Order Amending the Lockdown Regions Designation Order (COVID-19), No. 2: SOR/2022-1
Canada Gazette, Part II, Volume 156, Number 2
Registration
SOR/2022-1 January 4, 2022
CANADA WORKER LOCKDOWN BENEFIT ACT
P.C. 2022-21 January 4, 2022
Whereas “lockdown orders”, as defined in section 2 of the Canada Worker Lockdown Benefit Act footnote a, have been made with respect to COVID-19 outbreaks in additional regions to those set out in the Lockdown Regions Designation Order (COVID-19) footnote b, imposing measures referred to in subparagraphs (a)(i) and (ii) of that definition that apply to those regions for at least seven consecutive days;
And whereas the Minister of Employment and Social Development is of the opinion that it is in the public interest that an order designating those additional regions as lockdown regions be made for the benefit periods set out in the annexed Order;
Therefore, Her Excellency the Governor General in Council, on the recommendation of the Minister of Employment and Social Development, pursuant to section 3 of the Canada Worker Lockdown Benefit Act footnote a, makes the annexed Order Amending the Lockdown Regions Designation Order (COVID-19), No. 2.
Order Amending the Lockdown Regions Designation Order (COVID-19), No. 2
Amendment
| Item | Column 1 Lockdown region |
Column 2 Benefit period |
|---|---|---|
| 21 | Yukon | Beginning on December 19, 2021 and ending on the Saturday of the week in which the lockdown measures imposed by the government of Yukon cease to apply in the region |
| 22 | Northwest Territories | Beginning on December 19, 2021 and ending on the Saturday of the week in which the lockdown measures imposed by the government of the Northwest Territories cease to apply in the region |
Coming into Force
2 This Order comes into force on the day on which it is registered.
REGULATORY IMPACT ANALYSIS STATEMENT
(This statement is not part of the Order.)
Issues
In September 2020, the Government of Canada introduced the Canada Recovery Benefit to provide financial support for workers who lost employment because of the COVID-19 pandemic. While economic recovery and labour market conditions have improved and employment has regained pre-pandemic levels, lockdown measures continue to be important in controlling the spread of COVID-19 in some regions. In October 2021, the Government of Canada announced the intention to introduce targeted benefits for workers who lose employment income in regions where public health lockdowns are occurring. The Canada Worker Lockdown Benefit Act (the Act) was created to provide financial assistance in specified regions for specified periods of time. The Order Amending the Lockdown Regions Designation Order (COVID-19), No. 2 (the Order) designates specific regions as “lockdown regions” within the meaning of the Act and allows affected workers in these areas to apply for income support through the Canada Worker Lockdown Benefit (CWLB).
Without this designation, the benefit would not be accessible to eligible workers in regions that currently have or had lockdown measures imposed.
The Order directly supports the Government of Canada’s flexible response to COVID-19 and the analytical requirements have been adjusted to permit a timely and effective response.
Objective
To designate regions which meet the definition of a “lockdown region” under the Act thereby allowing eligible workers to claim income support through the CWLB for a specified period.
Description and rationale
Recognizing that some workers require targeted income support if a lockdown is imposed in a region to prevent the spread of COVID-19, the Government introduced Bill C-2, An Act to provide further support in response to COVID-19, which received royal assent on December 17, 2021. This bill enacted the Canada Worker Lockdown Benefit Act (the Act), which provides for the CWLB, available until May 7, 2022.
The CWLB is designed to provide targeted and temporary income support to workers whose employment is interrupted by a designated COVID-19 public health lockdown. These payments will provide income support to workers who have lost their employment or are unable to perform work as a self-employed person, or who have a reduction in income of at least 50%, due to a measure in a lockdown order.
Regulations Amending the Canada Worker Lockdown Benefit Act (Lockdown Order Definition and Minimum Lockdown Period) [the Regulations] have been introduced that temporarily expand the definition of “lockdown order” to include capacity-limiting restrictions of 50% or more. These amendments permanently remove the requirement that non-compliance with an order must be an offence resulting in a sanction or administrative monetary penalty. They also reduce the required number of consecutive days of eligible lockdown orders from 14 to 7.
