COVID-19 — New Targeted Support Measures
The information contained in the below publication was current at the time it was published. The COVID-19 programs evolve continuously, and the relevant information may have changed since publication. Readers are advised to discuss their particular situation with their Crowe BGK advisor.
On October 21, 2021, the federal government announced various changes to the COVID-19 support programs. These changes include:
- Extending the Canada Recovery Hiring Program (CRHP) until May 7, 2022, for eligible employers with current revenue losses above 10% and increase the subsidy rate to 50%.
- Establishing new targeted support program to businesses that are still facing significant pandemic-related challenges. Support would be available through two streams:
- Tourism and Hospitality Recovery Program (THRP), which would provide support through the wage and rent subsidy programs, to hotels, tour operators, travel agencies, and restaurants, with a subsidy rate of up to 75%.
- Hardest-Hit Business Recovery Program (HHBRP), which would provide support through the wage and rent subsidy programs, would support other businesses that have faced deep losses, with a subsidy rate of up to 50%.
- Extending the Canada Recovery Caregiving Benefit (CRCB) and the Canada Recovery Sickness Benefit (CRSB) until May 7, 2022, and increase the maximum duration of benefits by 2 weeks.
- Establishing the Canada Worker Lockdown Benefit (CWLB) which would provide $300 a week in income support to eligible workers should they be unable to work due to a local lockdown anytime between October 24, 2021 and May 7, 2022.
Other existing programs, such as the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Rent Subsidy (CERS) and the Lockdown Support, ended on October 23, 2021, as previously announced.
SUPPORT FOR TOURISM, HOSPITALITY AND OTHER HARD-HIT ORGANIZATIONS
By way of this announcement, the government is proposing to extend the CEWS, CERS and Lockdown Support until May 7, 2022, to organizations in selected sectors of the tourism and hospitality industry that have been deeply affected since the outset of the pandemic and that continue to struggle.
Tourism and Hospitality Recovery Program (THRP)
The THRP will be available to eligible organizations in the tourism and hospitality industry which would include hotels, restaurants, bars, festivals, travel agencies, tour operators, convention centers, convention and trade show organizers, and others.
Eligible organizations would be required to meet the following two conditions to qualify for the THRP:
- An average monthly revenue reduction of at least 40% over the first 13 qualifying periods for the CEWS (12-month revenue decline); and
- A current-month revenue loss of at least 40%.
The 12-month revenue decline would be calculated as the average of all revenue decline percentages for eligible organizations from March 2020 to February 2021 (corresponding to CEWS claim periods 1-13, excluding claim period 10 or 11). Any periods in which an entity was not carrying on its ordinary operations for reasons other than a public health restriction (for example, because it is a seasonal business) would be excluded from this calculation. The existing rules for the CEWS, CERS and Lockdown Support would continue to apply for the purposes of calculating the current-month revenue decline.
Subsidy Rate Structure
The table below details the proposed wage and rent subsidy rate structure for organizations that qualify for the THRP from October 24, 2021, until May 7, 2022.
|
Wage and Rent Subsidy Rate Structure under the Tourism and Hospitality Recovery Program |
||
|
|
Periods 22-26 |
Periods 27-28 |
|
Current-month revenue decline |
|
|
|
75% and over |
75% |
37.5% |
|
40-74% |
revenue decline |
revenue decline ÷ 2 |
|
0-39% |
0% |
0% |
Lockdown Support would also be available at the current fixed rate of 25% and pro-rated based on the number of days a particular location was affected by a lockdown, as under existing rules.
Support in the Event of a Public Health Lockdown
To recognize the challenges that may arise from resurgences of the pandemic, organizations subject to a qualifying public health restriction would be eligible to the THRP, regardless of sector, if they have one or more locations subject to a public health restriction (lasting for at least seven days in the current claim period) that requires them to cease activities that accounted for at least approximately 25% of total revenues of the employer during the prior reference period.
Applicants would not need to demonstrate the 12-month revenue decline, only a current-month decline. It would be available to affected organizations, regardless of sector.
