory amendments.

While the non-regulatory initiatives successfully improved a number of elements of the SST process, further improvements were made through legislative amendments to the DESDA through BIA, 2021, No. 1. These include changes such as

Specific to this proposal, the legislative amendments also included a provision to enable the Governor in Council to prescribe in regulations the circumstances in which a hearing may be held in private.

The current appeal process for income security works as follows:

The legislative amendments made by BIA, 2021, No. 1 will allow for the following changes to the appeal process:

The legislative amendments for these changes are not yet in force. To fully implement the legislative changes, regulatory amendments are also required.

Objective

The objective of this proposal is to repeal the existing SST Regulations and replace them with the new proposed regulations regarding constitutional questions, choice of format of hearing, and confidentiality of proceedings. Repealing the existing SST Regulations is required to enable the SST to develop Rules of Procedure, which will address issues related to the operations and procedures of the SST. Replacing the existing SST Regulations with the proposed Social Security Tribunal Regulations, 2022 will maintain key protections for SST appellants. Together with the new Rules of Procedure, they will provide an appeal process that is more client-centric, faster, and simpler.

Description

The Department of ESD proposes to repeal the existing SST Regulations and replace them with new regulations to ensure oversight in the following three key areas: constitutional questions; choice of format of hearing; and confidentiality of proceedings. Section 69 of the DESDA is the enabling authority to create these regulations.

The SST’s Rules of Procedure are being drafted further to the SST Chairperson’s new authority, following royal assent of BIA, 2021, No. 1, and will take into consideration the regulations that the Minister of ESD is proposing to repeal. The Rules of Procedure will be reviewed by the Department of Justice and approved by the Minister of ESD to ensure consistency, and are being made available on the SST’s website for consultation simultaneously with the new proposed regulations.

Constitutional questions: The new provisions for constitutional questions would replace section 20 of the existing SST Regulations. Much of the current section 20 would be re-enacted in the new regulations; however, there would be two clarified requirements for filing a notice: the party who wants to make a constitutional challenge must set out the material facts relied on to support the constitutional challenge and they must include a summary of the legal argument to be made in support of the constitutional challenge.

Choice of format of hearing: The new provisions for choice of format of hearing would replace section 21 of the existing SST Regulations. The new regulation would specify the formats in which the Tribunal must hold hearings, i.e. in writing, by telecommunication, or in person. It would also include a provision that allows other parties to participate by a means other than the form requested by the appellant based on the needs and circumstances of that party. In addition, the new regulation would include a provision that ensures the SST must grant the choice of format of hearing requested by the appellant, except in specific circumstances. The exceptional circumstances would include when the appellant’s choice does not allow for a full and fair hearing, the appellant’s choice raises security or health concerns, or the Tribunal is unable to offer the appellant their format of choice because of unforeseen circumstances, such as a natural disaster. This regulation would enable the Tribunal to protect the parties’ right to a fair hearing and ensure that the Tribunal is able to conduct the fact-finding necessary for the proceedings.

Confidentiality of proceedings: These would be new provisions. One of the legislative amendments made under BIA, 2021, No. 1, includes a provision providing the Governor in Council with regulation-making authority to prescribe the circumstances in which all or part of a Tribunal hearing may be held in private. This would enable the Tribunal to hold a hearing, in whole or in part, in private, and restrict public access to all or part of the appeal record if certain risks (relating to the disclosure of personal information, security of the person, the fairness of proceedings, and public security) cannot be mitigated through alternative measures.

Regulatory development

Consultation

The 2017 third-party Review of the SST included extensive public consultations, including six in-person and two virtual focus groups with community, legal, and labour organization representatives, appellants, and observers from the Department of ESD. Online surveys were completed by appellants and representatives; appointees of the Board of Referees, former and current SST members, members of the Office of Commissioner of the Review Tribunals, and Pension Appeals Board members; and employees of the Board of Referees and Administrative Tribunals Support Services Canada (ATSSC). The findings of the Review underscored the challenges and frustrations that users were experiencing when trying to understand and navigate the IS appeal processes during a time of financial vulnerability or while experiencing serious health issues. The Review heard that, for users, the processes are too complex, impersonal, legalistic and intimidating, which discourages appellants from appealing or moving beyond the reconsideration stage of the process. The public consultations repeatedly revealed dissatisfaction and frustration with service standards, timelines, the accountability of the SST, and the accessibility of various processes, including decision-making.

