Under intense pressure from the business community, and as COVID-19 restrictions are tightened across the country in an attempt to contain the fast-spreading Omicron variant, the federal government has stated its intention to temporarily expand access to two worker and business relief benefits. The $4 billion expansion would be covered by $4.5 billion in funding specifically budgeted in the Fiscal and Economic Update 2021 to support Canadians impacted by the new strain.
As part of its revised business support strategy, Ottawa would:
- Change qualifying rules for the Canada Worker Lockdown Benefit “to include workers in regions where provincial or territorial governments have introduced capacity-limiting restrictions of 50 per cent or more.” The benefit provides $300 a week in income support to eligible workers whose employment is directly affected due to COVID-19 restrictions and who have lost 50 per cent of their income or more
- Expand the Local Lockdown Program, making it accessible to employers facing business capacity restrictions of 50 per cent or more—or those that have had their business activities restricted by a public health order that accounts for at least 50 per cent of their company’s total qualifying revenue—while also reducing the revenue decline threshold requirement to 25 per cent. Eligible employers would be able to access wage and rent subsidies of between 25 per cent to 75 per cent based on the revenue loss they’ve experienced. There is no 12-month revenue decline test to access the Local Lockdown Program. The proposed temporary wage and rent subsidy rate structure for the benefit would be as follows:
|Current-month revenue decline||Period 24-25 (December 19, 2021 – February 12, 2022)|
|75% and over||75%|
|25-74%||Revenue decline (e.g., 50% revenue decline = 50% subsidy rate)|
The changes would be in effect from December 19th 2021 to February 12th, 2022. But given the rapid spread of the coronavirus—daily case loads in Ontario continue to break records and reached an eye-watering 9,500 today alone—it would not be surprising to see a further expansion of relief benefits, particularly if the public health situation fails to improve in the short term.
As noted in a previous blog, the government introduced several targeted support programs in October that will run until at least May 7, 2022. They replaced existing COVID-19 benefits such as the Canada Emergency Response Benefit (CERB) and the Canada Emergency Wage Subsidy (CEWS). They included:
- The Tourism and Hospitality Recovery Program, which provides support to eligible tourism and hospitality sector businesses such as hotels, restaurants and convention centres. Qualifying applicants must demonstrate an average monthly revenue reduction of at least 40 per cent over the first 13 qualifying periods for the CEWS, and a current-month revenue loss of at least 40 percent
- The Hardest-Hit Business Recovery Program, which provides rent and wage subsidies to organizations that can demonstrate an average monthly revenue reduction of at least 50 percent over the first 13 qualifying periods for the CEWS, along with a current-month revenue loss of at least 50 percent
The government also extended the Canada Recovery Hiring Program, the Canada Recovery Caregiving Benefit and the Canada Recovery Sickness Benefit until May 7, 2022.
Armando Iannuzzi, Co-Managing Partner
For more information on federal COVID-19 subsidies, contact a member of our team