COVID-19: Expanded Employment Insurance and Work-Sharing Benefits
The Federal Government has announced several measures to assist employees and employers in response to the COVID-19 outbreak, including several changes to Employment Insurance Sickness Benefits and the federal Work-Sharing program. They have also announced a number of new programs for small business owners and self-employed Canadians to assist them through the COVID-19 pandemic.
This is a quickly evolving area with changes being made daily. Below is information that is current to the time of this posting. We at BTM Lawyers LLP are keeping up to date with all changes and are here to assist employers in navigating these uncertain times. We strongly recommend that employers seek legal advice when making decisions to protect their businesses and employees.
Employment Insurance (EI) Sickness Benefits
What does EI Sickness Benefits provide?
EI Sickness Benefits are federal income replacement benefits that provide financial support for workers who:
- are unable to work for medical reasons, including being subject to quarantine or self-isolation;
- have experienced a decrease in regular weekly earnings of more than 40% for one week; and,
- have accumulated 600 insured hours of work in the 52 weeks before the start of the claim.
How much can an employee claim, and for how long?
- 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.
What is a “waiting period”, and how has it changed?
- A waiting period is a period of time during which an employee does not receive EI Sickness Benefits.
- Normally, there is a one week waiting period for EI Sickness Benefits.
- The Government has now waived the one week waiting period. This means employees will now be able to access benefits for their period of absence, up to a maximum of 15 weeks.
Is a doctor’s note required to access EI Sickness Benefits?
- Normally, a doctor’s note would be required in order to receive EI Sickness Benefits.
- As of March 11, 2020, the Government has stated that they are no longer requiring a doctor’s note for people required to go into quarantine by law or by a public-health official.
- A doctor’s note may be required to extend EI Sickness beyond the original period of quarantine or self-isolation.
Can employers top up an employee’s EI Benefits?
Yes, a Supplementary Unemployment Benefit Plan (“SUBP”) can be established by an employer to top up employees’ EI benefits during a period of unemployment for things such as a temporary layoff/downturn in work and sickness. There are strict eligibility requirements for SUBP, and we recommend that employers contact Service Canada to determine whether this is an option that works for their workforce.
We anticipate some further changes to the eligibility requirements to extend the program to allow more and more employers to access this benefit in the coming days.
Emergency Care Benefit & Emergency Support Benefit
Today, the Federal Government announced it is extending EI benefits to workers that are not ordinarily eligible for EI benefits, including self-employed individuals, independent contractors, freelancers, gig economy workers, and part-time workers to assist them financially to get through the COVID-19 crisis.
The extension of benefits includes providing EI Sickness Benefits and regular EI Benefits for laid off employees to these categories of workers.
The benefit will be available in early April 2020. We will provide further details once they are announced.
Federal Wage Subsidy
The Federal Government will be implementing a Wage Subsidy program to assist small and medium sized businesses to keep their employees employed during the COVID-19 crisis.
Exact details of the subsidy have not been announced. However, Federal Finance Minister Morneau indicated that employers will be eligible for a 10% wage subsidy, up to $25,000 per employer.
Federal Work-Sharing Program
What is work-sharing?
- Work-sharing is a program designed to help eligible employers avoid layoffs when there is a temporary reduction in the normal level of business activity (that is beyond the control of the employer).
- Employment Insurance Benefits are provided for eligible employees as income support.
- Affected employees must agree to work a reduced schedule and share available work over a specified period of time.
- Both the employer and the employee must apply to participate in a Work-Sharing program together.
How do I know if I am an eligible employer?
To be eligible for a Work-Sharing program, employers must:
- have been in business in Canada year-round for at least two (2) 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%; and,
- submit and implement a recovery plan designed to return the Work-Sharing individuals to normal working hours by the end of the program.
Employers may not make a Work-Sharing agreement with employees who are:
- seasonal, or are students hired for the summer or co-op term;
- hired on a casual or on-call basis; or
- shareholders of the business, whose shares provide them with significant decision-making power as to the direction of the company.
How many hours of an employee’s work schedule can be reduced, and how long can it last?
- A reduction 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%-60% for the duration of the program.
- The program must have a minimum duration of six (6) weeks and as a result of COVID-19, may last up to 76 weeks (normally maximum 38 weeks).
We anticipate further details to be announced in the coming hours and days, including from the BC Provincial Government and recommend that employers contact our office to get up to date information. We can be reached at 604-937-1166 or you can reach out to our employment lawyer Catherine Coakley directly by email at [email protected] or on her direct line on 604-917-0048.