The Canada Emergency Wage Subsidy (CEWS) was first announced on April 1, 2020. The wage subsidy was intended to help employers protect jobs, rehire employees and provide workers with a decent income. The subsidy originally covered 75% of an employee’s wages, up to $847/week.
On July 21, 2020, the federal government passed Bill C-20, An Act respecting further COVID-19 measures. The legislation allows more companies to be eligible for the wage subsidy, changes the amount companies can put toward their workers' wages, and extends the wage subsidy program to December 19, 2020. The bill also sends a one-time payment of $600 to people with disabilities.
Key components of the revised CEWS:
- Elimination of revenue drop test for the base subsidy: A scaled base subsidy available to all employers who experience any decline in monthly revenues. The subsidy amount varies depending on the scale of revenue decline. The base subsidy would be at a specified rate of the reduction in an eligible employer's monthly revenues, applied to the amount of remuneration paid to the employee for the eligibility period, to an initial maximum of $677 /week on remuneration of up to $1,129 /week. The scaled base subsidy enables employers with less than the original qualifying 30% revenue loss to access support.
- Introduction of a top-up subsidy: A top-up subsidy of up to an additional 25% for employers who were hit the hardest by the COVID-19 crisis and experienced a three-month average revenue drop of more than 50%.
Additional detailed information on the Canada Emergency Wage Subsidy can be found here: Adapting the Canada Emergency Wage Subsidy to Protect Jobs and Promote Growth