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August 10, 2020

Canada Extends COVID-19 Wage Subsidy Program

On July 27, the Canada Emergency Wage Subsidy (CEWS) was officially extended through December 2020.

Changes to the COVID-19 relief program will:

  • Make the subsidy more accessible to a broader range of employers by providing a gradually decreasing base subsidy to all eligible employers that are experiencing a decline in revenues;
  • Help struggling employers with less than a 30 percent revenue loss get support to keep and bring back workers, while also ensuring those who have previously benefited could still qualify, even if their revenues recover and no longer meet the 30 per cent revenue decline threshold;
  • Introduce a top-up subsidy of up to an additional 25 percent for employers that have been most adversely affected by the COVID-19 crisis;
  • Provide certainty to employers that have already made business decisions for July and August by ensuring they will not receive a subsidy rate lower than they would have under the previous rules; and
  • Address technical issues with the CEWS identified by stakeholders, for example by providing continuity rules to address circumstances where an employer purchased all or substantially all of another entity’s business assets.

The Canadian government also has announced that, in the coming weeks, it plans to transition all Canadians on the Canada Emergency Response Benefit (CERB) to Employment Insurance benefits. Prime Minister Justin Trudeau noted that this benefit will include access to training “and allow you to work more hours and earn more money.”

Also included in the insurance will be a sickness and caregivers benefit for those Canadians who are not covered at work if they, or if they have an immediate family member, falls ill due to COVID-19.