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CFIB statement on Canada Emergency Wage Subsidy details

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Toronto, April 1, 2020 – The Canada Emergency Wage Subsidy is an incredibly important tool that will help many small firms protect jobs, ensure the viability of SMEs through the crisis, and ensure the economy can quickly recover by getting people back to work immediately after the crisis ends. CFIB is pleased that government has confirmed it will be available to firms of all sizes and structures, including sole proprietorships and partnerships. We are also pleased that the government will not require firms to cover the remaining 25 per cent of wages if they are financially unable to do so.

However, there are several design features and unanswered questions that may prevent the program from meeting its intended goal of reducing layoffs. Government has confirmed that businesses will be required to prove a 30 per cent drop in gross revenue on a month-by-month basis by comparing their revenues to the same time last year. For some firms with very tight profit margins, even a small drop in sales can require significant numbers of layoffs in order to lower costs. New businesses, seasonal businesses and those who experienced a major event last year at this time would also find it challenging or impossible to demonstrate the 30 per cent decline figure. 

The goal of this unprecedented and positive move is to give employers the means and confidence to retain their staff during the COVID-19 pandemic. If employers are not able to know with certainty whether they will qualify for the subsidy, many will be forced to lay off workers. Wages are so significant an expense that getting it wrong or having your documentation of the revenue drop rejected on audit would put small businesses in risk of bankruptcy. It is also concerning that the funds will not be available to businesses for another six weeks, as many are facing cash flow emergencies now.

CFIB is pleased to learn that the earlier 10 per cent wage subsidy for smaller firms remains available to those who may not qualify for the new 75 per cent program.

CFIB continues to support the Canada Emergency Wage Subsidy and will work with government on further changes to ensure it is widely available to all small and medium-sized businesses. As the vast majority have been negatively affected by the economic crisis created by COVID-19, CFIB urges government to eliminate the requirement for proof of a 30 per cent drop in revenue from all firms with fewer than 500 workers and those ordered to fully or partially close by provinces. Small firms are grateful for the support, but we need to get this right. Hundreds of thousands of jobs are on the line. The future of many small firms and a quick recovery are on the line too.

- Dan Kelly, President, Canadian Federation of Independent Business (CFIB)

For media enquiries or interviews, please contact:
Milena Stanoeva, CFIB
647-464-2814
[email protected] 

About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 110,000 members across every industry and region. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.