Finance Minister Bill Morneau said Canada Emergency Wage Subsidy will be extended by an additional 12 weeks to August 29

The Government of Canada announced Friday it is extending the Canada Emergency Wage Subsidy to help businesses keep employees on the payroll and to encourage employers to re-hire workers previously laid off.

Finance Minister Bill Morneau said CEWS will be extended by an additional 12 weeks to August 29.

“Extending the program will give workers greater confidence that they will continue to get the support they need during these difficult times. The Government will consult with key business and labour representatives over the next month on potential adjustments to the program to incent jobs and growth, including the 30 per cent revenue decline threshold. Any potential changes following the consultation will have as key objectives to maximize employment, ensure the CEWS reflects the immediate needs of businesses, and support the post-crisis economic recovery,” said the government.

“The COVID-19 pandemic has had a profound impact on Canadians in all communities and in all sectors of the economy. We have been listening to concerns raised by employers of all kinds, and we know that extending the duration of the wage subsidy and broadening eligibility will help more workers and will better position Canada for economic recovery. This will allow more businesses and organizations to retain or rehire employees in order to be better positioned when the economy rebounds,” said Morneau.

Dan Kelly, President of the Canadian Federation of Independent Business, said the organization is very pleased with the federal government’s announcement.

“As provinces are only now beginning to allow some small businesses to reopen, we can expect the economic effects of COVID-19 to last for many months. An extended and simplified wage subsidy will be an important measure in helping Canadian small businesses get back to health. If properly designed, this will be a major relief for tourism and other sectors who are expecting a very soft summer,” said Kelly. “CFIB is also happy to hear that government is open to changes to the CEWS requirement to demonstrate a 30 per cent drop in gross revenue. This test is one of the reasons the take up of the program has been far less than expected and will cause a particular problem as we move to the recovery phase. CFIB will survey its members on additional changes and bring this information to policy makers.

“However, it will be critical to continue the focus on the other elements of a successful recovery. CFIB continues to push for an expansion to the Canada Emergency Business Account (CEBA) and a major overhaul of the Canada Emergency Commercial Rent Assistance (CECRA) program. Small business owners are eager to get back to business and get off the government subsidies they have had to rely on through the COVID-19 pandemic. Unfortunately, we are not there yet. Today’s announcement – particularly if quickly followed by changes to CEBA and CECRA – will give many peace of mind that they will be supported through the upcoming reopening phase.”

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