COVID-19

Work Sharing Program

CRA provides full details here

  • Service Canada that allows groups of employees to share hours of work during a temporary reduction in business activity (that is beyond the control of the employer).
  • The program allows employees to retain more income than regular EI benefits would otherwise provide had the employees been laid off.
  • Must have been in business for 2 years.
  • Demonstrate a temporary shortage of work.
  • Submit and implement a recovery plan for workers to return to full time employment.
  • Individual employees who have the same job description cannot participate in work-sharing while others continue to work normal hours. As work increases, the additional hours of work must be shared equally.
  • Must be able to demonstrate a 10% decrease in sales within the last 6 months.
  • The reduction in work hours (10-60%) must correspond to the number of anticipated temporary layoffs for the whole section of employees affected by the shortage of work.
  • Application is submitted at the time of job sharing is agreed to.

EXAMPLE:

Receiving Employment Insurance Work-Sharing benefits

  • Samantha works as a full-time employee and earns $40,000 per year (weekly earnings of $769). Due to the COVID-19 crisis, the firm faces significant reduction in workload because of decline in sales, and the possibility of laying off a quarter of its employees. The firm decides to enter into a Work-Sharing agreement with Service Canada, where all eligible employees in Samantha‚Äôs work unit agree to reduce their work hours per week by 35% and receive EI Work-Sharing benefits for days where they do not work as a result of the agreement.
  • If Samantha and her co-workers did not agree to voluntarily reduce their work hours to participate in the Work-Sharing program and were laid off, each of them would have been entitled to receive 55% of their weekly income ($423), by applying for EI regular benefits. By participating in the Work-Sharing program, Samantha and her co-workers receive 35% less of their regular weekly income (earning $500 per week); and collect EI benefits for that 35% of their average hours worked per week (equal to 55% of the value of the insurable earnings she would have received from the firm ($423), which is $148).
  • By participating in the Work-Sharing program, Samantha and her co-workers are able to earn a total of $648 per week ($500 worth of income from working at the firm plus $148 from Work-Sharing benefits), compared to $423 if they had been on EI regular benefits following a layoff. By participating in the Work-Sharing program, Samantha and her co-workers are able to earn more and keep their jobs, and keep their skills up to date. At the same time, the firm is able to retain its skilled and experienced workforce.
  • Consider that if the company was eligible for the Canada Emergency Wage Subsidy, it may be possible to achieve even better results.