To say that COVID-19 blind sided almost every business in the world is stating the obvious. Despite this gargantuan financial impact, however, a lot of individuals have settled into a nice rhythm since the onset of the pandemic. It’s human nature, after all; we tend to adapt.
But while many fortunate Canadians have gone from panic socializing on House Party, to enjoying guilt free Netflix without social obligation, the economic reality of COVID-19 still bears down on business owners across the country. Time strapped, stressed, and facing unrelenting uncertainty, navigating the government subsidies has been both challenging and critical to their survival.
The series of financial measures to support Canadians and Canadian businesses were released in stages. Each stage typically started with an initial announcement, followed by preliminary written-form information, FAQs with technical details, followed by consultation periods where the Department of Finance would collect feedback from business owners and advocacy groups representing professional interests.
Wage subsidies were, and remain today, one of the biggest focuses of small and medium-sized businesses. The wage subsidies represent the largest flow of capital from government to businesses in Canada during the pandemic, and smaller businesses are more likely to be adversely affected by COVID-19's economic impact. According to Statistics Canada, businesses with under 100 employees are more likely to have reported over 20% decline in revenue in early 2020.
As of the beginning of October, the Government of Canada has approved roughly 1.2 million applications and paid $40 billion in subsidies from the Canadian Emergency Wage Subsidy alone.
From Humi's own experience supporting Canadian SMBs throughout this period, most business owners have faced varying degrees of challenge utilizing the wage subsidies. This is primarily due to the confusion around differentiating the types of wage subsidies available, how they interact with each other as well as with employee-oriented measures like the CERB, and keeping track of the latest updates to wage subsidies.
Depending on the type of subsidy and the period you're claiming the subsidy for, the mechanics of the subsidies may get very intricate. The CRA has been releasing comprehensive resources to help business owners determine eligibility, calculate claim, and apply for claim.
While the above resources are comprehensive, crunching numbers and working through data can be a challenge. Despite the fact that it’s never been so critical, it simply isn’t what most of us got into business to do. If you’re in further need of guidance, your payroll provider should be keen to assist you, and there are many local accounting firms that have worked quickly to streamline the process of aiding with applications as well.
Aside from securing the benefit of these subsidies if you are in need, I urge everyone to remember that they are not intended for businesses that are unaffected by the pandemic. Unfortunately, the potential audit to ensure that paid benefits were sent to truly eligible employers may be even more painful than the initial applications. In the end, the audit is a positive process that may uncover many bad actors within our country, and it’s important that everyone is prepared in the case they are selected. We’ve written additional guidance on preparing for this audit, which is a must-read for anyone leveraging the subsidies.
For those of us who have been lucky enough to survive this long, it’s my hope that we can all emerge stronger, with new perspectives and fortitude, leading to a brighter future for all Canadians. Whether your business has been damaged or just slightly dinged by COVID-19, myself and the team at Humi are here to support you, to help make that future a reality.
Simon is one of two CEOs at Humi. He spent years working at an investment bank throughout the last financial crisis before shifting to tech in 2012; a founder at OneLocal before co-founding Humi in 2016. Through both businesses, he has focused on everything from sales to finance, and spends his time trying to navigate changes and challenges like COVID-19 at Humi.
Hey there 👋 my name is Andrea Bartlett.
I’m the Director of HR at Humi, and I’m obsessed with all things people and human resources. Throughout my time working in a range of industries, I’ve learned that one thing is clear: the world of work is changing and HR professionals are leading the charge.
I believe that businesses should know their people as well as they know their product. But people are complex, and the solutions aren’t always easy. That’s how Think with Humi will help.
Written by me, this newsletter is designed to give you insight into the relevant and raw people challenges, and give you the tools to enable you to continuously to shape the future of work.
Written by a people leader, for people leaders.