Finance Minister Morneau and Prime Minister Trudeau confirmed on April 8, 2020 that access to the Canada Emergency Wage Subsidy has been relaxed.  The government has provided opposition parties with a copy of a draft bill and a date for the return Parliament to debate the bill has not been finalized.

There was considerable push back by business about the rigidity of the original wage subsidy proposal, particularly about the calculation of the reduction of at least 30 per cent of their gross revenue in March, April or May, when compared to the same month in 2019.

As it sits, this subsidy would be available to eligible employers that see a drop of at least 15 per cent of their revenue in March 2020 and 30 per cent for the following months. The Government has provided further flexibility for employers to access the Canada Emergency Wage Subsidy and indicated that the reduction from 30% to 15% for March was “in recognition of the fact that many businesses did not begin to be affected by the crisis until partway through the month”.

In applying for the subsidy, employers would be required to attest to the decline in revenue.  The government has provided the following guidance:

The amount of wage subsidy (provided under the COVID-19 Economic Response Plan) received by the employer in a given month would be ignored for the purpose of measuring year-over-year changes in monthly revenues.

  • For example, if revenues in March 2020 were down 20 per cent compared to March 2019, the employer would be allowed to claim the CEWS (as calculated above) on remuneration paid between March 15 and April 11, 2020.
  • Alternatively, this employer could use its average revenue from the months of January and February 2020, instead of March 2019, to determine if it is eligible for the CEWS.
  • Once an approach is chosen, the employer would have to apply it throughout the program period.
    The table below outlines each claiming period, the required reduction in revenue and the reference period for eligibility.
Eligible Periods
Claiming period Required reduction in revenue Reference period for eligibility
Period 1 March 15
April 11
15% March 2020 over:

  • March 2019 or
  • Average of January and February 2020
Period 2 April 12
May 9
30% April 2020 over:

  • April 2019 or
  • Average of January and February 2020
Period 3 May 10
June 6
30% May 2020 over:

  • May 2019 or
  • Average of January and February 2020

This is certainly a welcome change, though some will argue it doesn’t go far enough and it remains to be seen whether any further amendments will be made to the subsidy through negotiation with opposition parties and Parliamentary scrutiny.