The collective agreement between a boilermakers union and a group of employers was amended to provide a “streamlined” system that eliminated the need for receipts for travel allowances paid to the employees: they were paid a straight sum based on the distance between a standardized central point (Burnaby City Hall) and the job site, irrespective of the actual starting location of the employee or of the employers’ premises.
Wong J found that this change had the effect of making the travel allowances fully taxable pursuant to s. 6(1)(b)(vii) or ss.. 6(1)(b)(vii.1) and (x). Furthermore, although the employees could still claim their actual travel expenses pursuant to s. 8(1)(h) or (h.1), they had no receipts. Their allowances were fully taxable with no offsetting deductions.