Bill C-4: Canada Passes New Extended Recovery Benefits Related to COVID-19 and Amendments to the Canada Labour Code

| 8 minutes

On October 2, 2020, Bill C-4 – An Act relating to certain measures in response to COVID-19 (the “Bill”) received Royal Assent in the House of Commons. The Bill created three new temporary recovery benefits for Canadians who are unable to work for reasons related to COVID-19 (collectively, the “Recovery Benefits”).

Additionally, the Bill amended the Canada Labour Code to ensure that federally regulated employees have access to job-protected leaves so that they can avail themselves of the Recovery Benefits as well as consequential amendments to the Income Tax Act and the Income Tax Regulations. Further, as part of the Bill, the Government of Canada also amended and extended the application of the Public Health Event of National Concern Payments Act (the “PHENCPA”) to December 31, 2020.

The Recovery Benefits

Part 1 of the Bill enacts the Canada Recovery Benefits Act. This Act introduces the following three new temporary Recovery Benefits which aim to provide income support to Canadians while introducing measures that encourage people to safely return to work: (i) Canada Recovery Benefit (“CRB”); (ii) Canada Recovery Sickness Benefit (“CRSB”); and (iii) Canada Recovery Caregiving Benefit (“CRCB”). Canadians will be able to apply for the CRB, CRSB and CRCB through the Canada Revenue Agency for one year up until September 25, 2021.

  • Canada Recovery Benefit

The CRB provides workers who are self-employed or who are not eligible for Employment Insurance (“EI”) with $500 per week for up to 26 weeks. Importantly, the Bill provides for a repayment mechanism whereby a person who has income of more than $38,000 in 2020 or 2021 will be required to repay an amount equal to 50 cents for every dollar of income earned in that year, above $38,000, up to the total amount of the CRB received by them in the year.

To be eligible for the CRB, an individual must reside and be present in Canada for the application period, be at least 15 years old on the first day of the application period and have a valid Social Insurance Number. The individual must also have earned a minimum of $5,000 in 2019, or in 2020, or in the 12 months preceding their first application for this benefit from one or more of the following (i) employment income, (ii) self-employment income, (iii) EI maternity or parental benefits; or (iv) Quebec Parental Insurance Plan (“QPIP”) benefits.

In addition to the above criteria, applicants must also have stopped working due to the COVID-19 pandemic, but remain available and looking for work or have continued working but have suffered a reduction of at least 50% in their employment/self-employment income for reasons related to COVID-19. In no circumstance can an applicant have quit their job voluntarily. Lastly, for the week(s) with which they are applying to receive the CRB, applicants must not be receiving the CRCB, the CRSB, short-term disability benefits, workers’ compensation benefits, any EI benefits, or QPIP benefits.

  • Canada Recovery Sickness Benefit

The CRSB provides eligible workers with $500 per week for up to two weeks if they cannot work because they are sick or must self-isolate for reasons related to COVID-19.

To be eligible for the CRSB, an individual must reside and be present in Canada for the application period, be at least 15 years of age on the first day of the application period and have a valid Social Insurance Number. They must also have earned at least $5,000 in 2019, or in 2020, or in the 12 months preceding their first application for this benefit from one or more of the following: (i) employment income, (ii) self-employment income, (iii) EI maternity or parental benefits; or (iv) QPIP benefits.

Additionally, the applicant must have been unable to work for at least 50% of their normally scheduled work within a given week because of being sick or required to self-isolate for reasons related to COVID-19. They must also not be in receipt of paid leave from an employer in respect of the same week and must not be in receipt of the CERB, the EI Emergency Response Benefit, the CRB, the CRCB, short-term disability benefits, workers’ compensation benefits, or any EI benefits or QPIP benefits in respect of the same work.

  • Canada Recovery Caregiving Benefit

The CRCB provides $500 per week, for up to 26 weeks per household to eligible workers who cannot work because they must provide care to children or family members due to the closure of schools, daycares or other care facilities.

