On April 1, 2020, the Canadian government provided further details about its plan to help Canadian employers by providing a 3-month, 75% wage subsidy, retroactive to March 15, 2020.
Parliament will likely soon be recalled to consider, debate, and pass legislation to create the wage subsidy program. For now, the preliminary plan for the Canada Emergency Wage Subsidy is as follows:
- The subsidy will be 75% of the first $58,700 normally earned by employees, or a maximum benefit of $847 per week, per employee. There is no limit on the amount that employers can claim, although entitlement will be based on the actual wages paid to employees.
- Employers of all sizes will be eligible to participate, provided they meet the remaining criteria. As a result, the program will be available to sole proprietors, taxable corporations, and partnerships. Special rules are expected for employees who do not deal at arm’s length with the employer. Public sector entities will be excluded from the program, but it is unclear if the program will apply to “quasi-public” or “broader public” sector employers who receive a small percentage of funding from the government.