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2. General Overview

Protecting Worker's Wages

The Wage Earner Protection Program

The Wage Earner Protection Program (WEPP) is a Government of Canada program that provides timely payment of eligible wages owing to workers who lose their job because their employer has gone bankrupt or become subject to receivership. Eligible wages under the WEPP include salaries, commissions, vacation pay, termination pay and severance pay.

Eligibility

Workers legally entitled to work in Canada can apply if:

• their employment has ended;
• their former employer is formally declared bankrupt or is subject to a receivership under the Bankruptcy and Insolvency Act; and
• they are owed eligible wages for the six-month period ending on the date of the bankruptcy or receivership.

Workers are generally not eligible to receive a payment in respect of any wages earned during, or that otherwise relate to, a period in which the individual:

• was an officer or a director of the former employer;
• had a controlling interest in the business of the former employer;
• was a manager whose responsibilities included making binding financial decisions impacting the business of the former employer, and/or making binding decisions on the payment or non-payment of wages by the former employer; or
• was not dealing at arm’s length with any of these persons.

The Process

The trustee or receiver assigned to manage the bankruptcy or receivership will provide the applicant with information on the WEPP and on any amounts owed. A proof of claim should be filed with the trustee or receiver as soon as possible. A proof of claim is a written statement indicating the amount believed to be owed. The trustee or receiver can help complete the proof of claim statement.

The application must then be submitted for payment to Service Canada online or by paper application at the nearest Service Canada Centre.

Responsibility of Trustees and Receivers

Trustees and receivers have the responsibility to:

• identify workers who are owed wages;
• determine the amounts owed to workers;
• inform workers of the existence of the WEPP; and
• provide Service Canada and applicants with information necessary to establish eligibility for payment.

Applications must be submitted to Service Canada within 56 days of the date of bankruptcy or receivership. Extensions may be granted for good reason.

Maximum Payment

The maximum amount that can be received under the WEPP is an amount equalling four weeks maximum insurable earnings under the Employment Insurance (EI) Act (currently $3,323), less the source deductions that would normally have been applied to the pay.

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Date Modified:

2011-10-05