Generally, USCIS should send out a revocation notice on the EAD card upon the denial of the I-485 application. If you file an appeal of the I-485 denial and it is ultimately approved, then your work may not constitute unauthorized employment. However, under USCIS policy, a person is not supposed to work once the EAD has been canceled, or they send a notice revoking or canceling the EAD card. 

Merely filing an I-485 appeal does not enable a person to work on the EAD. That is a reason many people will continue to extend the H-1B status, even though it costs to keep extending it, especially on an annual basis after expiration of the the 6 years on H-1B status.