This is the third bulletin in a weekly series that provides a recap of important COVID-19 developments and their impact on employers as they navigate these challenging times. This recap covers the week of April 6, 2020 and is current as of April 13, 2020.
During the week of April 6, 2020, the federal and provincial governments announced changes to and new details on important measures that have been instituted to stop the spread of COVID-19 and to help employers and employees weather this storm, including the Canada Emergency Wage Subsidy (“CEWS”), the Business Credit Availability Program (“BCAP”), and the Ontario essential workplaces list.
The key developments from this week, as well as their implications for employers, are set out below.
Ontario Amended the Shortened Essential Workplaces List
After deeming cannabis retail stores non-essential workplaces on April 3, the provincial government passed an emergency order on April 7 to allow cannabis retail stores to reopen on a limited basis. Cannabis retail stores are allowed to stay open for online and telephone orders, which customers are able to pick up from retail stores or have delivered by sales associates.
Ontario Launched an Online Portal to Match Health Care Workers and Employers
On April 7, the Ontario government launched a Health Workforce Matching Portal as part of the fight against COVID-19. The Portal is intended to match health care providers with skilled workers who are not currently working, such as retired or non-active workers, students, and internationally trained health care professionals.
The Canada Summer Jobs Program was Temporarily Expanded
The federal government announced a temporary expansion to the Canada Summer Jobs program for young workers on April 8 to help combat the challenges young workers will face getting summer jobs during the COVID-19 pandemic. The program is available for certain small businesses, non-profits and public sector employers that hire young people between the ages of 15 and 30. The changes include increasing the program’s wage subsidy to provide employers with a subsidy of up to 100% (rather than the usual 50%) of the applicable minimum wage for each employee and extending the end date of employment for employees in the program to February 28, 2021, among others.
Further Details were Provided on the Business Credit Availability Program
The government clarified last week that up to 25% of Canada Emergency Business Account Loans under the BCAP, which will provide interest free loans of up to $40,000 to small businesses and non-profits that have been impacted by COVID-19 through banks and other financial institutions, will be forgivable if the loans are repaid by December 31, 2022. Applications for these loans opened on April 9, 2020. Employers that are interested in applying should contact their bank or credit union.
The new details on the BCAP offer further good news for employers. The potential to have 25% of Canada Emergency Business Account Loans forgiven if 75% of a loan is repaid by December 31, 2022 provides a further benefit for eligible employers currently struggling with liquidity.
The Canada Emergency Wage Subsidy Became Law
On April 11, the federal government passed Bill C-14, the COVID-19 Emergency Response Act, No. 2 (the “Act”), enacting the CEWS, which included additional changes to and details about the CEWS.
Key developments announced earlier that were confirmed in the legislation include:
- Employers will only need to show a 15% decline in revenue in March 2020 to qualify for the CEWS for wages they paid to employees in the March 15 and April 11, 2020 claiming period, as opposed to the 30% reduction that is required for April and May.
- Employers will have the option of comparing their revenue with revenue in the same month in 2019, or with their average monthly revenue in January and February 2020, to demonstrate the required drop in revenue for CEWS eligibility.
- Employers will be able to calculate their revenues to show the required reduction using either the accrual method, or the cash method (but have to use the chosen method for all claiming periods).
Additional developments outlined in the Act include:
- An employer that successfully applies for the CEWS in one claiming period will be automatically eligible to receive it in the next claiming period, without having to demonstrate a revenue reduction for that period, but would then have to apply again for the following period (e.g. an employer approved for March will automatically be approved in April but will then have to apply again for May).
- The CEWS now includes a 100% refund for certain employer contributions to Employment Insurance, the Canada Pension Plan, the Quebec Pension Plan, and the Quebec Parental Insurance Plan for eligible employees, for each week that the employees are on a paid leave and the employer is eligible to claim the CEWS for the employees, which is in addition to the $847 weekly maximum of the CEWS for each employee.
- The Act gives the government the authority to extend the CEWS from June 6 (when it is currently slated to end) to September 30, 2020.
- The Minister of National Revenue may publish the name of any person or partnership that has claimed the CEWS.
Eligible employers can apply for the CEWS through their CRA My Business Account online portal. The government has stated that further details about the application process and requirements will be available soon, and funds from the CEWS will be available in two to five weeks.
For further details about the developments to the CEWS, and what this could mean for your business, please see our April 14 article dedicated to the CEWS on this Resource Centre.
This blog is provided as an information service and summary of workplace legal issues. This information is not intended as legal advice.