Federal Government Extends Wage Subsidy For Businesses
OTTAWA — The federal government is extending the Canada Emergency Wage Subsidy (CEWS) for an extra three months.
Prime Minister Justin Trudeau said Friday the extension is designed to help business owners bring back their workers — and hopefully hire new ones — as the economy begins to reopen.
“Business owners, you now have some runway to catch your breath as you get started, so please bring back your employees,” he said.
The CEWS is a federal program that pays 75 percent of employee wages to businesses impacted by Covid-19.
Initially, the government said the program would cover wages for the 12-week period between March 15 and June 7. The new extension means employers can now get the subsidy until August 29.
Along with extending the program, Trudeau said his government is looking at changing the requirement that businesses must have lost 30 percent of their revenue to get the subsidy.
“As businesses start [back] up, meeting a [revenue] decline shouldn’t be a barrier to growth,” he said.
As the Canadian Federation of Independent Businesses notes in a statement on the CEWS changes, the 30 percent requirement has already been a barrier for employers trying to access the benefit. That problem would have only grown worse, the CFIB says, as businesses moved into recovery mode.
Dan Kelly, the president and CEO of the Canadian Federation of Independent Businesses, called the wage subsidy extension a “significant and very positive announcement.”
“An extended and simplified wage subsidy is a terrific measure to help get Canadian small businesses back to health. If properly designed, this will be a major relief for tourism and other sectors who are expecting a very soft summer,” he wrote.
In his announcement today, Trudeau said the government will work with business leaders over the coming month to ensure the CEWS is working as intended.
“We’re going to work with industry, work with labour, work with stakeholder groups to make sure we’re getting it right. But that wage subsidy is going to be a very important part of the coming months of recovery,” the Prime Minister said.
To that end, the federal government also expanded eligibility for the CEWS.
Now, some Indigenous government-owned corporations, news organizations, amateur athletic associations, and private colleges and schools will qualify.
The government will also try to pass legislation that makes the CEWS more accessible to employers with seasonal workers, recently amalgamated corporations and trusts.
Those changes come after many business owners expressed frustration with what they feel is the CEWB’s narrow eligibility and the lack of clear information from the government about the program.
Prior to Trudeau’s announcement on Friday, Conservative Party leader Andrew Scheer criticized the federal government for not acting fast enough to fix the “technical barriers” keeping employers from accessing the CEWS.
“If you don’t have a CRA payroll number you can’t access the wage subsidy. If you are self-employed and receive dividends from a family business you don’t qualify for the federal wage subsidy either,” Scheer said.
Scheer said the government first promised to fix these problems in March, and that its “refusal” to act quickly has cost too many Canadians their jobs.