The federal government has extended the Canada Emergency Wage Subsidy (CEWS) program beyond June. The extension is aimed to encourage employers to re-hire workers laid off as a result of COVID-19, and “help kickstart the reopening of the country’s economy.”
The first payments from the 75 percent wage subsidy were expected to be received this week.
In his daily press briefing, Prime Minister Justin Trudeau said since the CEWS launched last week, employers have applied for the 75 percent subsidy for more than 2 million workers. He added that this subsidy would play a more significant role as provinces begin to open their economies. The first payments from the CEWS were expected to be received this week.
The CEWS was originally available for three months and was set to end on June 6. The prime minister did not specify how much longer the wage subsidy would be available, simply noting it will be available beyond June.
“To businesses hit by COVID-19, the wage subsidy will continue to be there for you to help you keep your employees on the payroll,” Trudeau said. “And if you had to let people go, try to bring them back. It’s those workers who will drive our economy’’s short and long-term recovery.”
The CEWS offers a subsidy of 75 percent of an eligible employee’s weekly earnings, to a maximum of $847 per employee per week to eligible employers, for up to 12 weeks. The funding is retroactive to March 15. The government said businesses can generally expect to receive their payment within 10 business days if they are registered for direct deposit on their payroll account.
The extension of the wage subsidy follows Statistics Canada releasing its monthly jobs report, which found about 2 million Canadians lost their jobs in April. Unemployment soared to 13 percent, up from March’s rate of 7.8 percent. The total number of Canadians that have filed for unemployment since the COVID-19 hit Canada has reached 3 million.
While some from the startup and tech community have criticized the federal program’s revenue criteria, a survey conducted by the Council of Canadian Innovators found the expanded criteria passed by Parliament in early April could allow more startups to access the subsidy. The survey found that nearly 40 percent could be ineligible for the wage subsidy, compared to 94 percent of companies that said they would be ineligible prior to the expanded criteria.
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