In response to the Review, officials from the Department of ESD created a working group in which external stakeholders from community, legal, and disability advocacy organizations, as well as internal stakeholders from the Department of ESD and the SST/ATSSC, were actively engaged in exploring potential policy changes through in-person engagement sessions. The SST-Income Security Engagement Working Group included nine external stakeholders with direct experience with IS programs and/or the SST-IS appeal process, including advocates for people with disabilities and seniors, appeals representatives, and lawyers.

Stakeholders from the working group made a number of observations regarding the first and second levels of appeal. They characterized the SST-General Division as overly technical and difficult to navigate, with requirements for unnecessary information and legal expertise inaccessible to the average appellant. From this perspective, stakeholder feedback aligned with the recommendations of the Review, highlighting the importance of making the General Division easier to navigate, less legalistic, and more efficient for Canadians. Engagement specifically highlighted the need to establish and/or maintain certain protections in the proposed regulations, i.e. client rights and public interest.

Stakeholders also indicated that significant changes to the Appeal Division were needed. Suggestions included simplifying the grounds of appeal to improve appellants’ access to the Appeal Division and moving to a “de novo” model where Tribunal members would hear appeals with new evidence allowed and make a final decision on an appellant’s eligibility for benefits.

Extensive consultations with representatives of the SST were conducted before the finalization of the client-centric improvements and the legislative amendments. No consultations specific to the proposed regulatory amendments have taken place, as engagement on the overall improvements to the appeal process were deemed sufficient. The Department of ESD is committed to ongoing collaboration with the SST during the development of the new proposed regulations and Rules of Procedure to ensure appropriate alignment and coordination of stakeholder consultation.

Modern treaty obligations and Indigenous engagement and consultation

In accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, an assessment of Modern Treaty Implications was conducted for this regulatory proposal. After examination, no negative implications or impacts on the Department of ESD’s modern treaty obligations were identified. The proposal is not expected to have an impact on the Department of ESD’s modern treaty obligations in the areas of training, service delivery, procurement and contracting.

Instrument choice

Status quo

In addition to public information about the appeal process published by the SST, the existing SST Regulations currently provide rules and procedures that govern appeals before the SST. The current SST Regulations, as the Review determined, added complexity and delays that create challenges for clients and are not reflective of the Government of Canada’s intended approach as set out by the amendments to DESDA.

Regulatory option

The legislative changes provide authority to the Chairperson of the SST to make Rules of Procedure governing the processes and procedures before the SST. The Rules of Procedure require ministerial approval prior to consultation and final publication. The existing regulations need to be repealed to allow the SST to bring the Rules of Procedure into force. The proposed regulatory amendments are needed to fully implement the legislative changes.

The SST’s Rules of Procedure would govern the appeal process, practices, procedures, and operations of the Tribunal to provide clarity and transparency, to mitigate delays, and to encourage efficiency. For example, the proposed Rules of Procedure set out the appeal processes for EI and IS, parties’ roles and responsibilities, documentation requirements, deadlines, and so forth. Given that the SST has direct oversight of the day-to-day operations of the appeal process, it was determined that the SST is best placed to monitor the implementation of procedures and make adjustments as needed. The Rules of Procedure allow these changes to be implemented in a more efficient and responsive manner. As such, the existing SST Regulations need to be repealed to avoid duplication with the proposed Rules of Procedure. The proposed regulations would apply to both EI and IS appeals and include provisions regarding the following key claimant rights: constitutional questions, choice of format of hearing, and confidentiality of proceedings.

The Department of ESD is working closely with the SST to ensure the new proposed regulations and the SST’s new Rules of Procedure are aligned to ensure clarity and consistency, and to avoid duplication. The Rules of Procedure will be made available on the SST’s website for consultation simultaneously with the new proposed regulations.

