To Work or Not To Work: Is CERB Creating A New Kind of Welfare?

5 min. readbyVexxit StaffonJune 04, 2020
Now that restrictions are being relaxed and many businesses are reopening, many workers are feeling reserved about returning to work. Does it make sense to stay home and continue to collect CERB funds as long as you can? Let's find out.

“If all the year were playing holidays; sport would be as tedious as work,” wrote William Shakespeare. Now that a huge chunk of our society has had a chance to test that theory out, it turns out to be true for some and not so much for others.

Certainly, after more than two months of pandemic lockdown, many people are eager to get back to their jobs and back to normal, whatever that may look like.

When Canada shut down with the rest of the world, millions of people suddenly lost their jobs and a substantial amount of income. The federal government’s response was extraordinary. Canadian Emergency Response Benefit (CERB) payments were issued swiftly, with very few questions asked.

It was a similar story around the world, as The Telegraph writer Alison Pearson marvelled over the British healthcare system, “Amazing what can be achieved when there’s no time for paperwork, protocols or layers of useless management.”

With some eight million Canadians collecting payments, it will be interesting to see if the tap of money closes as swiftly as it opened. The benefit was intended to support “anyone who has been laid off either permanently or temporarily from a job since March 15, or can’t work because they have to take care of their children,” according to Macleans.

Now that businesses are opening again, not everyone is entirely keen to get back to it. There are still fears, still no cure or vaccine, and the risk of catching the virus through community spread is no less than it was in March.

According to Macleans, “With many of the jobs that have opened across the country, such as hairdressing or construction, it’s almost impossible to work and social distance. Staff who are concerned about contracting COVID-19 may want to stay home and continue collecting the $2,000-a-month Canada Emergency Response Benefit (CERB), which they likely applied for when they were temporarily laid off.”

Tempting, right? However, the rules are that if you have a job waiting for you, and you choose not to return to it, you would essentially be quitting – and therefore, no longer eligible for CERB nor employment insurance.

While there may be a few people out there taking more than they should out of the system, there will come a time when the federal tax team is back at their desks and all these matters will get reconciled. If you end up taking more CERB than you rightly deserve, you will need to pay it back.

Regardless, any and all CERB funds are fully taxable, so that must be factored into your overall income and tax planning situation. It’s a year when nothing is normal and more than ever, the sound advice of an accountant can be a saving grace.

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