On April 16, 2020, Prime Minister Justin Trudeau announced an expansion of the eligibility criteria for the Canada Emergency Business Account (“CEBA”) as well as the introduction of a new program, the Canada Emergency Commercial Rent Assistance (“CECRA”) program. He also reiterated his April 15, 2020 announcement of wage top-ups for essential workers earning less than $2,500 per month, though details of that are still to come.
Expansion to CEBA Eligibility
CEBA is intended to help eligible businesses struggling with their cash flow by providing rapid access to funds for operational costs and other immediate needs. The program provides a government guaranteed loan, with up to $40,000 interest free. Of that $40,000, $10,000 will be forgiven from repayment assuming the full remaining balance of the loan is repaid by December 31, 2022.
Previously CEBA was intended for eligible businesses with payrolls between $50,000 and $1 million. Today new eligibility criteria expanded both sides of that threshold: now eligible businesses that had a total payroll in 2019 of between $20,000 and $1.5 million will be eligible to receive the CEBA.
New Canada Emergency Commercial Rent Assistance Program
CECRA’s purpose is to provide loans, including forgivable loans, to commercial property owners who in turn will lower or forgo the rent of small businesses for the months of April (retroactive), May, and June of 2020.
Implementation of this program requires working with the provinces and territories given their jurisdiction over property owner-tenant relationships. More details are anticipated to be shared soon on this new program.
We have seen the introduction of several emergency programs over the past weeks since the COVID-19 crisis began. As government receives feedback from Canadians and opposition parties we have seen these programs expand. As new information becomes available, our team remains committed to helping employers keep apprised of the key developments they should be aware of.