Navigating Employment Insurance and COVID-19 for Your Restaurant

As restaurant owners continue to cope with the effects of COVID-19, one of their major areas of concern has been how to best support their employees. Restaurants have made difficult decisions including reducing employee hours or cutting hours completely. While some restaurants had to make the extraordinary decision to close, others are operating with take-out and delivery and pivoting their operations where possible.

For restaurants and their employees, it is important to be aware of Employment Insurance (EI) benefits, new government programs, and work-sharing programs.

“Staying up-to-date with the new programs and changes to existing programs the government has made is crucial to navigating the impacts COVID-19 is having on restaurant operations and employees,” says Hali Van Vliet, Senior Manager in BDO’s Human Resources Advisory. “It’s equally important to communicate with your employees as you entertain different workforce strategies to address the ever changing situation.

At the same time, restaurant owners are making difficult decisions for their team, they are dealing with the payroll implications. “Restaurant owners are reaching out to our payroll group frequently with questions about how they can navigate the paperwork and payroll rules,” says Matthew Sturges, BDO Partner in Outsourcing. “We are working diligently to provide restaurants with relevant guidance.”

Government Programs

Some of the key programs are highlighted below. Review our detailed article on these programs to learn more and stay up-to-date on new changes.

 The EI sickness benefit provides financial support for eligible workers who:

• are unable to work for a medical reason (including being subject to quarantine or self-isolation)
• experienced a decrease in regular weekly earnings of more than 40% for one week
• accumulated 600 insurable hours worked in the 52 weeks before the claim began

Employees can claim the benefits for up to 15 weeks, with a maximum of $573 per week or 55% of insurable earnings. Among the changes implemented, the government has waived the one-week waiting period, and the doctor’s note requirement for those going into quarantine by law or public health requirements.

The government has proposed legislation to establish the Canada Emergency Response Benefit (CERB) for workers who lose their income due to COVID-19. Eligible recipients would have access to this taxable benefit of $2000.00 a month for up to four months. The CERB would be a simpler and more accessible combination of the previously announced Emergency Care Benefit and Emergency Support Benefit. A portal will be set up so that Canadians can easily access the benefits and receive their CERB payments within 10 days of application. The program will be available from March 15, 2020 to October 3, 2020.

Work-sharing is designed to help eligible employers avoid layoffs due to a temporary reduction in the normal level of business activity beyond the employer’s control.

• Eligible employees can receive the EI benefits as income support, and must agree to work a reduced schedule and share available work over a specified period.
• Both the employer and the employee must apply to participate in a work-sharing program together. The government waived the mandatory waiting period.

Work share programs have a number of eligibility and hours per week requirements. The goal is to return employees to regular working hours by the end of the program. The program normally lasts for a minimum of six weeks, but due to COVID-19, it now lasts up to 76 weeks.

BDO is here to help

Those in the restaurant business are accustomed to dealing with challenges, but they are now operating in an unprecedented environment. BDO’s People Advisory team and Outsourced Payroll and Bookkeeping team can help support your restaurant and employees.

Matthew Sturges, Partner, Leader – Outsourcing Services

Hali Van Vliet, VP – Human Resources Advisory