CPCA Bulletin: Government Details on Wage Subsidy Program for Businesses
CPCA has been monitoring announcements as all members have with respect to various relief programs related to COVID-19. Even though the details were announced as below, there are still some clarifications demanded of the Government. The best course of action for members is to apply for relief funding now as set out in the program requirements as noted on April 6, 2020.
The Federal Government provided much-anticipated details on their 75% wage subsidy for businesses and not-for-profits, the Canadian Emergency Wage Subsidy program. The details were released in a press conference with Finance Minister Bill Morneau, International Trade and Small Business Minister Mary Ng, and Innovation, Science and Industry Minister Navdeep Bains.
The Finance Minister called the subsidy “the largest economic program in Canadian history,” with an estimated cost of $71 billion.
Parliament will need to return to pass these measures into law, which is expected early next week, and funds are expected to be available within six weeks. More details will be provided to members as they become available.
Emergency Wage Subsidy Details
- Available to all businesses, not-for-profits and charities; that are not publicly funded; and that are facing a 30% or greater revenue decline because of COVID-19.
- Wage subsidy of 75% available on a maximum salary of $58,700 ($847 per week).
- The program will be in place for a 12-week period, from March 15 to June 6, 2020.
- 30% revenue decline will be based on revenues for March, April and May 2019. (Minister Morneau indicated that the government is looking at options to assess revenue decreases for businesses that were not around in March 2019.)
- Businesses will need to reapply for the subsidy each month.
- Employers will need to attest that they are doing their part to contribute the additional 25% of wages, but Minister Morneau recognized that not all businesses will be able to contribute this amount.
- Employers found to violate the terms of the program will face severe penalties.
- Eligible employers will include employers of all sizes and across all sectors of the economy, with the exception of public sector entities.
- Eligible employers will be able to access the Canada Emergency Wage Subsidy by applying through a Canada Revenue Agency online portal. More details will follow.
- The government will continue to work with non-profit organizations and registered charities to ensure the definition of revenue is appropriate to their circumstances.
- Organizations that do not qualify for the Canada Emergency Wage Subsidy may continue to qualify for the previously announced wage subsidy of 10% of remuneration paid from March 18 to before June 20, up to a maximum subsidy of $1,375 per employee and $25,000 per employer.
All measures are proposed and are contingent on legislative approval and as such may be subject to change. However, given the crisis and timing, it is not expected to be held up.
Federal Engagement
A comprehensive resource for all government programs is available per the links below:
The Canada Emergency Wage Subsidy
https://www.canada.ca/en/department-finance/news/2020/04/the-canada-emergency-wage-subsidy.html
The Canada Emergency Response Benefit
https://www.canada.ca/en/services/benefits/ei/cerb-application.html
As the details of the programs already announced become available, CPCA will provide as much detail as is available to help your organization get through these extraordinary times.