As of March 13, 2022, the federal government reduced the subsidy rates for the Tourism and Hospitality Recovery Program (“THRP”) and the Hardest-Hit Business Recovery Program (“HHBRP”). Businesses receiving support from the THRP or HHBRP will therefore generally receive smaller subsidies due to these reduced subsidy rates. Accordingly, such employers should take this into account when planning their business’ finances.
The THRP and HHBRP pandemic supports were introduced by the federal government on October 21, 2021, with the intention of providing rent and wage subsidy support for eligible businesses that have been most negatively impacted by the COVID-19 pandemic.
As discussed in our previous blog, employers eligible for the THRP include businesses in the tourism and hospitality industry that meet the following three conditions:
- more than 50% of its total eligible revenue for the prior reference periods for claim periods 1 to 13 (but excluding one of either claim period 10 or 11) comes from one or more of the tourism, hospitality, arts, entertainment, or recreation activities that this program supports;
- the business had a 12-month average revenue drop of at least 40% from March 2020 to February 2021; and
- the business has a claim period revenue drop of at least 40%.
Employers eligible for the HHBRP include businesses that are not eligible for the THRP but which have been strongly impacted by COVID-19 and meet the following two conditions:
- the business has a 12-month average revenue drop of at least 50% between March 2020 to February 2021; and
- the business has a claim period revenue drop of at least 50%.
Up until March 13, 2022, the THRP provided eligible businesses with a subsidy rate of up to 75% and the HHBRP provided eligible businesses with a subsidy rate of up to 50%. As of March 13, 2022, the subsidy rates for the THRP and HHBRP programs have decreased to 37.5% and 25%, respectively.
Takeaways for Employers
Employers who have been relying on the subsidies from the THRP or HHBRP should be aware that they will likely receive smaller subsidies after March 13, 2022, due to the decreased subsidy rates outlined above. As a result, such employers should plan accordingly and consider seeking funding from an alternative source where necessary to ensure continuity of operations.
Employers eligible for the THRP or HHBRP who have not yet applied should note that these supports will continue to be available until May 7, 2022.
We will continue to monitor for any updates regarding federal support programs and related changes, and post about any changes that are relevant to employers on this Resource Centre.