UPDATE: Canada Emergency Wage Subsidy (CEWS)
CEWS Extended to June 2021
On November 19, 2020, the CEWS was extended to June 2021. The maximum base subsidy rate for periods 8 to 10 (September 27 to December 19, 2020) will remain at 40% of the remuneration paid.
Application Deadlines
The deadline to apply for the CEWS for claim periods 1 to 5 is January 31, 2021. The deadline to apply for qualifying periods thereafter is 180 days from the last day of the claim period.
Top-up Subsidy
Starting from claim period 8 (September 27 – October 24, 2020), eligibility for the top-up subsidy will be calculated by comparing the revenue for the claim period against the revenue for the same period in the prior year. Revenues must have dropped by more than 50% to qualify for the top-up subsidy. Employers who have chosen to use the average revenues of January and February 2020 to calculate their base subsidy amounts will use the same approach to determine their eligibility for the top-up subsidy.
For claim periods 8 to 10, using the current month’s revenues to determine the revenue drop (as explained above) is optional. Employers may continue to calculate the revenue drop using the average revenues of the previous 3-months or they can change to the method of comparing the current period’s revenue to that of the same period in the prior year, the latter is the method prior to the November change. The original calculation method is explained in our July 27, 2020 – CEWS update.
Furloughed Employees
Payments made to employees who are on leave with pay are no longer eligible for full subsidy under the CEWS. Starting on October 25, 2020, the wage subsidy for furloughed employees was adjusted to align with the benefits provided through employment insurance (“EI”).
The wage subsidy calculation for a furloughed employee is now the lesser of:
- The amount of eligible remuneration paid in respect of the week; and
- The greater of:
- $500, and
- 55% of pre-crisis remuneration for the employee, up to a maximum subsidy amount of $573.
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