Bill C-17 Proposes Changes to the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Response Benefit (CERB)

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On June 10, 2020, the federal government introduced Bill C-17, An Act respecting additional COVID-19 measures, for first reading.  If passed in its current form, Bill C-17 would, among other things, make changes to the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Response Benefit (CERB).  The CEWS is a 75% wage subsidy designed to encourage employers to retain employees during the COVID-19 crisis.  The CERB is a taxable benefit of $2,000 every four weeks for up to four months for eligible workers who have lost their income due to the COVID-19 crisis.

Amendments to the CEWS

If passed in its current form, Bill C-17 would make the amendments to the CEWS that we discussed here.

Amendments to the CERB

If passed in its current form, Bill C-17 would make the following amendments to the CERB:

Payments in two-week increments

CERB payments will be made in two-week increments beginning on July 5, 2020 and ending on October 3, 2020.

Circumstances in which workers will not be eligible

Workers will not be eligible for CERB if they:

  • Fail to return to work when it is reasonable to do so and the employer makes a request for their return;  
  • Fail to resume self-employment when it is reasonable to do so; or
  • Decline a reasonable job offer when they are able to work.

Penalties for certain applicants

CERB applicants, or another person acting for these applicants, may be subject to a penalty if they:

  • Made a representation that they knew was false or misleading;
  • Provided false or misleading information;
  • Knowingly failed to declare some or all of their income;
  • Made an application or declaration that they knew was false or misleading because of the non-disclosure of facts; or
  • Knowingly received an income support payment that they were not eligible to receive.

The Bill provides that:

  • The penalty set for each act or omission listed above may not exceed three times the amount of a CERB payment for a week that falls within the application period.
  • A person who acts in a manner described will be guilty of an offence; however, no prosecution for an offence may be instituted if a penalty for that conduct has been imposed.
  • Every person guilty of such an offence is liable on summary conviction to:
    • A fine not exceeding $5,000, plus not more than double the amount of the CERB payment that was or would have been paid as a result of committing the offence; or
    • Both the fine and imprisonment for not more than six months.    

Bottom Line for Employers

Perhaps the most important proposed amendment in Bill C-17 is that an employee will be ineligible for CERB payments if an employer asks an employee to return to work and the employee fails to do so when it is reasonable to do so. 

It is important to note that at this stage in the legislative process these are merely proposed amendments to the CEWS and the CERB that do not currently have the force of law.  The proposed amendments cannot be made until the Bill is passed through the House and Senate.  When the minority federal government brought Bill C-17 to Parliament, it hoped to obtain unanimous consent to debate the Bill and put it to a final vote in one day, since there are no plans for Parliament to sit regularly again until September; however, the opposition parties refused to support the Bill unless their various demands were met.  It now remains to be seen how the government will proceed with its efforts to get the Bill passed.  We will be monitoring developments and providing an update, as appropriate.      

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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