COVID -19- Canadian Alternatives to Layoffs Without Pay: Supplementary Unemployment Benefit and Work Sharing

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COVID -19- Canadian Alternatives to Layoffs Without Pay: Supplementary Unemployment Benefit and Work Sharing Supplementary Unemployment Work Sharing Benefit (SUB) Does the employee need to No Yes, but with at least a 10% reduction work at all? and maximum a 60% reduction in hours. Must all employees have No Yes their hours reduced by the same percentage? Is it available if the Yes No business is completely closed? Which employees are Any Employees in a Work Sharing Unit eligible? (WSU) who do similar work, who all agree to the same percentage reduction in their hours. What it does Employees get up to 55% of pay Employees work part time while replaced by regular government receiving EI benefits corresponding to Employment Insurance (EI). the lost hours. Employees in a WSU Employer can top up this up so all agree to work reduced hours. that the employee gets 95% Reductions of up to 60% of normal (subject to salary limits). hours are covered by the program. Cost to the employer The employer pays the full Employer must continue to provide all amount of the top up that it fringe benefits, and at least 40% of decides to pay. regular salary (for workers who have had the maximum 60% reduction in hours). What does the government The only concession by the The government pays the employees provide? government is that it does not cut 55% of the reduction in the salary they back the regular EI payment, and have lost due to the reduced hours EI premiums are not charged on (subject to a salary cap). the payments by the employer. Main drawback Substantial cost to the employer, Needs to be feasible to reduce the paying up to 40% of wage of hours of each employee in the work employees who are not working. group by the same percentage. Employees must work and be paid for at least 40% of their regular hours. Main advantage to the Promotes employee goodwill. Allows large reduction in the payroll employer Reduces risk of claims for at little cost to the employer, while damages for constructive preserving employee engagement in dismissal due to a common law anticipation of a normal return to layoff. business. How to apply https://www.canada.ca/en/employ https://www.canada.ca/en/employment ment-social- -social-development/services/work- development/programs/ei/ei- sharing/apply.html list/reports/supplemental- unemployment- benefit/registration.html Full details at government https://www.canada.ca/en/employ https://www.canada.ca/en/employment website ment-social- -social-development/services/work- development/programs/ei/ei- sharing.html list/ei-employers-supplemental- unemployment-benefit.html About the Author: Alexandra Monkhouse is a partner and a lawyer at Monkhouse Law. Alexandra practices employment law, and general litigation with a focus on major claims and class actions. She is trained in conducting mediations and has been appointed by the government of Ontario to be on the roster of Toronto mediators for mandatory mediation. Alexandra has appeared at the Ontario Superior Court of Justice and before the Supreme Court of Canada numerous times. She also practices in French and Romanian. .

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