The Federal Government Announces the Wage and Rent Subsidy Amounts Until June 5, 2021 Crowe BGK

The Federal Government Announces the Wage and Rent Subsidy Amounts Until June 5, 2021

Crowe BGK
The Federal Government Announces the Wage and Rent Subsidy Amounts Until June 5, 2021 Crowe BGK

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.

Date:  March 5, 2021

From:  Crowe BGK Tax Group

Subject:          The Federal Government Announces the
Wage and Rent Subsidy Amounts
Until June 5, 2021

The Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Rent Subsidy (CERS), and the Lockdown Support aim at supporting businesses that have experienced a decline in revenues while weathering the COVID-19 crisis. These programs are legislated to be available until June 2021, and details regarding the three measures have already been confirmed through March 13, 2021. On March 3, 2021, the federal government provided details on the parameters of the CEWS, the CERS and the Lockdown Support that are proposed to apply from March 14 to June 5, 2021. Note that the below announcements have yet to be implemented by way of legislation and/or regulation.

Maintaining the Current Rate Structures Until June 5, 2021

The rate structures for the CEWS for active employees, for the CERS, and for the Lockdown Support that are currently in place until March 13, 2021 would be extended for March 14 to June 5, 2021. This means that:

  • The maximum base CEWS rate for active employees would remain at 40%, and the maximum top-up CEWS rate for employers most adversely impacted by the pandemic would remain at 35%. As such, the maximum combined CEWS rate would remain75%. The table below illustrates the base and top-up CEWS rates for periods 14 to 16.

Canada Emergency Wage Subsidy Rate Structure, Periods 14 to 16
(March 14 to June 5, 2021)

Revenue decline

Base subsidy

Top-up wage subsidy

70% and over





(Revenue decline - 50%) x 1.75


Revenue decline x 0.8


  • The maximum CERS rate would remain 65%.
  • Lockdown Support would remain 25% and continue to be provided in addition to the CERS, providing eligible hard-hit businesses with rent support of up to 90%.

CEWS - Support for Furloughed Employees

The CEWS legislation provides for a separate CEWS calculation for active employees and for furloughed employees. To ensure that the CEWS for furloughed employees remains aligned with benefits available under Employment Insurance (EI), the weekly CEWS for a furloughed employee, from March 14 to June 5, 2021, would remain the same and continue to be the lesser of:

  • the amount of eligible remuneration paid in respect of the week; and
  • if the employee receives remuneration of $500 or more in respect of the week, the greater of:
    • $500; and
    • 55% of pre-crisis remuneration for the employee, up to a maximum subsidy amount of $595.

Employers would also continue to be entitled to claim under the CEWS their portion of contributions in respect of the Canada Pension Plan, EI, the Quebec Pension Plan and the Quebec Parental Insurance Plan for furloughed employees.

Revenue-decline Reference Periods Until June 2021

Currently, the CEWS legislation provides that the decline of revenue of an employer is determined either:

  • By comparing the employer’s revenues in a month with the revenues in the same month in 2019 (the general year-over-year approach); or
  • By comparing the employer’s revenues in a month with the average of its January and February 2020 revenues (the alternative approach).

Also, a deeming rule exists, which provides that an employer’s decline in revenues for any particular qualifying period is the greater of its decline in revenues for the particular qualifying period and the immediately preceding qualifying period.

Given that we are approaching a full year of the COVID-19 pandemic, in order to ensure that the general year-over-year approach continues to calculate an organization's decline in revenues relative to a pre-pandemic month, the prior reference periods would be based on calendar months from 2019, effective as of the qualifying period from March 14 to April 10, 2021 (period 14). The proposed reference periods are summarized in the table below:

Canada Emergency Wage Subsidy and Canada Emergency Rent Subsidy Reference Periods, Periods 14 to 16
(March 14 to June 5, 2021)


Period 14
March 14 – April 10

Period 15
April 11 – May 8

Period 16
May 9 – June 5

General approach

March 2021 over March 2019 or February 2021 over February 2020

April 2021 over April 2019 or March 2021 over March 2019

May 2021 over May 2019 or April 2021 over April 2019

Alternative approach

March 2021 or February 2021 over average of January and February 2020

April 2021 or March 2021 over average of January and February 2020

May 2021 or April 2021 over average of January and February 2020


Employers that chose to use the general approach for prior periods would continue to use that approach. Similarly, employers that chose to use the alternative approach would continue to use the alternative approach.

CEWS - More Flexible Baseline Remuneration Periods

An eligible employer's entitlement to the CEWS for a furloughed employee or an active non-arm's length employee is determined through a calculation that takes into account both the employee's current and baseline (or pre-crisis) remuneration.

By default, baseline remuneration means the average weekly eligible remuneration paid to an eligible employee by an eligible employer during the period beginning January 1, 2020, and ending March 15, 2020. Any period of seven or more consecutive days for which the employee was not remunerated is excluded from the calculation. However, the eligible employer may elect to use an alternative baseline period for calculating the average weekly eligible remuneration.

An additional elective alternative baseline remuneration computation for March 14 to June 5, 2021 is proposed to ensure that the baseline remuneration comparator remains appropriate. In particular, an eligible employer would be allowed to elect, for qualifying periods from March 14 to June 5, 2021, to use the period of March 1, 2019 to June 30, 2019, or July 1 to December 31, 2019 (the current alternative period), to calculate baseline remuneration.