COVID-19: Federal Government Support Programs

Summary of Federal Benefits and Video Interview: This page provides an overview of the federal benefits programs and an interview that will help with understanding the federal wage subsidy and emergency benefit programs.

On April 3, Rob Stevens, AME’s Vice President of Regulatory and Technical Policy interviewed Preston Parsons, a lawyer at Overholt Law, who practices in the firm’s core areas of labour relations law, employment law, and human rights law about the federal government’s support packages to offset the impact to people and businesses as a result of the COVID-19 outbreak. Information in this interview may be out of date, see links below:

Helpful Links:

The Government of Canada’s dedicated Coronavirus Disease (COVID-19) website includes Canada’s Economic Response Plan and the application process opened on April 6, 2020

The Canada Emergency Wage Subsidy, what It Means for Canadian Employers: https://www.canada.ca/en/department-finance/economic-response-plan/wage-subsidy.html

See the helpful summary of Canada’s COVID-19 Economic Response Plan

Businesses

Canada Emergency Business Account (CEBA): Loans of up to $40,000 for small businesses and not-for-profits, interest-free for one year. A portion may be forgivable. Eligibility has been expanded to include companies with 2019 payrolls of between $20,000 and $1.5 million.
– Note #1: Non-eligible small and medium businesses may be able to receive similar financing support through their local Regional Development Agency.
– Note #2: Non-eligible small and medium Indigenous businesses may be able to similar financing support through Aboriginal Financial Institutions. Learn more.
– Note #3:Eligibility has been further expanded to include some sole proprietors, businesses that rely on contractors, and family-owned corporations that pay employees through dividends rather than payroll. Speak with your financial institution. Learn more.

Loan Guarantee: Operating credit and cash flow term loans of up to $6.25 million to SMEs. Available mid-April. Speak to your Financial Institution.

Co-Lending Program: Co-lend term loans to SMEs for their operational cash flow requirements. Eligible businesses may obtain incremental credit amounts of up to $6.25 million through the program. Available mid-April. Speak to your Financial Institution.

BCAP will be expanded to mid-sized companies with larger financing needs. Loans of up to $60 million per company, and guarantees of up to $80 million. Speak with your financial institution. Learn more

Large Employer Emergency Financing Facility (LEEFF): Will provide bridge financing to Canada’s largest employers, whose needs during the pandemic are not being met through conventional financing, in order to keep their operations going. Companies seeking support must demonstrate how they intend to preserve employment and maintain investment activities, commit to respect collective bargaining agreements and protect workers’ pensions, and require strict limits to dividends, share buy-backs, and executive pay. More info

Wage Subsidies

Canada Emergency Wage Subsidy Businesses can apply from Monday, April 27. A new calculator has launched to let businesses know how much they are eligible to receive. (CEWS) covers up to 75% of wages for businesses, charities, and non-profits that have lost more than 25% of their revenue. Max subsidy of $847 per week per employee, from March 15 – June 6. Qualifying employers may also be eligible for 100% refunds on certain employer-paid contributions to EI and CPP. Applications are now Open: Apply online.

Temporary Wage Subsidy covers up to 10% of payroll for small businesses, not-for-profits, charities between March 18-June 19. Organizations that do not qualify for the Canada Emergency Wage Subsidy may qualify for this program. You do not need to apply for this subsidy; you reduce it from remittance to the CRA. Learn more.

Canada Summer Jobs Program wage subsidy is increased to 100% of minimum wage. Eligibility for this program has also been relaxed. More info.

Workforce

Unlimited, unpaid job-protected leave for workers who are unable to work for reasons relating to COVID-19, retroactive to Jan 27, 2020. As a permanent change, workers now also have three days of unpaid, job-protected leave each year for people who cannot work due to illness or injury.

Employment Insurance (EI): If you have stopped working because of COVID-19, you should apply for CERB whether or not you are eligible for Employment Insurance.

EI Sickness Benefit: One-week waiting period has been waived.

Canada Emergency Response Benefit (CERB) provides $500/week to people who have stopped earning income due to COVID-19, including contractors and self-employed people.

Taxes

GST/HST payments owed deferred to June 30.

Customs duties & taxes payments owed deferred to June 30.

Income tax payments owed are deferred until after August 31.