This is an update to our recent blog post summarizing the measures the federal government has implemented to assist Canadian employers and employees. You can find the first part of our post here.
On March 24, 2020, Canada passed Bill C-13. It introduces and implements measures by the federal government to provide financial assistance to employers and employees across the country.
Below is a summary of the employment-related measures in Bill C-13. This is a rapidly evolving situation and we anticipate further changes and clarifications in the coming days. We are monitoring the situation closely, and will continue to communicate updates as soon as they become available.
Income Tax Measures. The government implemented a one-time additional payment under the GST/HST tax credit, is providing temporary additional amounts under the Canada Child Benefit, and is reducing required minimal withdrawals from registered retirement income funds by 25% for 2020. Also, as promised, the government is providing eligible small employers a temporary wage subsidy for a period of three months.
The Canada Emergency Response Benefit Act. An employed or self-employed worker can apply for an income support payment for one of the defined four-week periods between March 15, 2020 and October 3, 2020. The four-week periods are currently defined as follows:
- March 15, 2020 to April 11, 2020
- April 12, 2020 to May 9, 2020
- May 10, 2020 to June 6, 2020
- June 7, 2020 to July 4, 2020
- July 5, 2020 to August 1, 2020
- August 2, 2020 to August 29, 2020
- August 30, 2020 to September 26, 2020
Workers cannot apply after December 2, 2020. To be eligible, a worker must:
- Cease working (this does not include workers who resign voluntarily) for reasons related to COVID-19 for at least 14 consecutive days within the four-week period where they apply for the payment; and
- Not receive, during this period, income from employment or self-employment, any Employment Insurance benefits, or any provincial pregnancy/parental benefits (e.g., QPIP for Quebec employees), or any other income that may be prescribed by regulation.
Workers are entitled to a maximum of 16 weeks of income support payments. The amount of these payments will be set soon, though press releases suggest it will amount to $2,000 for every four-week period.
Leave for Federally-Regulated Employees. The government removed the requirement for federally-regulated employees to obtain medical certification to take Compassionate Care Leave, Leave Related to Critical Illness, or Medical Leave under the Canada Labour Code. The government also introduced a Leave Related to COVID-19, offering federally-regulated employees up to 16 weeks of leave if the employee is unable or unavailable to work for reasons related to COVID-19. The employer may require an employee to provide a written declaration in support of the reasons for the leave of absence taken and of any change in the length of the leave.
Employment Insurance Changes. Bill C-13 amended the Employment Insurance Act to allow the government to make interim orders related to COVID-19. The government also eliminated the need for employees to receive medical certificates to access Employment Insurance.
You can find the full text of Bill C-13 here.
As the national response to the COVID-19 pandemic continues to rapidly evolve, employers are increasingly faced with around-the-clock challenges on how to support employees and their families in these unprecedented times. Planning for how to address the challenges and changes is essential to ensure that employers successfully navigate these difficult financial times calmly and effectively.
You can access our Coronavirus Resource Center for more information on the impact of this situation on your business and what you can do to manage these risks. It covers areas of immediate concerns such as employer obligations, contract issues, supply chain disruption, financing and force majeure, as well as more forward-looking issues such as the practical impact of COVID-19 on transactions and IPO activity.