As of April, 6, 2020, workers can apply for the new Canada Emergency Response Benefit (“CERB”). The following update sets out what CERB is, how employees can apply, and how it may affect the federal government’s other employment benefit initiatives, such as the Canada Emergency Wage Subsidy. The Government of Canada’s primer on CERB can be found here.
What is CERB?
CERB is a weekly $500 payment made directly to workers whose earnings have been interrupted between March 15, 2020 and October 3, 2020 because of COVID-19 or for reasons that would ordinarily qualify for regular or sickness Employment Insurance (“EI”) benefits. CERB modifies the existing EI system to help process the influx of unemployment claims during the COVID-19 pandemic.
Eligible employees can receive CERB payments for a maximum of 16 weeks, broken into four-week periods. Employees eligible in one four-week period will have to re-certify their eligibility for the benefit in the next four-week period.
CERB payments will start within 10 days of application. There is no waiting period. Payments will be made through direct deposit or by cheque, retroactive to the date of eligibility.
CERB payments will not be deducted at the source. Participants will receive the entire $500 payment each week. However, the benefit is deemed income and will have to be reported as such on the employee’s 2020 tax return.
Who qualifies for CERB?
To be eligible for CERB, an employee must:
Employees do not need to provide a medical certificate to receive CERB payments if they are in quarantine or sick from COVID-19.
Examples of having “stopped working because of COVID-19” include but are not limited to:
This means employees may be eligible for CERB even if they are not “laid off” because of COVID-19. Employees who remain employed but are simply receiving no income because of COVID-19 can still receive payments, assuming they meet the other eligibility criteria.
Note that employees may also qualify for CERB payments if they have experienced an interruption in their earnings not “because of COVID-19” but for reasons that would otherwise qualify them for regular or sickness EI benefits.
Employees who voluntarily quit or left their job do not qualify for CERB.
How do people apply for CERB?
As of April 6, 2020, eligible employees should apply for CERB directly online through their “My CRA Account” or by phone. There will be a new CERB portal for online applications.
Eligible employees can apply for CERB retroactively to March 15, 2020:
Both online and phone applications are available 21 hours a day, seven days a week.
How will CERB affect Employment Insurance?
CERB is intended to ease the anticipated burdens on the EI system during the COVID-19 pandemic. Employees who would have otherwise been eligible for regular or sickness EI benefits on or after March 15, 2020 will instead receive CERB payments.
This means any employee eligible for CERB will receive the weekly $500 payment in lieu of whatever they would have received under EI:
Receiving income from CERB will not impact an employee’s eligibility for regular or sickness EI benefits after the 16-week CERB period ends.
CERB does not affect other EI programs, such as maternity, parental, caregiving, fishing, and work sharing benefits. Employees who are eligible for those benefits should continue to apply for them rather than for CERB.
An employee currently receiving those special EI benefits is expected to return to work at the end of the collection period. However, if the employee’s work is unavailable when they attempt to return to work because of COVID-19, they may be eligible for CERB at that time.
How is CERB affected by payments from other government initiatives?
CERB payments are only available to employees who expect “to be without employment or self-employment income for at least 14 consecutive days in the initial four-week period of the application.” Employment income therefore disqualifies employees from accessing the benefit.
However, technically, payments under a SUB Plan are not “earnings” for the purposes of EI, so there might be some reason to think that the same would be true for eligibility under CERB.
?This publication is intended only to provide general information. It should not be relied on as legal advice. For specific legal advice, please contact: Leslie Dizgun, Allyson Fischer, Lorne Honickman, Justin Anisman, or William McLennan