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Should I Return to Work or Stay on CERB?
I’m currently collecting the Canadian Emergency Response Benefit (CERB) and have been offered my job back/I have been offered a new position, should I return to work or continue to collect the CERB?
This is a complicated question that requires a bit of analysis based on each individual circumstance. I encourage everyone to seek professional advice from a Chartered Professional Accountant to discuss your personal situation. It is important to determine what is the best option for you and your family.
The short answer is that in most situations, returning to work is the right answer. Morally we have a responsibility to help the Canadian economy by returning to work if we have the opportunity to do so. COVID-19 has drastically impacted many businesses which has led to a record increase in unemployment across the country. Many people will not have the opportunity to return to their place of work, so you should recognize that you are fortunate to have this employment opportunity. From a fiscal responsibility perspective, it is important to recognize that the CERB benefit was originally available for a maximum of 16 weeks then extended by an additional 8 weeks. If you decline an offer to return to work, who knows if that opportunity will still be available for you when you have reached the maximum 24 week benefit.
It is important to secure employment sooner than later, because after 24 weeks, you and many Canadians will be vying to obtain employment in a very saturated job market. Acquiring ongoing employment now provides better security for you from a long term perspective.
The long answer to this question requires some specific analysis of your individual situation. First you need to determine if you are being offered a new opportunity or are being recalled from a furlough. If you are being recalled from a furlough, and you decline to return to work, this in effect will void your eligibility to receive any future CERB payment. Refusing to return to work is deemed as an employee quitting their job. One of the specific requirements for the CERB is that you have not quit your job voluntarily.
It is important to recognize that the CERB benefit program was rolled out very quickly and the government has taken the position that they would rather put the money in the hands of Canadians now, and audit for eligibility when the dust settles. This means that you may have indeed received a benefit for the CERB when you were truly not entitled to it.
Receiving a benefit that you are not entitled to will likely result in you having to return all those funds, plus you could potentially be liable for additional penalties. The government has made it very clear that they intend to actively target people who have taken advantage of any government subsidies. Then government has announced the audit process and the hefty fine up to $5,000 and jail time they may assess for fraudulent CERB applications. This is a risk I would not personally be comfortable taking. If you have any opportunity to return to work, I strongly encourage you to seize the opportunity at hand.
If you have not been furloughed and have been offered a new job opportunity, the decision to return to work may be more complicated. The first thing you should look at is how many weeks of CERB benefit would you be giving up by returning to work. Given that the initial CERB benefit was available as of March 15th and is available for a maximum of 24 weeks, you may be giving up as little as a few weeks of potential CERB benefit. More importantly, if you choose not to return to work you may be giving up substantially more by not taking advantage of the opportunity in front of you. My personal belief is that when the dust settles there may be still substantial unemployment as a result of the overall effect of COVID-19. Over and above this there is a moral obligation to not take advantage of government subsidies that you do not truly require.
For those that are truly in need the Canadian Emergency Response Benefit you may view our step by step guide on how to apply for the CERB at https://cpa4it.ca/cerb-walk-through/. However, before you apply please thoroughly review the questions and answers on the Canadian Emergency Response Benefit posted by the CRA. As a reminder this program is available to workers:
- Residing in Canada, who are at least 15 years old;
- Who have stopped working because of reasons related to COVID-19 or are eligible for Employment Insurance regular or sickness benefits or have exhausted their Employment Insurance regular or fishing benefits between December 29, 2019 and October 3, 2020;
- Who had employment and/or self-employment income of at least $5,000 in 2019 or in the 12 months prior to the date of their application; and,
- Who have not quit their job voluntarily.
When submitting your first claim, you cannot have earned more than $1,000 in employment and/or self-employment income for 14 or more consecutive days within the four-week benefit period of your claim.
When submitting subsequent claims, you cannot have earned more than $1,000 in employment and/or self-employment income for the entire four-week benefit period of your new claim.
Provided it is allowed in your province or territory, you may also receive provincial or territorial support payments at the same time you receive the Canada Emergency Response Benefit.
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