The Act specifies that the Governor in Council (GiC), on the recommendation of the Minister of Employment and Social Development (the Minister), may designate by order any region in Canada as a lockdown region, for a specific period. The Minister may make the recommendation to the GiC only if the Minister is of the opinion that it is in the public interest and that measures referred to in the definition of “lockdown order” in section 2 of the Act, as modified by the Regulations, have been in place for at least seven consecutive days.
On December 23, 2021, the Government in Council made the Lockdown Regions Designation Order (COVID-19), which designated certain areas in the Northwest Territories and Quebec as lockdown regions. The Order Amending the Lockdown Regions Designation Order (COVID-19), which designated British Columbia, Alberta, Manitoba, Ontario, Quebec, New Brunswick, Prince Edward Island, Nova Scotia, Newfoundland and Labrador and Nunavut was approved by the Governor in Council and registered on December 29, 2021.
Benefit access is retroactive to the week beginning December 19, 2021.
Regions recommended as meeting the definition of a lockdown region
Yukon
Public health orders were imposed on December 4, 2021, across the Yukon requiring some businesses and facilities to restrict capacity to 50%. As of December 19, 2021 (the date set out in the Regulations), these restrictions have been in place for at least seven consecutive days. The orders were made under the territory’s Civil Emergency Act.
Northwest Territories
Under the Public Health Act of the Northwest Territories public health orders required some businesses and facilities to restrict their indoor capacity to 25 persons as of October 22, 2021, resulting in a 50% capacity reduction for some of these businesses. As of December 19, 2021 (the date set out in the Regulations), the orders have been in place for at least seven consecutive days.
The Minister is of the opinion that the “lockdown order” definition has been met for the territories listed above and has made a recommendation to the Governor in Council. The Order, made pursuant to section 3 of the Act, designates Yukon and Northwest Territories as lockdown regions and allows workers who meet the eligibility requirements in these territories to receive lockdown benefits under the Act from December 19, 2021, to the Saturday of the week in which the lockdown measures end.
Consultation
Members of Parliament and Senators have examined Bill C-2, An Act to provide further support in response to COVID-19, as part of the legislative process and asked witnesses to provide their views on aspects of the CWLB contained in the legislation, including the process to designate lockdown regions. Generally, members acknowledged the need to continue providing financial supports to workers during the ongoing COVID-19 pandemic, particularly with the emergence of the Omicron variant. Some questions and concerns were raised with respect to the administration and post-verification methods of the past benefits, i.e. the Canada Emergency Response Benefit (CERB) and the Canada Recovery Benefit. An amendment was made to the Bill requiring the Auditor General to complete a performance audit of the Act, one year following royal assent.
The CWLB has received public and media attention since it was announced on October 21, 2021. Initial reaction was primarily neutral and factual. There was some reaction to the announcement that the benefit would not be available to those who lost work due to non-compliance with their employer’s vaccination policies. Currently, the majority of Canadians strongly or somewhat support COVID benefits. iPolitics reported a new poll by Mainstreet Research that found that about one third of Canadians are strongly in favour of keeping the COVID supports in place, while one quarter are somewhat in favour. Another quarter are strongly opposed, while 16% are somewhat opposed. footnote 1
On December 22, 2021, the Government of Canada announced its intention to temporarily expand eligibility for key support programs, including the CWLB, to ensure Canadians are protected, and workers get the financial support they need to sustain them through the new public health restrictions.
The Order responds directly to the continuing and extraordinary economic circumstances posed by the COVID-19 pandemic. These measures need to be in place expeditiously to be effective. Consequently, consultations were not undertaken and the Order was granted an exemption from prepublication in the Canada Gazette, Part I.
Cost-benefit analysis
The proposal directly supports the Government of Canada’s response to COVID-19 and the analytical requirements for cost-benefit analysis have been adjusted to permit a timely and effective response.
