CFIB welcomes federal, provincial business help
April 3, 2020, 10:07 am
Rob Paul Local Journalism Initiative Reporter
The Canadian Federation of Independent Business said Friday it welcomes federal support, including a 75 per cent wage subsidy for businesses that remain open that have been impacted by Covid-19, which the CFIB had campaigned hard for.
The government had previously announced a 10 per cent wage subsidy. Marilyn Braun-Pollon of the CFIB told the World-Spectator Friday afternoon that the announcement should make a difference for a lot of businesses trying to stay open.
“Ten per cent wasn’t going to make a difference, but we believe the 75 per cent is going to protect many jobs and keep employees connected to their employers, and that’s the important part, because that will help speed the recovery when the Covid emergency phase is over.
“We know the subsidy is not going to help every company or every employee, or prevent the loss of every job, but it will help firms retain hundreds of thousands of employees who would otherwise be laid off.
“We know that business owners have been making tough decisions day by day, to continue to pay their workers when they could, but with the knowledge that their resources were evaporating quickly.
“We want to get the details as soon as possible. The government release says it’s a wage subsidy for qualifying businesses for up to three months. Our first question is who qualifies? Is it sole proprietorships, is it partnerships, is it incorporated businesses, is there a cap per employee or employer, does it require businesses to pay 100 per cent of regular wages, those are the questions that we have.
“We want to make sure that business owners get the answers they need. We’re encouraged that the wage subsidy will be backdated to March 15. That will allow some businesses that have already laid off employees to rehire them. That was our point all along, keeping the connection to the employer.
“When we did our last survey Tuesday, we found 60 per cent of businesses were seeing a significant drop in sales and more than one in three were seeing a 75 per cent drop in sales. We said at this rate, the only way to prevent massive unemployment was for the government to introduce a much larger wage subsidy program.
“The initial announcement of a 10 per cent subsidy was a step in the right direction, it wasn’t enough for a lot of businesses to retain their staff, so we asked for a 75 per cent wage subsidy because we’re in a crisis. We’re in uncharted territory. There is no rulebook for this level of uncertainty in the economy.
“There were a million EI applications in the last week. Employers were going to be forced to make layoff decisions in the next couple of days.
“We said announcing a substantive wage subsidy of 75 per cent was the only way to help employers keep those employees and help us recover when we see the other side of this.”
The CFIB is hoping to get more information on the program as quickly as possible.
“It is critical that small business owner get details on the program quickly. CFIB’s Business Helpline will be flooded with calls from small business owners asking important questions, including:
• Who qualifies (sole proprietorships, partnerships, medium-sized firms)
• Is there a cap per employee, per employer
• Does it require the business to pay 100 per cent of regular wages, particularly on wages above any per employee cap.”
The CFIB said it also welcomed the announcement of $40,000 emergency loans for businesses with up to $10,000 being forgivable.
“The interest-free loans for small businesses through the Canada Emergency Business Account will be of assistance to firms struggling with ongoing fixed costs, particularly with the news that up to $10,000 will be forgivable,” CFIB said Friday.
“CFIB is also pleased government accepted its recommendation to defer GST/HST to June as it will assist entrepreneurs with cash flow issues.
The CFIB conducted a survey of over 11,000 small businesses to see the impact the Covid-19 pandemic has had on them.
The survey concluded that 60 per cent of small businesses have seen a significant drop in sales with more than one in three reporting a loss greater than 75 per cent.
“More than half of small firms have begun laying off staff, with a quarter reporting they have already been forced to lay off their entire workforce,” said CFIB President Dan Kelly.
“The only way to prevent massive additional unemployment was for government to introduce a much larger wage subsidy program.”
The initial wage subsidy was set at 10 per cent. After calls from the Canadian Chamber of Commerce and the CFIB, the federal government decided Friday to increase the wage subsidy to 75 per cent.
“On top of the 930,000 new Employment Insurance (EI) applications filed last week across Canada, many small businesses will be forced to make additional layoff decisions in the next few days,” said Kelly.
CFIB says that nearly one in three businesses said they could survive less than a month before the higher wage subsidy was announced.
According to the survey the average cost of the outbreak for affected businesses has doubled since last week to $136,000.
CFIB fielded over 3,500 calls last week from small businesses owners with questions because of the uncertainty right now.
“In addition to these impacts, small business owners are facing a lot of uncertainty and thousands have been calling CFIB with questions,” said CFIB Vice-President Marilyn Braun-Pollon.
“The record of employment process is very onerous, especially if a business is forced to lay off all its staff at once.
“Businesses are looking for ways to keep their staff employed but reduce their operating costs so they can weather the massive disruption,” said Braun-Pollon.
“Others want to know what the loss of their business means for them and their employees, how Employment Standards apply to this extraordinary situation and how to access the new government programs that were announced last week.”
Of the small businesses involved in CFIB’s survey, one per cent said they need no further assistance from the federal government, two per cent said they need no further assistance from their provincial government, and three per cent said they need no further assistance from their local government.
“We recognize this is uncharted territory and extremely challenging times for small businesses owners,” said Braun-Pollon.
“This is unprecedented, we’ve never encountered this before, we’ve never seen a shock to the business climate like we have with Covid-19.
“There’s no rulebook, it seems as if the landscape is changing by the hour, so what our survey revealed is that the Covid-19 outbreak is quickly becoming a disaster for small business owners.
“Canadian businesses are ready to step up to overcome the challenge, but to win this fight we need every possible human and financial resource and we must be able to focus all of our attention on this struggle.
“We’re at a critical point here where we’re days away from a good chunk of employers looking at additional layoffs either temporary or permanent or some businesses being forced to close,” said Braun-Pollon.
“We’re asking the federal government to delay planned tax hikes, put the April 1 carbon tax on hold. We just can’t expect business owners to dig into a diminishing line to fund a costly carbon tax.”
Braun-Pollon says she likes the direction the provincial government in Saskatchewan is headed, but government at all levels can do more.
“We’re pleased Premier Scott Moe announced a financial support plan for Saskatchewan employers and employees hit by the impacts of the Covid-19 pandemic, which includes a number of measures such as the Self-Isolation Program, as well as cost saving measures such as the three month PST remittance deferral and audit suspension,” said Braun-Pollon.
“We also welcome the establishment of a Business Response Team, which will be a single window information webpage for businesses to help them navigate and find relevant information on programs and support.”
CFIB has online guidelines for employers to access to help them during the Covid-19 crisis. “Our number one priority is the health of the small business owners and employees so we’ve put together some information and tools to help them,” said Braun-Pollon. “We have an online guide of frequently asked Covid-19 questions and we have templates for prevention measures, dealing with employees who travel, emergency preparedness,” said Braun-Pollon. “Just making sure they have the tools they need.”