Question Period Note: PROPOSED CHANGES TO WAGE EARNER PROTECTION PROGRAM REGULATIONS

What changes are being proposed to Wage Earner Protection Program (WEPP) Regulations?

• The WEPP is a 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.

• New WEPP Regulations are being developed to broaden Program access by:
o enabling earlier WEPP payments when an employer engages in liquidating restructuring proceedings;
o extending coverage to individuals if their employer enters formal insolvency proceedings in another country; and
o updating the payment of trustee and receiver fees and expenses for low asset insolvencies so that more individuals can access the WEPP.

• The proposed regulations were published in Canada Gazette, Part I, on November 28, 2020, for feedback by stakeholder groups and the general public. These consultations closed on January 15, 2021.

• We have heard from a number of WEPP stakeholders. We are currently reviewing and analyzing the information received. We expect to finalize the regulations this spring.

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. The WEPP provides timely payment of eligible wages, up to an amount equalling seven weeks maximum insurable earnings under the Employment Insurance Act ($7,579 for 2021). WEPP has an annual allocation from the Consolidated Revenue Fund of $49.25 million.

Following up on a Budget 2018 commitment, the WEPP Act was amended in December 2018 as part of Budget Implementation Act, 2018, No. 2, to increase the maximum payment from four to seven weeks of Employment Insurance maximum insurable earnings. This increase came into effect immediately and applied retroactively to the date of the Budget announcement of February 27, 2018.

However, there are two additional amendments that were made at that time that require updated regulations before they can take effect:
• enabling more timely payments to individuals if their employer engages in a lengthy restructuring proceeding before entering bankruptcy or becoming subject to receivership; and
• providing WEPP coverage to employees if their employer is bankrupt or subject to a receivership in another country.

Proposed changes to WEPP Regulations were published in Canada Gazette, Part I, on November 28, 2020, for a 30-day public comment period. These consultations ended on January 15, 2021.

Stakeholder input is being analyzed to determine if the draft regulations should be revised. It is anticipated that the new regulations would come into force in late spring / early summer 2021.

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.

• The Wage Earner Protection Program (WEPP) provides financial support to workers for “eligible wages” owed if their employer files for bankruptcy or becomes subject to a receivership.
• “Eligible wages” include unpaid amounts for wages, vacation pay, severance and termination pay.
• The maximum payment under the WEPP is equal to seven weeks of maximum insurable earnings under the Employment Insurance Act ($7,579 for 2021).
• Since the WEPP was launched, in July 2008, nearly 155,000 workers have received WEPP payments, totalling more than $448 million (as at December 31, 2020).