With the release of the 2021 Federal Budget on April 19, 2021, the government announced an additional means for employers to receive government assistance covering a portion of their employee wages. This program allows eligible employers to claim a subsidy of up to 50 per cent of incremental remuneration paid to eligible active employees between June 6, 2021, and November 20, 2021. With several provincial governments having significantly eased public health restrictions, many businesses are starting to reopen or gradually return to normal operating levels, and the CRHP subsidy could provide a significant benefit for those businesses that have re-hired, or otherwise began to increase their payroll over and above pandemic payroll levels. The following are some of the key details to know about this new important new subsidy.
(NOTE – The information below references similarities and integrations with the Canada Emergency Wage Subsidy Program (CEWS). For more information on the rules for CEWS program visit our Guide to the Canada Emergency Wage Subsidy (CEWS) for Employers)
Which Employers are Eligible?
Generally, any employer that is eligible for the CEWS subsidy (including Canadian Controlled Private Corporations, individuals, not-for-profit organizations, and partnerships made up of other eligible entities) will be eligible for CRHP. The one significant difference in eligibility is that a corporation will only be eligible if it is a Canadian Controlled Private Corporation, meaning that a public entity will not be eligible for CRHP
What Remuneration is Eligible for CRHP?
Generally, the same remuneration which is eligible for the CEWS subsidy program will also be eligible for CRHP. One major difference is that CRHP would not be available in relation to remuneration paid to furloughed employees, meaning those who are on leave with pay but do not perform any work for the employer.
Incremental remuneration for a qualifying period is the difference between total eligible remuneration paid to eligible employees during the qualifying period and total eligible remuneration paid to them during the baseline period. For calculation of total eligible remuneration paid for both the qualifying period and the baseline period, eligible remuneration for each eligible employee would be subject to a maximum of $1,129 per week.
The following table outlines the dates used for calculating incremental remuneration.
|
Qualifying period |
Period 17 |
Period 18 |
Period 19 |
Period 20 |
Period 21 |
Period 22 |
|
|
Qualifying period dates |
June 6 to July 3, 2021 |
July 4 to July 31, 2021 |
August 1 to August 28, 2021 |
August 29 to September 25, 2021 |
September 26 to October 23, 2021 |
October 24 to November 20, 2021 |
|
|
Baseline period |
March 14 to April 10, 2021 |
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*Period 17 of the Canada Emergency Wage Subsidy would be the first period of the Canada Recovery Hiring Program. Period identifiers have been aligned for ease of reference. |
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Is there a Required Revenue Decline to Qualify for the Program?
To be eligible for CHRP an employer would have to demonstrate a decline in revenues based on the following thresholds:
- More than 0 per cent, for the qualifying period between June 6, 2021 and July 3, 2021.
- More than 10 per cent, for qualifying periods between July 4, 2021 and November 20, 2021
An employer's decline in revenues would be determined in the same manner as under the Canada Emergency Wage Subsidy. Employers can elect to use either the general approach (comparison current month revenue to corresponding pre-pandemic calendar month), or alternative approach (comparison to average of January and February 2020 revenues), however, employers that have also claimed the CEWS subsidy must elect to use the same method as used for previous CEWS applications.
The following table sets out the reference periods used to determine an eligible employer’s revenue decline for the qualifying periods:
|
Timing |
Period 17 |
Period 18 |
Period 19 |
Period 20 |
Period 21 |
Period 22 |
|
General approach |
June 2021 over June 2019 or May 2021 over May 2019 |
July 2021 over July 2019 or June 2021 over June 2019 |
August 2021 over August 2019 or July 2021 over July 2019 |
September 2021 over September 2019 or August 2021 over August 2019 |
October 2021 over October 2019 or September 2021 over September 2019 |
November 2021 over November 2019 or October 2021 over October 2019 |
|
Alternative approach |
June 2021 or May 2021 over average of January and February 2020 |
July 2021 or June 2021 over average of January and February 2020 |
August 2021 or July 2021 over average of January and February 2020 |
September 2021 or August 2021 over average of January and February 2020 |
October 2021 or September 2021 over average of January and February 2020 |
November 2021 or October 2021 over average of January and February 2020 |
How is the CHRP Subsidy Amount Calculated and How Can Eligible Employers Apply?
If an eligible employer meets the revenue-decline threshold for a qualifying period, its subsidy amount would be equal to its eligible incremental remuneration multiplied by the Hiring subsidy rate (e.g. 50%, 40%, 30% or 20%) for the qualifying period. The rates for each period are shown below, in the table below:
|
|
Period 17 |
Period 18 |
Period 19 |
Period 20 |
Period 21 |
Period 22 |
|
Hiring subsidy rate |
50% |
50% |
50% |
40% |
30% |
20% |
All eligible employers should assess both their CRHP and CEWS eligible subsidy amounts for each qualifying period as it is important to note that eligible employers are permitted to claim either the hiring subsidy or the Canada Emergency Wage Subsidy for a particular qualifying period, but not both.
The application deadline for each CHRP qualifying period is 180 days after the end of each qualifying period, which is the same as the corresponding CEWS application deadline.
For more information, visit the Canada Revenue Agency’s official webpage for the Canada Recovery Hiring Program (CRHP).
If you have any questions about these or any other COVID-19 relief measures, including CEWS, CRB, and CEBA, visit our main blog page or contact Gregory Harriman & Associates LLP by email at This email address is being protected from spambots. You need JavaScript enabled to view it. or by phone at 1-403-934-3176.
Disclaimer
The information in this publication is current as of July 27, 2021.
This publication has been carefully prepared, but it has been written in general terms and should be seen as broad guidance only. The publication cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information contained therein without obtaining specific professional advice. Please contact Gregory, Harriman & Associates LLP to discuss these matters in the context of your particular circumstances. Gregory, Harriman & Associates LLP, its partners, employees and agents do not accept or assume any liability or duty of care for any loss arising from any action taken or not taken by anyone in reliance on the information in this publication or for any decision based on it.