How does the 2021 Federal Budget impact Canadian employers?

How does the 2021 Federal Budget impact Canadian employers?

Ontario Employment Lawyer: How does the 2021 Federal Budget impact employers?

The new additions to the 2021 Federal Budget have been created to not only help employers remain as stable as possible during the pandemic, but it has also been altered to help with the transition into a recovery period as more vaccines roll out and businesses re-open. As we gear up to face what we hope to be the last lockdown, employers now have to plan for how they will respond and recover after this year of adversity.

New Additions to CEWS

The 2021 Federal Budget has extended the Canada Emergency Wage Subsidy (CEWS) to September 25, 2021. As you may already know, CEWS is a wage subsidy that works to help employers currently experiencing a decrease in revenue, with a base subsidy specifically for eligible remuneration that is paid to their employees.

There is also a top-up subsidy available for employers who have lost their revenues by 50%, and at maximum 75% (this is only extended until June 5, 2021).

The wage subsidy offered will decrease starting July 4, 2021 which will be the date that employers who have a 10% loss in revenues can begin to receive a wage subsidy.

The plan for 2021, is to eventually replace CEWS with the new Recovery Hiring Program.

Recovery Hiring Program

From June until November 2021, the Canada Recovery Hiring Program will be initiated. This program has been created to help employers hire new employees and hire back workers they have previously laid off. For those employers who are eligible, a hiring subsidy of 50% (at most) on the incremental remuneration will be available to be given to their eligible employees.

Employers can choose between participating in either the hiring program or CEWS. Because the hiring program is meant to be a transition away from receiving CEWS, an employer cannot receive both subsidies.

New Additions to CERS

The Canada Emergency Rent Subsidy and Lockdown (CERS) has been implemented for qualifying organizations that have experienced a decrease in revenue and need rent support. The rent subsidy specifically targets helping organizations with their expenses until September 25, 2021.

From June 6, 2021 to September 25, 2021 there will be a base rent subsidy provided that will be reduced beginning on July 4, 2021. The maximum base rent subsidy (currently providing 65% of eligible expenses) will be provided until June 5, 2021. Like CEWS, organizations with a 10% loss in revenue may receive this subsidy starting on July 4, 2021.

If you have any questions about how your business can use these programs and recover from the pandemic, please contact KCY at LAW by filling in an online consultation request or contact us by phone at 905-639-0999 to book your consultation today.