COVID-19 Federal Benefits and Supports
Laying Off Employees
By Nizam Shajani, CPA, CA, MBA
During these difficult times, we are seeing a large number of layoffs due to temporary business closures or loss of business.
If you are laying off employees due to COVID-19, the following considerations need to be made on the employees record of employment (ROE).
Generally, you have five days after the end of the pay period in which an employee’s interruption of earning occurs to issue an ROE. This interruption of earnings includes layoffs due to COVID-19 as well as other layoffs, retirement, resignation or dismissal. The employee will need the ROE to determine if they are entitled to employment insurance (EI) benefits.
Completing the ROE
If your employees are directly affected by the coronavirus (COVID-19) and they are no longer working, you must issue a Record of Employment (ROE). To complete an ROE you can use the Service Canada online ROE web service, your payroll provider’s ROE service or fill out a paper ROE.
When the employee is sick or quarantined, use code D (Illness or injury) as the reason for separation (block 16). Do not add comments.
When the employee is no longer working due to a shortage of work because the business has closed or decreased operations due to coronavirus (COVID-19), use code A (Shortage of work). Do not add comments.
When the employee refuses to come to work but is not sick or quarantined, use code E (Quit) or code N (Leave of absence), as appropriate. Avoid adding comments unless absolutely necessary.
Collecting EI due to COVID-19
To be eligible for EI benefits, the employee will need to have worked for a specified number of hours in the past 52 weeks, have an ROE from their employer, and have lost their job due to the pandemic. For more details see EI Applications. It is recommended to apply as soon as a job loss occurs, waiting more than 4 weeks may result in a loss of benefits.
Benefits may include up to 15 weeks of assistance if a person cannot work due to medical reasons such as self-isolation or self-quarantine.
Where loss of employment is due to business closure or decreased operations due to COVID-19, the employee may receive EI from 14 weeks to a maximum of 45 weeks.
The employee may also apply to have the one-week waiting period waived by calling Service Canada at 1-833-381-2725.
Note if you do not qualify for regular EI benefits, you may still be eligible for the Emergency Care Benefit. More details will be available in April.
If our firm processes your payroll and you need assistance with an ROE, please let us know by contacting your account manager at Shajani.
This information is for discussion purposes only and should not be considered professional advice. There is no guarantee or warrant of information on this site and it should be noted that rules and laws change regularly. You should consult a professional before considering implementing or taking any action based on information on this site. Call our team for a consultation before taking any action. © 2020 Shajani LLP