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EI Sickness Benefits, Emergency Care Act and Work-Sharing

March 24, 2020

The impact of the COVID-19 virus is being felt by workers across the country. The Federal Government has announced changes to EI Sickness Benefits and introduced the Emergency Care Act for those who are self-employed, however, the majority of these benefits are applicable only if the individuals involved are directly impacted by the virus.

At this time, employers that lay off their employees due to a shortage of work, where no one is sick and/or caring for someone that is sick with the virus, must follow the traditional method of issuing ROE’s. The reason for issuing the ROE would be a shortage of work and the employee would follow the usual process of applying for benefits.

The new benefits currently available from the Federal Government are:

Individuals Without Paid Sick Leave

For Canadians without paid sick leave (or similar workplace accommodation) who are sick, quarantined or forced to stay home to care for children, the government is:

  • Waiving the one-week waiting period for those in imposed quarantine that claim Employment Insurance (EI) sickness benefits, effective March 15, 2020
  • Waiving the requirement to provide a medical certificate to access EI sickness benefits.

Emergency Care Benefit

Introducing the Emergency Care Benefit providing up to $900 bi-weekly, for up to 15 weeks (comparable to EI sickness benefit). This benefit would provide income support to:

  • workers, including the self-employed, who are quarantined or sick with COVID-19 but do not qualify for EI sickness benefits;
  • workers, including the self-employed, who are taking care of a family member who is sick with COVID-19, such as an elderly parent, but do not qualify for EI sickness benefits; and
  • parents with children who require care or supervision due to school closures, and are unable to earn employment income, regardless of whether they qualify for EI or not.

Application for the Benefit will be available in April 2020 and require Canadians to attest (and continue to attest every two weeks) that they meet the eligibility requirements. Individuals can apply through CRA’s MyAccount, their My Service Canada Account, or by calling an automated toll-free number not yet released

Longer-Term Income Support

  • An Emergency Support Benefit will provide up to $5.0 billion in support to workers who are not eligible for EI and who are facing unemployment. The individual amounts and process will be disclosed shortly.
  • Implementing changes to the EI Work Sharing Program, which provides EI benefits to workers who agree to reduce their normal working hour as a result of developments beyond the control of their employers, by extending the eligibility of such agreements to 76 weeks, easing eligibility requirements, and streamlining the application process. This is intended to benefit both employees and employers as it may provide the ability for the employees to share their hours and receive benefits for the shortage and allow employers to keep people working.

If you would like more information on this topic, please contact a member of the Empire CPA team by filling out the contact form below.

Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. Empire, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.

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