Hardest-Hit Business Recovery Program (HHBRP)
Hard-hit organizations that do not qualify for the THRP and that have been deeply affected since the outset of the pandemic would qualify for rent and wage support under the Hardest-Hit Business Recovery Program (HHBRP), provided they meet the following two eligibility requirements:
- An average monthly revenue reduction of at least 50% over the first 13 qualifying periods for the Canada Emergency Wage Subsidy (12-month revenue decline); and
- A current-month revenue loss of at least 50%
The calculation of the 12-month revenue decline would follow the same rules as under the THRP, as detailed above. The existing rules for the CEWS, CERS and Lockdown Support would continue to apply for the purposes of calculating the current-month revenue decline.
Subsidy Rate Structure
The table below details the proposed wage and rent subsidy rate structure for organizations that qualify for the HHBRP from October 24, 2021, until May 7, 2022.
|
Hardest-Hit Business Recovery Program Wage and Rent Subsidy Rate Structure October 24, 2021, to May 7, 2022 (Periods 22 to 28) |
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|
|
Periods 22-26 |
Periods 27-28 |
|
Current-month revenue decline |
|
|
|
75% and over |
50% |
25% |
|
50-74% |
10% + (revenue decline – 50%) x 1.6 |
5% + (revenue decline – 50%) x 0.8 |
|
0-49% |
0% |
0% |
Lockdown Support would also be available at the current fixed rate of 25% and pro-rated based on the number of days a particular location was affected by a lockdown, as under existing rules.
Increasing the Monthly Cap on Eligible Expenses under the Canada Emergency Rent Subsidy
Under the current rules, there is a monthly cap on eligible expenses that can be claimed under the CERS of $75,000 per business location and $300,000 in total for all locations (including any amounts claimed by affiliated entities).
The government is proposing to increase the aggregate monthly cap from $300,000 to $1 million (including any amounts claimed by affiliated entities) starting on October 24, 2021.
This new monthly cap would be available to all eligible employers and organizations that meet the new eligibility requirements for the rent subsidy under the THRP and the HHBRP.
Extending the Canada Recovery Hiring Program (CRHP)
The CRHP is set to expire on November 20, 2021. The government is proposing to update the subsidy rate for currently eligible employers. Specifically, the government is proposing to increase the subsidy rate to 50% from October 24 to November 20, 2021 until May 7, 2022.
Under the proposed extension, the existing baseline period of March 14 to April 10, 2021, would continue to be used to calculate incremental remuneration. The existing eligibility rules would also continue to apply, including the required revenue decline of more than 10%.
SUPPORT FOR INDIVIDUALS
Canada Recovery Caregiving Benefit (CRCB) and the Canada Recovery Sickness Benefit (CRSB)
The government is proposing to extend the CRCB and CRSB until May 7, 2022, and increase the maximum duration of benefits by 2 weeks. As a result, the CRCB would be extend from 42 to 44 weeks and the CRSB from 4 to 6 weeks.
For more details regarding the eligibility requirements of the CRCB and CRSB, please consult our publication on these benefits.
Canada Worker Lockdown Benefit (CWLB)
The government is proposing to introduce legislation for the new Canada Worker Lockdown Benefit (CWLB), which would provide income support to workers whose employment is interrupted by specific government-imposed public health lockdown scenarios and who are unable to work due to such restrictions.
The new benefit would be:
- $300 per week.
- Strictly available to workers whose work interruption is a direct result of a government-imposed public health lockdown.
- Available until May 7, 2022, with retroactive application to October 24, 2021 should the situation warrant it.
- Accessible for the entire duration of a government-imposed public health lockdown (up until May 7, 2022).
- Available to workers who are ineligible for Employment Insurance (EI) and those who are eligible for EI, as long as they are not paid benefits through EI for the same period.
Individuals whose loss of income or employment is due to their refusal to adhere to a vaccine mandate would not be able to access the benefit.
Please note that legislation will have to be adopted to implement the above-described changes. This publication will be updated when said legislation is published.