A planned increase in federal funding for Soulpepper Theatre has been voted down by the Canada Council for the Arts' board of directors.

On Thursday, the council's board voted to rescind an increase of $375,500 the theatre company was set to receive. That was on top of a $184,500 "core grant" which the company will still collect this year and again next year, Canada Council said in a statement sent to CBC Toronto.

After four civil suits were launched against former artistic director Albert Schultz in January, the granting agency placed Soulpepper on "concerned status" and conducted a review.

"It's very important to the Canada Council, as a public arts funder, that the organizations we fund provide a work environment that's free of harassment, sexual misconduct or abuse of power," the statement reads.

Soulpepper has been under pressure since allegations of sexual harassment, sexual remarks and unwanted groping against Schultz surfaced. The lawsuits are being filed by four women who worked as actors with the company. The theatre itself is named in the statement of claims of each suit. None of the allegations have been proven in court.

The complainants are seeking $4.25 million in damages from Soulpepper and $3.6 million from Schultz.

A month ago, Heritage Minister Mélanie Joly said arts organizations that don't have "best practices" in place to deal with harassment and bullying may be blocked from federal funding.

Canada Council said it is currently reviewing its granting policies to "ensure that there are adequate provisions to allow us to fairly and more effectively address situations which involve artists or organizations receiving Canada Council funding." They aim to have this work finished by spring.

In a statement to CBC Toronto, Soulpepper said they "continue to be in close communication" with the council as they "demonstrate our commitment to renewal and achieving our artistic mandate."

"We are very grateful they have decided to maintain their funding at the same level as last year. We are thankful to all of our donors, government agencies, partners and supporters that continue to believe in a strong future for the company."

Although Soulpepper remains on concerned status, Canada Council insists the company has been cooperative throughout the review.

"We are encouraged by the continued support of [Soulpepper's] patrons, partners, artists, and staff," the council said. "[They] will, like all other artistic institutions, have the opportunity to apply for the next cycle of core funding this fall."