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Removes deduction of 6.82 per cent applied to payments; enables earlier access

Nov 22, 2021

Ottawa is making changes to the Wage Earner Protection Program (WEPP) to expand eligibility and put more money in the pockets of Canadians.

Specifically, the government has removed the standard 6.82-per-cent deduction applied to all WEPP payments. This will give an average of $315 more to those who have lost their job and are owed wages by their former employer.

“These changes will help even more workers facing tough times access this critical program and have more money to cover essential needs and see them through to brighter days ahead,” says Seamus O’Regan Jr., minister of labour.

Ottawa is also:

  • enabling earlier access to WEPP payments
  • extending WEPP coverage to Canadians employed by foreign companies in Canada
  • updating the payment for trustee and receiver duties.

The government first announced the changes in Budget 2021, which was formalized in May. The elimination of the 6.82 per cent deduction was intended to mimic the Canada Pension Plan and EI contribution amounts normally deducted at source.

Through the WEPP, individuals can claim unpaid eligible wages such as basic wages, disbursements, vacation pay, termination and severance pay up to a maximum amount equivalent to seven weeks of the employment insurance (EI) maximum yearly insurable earnings under the Employment Insurance Act. This amount is $7,579 for 2021.

The program has paid roughly $473 million in wages to nearly 161,000 Canadian workers, according to the government.

WEPP was created through WEPP through Bill C-12 – a series of amendments to existing insolvency and wage-protection laws – which was approved in 2008. It came into force later that same year.

Source: https://www.hrreporter.com/focus-areas/compensation-and-benefits/changes-to-wage-earner-protection-program-now-in-effect/361934