As the situation surrounding the COVID-19 pandemic changes daily it becomes increasingly more difficult to find answers to all the questions you may have surrounding your business during this current crisis, such as how can I get a break on paying rent? Or how can I utilize the wage subsidy plan to help my staff? In effort to help you navigate these ever-changing times, we welcome the opportunity to find those answers for you. All you have to do is fill out this simple form and we will share your anonymous questions and the answers with others on our website and via our social media accounts. We are all in this together!
Q. How is revenue calculated for applicants to the Canada Emergency Wage Subsidy?
A:To measure their revenue loss, employers can compare their revenue of March, April and May 2020 either to that of the same month of 2019, or to an average of their revenue earned in January and February 2020.
Gross revenues will be used to determine eligibility. Employers will be allowed to measure revenues either on the basis of accrual accounting (as they are earned) or cash accounting (as they are received). Please refer to the accounting method used to report gross revenues in your organization’s financial statements.
This excludes revenues from extraordinary items and amounts on account of capital (i.e. capital gains are not included in gross revenue calculations). Special rules will be provided to address issues for corporate groups, non-arm’s length entities, and joint ventures. Employers are required to maintain records to demonstrate a decline in revenues and remuneration paid to employees.
Non-profits will be allowed to include or exclude government funding in their applications.
Special consideration will be given to organizations that cannot show a year-over-year loss in revenue. This includes rapidly growing firms and those that were not in business last year. More details to come.
Q: What if I don’t qualify for Employment Insurance?
A: The Government of Canada has announced the creation of an Emergency Response Benefit. Details on how the program will work:
They will provide a taxable benefit of $2,000 a month for up to 4 months to:
workers who must stop working due to COVID19 and do not have access to paid leave or other income support.
workers who are sick, quarantined, or taking care of someone who is sick with COVID-19.
working parents who must stay home without pay to care for children that are sick or need additional care because of school and daycare closures.
workers who still have their employment but are not being paid because there is currently not sufficient work and their employer has asked them not to come to work.
wage earners and self-employed individuals, including contract workers, who would not otherwise be eligible for Employment Insurance.
Q:How will COVID-19 affect import/exports and shipment of inventory?
A: Currently, there are no restrictions on the import or exports. While borders are beginning to close for leisure travel, there is no indication whatsoever this will affect commercial transport. If your business relies on transport by air, be aware most passenger airlines are currently scaling back operations but cargo services are continuing as normal.
Q:My business relies on Temporary Foreign Workers, workers on visas or international students. What will happen to them?
A: Temporary foreign workers will still be allowed entry into Canada, despite restricted border measures, provided they self-isolate for 14 days, according to a statement made by Public Safety Minister Bill Blair.
Q: My staff are working remotely. What are some best practices?
A: For many businesses, COVID-19 has forced remote working on their team. Fortunately, it’s easy to maintain productivity even while the team is separated. Employers should schedule regular morning meetings, be clear in expectations, make sure employees have what they need to perform their role safely, and be patient – this is a time of tremendous anxiety and turmoil for everyone.
Q: How is Canada supporting its citizens and businesses as a result of the COVID-19 outbreak?
A: The Government of Canada is taking immediate, significant and decisive action to help Canadians facing hardship as a result of the COVID-19 outbreak. Click here to view Canada’s COVID-19 Economic Response Plan
Q. How is the government supporting businesses that have to reduce operations due to COVID-19 impacts?
A. The Work-Sharing Program has been temporarily enhanced i.e., doubling the length of time that employers and workers are eligible for the program from 38 to 76 weeks, and streamlining processes so that help can be accessed as soon as possible. The following changes have been made to the program:
Reducing the requirement that businesses have been operating for 2 years to 1 year;
Employers can apply for the full 72 weeks at one time;
Removing the requirement for a recovery plan;
Streamlining the application form;
Decreasing the processing time to 10 days;
Introducing secondary point of contact (email).
The government has also introduced the Emergency Wage Subsidy which would apply at a rate of 75 per cent of the first $58,700 normally earned by employees – representing a benefit of up to $847 per week. The program would be in place for a 12-week period (March 15 to June 6, 2020).
Employers who suffer a drop in gross revenues of at least 30 %in March, April or May, when compared to the same month in 2019.
Employers of all sizes and across all sectors of the economy, with the exception of public sector entities.
Non-profit organizations and registered charities similarly affected by a loss of revenue would be eligible. The government will continue to work with the sector to ensure the definition of revenue is appropriate to their circumstances. The government is also considering additional support for non-profits and charities, particularly those involved in the front line response to COVID-19. Further details will be announced in the near term.
An employer’s eligibility will be based entirely on the salary or wages actually paid to employees. All employers would be expected (or at least make best efforts) to top up salaries to 100% of the maximum wages covered.
Eligible employers would be able to access the Canada Emergency Wage Subsidy by applying through a Canada Revenue Agency online portal. More details regarding how to apply for the program will follow.
Those organizations that do not qualify for the Canada Emergency Wage Subsidy may continue to qualify for the previously announced wage subsidy of 10 per cent 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.
The government’s backgrounder provides more detailed information.
The subsidy will be equal to 75% of remuneration paid during that period. Businesses and nonprofits of all size are eligible for the subsidy if they have experienced a drop in revenue of at least 30%. The subsidy will cover 75% of annual earnings up to $58,700 or $847 per week and is retroactive to March 15, 2020.