Covid-19 : Adapting the Canada Emergency Wage Subsidy (Periods 11 to 20)
The deadline to claim the Canada Emergency Wage Subsidy is the day following 180 days after the end of the claim period.
The Canada Emergency Wage Subsidy (CEWS) was put in place for eligible wages paid from March 15, 2020. Initially, there were only three periods (March 15 to June 6, 2020). In its most recent budget submitted on April 19, the federal government has added periods 17 to 20 (until September 25, 2021).
Base Subsidy
Effective July 5, 2020, employers that have been affected by the COVID-19 crisis would be eligible for a base CEWS. The maximum amount of paid remuneration, on which the CEWS will be calculated, will always be $1,129 per week.
The rate of the base CEWS will vary depending on the level of revenue decline during each period, and its application will be extended to employers with a revenue decline of less than 30 per cent.
Timing | Period 11: | Period 12: January 17, 2021 to | Period 13: February 14, 2021 to | Period 14: March 14, 2021 to | Period 15: April 11, 2021 to |
Maximum weekly | Up to $733.85 | Up to $733.85 | Up to $733.85 | Up to $733.85 | Up to $733.85 |
Revenue drop |
|
|
|
|
|
50% and over | 40% | 40% | 40% | 40% | 40% |
0% to 49% | 0.8 × revenue drop | 0.8 × revenue drop | 0.8 × revenue drop | 0.8 × revenue drop | 0.8 × revenue drop |
Timing | Period 16: May 9, 2021 to | Period 17: | Period 18: July 4, 2021 to | Period 19: August 1, 2021 to | Period 20: August 29, 2021 to |
Maximum weekly | Up to $733.85 | Up to $846.75 | Up to $677.40 | Up to $451.60 | Up to $225.80 |
Revenue drop |
|
|
|
|
|
50% and over | 40% | 40% | 35% | 25% | 10% |
0% to 49% | 0.8 × revenue drop | 0.8 × revenue drop | 0.875 × (revenue drop – 10%) | 0.625 × (revenue drop – 10 %) | 0.25 × revenue drop |
* The maximum weekly benefit per employee is equal to the maximum combined base subsidy and top-up wage subsidy for the qualifying period applied to the amount of eligible remuneration paid to the employee for the qualifying period, on remuneration of up to $1,129 per week.
Top-Up Subsidy for Employers Most Adversely Affected
An additional CEWS rate of up to 35% will be offered to employers who have been most affected by the pandemic. To be eligible for this additional subsidy, companies must have a revenue drop of more than 50%.
Top-Up CEWS Rates for Selected Levels of Average Revenue Drop
Reference | Periods 11 to 16 | Period 17 | Period 18 | Period 19 | Period 20 |
Revenue |
|
|
|
|
|
70% | 25% 1.25 x (70% - 50%) | 35% 1.75 x (70% - 50%) | 25% 1.25 x (70% - 50%) | 15 % 0.75 x (70% - 50%) | 10 % 0.5 x (70% - 50%) |
65% | 18.75% 1.25 x (65% -50%) | 26.25% 1.75 x (65% - 50%) | 18.75% 1.25 x (65% - 50%) | 11.25% 0.75 x (65% - 50%) | 7.50% 0.50 x (65% - 50%) |
60% | 12.5% 1.25 x (60% - 50%) | 17.5% 1.75 x (60% - 50%) | 12.5% 1.25 x (60% - 50%) | 7.5% 0.75 x (60% - 50%) | 5.0% 0.50 x (60% - 50%) |
55% | 6.25% 1.25 x (55% - 50%) | 8.75% 1.75 x (55% - 50%) | 6.25 % 1.25 x (55% - 50%) | 3.75% 0.75 x (55% - 50%) | 2.25 % 0.50 x (55% - 50%) |
50% | 0.0% 1.25 x (50% - 50%) | 0.0% 1.75 x (50% - 50%) | 0.0% 1.25 x (50% - 50%) | 0.0% 0.75 x (50% - 50%) | 0.0% 0.50 x (50% - 50%) |
Reference Periods for the Drop-in-Revenue Tests
For the purpose of the base CEWS, eligibility would generally be determined by the change in an eligible employer's monthly revenues, year-over-year, for the applicable calendar month. The directive allowing the employer to be automatically qualified, if the employer qualifies for the previous period, is still valid.
Employers must keep the elected approach applied to previous periods for Period 11 and subsequent periods.
| Claim Period | General Approach | Alternative Approach |
Period 11 | December 20, 2020 to January 16, 2021 | December 2020 over | December 2020 or November 2020 over average of January and |
Period 12 | January 17, 2021 to | January 2021 over | January 2021 or December 2020 |
Period 13 | February 14, 2021 to | February 2021 over February 2020 or January 2021 | February or January 2021 |
Period 14 | March 14, 2021 to | March 2021 over | March or February 2021 |
Period 15 | April 11, 2021 to | April 2021 over | April or March 2021 |
Period 16 | May 9, 2021 to | May 2021 over | May or April 2021 |
Period 17 | June 6, 2021 to | June 2021 over | June or May 2021 |
Period 18 | July 4, 2021 to | July 2021 over | July or June 2021 |
Period 19 | August 1, 2021 to | August 2021 over | August or July 2021 |
Period 20 | August 29, 2021 to | September 2021 over | September or August 2021 |
Requirement to Repay Amounts Paid Under the CEWS
The 2021 budget proposes to require listed companies to reimburse the wage subsidy received for the periods beginning after June 5, 2021 (Period 17 and beyond) if the total remuneration for the specified executives is higher than that paid in 2019.
The specified executives of a publicly traded company will be its named executive officers whose compensation is required to be declared under Canadian securities law or under another jurisdiction. These members are typically made up of the chief executive officer, chief financial officer and three other top-paid executives.
The subsidy refund amount will be the lesser of the following two amounts:
- The total amount of CEWS for Period 17 and beyond;
- The amount of the total compensation of the specified executives for 2021 which exceeds that of 2019.
The obligation to reimburse will be applied at the group level and applicable to the CEWS received by each entity of the group.
For more information:
Want to know more?