Government extends the Canada Emergency Wage Subsidy

Government extends the Canada Emergency Wage Subsidy

From: Department of Finance Canada

ORIGINAL SOURCE

News release

May 15, 2020 - Ottawa, Ontario - Department of Finance Canada

The Government of Canada is taking immediate, significant and decisive action through Canada’s COVID-19 Economic Response Plan to support Canadians and protect jobs during the global COVID-19 pandemic.

The Canada Emergency Wage Subsidy (CEWS) helps businesses keep employees on the payroll and encourages employers to re-hire workers previously laid off, and better positions businesses to bounce back following the crisis.

Finance Minister Bill Morneau today announced that the Government of Canada will extend the CEWS by an additional 12 weeks to August 29, 2020. Extending the program will give workers greater confidence that they will continue to get the support they need during these difficult times. The Government will consult with key business and labour representatives over the next month on potential adjustments to the program to incent jobs and growth, including the 30 per cent revenue decline threshold. Any potential changes following the consultation will have as key objectives to maximize employment, ensure the CEWS reflects the immediate needs of businesses, and support the post-crisis economic recovery.

In addition, Minister Morneau also announced the approval of regulations to extend eligibility for the CEWS to ensure that it continues to support those employers and workers hardest hit by the COVID-19 pandemic, and protects the jobs Canadians depend on. These regulations extend eligibility for the CEWS to the following groups:

  • Partnerships that are up to 50-per-cent owned by non-eligible members;
  • Indigenous government-owned corporations that are carrying on a business, as well as partnerships where the partners are Indigenous governments and eligible employers;  
  • Registered Canadian Amateur Athletic Associations;
  • Registered Journalism Organizations; and
  • Non-public colleges and schools, including institutions that offer specialized services, such as arts schools, driving schools, language schools or flight schools.

The Government also intends to propose legislative amendments to ensure that the CEWS continues to meet its objectives. These proposed amendments would:

  • Provide flexibility for employers of existing employees who were not regularly employed in early 2020, such as seasonal employees;
  • Ensure that the CEWS applies appropriately to corporations formed on the amalgamation of two predecessor corporations and
  • Better align the treatment of trusts and corporations for the purpose of determining CEWS eligibility.

The CEWS is a key measure in the Government of Canada’s COVID-19 Economic Response Plan, a comprehensive plan to help ensure that Canadians can pay for essentials like mortgages, rent and groceries, and to help businesses continue to pay their employees and their bills during this time of uncertainty. Since its introduction, the wage subsidy has helped nearly 2 million Canadians keep or return to their jobs.

The government continues to assess and respond to the impact of COVID-19, and stands ready to take additional actions as needed to stabilize the economy and mitigate the impacts of the pandemic.

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