COVID-19 Update: Canada Emergency Response Benefit (“CERB”) Extension, Employment Insurance (“EI”) Expansion, New Sickness and Caregiving Benefit
On August 20th, 2020, the Government of Canada announced a further $37-billion in new income-support measures in response to the COVID-19 pandemic. These measures extend the CERB for an additional one month, ease the eligibility rules for EI, and add a new sick leave and caregiving benefit.
CERB Transition Plan
The CERB will be extended by an additional four weeks, providing a new maximum of up to 28 weeks of benefits. Effective September 27, 2020, workers who remain unemployed will have the option of applying for EI or one of the Government’s three new income-support programs: the Canada Recovery Benefit, the Canada Recovery Sickness Benefit, or the Canada Recovery Caregiving Benefit.
The number of hours required to qualify for EI benefits will be reduced. While the existing rules require that a worker’s minimum number of hours worked over the previous year be between 420 and 700, under the new temporary measures, claimants can qualify with a minimum of 120 insurable hours.
Canada Recovery Benefit
The Canada Recovery Benefit will provide $400 per week for up to 26 weeks and is directed towards workers who are either self-employed or who are not eligible for EI and cannot resume work. Workers will need to apply after every two-week period for which they are seeking income support and attest that they continue to meet the requirements. The benefit is taxable and claimants may need to repay some or all of the benefit through their income tax return if their annual net income, excluding the Canada Recovery Benefit payment, is over $38,000.
The Canada Recovery Sickness Benefit
The Canada Recovery Sickness Benefit will provide $500 per week for up to 2 weeks as support for workers who fall ill or who must self-isolate due to COVID-19. Workers will not be required to have a medical certificate to qualify for the benefit. Workers cannot claim this benefit at the same time as receiving paid sick leave from their employer. In order to qualify for this taxable benefit workers must have missed a minimum of 60% of their scheduled work in the week for which they claim the benefit.
The Canada Recovery Caregiving Benefit
The Canada Recovery Caregiving Benefit will provide a household $500 per week for up to 26 weeks to support individuals who are required to care for a child under 12 years of age on the first day of the period for which the benefit is claimed, or provide care to a family member with a disability or a dependent because:
- their school, daycare, or other care facility is closed or operates under an alternative schedule due to COVID-19;
- they cannot attend school, daycare, or other care facility under the advice of a medical professional due to being at high-risk upon contraction of COVID-19; or
- the caregiver who usually provides care is not available for reasons related to the COVID-19 pandemic.
Workers cannot be in receipt of a paid leave from an employer in respect of the same week, nor can they be in receipt of the CERB or similar EI benefit at the same time as receiving the Canada Recovery Caregiving Benefit. In order to qualify for this taxable benefit workers must have missed a minimum of 60% of their scheduled work in the week for which they claim the benefit. Two members residing in the same household could not be in receipt of the benefit for the same period.
Finally, the Government also announced that it will freeze EI premium rates at their current levels for two years. As EI is normally paid for by payroll premiums collected from workers and their employers, the Government’s decision is meant to prevent workers and businesses from facing an immediate increase in costs and payroll deductions due to the additional expenses resulting from the COVID-19 pandemic.
We at McCarthy Tétrault are continuing to monitor the changes brought by this announcement. Watch our COVID-19 Recovery Hub and our McCarthy Tétrault Employer Advisor Blog for further updates. In the interim, if you are an employer and have any questions about the changes brought by the Government’s announcement or any other COVID-19 workplace matter, please contact any member of our National Labour & Employment Group.