These are very challenging times and the economic uncertainty caused by COVID-19 has impacted almost every business in the country in some way. The federal government has announced many initiatives to support Canadian businesses and families through this difficult period, including measures of increased support and flexibility to the Work-Sharing (WS) program.
Work-Sharing is designed to help employers and employees avoid layoffs when there is a temporary reduction in the normal level of business activity that is beyond the control of the employer.
Mentor Works has been actively monitoring the federal and provincial government’s response to COVID-19. We’re summarizing the resources available to manage the impact on businesses during upcoming COVID-19 webinars. We encourage you to attend to better understand your options during this time of global transition.
COVID-19 Work-Sharing Program Overview
Canada’s Work-Sharing program provides income support to employees working a temporarily decreased work week during a period of reduced business activity. Effective March 15, 2020 to March 14, 2021, the Work-Sharing program is taking temporary action to support employers affected by the downturn caused by COVID-19. These enhancements are for all sectors and industries.
Prior to the updates, applications were to be submitted a minimum of 30 days prior to the requested work-sharing start date. They are now encouraged to submit applicants 10 calendar days prior to the requested start date.
More details include:
- There has been an extension of the maximum possible duration of a WS agreement from 38 weeks to 76 weeks;
- WS provides income support to employees eligible for employment insurance (EI) and processed through the EI payment system;
- The expected work reduction is from a minimum of 10% to a maximum of 60%. The reduction of hours can vary from week to week, if the average reduction over the course of the agreement is from 10% to 60%;
- The mandatory waiting period has been waived for employers who have already used the Work-Sharing program so that eligible employers may immediately enter into a new agreement;
- Employers, employees, and unions must all agree to apply to WS and working hours (equal sharing of work);
- A utilization report must be submitted weekly for payment and first payment will take up to three to four weeks; and
- There is no retroactive pay – therefore, it is imperative you get your Work-Sharing application in ASAP.
To be eligible for a Work-Sharing arrangement, employers must:
- Demonstrate a recent decrease in business activity by 10%;
- Demonstrate that the work shortage is temporary and beyond their control; and
- Be a for-profit or not-for-profit organization operating year-round in Canada for at least one year. (This is a COVID-19 upgrade; typically, businesses are to be operating for at least two years).
To be eligible for a Work-Sharing arrangement, employees must:
- Be eligible for Employment Insurance benefits;
- Agree to a reduction of normal working hours and share the available work hours; and
- Be “core employees” (year-round, permanent, full-time, or part-time employees needed to carry out the day-to-day functions of the business).
Next Steps to Apply for the Work-Sharing Program
To access the Work-Sharing program, employers must submit an application, recovery plan, and other mandatory forms.
We’re here to help educate and guide you through the WS application process and guidelines. Contact Mentor Works to learn more about the program and get started. And make sure to register for an upcoming COVID-19 webinar to explore additional financial support available!