Question Period Note: WAGE EARNER PROTECTION PROGRAM

What is the Wage Earner Protection Program (WEPP)?

The WEPP is a statutory Government of Canada program that provides financial support for eligible wages owing to workers when their employer files for bankruptcy or becomes subject to receivership. The WEPP has a statutory allotment of $49.25 million per year.

The maximum WEPP payment amount is equivalent to 7 weeks of the maximum yearly insurable earnings under the Employment Insurance Act ($8,177 for 2022). The Government of Canada is subrogated to any rights the individual may have in respect to unpaid wages and the Canada Revenue Agency administers collection activities.

Since its inception in July 2008, WEPP has paid $461 million in eligible wages to nearly 158,000 Canadians (as at March 31, 2022). In a typical year, about 11,700 individuals benefit from WEPP, and over the life of the program have received an average WEPP payment of about $3,918 per recipient.

The WEPP provides financial support to Canadian workers, under federal, provincial and territorial jurisdictions, who are owed money when their employer files for bankruptcy or becomes subject to a receivership. Workers can receive a one-time payment of up to an amount equivalent to seven times the maximum weekly insurable earnings under the Employment Insurance Act ($8,177 for 2022). The annual indexation of the cap ensures that the amount of wages protected by the WEPP increases with inflation. WEPP has an annual allocation from the Consolidated Revenue Fund of $49.25 million.

To be eligible for a WEPP payment, an applicant must meet three conditions:

they were employed in Canada and their employment has been terminated;

their former employer must be bankrupt or subject to a receivership; and

the individual must be owed eligible wages by their former employer.

Eligible wages, which include wages, vacation pay, termination and severance pay, must have been earned in the 6-month period leading up to a bankruptcy or receivership. If an employer attempted to restructure prior to their bankruptcy or receivership, then eligibility is extended to begin 6 months prior to the start of those proceedings.

When payments are made under the WEPP, the Government of Canada is subrogated to any rights the individual may have in respect of unpaid wages, to the extent of the WEPP payment amount. Collection activities are administered by the Canada Revenue Agency, both for subrogated debts owed to the Government, and for overpayments to recipients.

Since its inception in July 2008, WEPP has paid $461 million in eligible wages to nearly 158,000 Canadians (as at March 31, 2021). In a typical year, about 11,700 individuals benefit from WEPP, and over the life of the program have received an average WEPP payment of about $3,918 per recipient.

WEPP applicants have the right to request a review of their application, which is conducted by Service Canada. If the applicant is not satisfied with the review, they may file an appeal with the Canada Industrial Relations Board in cases where the applicant disagrees with the jurisdiction or the interpretation of the WEPPA and its Regulations.

WEPP is delivered by Service Canada and information can be obtained by visiting a local Service Canada office, their web site www.servicecanada.gc.ca, or by calling the WEPP call centre at 1-866-683-6516.

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