Since the beginning of the month, the federal government has faced strong pressure from employers’ groups and business lobbies across Canada to set up an employment subsidy program, as there are in Europe, in Denmark, in Germany, the United Kingdom and France in particular.
Rather than sink into the most complete administrative and bureaucratic chaos to manage the influx of millions of new unemployed workers generated by the coronavirus crisis, the government was proposed to subsidize the wages of corporate employees by keeping them on their payrolls .
Ottawa must compensate workers who lose their jobs anyway, either through the employment insurance program or through the proposal to leave it up to businesses to take care of it.
Admin promoted the employment subsidy solution as the most effective way to allow businesses and workers to move to through the violent crisis that is sweeping.
(Re) read the column “Subsidizing jobs rather than the unemployed”
For the technology entrepreneur, the fact of maintaining the employment link between the worker and his company first of all alleviates the unsustainable pressure on the federal machine and its computer systems, but the employment subsidy allows above all to facilitate the return (which everyone hopes as soon as possible) to the post-crisis period.
“Several SMEs that lose their employees will find themselves bankrupt. We must help them get through the crisis by allowing them to maintain a certain structure in place, ”pleaded Serge Godin in particular to defend the concept of employment subsidies.
With the containment measures that have become widespread across Canada, the number of people who have lost or lose their jobs has reached astronomical proportions.
With the almost million new unemployed declared only last week, the federal machine was not able to absorb a cohort of this magnitude.
This is why Ottawa decided to introduce the Canadian Emergency Benefit (CEP) of $ 2,000 per month at the beginning of the week, intended for all workers – salaried, contract workers, self-employed workers, etc. – including income benefits. are affected by the coronavirus pandemic.
It was a nice way to offload the employment insurance program which is unable to bear the colossal load it faced, but again, faced with the incredible number of people who are being cut off, the federal government is doing well expects that handling the millions of cases that arise for support through the PKU will also be unsustainable.
Between promise and deliver
The federal government therefore decided at first to opt for the wage subsidy for SMEs by announcing Friday that this financial assistance would represent 75% of workers’ wages.
Justin Trudeau announced yesterday that Ottawa would subsidize 75% of the wages of employees of Canadian SMEs without giving details on how this measure will be applied.
But that is all we know for now because, as usual, Prime Minister Justin Trudeau has only confirmed the implementation of this measure. He remained stingy with details of how it would work, as he did two weeks ago when he announced a $ 10 billion business assistance program, the details of which were only released five days ago. later.
According to my information, Ottawa is not ruling out the possibility of extending this job subsidy program to big business, which will also have to successfully cross the transition period that will occur when the COVID-19 crisis is in regressive mode.
But for now, the press release that followed the Prime Minister’s intervention has been very vocal. We confirm the announcement of a 75% wage subsidy for eligible businesses which will be retroactive to March 15, but we “specify” that the details of the eligibility criteria will be communicated before the end of the month …
What will be the definition of an SME, that of Statistics Canada which wants it to be a company with less than 500 employees with revenues of less than 50 million?
Will Ottawa cap its financial support per employee at the $ 2,000 per month provided for in its ECP?
Will the program apply only to employees who are no longer working, or rather to all employees who are still on the job despite a deficit situation?
Philippe Hugron, CEO of Dakis, a Verdun SME which designs software and website solutions, will have to temporarily lay off 10 of its 30 employees on Monday morning because its revenues have fallen by 20% and it anticipates that they will drop by 30 % more within three months due to the COVID-19 crisis.
“I want to keep my 10 employees and I need this subsidy. I want us to be fully prepared when the crisis subsides, but it takes all my people to prepare for it. It will do nothing for the company if we subsidize 75% of the salary of 10 of our employees who are no longer with us, ”he told.