A worker may be eligible for this benefit if they reside and are present in Canada for the application period. They must also be at least 15 years of age on the first day of the application period and have a valid Social Insurance Number. Additionally, they must have earned at least $5,000 in either 2019 or in 2020, or in the 12 months preceding their first application for this benefit from one or more of the following: (i) employment income, (ii) self-employment income, (iii) EI maternity or parental benefits; or (iv) QPIP benefits. Moreover, they must have been unable to work for at least 50% of their normally scheduled work within a given week due to the fact that they:

  • must take care of a child who is under 12 years of age on the first day of the period for which the benefit is claimed: (i) because their school or daycare is closed or operates under an alternative schedule for reasons related to the COVID-19 pandemic; (ii) who cannot attend school or daycare under the advice of a medical professional due to being at high risk if they contract COVID-19; (iii) because the caregiver who usually provides care is not available for reasons related to the COVID-19 pandemic;

  • must provide care to a family member who requires supervised care: (i) because their day program or care facility is closed or operates under an alternative schedule for reasons related to COVID-19; (ii) who cannot attend their day program or care facility under the advice of a medical professional due to being at high risk if they contract COVID-19; or (iii) because the caregiver who usually provides care is not available for reasons related to the COVID-19 pandemic.

Notably, the applicant must be the only individual from their household claiming the CRCB for the week in which they are applying and must not be in receipt of paid leave from an employer in respect of the same week. They must also not be in receipt of the CERB, the EI Emergency Response Benefit, the CRB, the CRSB, short-term disability benefits, workers’ compensation benefits, or any EI benefits or QPIP benefits in respect of the same week. 

Proposed Amendments to the Canada Labour Code

In addition to the Recovery Benefits outlined above, the Bill provides amendments to the Canada Labour Code. The amendments include amending the reasons for which federally regulated employees are entitled to take leave related to COVID-19 as well the duration of the leave. Such amendments allow federally regulated employees to have access to job-protected leaves that will enable them to avail themselves of the Recovery Benefits.

Federally regulated employees are entitled to a job-protected leave of absence of:

  • up to two weeks, or if another number of weeks is fixed by regulation, that number of weeks — if the employee is unable to work because they contracted or might have contracted COVID-19 or because they have isolated themselves on the advice of their employer, a medical practitioner, nurse practitioner, person in authority, government or public health authority for reasons related to COVID-19; or

  • up to 26 weeks — or, if another number of weeks is fixed by regulation, that number of weeks — if the employee is unable to work because:

    • they must care for a child who is under 12 years of age because the school or other facility that the child normally attends is, for reasons related to COVID-19, closed, open only at certain times or open only for certain children;

    • the child cannot attend the school or other facility because (i) the child contracted or might have contracted COVID-19, (ii)the child is in isolation on the advice of a medical practitioner, nurse practitioner, person in authority, government or public health authority for reasons related to COVID-19, or (iii) the child would, in the opinion of a medical practitioner or nurse practitioner, be at risk of having serious health complications if the child contracted COVID-19;

    • the person who usually cares for the child is not available for reasons related to COVID-19; or

    • the care services that are normally provided to the family member at their place of residence are not available for reasons related to COVID-19.

Additionally, the amendments give the Governor in Council the power to make regulations. This includes regulations whereby in certain circumstances, a requirement or condition respecting a certificate issued by a health care practitioner would not apply, as well as the power to provide for alternative requirements and conditions.

Amending and Extending the Application of the Public Health Event of National Concern Payments Act

PHENCPA was initially enacted in March 2020 – at the beginning of the COVID-19 pandemic – to allow the Government of Canada to access the funds required for a significant part of the COVID-19 response measures that make up Canada’s Economic Response Plan. The Bill granted Parliamentary approval for access to funding, subject to prescribed limits until the end of 2020. Importantly, the spending authority would only be able to be used for specific measures approved in advance by Parliament as part of the Bill.

This update is part of our continuing efforts to keep employers informed about COVID-19. Check our COVID-19 hub and our McCarthy Tétrault Employer Advisor blog for further updates. If you are an employer and need assistance, please reach out to any member of our National Labour & Employment Team.

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