As the world continues to contend with COVID-19, many employers are facing unprecedented challenges. Employers and employees are dealing with reduced hours or cutting hours completely. As the situation is changing rapidly, it is important to be aware of Employment Insurance (EI) benefits, new government programs, and work-sharing programs.
“The government has introduced new programs and amended existing ones over the past week and it is important to stay up-to-date as COVID-19 impacts business operations and your employees,” says Hali Van Vliet, Vice President in BDO's People Advisory. “It's equally important to communicate with your employees as you entertain different workforce strategies to address the ever changing situation.
Below you will find a pertinent list of questions and answers for employers to use as they manage their business and employees during these uncertain times. We will make updates as changes are announced.
- Employment Insurance sickness benefits
- Canada Emergency Response Benefit (CERB)
- Work Sharing program
- Temporary Layoffs (Ontario) and other government programs
Employment Insurance sickness benefits
Q: What does the EI sickness benefit provide?
A: Financial support for eligible workers who:
- are unable to work for a medical reason (including being subject to quarantine or self-isolation)
- experienced a decrease in regular weekly earnings of more than 40% for one week
- accumulated 600 insurable hours worked in the 52 weeks before the claim began
Q: How much can an employee claim and for what duration?
A: EI sickness benefits pay 55% of an employee's insurable earnings, up to a maximum of $573 per week, less applicable taxes. Employees can claim these benefits for a maximum of 15 weeks.
Q: What is a waiting period and how has it changed?
A: A waiting period is a period of time in which an employee does not receive EI sickness benefits. The federal government waived the one-week waiting period. Employees will now be able to access benefits for their period of absence, up to a maximum of 15 weeks.
Q: Is a doctor's note required to access EI sickness benefits?
A: As of March 11, 2020, the federal government is waiving the medical note for individuals required to go into quarantine by law or a public-health official. If the quarantine period or self-isolation period extends beyond the original recommendation (by health authorities, your employer, or law) a signed medical certificate may still be necessary.
Q: Can employers top up employees' EI sickness benefits?
A: Yes, employers can establish a Supplementary Unemployment Benefit Plan (SUBP) to top up employees income during a period of unemployment due to a temporary layoff. This could include sickness and cover any period of unemployment due to a temporary stoppage of work, training, illness, injury, quarantine or any combination of such reasons.
A SUBP must be registered with Service Canada and must meet the requirements of the program, otherwise it will be treated as income and any EI benefits received may be reduced. For more information on EI Sickness Benefits or the Supplemental Unemployment Benefit Program visit:
EI sickness benefits: What these benefits offer
Supplemental employment benefit program
Canada Emergency Response Benefit (CERB)
Q: What does the Canada Emergency Response Benefit provide?
A: The CERB will cover Canadians who have lost their job, are sick, quarantined, or taking care of someone who is sick with COVID-19, as well as working parents who must stay home without pay to care for children who are sick or at home because of school and daycare closures.
The CERB applies to wage earners, as well as contract workers and self-employed people who would not otherwise be eligible for Employment Insurance (EI).
Q: How much can an employee claim and for how long?
A: This taxable benefit will provide $2,000 a month for up to four months for workers who lose their income as a result of the COVID-19 pandemic
A portal for accessing the benefit will be available in early April.
Canadians will begin to receive their CERB payments within 10 days of application. The CERB would be paid every four weeks and be available from March 15, 2020 until October 3, 2020.
Work-Sharing program
Q: What is a work-sharing program?
A: Work-sharing is designed to help eligible employers avoid layoffs due to a temporary reduction in the normal level of business activity beyond the employer's control. The program is available to both federally and provincially regulated employers.
- Eligible employees can receive the EI benefits as income support.
- Affected employees must agree to work a reduced schedule and share available work over a specified period.
- Both the employer and the employee must apply to participate in a work-sharing program together.
- The mandatory waiting period was waived so that employers with a recently expired agreement may immediately apply for a new agreement without waiting between applications.
Q: What are the eligibility requirements for employers?
A: To be eligible for a work-sharing program, employers must:
- have been in business in Canada year-round for at least two years
- be a private business, publicly-held company, or a not-for-profit organization
- demonstrate that the shortage of work is temporary and beyond their control
- demonstrate a recent decrease in business activity of approximately 10%
- submit and implement a recovery plan designed to return the work-sharing individuals to normal working hours by the end of the program
Q: How many hours can an employee's work schedule be reduced and for how long?
A: The schedule can be reduced between a minimum of 10% (one half day) and a maximum of 50% (three days). In any given week, the work reduction can vary depending on available work, as long as the work reduction on average is between 10% and 60% for the duration of the program. The program have a minimum duration of six weeks and may last up to 76 weeks (normally 38 week maximum) due to COVID-19.
For more information on the work-sharing program visit:
Temporary Layoffs (Ontario) and other government programs
Q: Are there any provincial programs we should be aware of that may be helpful to our employees?
A: Yes. For example, in Ontario they have a Temporary Layoff option.
Q: What is a temporary layoff in Ontario?
A: A week of layoff is a week where the employee earns less than one-half of the amount that they would earn at their regular rate in a regular week or their average earnings for the period of 12 consecutive weeks prior to the layoff period 60 days in a 120-day period. Ontario does not require employers to give employees notice before placing them on a temporary layoff.
For more details on temporary layoffs, including how long they can last, see the Temporary Layoffs section in the Employment Standards Act.
A Record of Employment must be issued for each employee that is on a temporary layoff. Employees may qualify to receive Regular EI benefits to cover the layoff period. For more information for employees, go to the Regular EI Benefit program.
How BDO can help
The COVID-19 pandemic is creating many hardships and we will continue to provide updated information as the situation evolves. BDO's People Advisory team can assist with developing contingency plans to help you protect your business and employees.