Canadian Government provides further details of the CEWS and CERS for Periods 11 to 13

On November 30, 2020, the government of Canada (the “Government”) released its much-anticipated Fall Economic Statement (the “Statement”), which, among other things, included further details of the Canada Emergency Wage Subsidy (“CEWS”) and Canada Emergency Rent Subsidy (“CERS”) programs in respect of Periods 11 to 13 (i.e., December 20, 2020 to March 13, 2021). The key aspects of the CEWS and CERS that are being proposed for Periods 11 to 13 are set out as follows:

  • CEWS for Active Employees: The maximum CEWS combined base and top-up subsidy rate is proposed to increase to 75% (up from 65%). This will be effected by increasing the maximum top-up subsidy rate to 35% (up from 25%). The maximum base subsidy rate will remain at 40%.

  • CEWS for Furloughed Employees: The CEWS rate structure for furloughed employees will continue to be aligned with the benefits available under Employment Insurance. The weekly maximum subsidy for a furloughed employee is proposed to be 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 weekly subsidy amount of $595.

  • CERS Rate Structure: The current CERS rate structure, including the “lockdown support” top-up subsidy, will be extended until the end of Period 13 (i.e., March 13, 2021).
  • CERS and CEWS Reference Periods: The reference periods in respect of the “general” and “alternative” approaches used to determine an eligible entity’s revenue-drop applicable to Periods 11 to 13 for both the CEWS and CERS have now been provided.

At the time of writing, the regulations required to formally effect the foregoing changes are outstanding. Details for the CEWS and CERS programs for any period beyond March 13, 2021 will be proposed at a later date.

The Statement can be found here.

Some of our Firm’s past commentary on the CEWS can be found herehereherehereherehere and here.

Our detailed commentary on the CERS can be found here

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