Canada effectively nationalizing private payrolls amid virus

Prime Minister Justin Trudeau addresses Canadians on the COVID-19 pandemic from Rideau Cottage in Ottawa on Monday. (The Canadian Press via AP)

TORONTO — Canada announced Monday it is effectively nationalizing many private payrolls by offering businesses large and small a 75% wage subsidy for their employees amid the coronavirus pandemic.

Prime Minister Justin Trudeau said businesses that have seen a 30% decrease in revenue are eligible.

“For people to get through this tough time and for the economy to rebound, people have to keep their job,” Trudeau said.

The prime minister said the government will cover up to 75% of salary on the first 58,700 Canadian dollars (US$41,474) that is earned. That means up to $847 Canadian (US$598) a week.

Trudeau did not put a price tag on it or say how long it would last but he called it a bridge to better times.

Trudeau previously announced the 75% wage subsidy for small businesses but announced Monday the number of employees a company has will not determine whether or not it gets support. He also said non-profits and charities are also eligible.

The Canadian government reversed course after initially only offering a 10% wage subsidy earlier this month. The new offer is backdated to March 15.

“These are measures that will make a huge difference,” Trudeau said.

Trudeau warned of severe penalties if companies try abuse the subsidy program.

Air Canada, meanwhile, said it will temporarily lay off more than 15,000 unionized workers beginning this week.

The layoffs will continue through April and May amid drastically reduced flight capacity from the Montreal-based airline.

Canada’s largest airline said the two-month furloughs will affect about one-third of management and administrative and support staff, including head office employees, in addition to the front-line workers.

Earlier this month Air Canada’s flight attendant union said 5,149 cabin crew would be temporarily laid off.