The Canadian Emergency Wage Subsidy (CEWS) is a massive $73 billion program by the Government of Canada. This program has the government fund wages for employees up to 75% of their wage to a maximum of $847 per week per worker. Instead of giving this money directly to workers, the government provides it to employers, who are then expected to top up the additional 25%. The government hopes that this will cut down on lay-offs during the COVID-19 pandemic.

Not only is the CEWS a massive transfer of wealth to the private sector, but it gives far too much power to employers to determine how they spend the money.

Case in point, Rise has learned of a large scale medical equipment distribution firm that has used the CEWS as an excuse to cut wages by 95%. Yes, that is not a typo: 95%.

When the virus first hit, this company laid off all of its unionized warehouse workers: they were the first to go. Other warehouses faced layoffs, but not to the same extent.

The company then unilaterally declared that all workers were to take pay cuts down to a level of 80% their regular pay. The implication was that any worker who refused would be laid off.

Let’s do the math. If the government is providing 75% of a workers’ wage, and the worker is only getting paid 80% of their wage, the company is only providing 5% of the regular wage they normally would. Despite, due to being an essential service, expecting 100% of the usual labour out of their workers.

In effect, the CEWS is not a relief program, but rather a massive subsidy to private companies. In this case, the company has been able to cut their labour costs by 95% while still keeping business.

This is simply another example of how the ruling capitalist class is using the COVID-19 pandemic to go on the offensive.

Is your company abusing the CEWS? Have your wages been cut? Rise would love to hear from you.