Compliance snapshot — Canada Emergency Wage Subsidy for businesses
The Canada Emergency Wage Subsidy (CEWS) was introduced at the onset of the COVID-19 pandemic to assist businesses with maintaining their workforce by partially offsetting their payroll-related costs.
At its height, the CEWS supported over 5 million employees across Canada:
- Over $100 billion in CEWS support was provided to 460,000 employers
- 100% of CEWS applications went through an automated pre-payment validation, where claims of concern were reviewed manually to ensure eligibility
The CEWS application periods are now closed, however post-payment verification activities of the subsidies paid are currently underway. Key results on this page will be updated regularly.
Ensuring compliance with the CEWS
To ensure the integrity of the COVID-19 support programs for businesses, the CRA developed a comprehensive compliance program which consisted of many activities, including automated validation criteria, manual pre-payment verification and post-payment verifications.
There were two post-payment verification programs developed to identify and address potential non-compliance with the CEWS program:
- Post-payment validations: Project-based reviews based on claims with specific risk indicators
- Post-payment audits: Comprehensive reviews based on claimants that demonstrated the highest-risk of non-compliance
These two compliance programs are undertaken using a risk-based approach that aligns with international best practices and existing compliance programs.
The following table includes preparer-linked CEWS claims (see below for more information).
| Description | Number of claimantsFootnote 2 | Claim amounts |
|---|---|---|
| Total verifications (in progress and completed)Footnote 3 | 52,794 | $18.9B |
| Total verifications completed | 51,180 | $15.9B |
| Post-payment audits | 4,664 | $14B |
| Post-payment validations | 46,516 | $1.9B |
| Amounts approved | $15.1B | |
| Total amounts reduced in part and denied in full | $810M | |
| Amounts reduced in partFootnote 4 | $501M | |
| Amounts denied in full (ineligible recipients)Footnote 5 | 1,959 | $309M |
| Penalties applied (gross negligence) | $30M | |
| Amounts approved (%) | 95% |
Preparer-linked CEWS claims (as of June 30, 2024)Footnote 1
The CRA has identified some aggressive non-compliance where claimants are suspected to have used certain third-party business subsidy preparers who knowingly facilitated the production of inaccurate or willfully non-compliant claims. These cases are being pursued by the CRA through post-payment audit activities and are also included in the table above.
| Description | Number of claimantsFootnote 2 | Claim amounts |
|---|---|---|
| Total audits (in progress and completed)Footnote 3 | 1,681 | $155M |
| Total audits completed | 651 | $81M |
| Amounts approved | $14M | |
| Total amounts reduced in part and denied in full | $68M | |
| Amounts reduced in partFootnote 4 | $9M | |
| Amounts denied in full (ineligible recipients)Footnote 5 | 461 | $59M |
| Penalties applied (gross negligence) | $17M | |
| Amounts approved (%) | 17% |
For more detailed information on the CEWS post-payment audit program activities, including a comprehensive breakdown of results as of March 31, 2023, please read Canada Emergency Wage Subsidy – Post-payment audits. Note that the data presented in this report represents a specific point in time and is not updated regularly.
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