Regulatory analysis

Benefits and costs

Summary

The quantified impacts of the proposed regulations would result in a net cost to the Department of ESD and the SST of $5.1 million over 10 years (total present value between 2022–23 fiscal year and the 2031–32 fiscal year, presented in 2021 dollars, discounted to 2022 using a 7% discount rate). However, the proposal would result in non-quantified benefits to Canadians that are expected to outweigh the cost to government. Canadians appealing an SST decision would benefit from a clearer, more client-centric process, and have some of their key rights protected in the regulations, specifically constitutional questions, choice of format of hearing, and confidentiality of proceedings.

Analytical framework

The cost-benefit analysis (CBA) measures the incremental impacts on the affected Canadian stakeholders (governments, consumers, businesses and other organizations) from the proposed regulations, in accordance with the Policy on Cost-Benefit Analysis. Incremental impacts reflect the difference between two scenarios: what would happen in the absence of these proposed regulations (baseline scenario); and what is expected to happen when these regulations are implemented (regulatory scenario). These scenarios are described in the next two sections.

Baseline scenario

The baseline scenario refers to the existing SST Regulations without the proposed legislative amendments or proposed Rules of Procedure. Under this scenario, the existing SST Regulations include provisions relating to summary dismissal, which allow the General Division to dismiss an appeal on the record and without having held a hearing, if the Tribunal is satisfied that the case has no reasonable chance of success. It also includes provisions relating to rescinding or amending decisions, which allow the Tribunal to change its decision upon the presentation of new material facts that could not have been discovered at the time of the hearing with the exercise of reasonable diligence. These provisions are not being retained in the new SST Regulations, 2022 as their authority will be repealed through legislative amendments to the DESDA made under BIA, 2021, No. 1, once those amendments are brought into force.

Regulatory scenario

Under the regulatory scenario, only those regulations required to protect certain key rights of appellants would be included.

Cost and benefits by key elements of the proposal

Cost-benefit statement

Monetized costs

Impacted stakeholder

Description of cost

Base year

Other relevant years

Final year

Total (present value)

Annualized value

Government

SST Administration

$244,418

$174,267

$124,250

$1,716,690

$34,799

In-Person Hearings

$488,000

$347,937

$248,074

$3,427,508

$68,480

 

Total costs

$732,418

$522,204

$372,324

$5,144,198

$104,279

Small business lens

Analysis under the small business lens concluded that the proposed regulation will not impact Canadian small businesses.

One-for-one rule

The one-for-one rule does not apply as there is no incremental change in administrative burden on business. The proposal repeals an existing regulation and replaces it with a new regulatory title, which results in no net increase or decrease in regulatory titles.

Regulatory cooperation and alignment

International agreements are not impacted by this proposal.

Alignment between the proposed regulatory amendments and the SST’s Rules of Procedure is needed in order to ensure that provisions to be repealed by this proposal are re-enacted in the Rules of Procedure, as well as to ensure that there is no duplication. The Department of ESD is working closely with the ATSSC and the SST to ensure the new proposed regulations and the SST’s Rules of Procedure are aligned and to coordinate the coming into force timelines and any consequential amendments.

Strategic environmental assessment

In accordance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, a preliminary scan concluded that a strategic environmental assessment is not required.

Gender-based analysis plus

The bender-based analysis plus (GBA+) has identified that these amendments are expected to better serve the roughly 9,600 Canadians per year who challenge a claim decision for EI or IS benefits at the SST. This proposal will, in particular, have direct positive impacts on the primary demographic groups for SST-IS cases, which is an older population that is approximately gender-balanced, and individuals with disabilities.footnote 6

Indirect impacts have also been identified for individuals living in rural or remote locations. The provision that protects appellants’ choice of format of hearing would enable these individuals to choose the form of hearing that best meets their needs and circumstances. Under the existing regulations, the SST may prefer to hold hearings for rural or remote individuals via teleconference or videoconference, for reasons of practicality and cost, while the individual may have preferred an in-person hearing. The new proposed regulations would protect that individual’s choice of format of hearing.

The Department collects specific demographic data on clients to determine benefit eligibility, such as date of birth, marital status, residence history, education level, income, medical diagnosis, and occupation. Neither the Department nor the SST collects data on the race and ethnicity of applicants and appellants. While the SST’s client surveys do not currently incorporate disaggregated data, it is within the Tribunal’s goals to collect this in the future.

