Trudeau extends wage subsidy until end of summer

May 15 2020, 3:27 pm

Prime Minister Justin Trudeau said the government is extending the Canada Emergency Wage Subsidy by another three months amid the COVID-19 pandemic.

Trudeau said the subsidy will extend to the end of August, and added that the government will be broadening the eligibility.

Finance Minister Bill Morneau announced the Government of Canada will extend the CEWS by an additional 12 weeks to August 29, 2020.

The Government said it 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%revenue decline threshold, according to a release.

“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,” states the federal government.

Minister Morneau also announced the approval of regulations to extend eligibility for the CEWS.

According to the Government of Canada, 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 said it also intends to propose legislative amendments to ensure that the CEWS continues to meet its objectives.

The 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 Wage Subsidy gives eligible employers 75% of employee wages for up to 12 weeks, retroactive from March 15, 2020, and had an original end date of June 6, 2020. The maximum benefit is $847 per employee each week.

Trudeau first teased the announcement last week, after Statistics Canada released its latest jobs report, noting another significant hit. Canada lost nearly two million jobs in April amid the COVID-19 pandemic.

According to Statistic Canada, after employment fell by 1,011,000 or 5.3% in March, it dropped by nearly two million in April, “bringing the total employment decline since the beginning of the COVID-19 economic shutdown to over three million.”

Statistics Canada calls the drop in employment “unprecedented.”

On Friday, Trudeau also announced $450 million to help researchers and research institutions.

The prime minister also said the Canada Child Benefit and GST/HST credit won’t be cut off for anyone who misses the June 1 tax filing deadline. These benefits will continue until the end of September.



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