Benefits schemes have finally ended – but HR leaders have some very mixed reactions
As of October 23rd, Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Rent Subsidy (CERS) officially ended. In their place, Deputy Prime Minister and Finance Minister Chrystia Freeland revealed the Tourism and Hospitality Recovery Program and Hardest Hit Business Recovery Program – which are designed to be “more targeted and less expensive”. Both programs will be in place in Canada until May 2022. And while they are designed to reduce the financial burden on the federal government and help the country get back on its feet, for Canadian employers it may be bittersweet. HRD spoke to Lorenzo Lisi, partner at Aird & Berlis, who revealed what these changes mean for organizations and their people.
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“It’s important to remember that many businesses weren't happy under the previous regime,” he told HRD. “A lot of employers felt that they had fallen through the cracks, particularly in the hospitality sector, so they are looking at the new structure with mixed emotions. On the one hand, employers want the work force to continue to receive support where required, but on the other it has become a real challenge in certain sectors to attract and retain employees. For example, the restaurant sector is having a tough time finding employees right now, so, the end of CERB may for many employers be a welcome respite – since it could draw employees back into the workforce.”
There is an overall concern that the government needs to get the economy back on track as we move out of the pandemic – something Freedland touched upon in her speech. But it’s not just concerns over talent shortages that have employers shaking – it’s the end of their rental benefits.
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“Some employers simply aren’t in the position to be able to cover their own rent right now,” added Lisi. “They still need some help. Employers have felt deep losses as a result of the pandemic, and they may not be ready to shoulder all the financial burden just quite yet. The new federal programs are targeted and focus on individuals and businesses who are deemed to be most in need of financial supports. These programs have stricter eligibility requirements in an effort to direct funding to specific sectors or individuals.
Many employers remain concerned about a fourth wave, particularly given the experience of some Canadian provinces following a relaxation of restrictions. The Hardest Hit Recovery Program suggests that government-imposed lockdowns are still a possibility as we head into the winter months and flu season. And it may be that there will be businesses who find themselves left out of these programs, as they may be able to generate enough revenue to render themselves ineligible, but still consider themselves to be reeling from the long-term economic impacts of COVID-19.
“Employers recognize that the economy will move beyond pandemic protections” Lisi added. This new legislation is clearly a sign that government is planning a return to “normal” for the economy. The challenge for employers, Lisi told HRD, is that certain businesses and sectors are not left behind in the rush.
