More than half of small firms to apply for help from the federal wage subsidy, but it is too late for some, confusing for others | CFIB
Toronto, April 27, 2020 – Applications for the Canada Emergency Wage Subsidy open today and more than half of small firms with employees say they will apply, finds a new survey by the Canadian Federation of Independent Business (CFIB). However, many have questions around which wages can be covered, who is eligible and how to bring back laid off employees ahead of receiving the subsidy payments.
“Our survey data indicates the wage subsidy program will be a big help for many small firms that have been struggling to keep their workers,” said CFIB president Dan Kelly. “Unfortunately, the subsidy has already come too late for some businesses, who are not currently in a position to rehire laid off staff. But with signs in some provinces that businesses may soon begin a phased approach to reopening, an ongoing wage subsidy may prove very useful in bringing back workers who have been laid off.”
CFIB’s Business Helpline is receiving thousands of calls from business owners each week (approximately 800 per day), and the complexities of the program remain a significant concern.
“The Canada Revenue Agency has been working with us to help provide answers, but much more needs to be done,” Kelly added.
The top questions business owners have about the Canada Emergency Wage Subsidy (CEWS) are:
- Can employer wages be included in the wage subsidy?
- Can employers pay staff retroactively using the wage subsidy or use it for those who have already claimed the Canada Emergency Response Benefit?
- Can employers hire new employees after March 15th and include their wages?
- Which employees can be included in the rebate of an employer’s payroll taxes?
- If employees are paid in periods that are different from those outlined by the government, how does the employer recalculate their pay?
- How does the previously announced 10 per cent wage subsidy work with the new 75 per cent version?
“We recommend business owners who have these or other questions visit cfib.ca/COVID19 for the latest information, or call our business help line at 1-888-234-2232 to speak with an expert,” added Kelly. “Given the emergency, CFIB is now providing free advice to all business owners, regardless of whether they are able to pay for a membership.”
CFIB is working closely with government to provide feedback and continuing to push for changes to the programs for businesses affected by COVID-19. For example, CFIB is looking to ensure all employers using the wage subsidy qualify for the rebate of payroll taxes and that government considers extending the program beyond June 6 to help small firms bring back laid off workers as an economic recovery measure.
The survey, which was collected over the weekend, also found that:
- Only one in five businesses are fully open, with half partially open and the rest fully closed
- Close to four in five businesses have seen a drop in revenues of 30 per cent or more since the start of the outbreak, one in five actually making no sales at all
- Three out of 10 business owners who had staff prior to COVID-19 say they will not apply for the CEWS – of those, 29 per cent say the main reason is because it is too late to bring back laid off workers, while 23 per cent would like to apply but are not eligible
Results are based on 6,361 responses from CFIB members, to a controlled-access web survey. Data reflect responses received between April 24 and 26, 2020. For comparison purposes, a probability sample with the same number of respondents would have a margin of error for national results of +/-1.2%, 19 times out of 20.
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Milena Stanoeva, 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.