COVID-19 Support for Employers - Current to February 2021
The Canadian government has enacted a number of financial support and relief programs to help employers facing hardship due to the ongoing COVID-19 pandemic. In this blog post we explore some of the programs that may be available to employers who are experiencing financial difficulties, current to February 2021.
Please note that the measures and programs listed in this blog post are not exhaustive. Employers facing economic difficulties due to COVID-19 are encouraged to discuss the options that may be available to them with their financial and legal advisors.
1. Employment Specific Federal Support
The federal government have enacted a couple measures and programs with the specific aim of helping organizations to keep or rehire employees. These measures include the following:
Measure | Effective Period | Description |
Canada Emergency Wage Subsidy (CEWS) | March 14, 2020 to June 30, 2021 | CEWS is a wage subsidy available to employers who have experienced a drop in revenue during COVID-19. CEWS provides a subsidy of up to 75% of eligible wages paid by a qualifying employer to each employee - up to a maximum of $847 per week. Since being announced in March 2020, CEWS has undergone a number of changes. Effective January 6, 2021, the following changes apply to CEWS for the period spanning December 20, 2020 to March 13, 2021:
The government has not yet announced details for the period spanning March 14, 2021 to June 30, 2021. The calculation of CEWS is complicated and employers may wish to seek financial advice when applying for CEWS. |
Extension of Work-Sharing Program (WSP) | March 15, 2020 to March 14, 2021 | Under the Work-Sharing Program eligible employers and employees enter into a Work-Sharing Agreement where the employees agree to reduce their normal working hours and share the available work. Employees who participate in a Work-Sharing Program are entitled to apply for EI benefits to supplement their wages. Effective March 15, 2020 to March 14, 2021 the following temporary measures apply to the Work-Sharing Program:
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2. Additional Federal Financial Support
In addition to the employment-specific measures, the federal government has also put in place a variety of support measures aimed at providing financial relief to Canadian businesses and organizations. In the chart below we outline some of the key features of these support measures. For further information on the eligibility requirements and application process for each, please visit: Managing your business during COVID-19: Financial support, loans and access to credit - Canada.ca.
Measure | Effective Period | Description |
Canada Emergency Rent Subsidy (CERS) | September 27, 2020 to June, 30 2021 | CERS is a commercial rent and property expense subsidy available to businesses, non-profit organizations or charities who have experienced a drop in revenue during COVID-19. Eligible renters may qualify for up to a maximum of 65% of qualifying rent expenses. Additionally, businesses that are forced to temporarily shut due to mandatory public health measures may be able to claim an additional 25% top up. For each claim period, expenses can be claimed to a maximum of $75,000 per location, with a total of $300,000 for all locations. |
Canada Emergency Business Account (CEBA) | Applications open until March 31, 2021 | This program offers interest-free loans to small businesses and not-for-profits. Effective December 4, 2020, approved organizations can receive up to a $60,000 loan. Repayment on or before December 31, 2022 will result in loan forgiveness of 33%. |
Highly Affected Sector Credit Availability Program (HASCAP) | Until June 30, 2021 | This program offers guaranteed, 4% interest rate loans of $25,000 to $1 million for businesses that have been highly impacted by COVID-19. To be eligible, businesses must have demonstrated a minimum 50% revenue decline for at least 3 months within an 8 month period, amongst other criteria. |
EDC Business Credit Availability Program (BCAP) | Until June 2021 | This program offers up to $6.25 million to Canadian small and medium size businesses to cover payroll and operating costs. EDC will guarantee 80% of the new operating line of credit or new term loan. |
Regional Relief and Recovery Fund (RRRF) | This fund was established to assist businesses and organizations cope with and recover from COVID-19. It is administered on a local level through regional development offices. | |
Large Employer Emergency Financing Facility (LEEFF) | Open while the pandemic persists | This program offers interest-bearing term loans of $60 million or more to large Canadian employers. To qualify, employers must be able to generally show approximately $300 million or more in annual revenues, amongst other criteria. |
Support for Indigenous businesses | This program offers up to $40,000 to small and medium-sized Indigenous businesses. $30,000 is available as an interest-free loan and $10,000 is available as a non-repayable contribution. |
3. Provincial and Sector-Specific Support
In addition to the federal programs and measures, most provinces have also taken steps to provide relief and support to employers who are facing difficulties due to COVID-19. Further, sector-specific programs and measures have been put in place across all levels of government in an effort to assist the sectors that have been especially hard hit by the pandemic.
Given the range and complexity of the measures in place, employers should speak with an experienced employment lawyer about their best options. Lee Workplace Law would be happy to help.