The program costs for designating each of the provinces as a lockdown region is estimated to be the following:
| Region | Cost estimate in billions (low) | Cost estimate in billions (high) |
|---|---|---|
| Yukon | 0.006 | 0.013 |
| Northwest Territories | 0.006 | 0.014 |
| Total | 0.012 | 0.027 |
The higher end of the range of the cost estimate is calculated as two weeks multiplied by the labour force size (in 2016) in the territory (designated region), multiplied by the weekly benefit rate ($300). The low end of the range of the cost estimate is the high end of the cost estimate multiplied by the percentage of the Canadian labour force that applied for the CERB during the time it was available (44%).
Benefit periods begin on the Sunday of the week in which the lockdown measures began to apply in the designated region and will end on the Saturday of the week in which those measures cease to apply in the designated region. The program cost estimates do not reflect lockdowns continuing beyond a two-week period; however, it is possible that the lockdowns in one or both of these regions will continue beyond that date. The regions will remain designated as lockdown regions until the Saturday of the week in which the lockdown measures cease to apply in the region and these forward-looking scenarios are not reflected in the estimates.
Estimates for administrative costs for the Canada Revenue Agency (CRA) are not available.
All of the program and operating costs will be sourced from the Consolidated Revenue Fund (CRF), until March 31, 2026, in accordance with section 29 of the Act.
Health benefits
The Order is also expected to have some health benefits related to mitigating the spread of COVID-19. Monetizing the health benefits is difficult, in part due to the uncertainties regarding the path of the pandemic, the frequency that public health lockdowns will be introduced and their duration. However, it is likely that the monetized value of these benefits would be significant.
Indirect economic benefits
The additional income supports to individuals who, because of the lockdown order, are unable to work and would otherwise have no or reduced income will provide indirect economic benefits that arise from the spending of these income supports in the economy. This spending will likely help keep some self-employed individuals and businesses, who would have experienced revenue loss or which would have otherwise had to close, operational during and after the lockdown. This in turn will likely assist with accelerating the economic recovery coming out of the lockdown. In addition, access to the additional income supports could have indirect societal impacts by reducing the risk of homelessness or childhood poverty.
Small business lens
Analysis under the small business lens concluded that the Order will not impact Canadian small businesses. No regulatory administrative or compliance burden on small businesses has been identified.
One-for-one rule
The one-for-one rule does not apply, as there is no incremental change in administrative burden on business.
Regulatory cooperation and alignment
The Order does not have implications for international agreements (trade, environmental, human rights, etc.) obligations, or voluntary standards. It is not aimed at minimizing or reducing regulatory differences, nor at increasing regulatory compatibility with another jurisdiction. It does not introduce specific Canadian requirements that differ from existing regulations in other jurisdictions for an international program. It does not seek to enable regulatory alignment with the United States as committed to under the Joint Action Plan for the Canada-United States Regulatory Cooperation Council.
Implementation
Health Canada and the Public Health Agency of Canada monitor and report on the COVID-19 pandemic across Canada and will support and inform Employment and Social Development Canada on the current public health restrictions across the country. This information will assist the Minister in making a recommendation to the GiC to designate a region as a lockdown region.
The CRA administers and enforces the recovery benefits programs and the CWLB on behalf of the Government of Canada and will utilize the same systems and processes for the CWLB as were used for the administration of the recovery benefits. The CRA already has the infrastructure in place and the processing system is prepared to allow the CWLB benefits to be paid.
Existing implementation and enforcement mechanisms contained in the CRA’s adjudication and controls procedures will ensure proper implementation. These include for instance, functionality to perform client accounting, withholdings, issuance of tax slips to applicants, support for individual eligibility and entitlement, tax assessment activities, and support for post-payment compliance and verification activities.
The Order comes into force upon registration.
Contact
George Rae
Director
Employment Insurance Policy
Skills and Employment Branch
Employment and Social Development Canada
140 Promenade du Portage, 7th Floor
Gatineau, Quebec
K1A 0J9
Email: george.rae@hrsdc-rhdcc.gc.ca