‘This will help businesses keep workers on the payroll, and put more Canadians in a position to recover quickly once we make it through these uncertain times
The federal government is looking to help Canada’s largest employers – and protect jobs – in establishing a Large Employer Emergency Financing Facility (LEEFF).
The program will provide bridge financing to employers whose needs during the pandemic are not being met through conventional financing, so they can keep their operations going, says the government. The support is meant for otherwise viable firms and will not be used to resolve insolvencies or restructure firms, or to provide financing to companies that otherwise have the capacity to manage through the crisis. The LEEFF is meant for employers to remain active during this difficult time, and position them for a rapid economic recovery.
The new measures “will help save middle class jobs, safeguard workers' benefits, and protect our economy,” says Prime Minister Justin Trudeau. “This will help businesses keep workers on the payroll, and put more Canadians in a position to recover quickly once we make it through these uncertain times.”
Companies seeking support must demonstrate how they intend to preserve employment and maintain investment activities. Recipients will need to commit to respect collective bargaining agreements and protect workers' pensions, says the government. The program will also require strict limits to dividends, share buy-backs and executive pay.
The government will also expand the Business Credit Availability Program (BCAP) to mid-sized companies with larger financing needs, providing mid-market businesses with loans of up to $60 million per company, and guarantees of up to $80 million. Through the BCAP, Export Development Canada (EDC) and the Business Development Bank of Canada (BDC) will work with private sector lenders to support access to capital for Canadian businesses in all sectors and regions.
On top of the federal Canada Emergency Wage Subsidy (CEWS), the federal government will also continue to provide financing to businesses through Farm Credit Canada, the BDC, and EDC, including through the Canada Account.
Last week, Trudeau announced $252 million in funding for the agriculture sector to help workers and employers during the time of COVID-19.