Canadian Government Wage Subsidies

So you heard about Canadian Government Wage Subsidies. But what does it mean?

As a small business owner in Canada, wage subsidies are critical to the success of your business, especially if you are hiring employees.

Why?

Wage Subsidy programs are designed to help unemployed people who are having a difficult time finding full-time work due to a lack of skills or work experience. The Government of Canada steps in to help and asks small business owners to provide employment to these individuals in need, and the wage subsidy program provides temporary wage subsidies to employers who decide to hire and provide work experience and skills enhancement to eligible program candidates.

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In other words, if you are a small business owner, the Government of Canada can provide you with money to help you hire staff (but that staff must meet the program criteria).

Before you jump for joy and think that you can go out and hire 10 new employees who will work for you cheaply and have the Government of Canada pay for it, it just does not work that way.

Employer Eligibility Requirements

As a small business owner or employer, you must meet some eligibility requirements, such as:

• You must be a registered business with a legal business name and number
• You must have been in business for at least one year
• You must have a position to fill that is normally part of your business operations (no new positions)
• You must confirm that the client would not have been hired without a wage subsidy
• You must offer a full-time position with a minimum of 35 working hours per week
• You must offer the opportunity of long-term employment
• You must provide reasonable and competitive wages

Program Participation Rules

If you meet the above criteria and you are ready to take advantage of hiring staff with a Wage Subsidy Program, be sure that you are following these rules as well:

• Be committed to training the employee for the position
• The duration and dollar rate of the wage will be directly related to the amount of training required for the employee to gain the skills needed to be successful in the position
• You must provide regular pay cheques on set pay days, and the Wage Subsidy Program provider will reimburse the negotiated amount on a monthly basis
• You will be required to submit monthly reports to the Wage Subsidy Program regarding the employee’s hours and wages, and commit to two on-site monitoring visits by program staff during the wage subsidy period
• The employer makes the final decision to accept or decline the referred client

Finding Wage Subsidy Programs

If you think you have what it takes to participate in a wage subsidy program and believe that you could benefit from hiring and training staff for your small business in Canada, be sure to take advantage of our Funding Database. You can find wage subsidies, government grants, government loans, tax incentives, and private funding programs that may be the perfect funding option for your small business.

What Are Some Purposes of Wage Subsidies?

Please note that not all wage subsidy programs are the same, and not everyone may be eligible. The following are just a few examples of wage subsidy programs available in Canada, in specific provinces:

• Apply for a $10 per hour wage subsidy to employ persons with disabilities at your business.
• Receive financial assistance when hiring a Master’s or PhD graduate to conduct research and related activities for your business.
• If you hire an apprentice, you could receive a tax credit equal to 10% of that person’s salary.
• You may qualify for an annual tax credit of up to $5,000 per qualifying apprentice, to a maximum of $15,000 over a 36-month period.
• If you hire students for the summer, this subsidy could help cover 50% of their wages.
• Apply for funding to increase the wages of eligible permanent employees at your child daycare home or centre.
• Ontario – You may be eligible for a refundable tax credit of up to $3,000 if you hire an Ontario co-op student.
• Receive temporary wage reimbursements when creating permanent jobs or annually recurring seasonal jobs.
• If you are planning a new business project that benefits the community, you may be eligible to hire a subsidized job seeker.
• Ontario – You may be eligible for a wage subsidy of up to $31,500 if you hire a recent graduate as a new intern in your Northern Ontario organization.