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Wage subsidy payments coming May 4
It took only a few hours for more than 10,000 businesses to apply for wage subsidies after the federal government opened online applications on Monday morning. By 3 p.m. ET, the Canada Revenue Agency told CTV News Vancouver it had received close to 30,000 applications.
North Vancouver fitness club owner Sheila Hamilton had already contacted her accountant about getting her application in.
“I want it to work and I’m excited about that prospect, but I need an accountant, a bookkeeper, pretty much, and employment lawyer,” Hamilton said.
She owns it’s time! Fitness Results in North Vancouver and had to lay off seven employees early on in the COVID-19 crisis. Now she hopes to qualify for the 75 per cent federal wage subsidy that would pay $847 per week per employee to a maximum of $58,700 of a worker’s salary.
“For those who qualify, this is going to be a game changer,” said Val Litwin, CEO of the BC Chamber of Commerce.
But Litwin says only about one third of B.C. businesses expect they will qualify and plan to apply.
Hamilton is hopeful for her employees but also says she can’t afford to bring them all back at once. The gym is still not open and her portion of the cost will be about $1,200 per month, per employee in salary, Canada Pension Plan and Employment Insurance payments.
“So it’s going to be a slow process of bringing one employee back at a time,” she said.
The prime minister has also made it clear that employees cannot double dip.
“I want to remind everyone - you won’t be able to keep both the wage subsidy and the CERB. It’s one or the other, not both,” Justin Trudeau said while announcing the subsidy portal had opened.
There has also been some concern about employees who are offered their jobs back but choose not to come back to work, collecting government support money instead. Trudeau says anyone who gets money they’re not entitled to will be found out.
“The government agencies have a clear record of who gets what. That will obviously help in sorting this out in the coming months,” Trudeau said.
The wage subsidy program is one of several initiatives designed to help businesses stay afloat through the pandemic. Litwin says there is no magic bullet, but it all helps. Even so, the future remains uncertain.
“Businesses now have about 60 days left if current conditions stay in place,” he said.
The Better Business Bureau of Mainland B.C. is also trying to help its members that are still open for business by putting a special logo on its website to let consumers know.
“It shows that there is still a need and there’s still activity happening in our marketplace, even though it has significantly slowed down,” said Karla Laird, the BBB’s local spokesperson.
For businesses like Hamilton’s, even with government help, both revenue and the future are uncertain.
"The length of time the gym is closed is going to be a significant factor as well. When we are given the green light to open, will we be able to have more than 10 people in the gym at any one time? Questions like that pop to mind."
The CRA says the wage subsidy applications received between April 27 and May 3 still need to be verified, and there will be a lag time until the first payments are deposited. They won’t be deposited until May 4, at the earliest.