The 2021 Budget proposes a new subsidy: the Canada Recovery Hiring Program (“CRHP”).
From June 6, 2021 to November 20, 2021, an eligible entity could claim the CRHP. Up until September 25, 2021, the CRHP is based on the same periods as for the Canada Emergency Wage Subsidy (“CEWS”) and the Canada Emergency Rent Subsidy (“CERS”). For the remaining periods, the CEWS and the CERS will no longer be in effect, but the CRHP periods will continue to consist of four weeks.
| CRHP REFERENCE PERIODS IN PERIODS 17 TO 22 | |||
| Qualifying Period | General Approach | Alternative Approach | |
|---|---|---|---|
| Period 17 | June 6, 2021 to July 3, 2021 |
June 2021 over June 2019 OR May 2021 over May 2019 |
June 2021 OR May 2021 over average of January and February 2020 |
| Period 18 | July 4, 2021 to July 31, 2021 |
July 2021 over July 2019 OR June 2021 over June 2019 |
July 2021 OR June 2021 over average of January and February 2020 |
| Period 19 | August 1, 2021 to August 28, 2021 |
August 2021 over August 2019 OR July 2021 over July 2019 |
August 2021 OR July 2021 over average of January and February 2020 |
| Period 20 | August 29, 2021 to September 25, 2021 |
September 2021 over September 2019 OR August 2021 over August 2019 |
September 2021 OR August 2021 over average of January and February 2020 |
| Period 21 | September 26, 2021 to October 23, 2021 |
October 2021 over October 2019 OR September 2021 over September 2019 |
October 2021 OR September 2021 over average of January and February 2020 |
| Period 22 | October 24, 2021 to November 20, 2021 |
November 2021 over November 2019 OR October 2021 over October 2019 |
November 2021 OR October 2021 over average of January and February 2020 |
CRHP would be available to employers that:
- Are eligible to the CEWS;
- Satisfy certain other status conditions– including, where the employer is a corporation, it is a Canadian-controlled private corporation (“CCPC”) (including a cooperative corporation that is eligible for the small business deduction) or, where the employer is a partnership, certain conditions on the composition of its partners. Other eligible employers would include individuals, non‑profit organizations and registered charities; and
- Have suffered a revenue drop (determined on the same basis as under CEWS and CERS), or, for the periods 18 to 22, have suffered a revenue drop of more than 10 per cent.
The CRHP would subsidize the incremental remuneration paid to an eligible employee at a rate of 50 % in periods 17 to 19, and then the subsidy rate would be 40%, 30% and 20% in periods 20 to 22, respectively.
The CRHP would not be available for furloughed employees.
Incremental remuneration for a qualifying period means the difference between an employer’s total eligible remuneration paid to eligible employees for the qualifying period and its total eligible remuneration paid to eligible employees between March 14, 2021 to April 10, 2021 (“baseline period”). In 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.
As is currently the case for the CEWS, the eligible remuneration for a non-arm’s length employee for a week could not exceed their baseline remuneration determined for that week.
An eligible employer would be permitted to claim either CRHP or the CEWS for a particular qualifying period, but not both.
Therefore, the determination of whether CEWS or CRHP would be more favorable to an employer would depend on the particular circumstances, including the revenue drop suffered (which increases the subsidy under CEWS) and the degree of incremental remuneration between the qualifying period and the baseline period (which increases the subsidy under CRHP).