Implementation, compliance and enforcement, and service standards

Implementation

The new proposed SST Regulations, 2022 will be prepublished in the Canada Gazette, Part I, for a 30-day consultation. The SST’s new Rules of Procedure will be prepublished on the SST’s website during the same time period for stakeholder comment and review in order to clarify the new processes.

The intent is to bring the enabling legislative changes made through BIA 2021, No.1 and the proposed regulatory amendments, as well as the Rules of Procedure into force at the same time in autumn 2022.

Contact

Tara Belanger-Zahab
Director
Policy and Partnerships
Canada Pension Plan Disability Directorate
Income Security and Social Development Branch
Employment and Social Development Canada
Email: NC-CPPD-PD-RPCI-CP-GD@hrsdc-rhdcc.gc.ca

PROPOSED REGULATORY TEXT

Notice is given that the Governor in Council, pursuant to section 69footnote a of the Department of Employment and Social Development Actfootnote b, proposes to make the annexed Social Security Tribunal Regulations, 2022.

Interested persons may make representations concerning the proposed Regulations within 30 days after the date of publication of this notice. All such representations must cite the Canada Gazette, Part I, and the date of publication of this notice, and be addressed to Tara Belanger-Zahab, Director, Income Security and Social Development Branch, Employment and Social Development Canada, 140 Promenade du Portage, Gatineau, Quebec K1A 0J9 (tel.: 613‑219‑0614; email: tara.belangerzahab@hrsdc-rhdcc.gc.ca).

Ottawa, May 24, 2022

Wendy Nixon
Assistant Clerk of the Privy Council

Social Security Tribunal Regulations, 2022

Constitutional Questions

Filing of notice

1 (1) A party who wants to challenge the constitutional validity, applicability or operability of a provision of the Canada Pension Plan, the Old Age Security Act, the Employment Insurance Act, Part 5 of the Department of Employment and Social Development Act or the rules or regulations made under any of those Acts must file a notice with the Tribunal that sets out

Service of notice

(2) At least 10 days before the date set for the hearing of the appeal or application, the party must serve notice of the challenge on the persons referred to in subsection 57(1) of the Federal Courts Act and file a copy of the notice and proof of service with the Tribunal.

Failure to file proof of service

(3) If proof of service has not been filed in accordance with subsection (2), the Tribunal may, on its own initiative or on the request of a party, postpone or adjourn the hearing.

Format of Hearing

Format of hearing

2 (1) A Tribunal hearing must be held in one of the following formats, as requested by the appellant:

Exception — other parties

(2) Despite subsection (1), the Tribunal may allow any other party to participate in a hearing by a means other than the format requested by the appellant if the Tribunal determines that it is warranted based on the needs and circumstances of that party.

Exception — circumstances

(3) Despite subsection (1), the Tribunal may hold a hearing, in whole or in part, in a format other than that requested by the appellant if the Tribunal determines that the requested format

Confidentiality of Proceeding

Private hearing and restricted access

3 The Tribunal may, on request or on its own initiative, hold a hearing, in whole or in part, in private and restrict public access to all or part of the appeal record if it determines that reasonable alternative measures cannot adequately mitigate any of the following serious risks that could result from a public hearing and public access:

Consequential Amendment, Repeal and Coming into Force

Consequential Amendment to the Old Age Security Regulations

4 Section 46 of the Old Age Security Regulations footnote 7 is replaced by the following:

46 If the appellant sets out a ground of appeal that has not been referred to the Court under subsection 28(2) of the Act and a ground of appeal that has been referred to the Court under that subsection, the Social Security Tribunal, on receipt of a certified copy of the decision of the Court, must proceed in accordance with the Social Security Tribunal Rules of Procedure.

Repeal

5 The Social Security Tribunal Regulations footnote 8 are repealed.

Coming into Force

S.C. 2021, c. 23

6 These Regulations come into force on the day on which Division 20 of Part 4 of the Budget Implementation Act, 2021, No. 1 comes into force, but if they are registered after that day, they come into force on the day on which they are registered.