The Wage Earner Protection Program (“WEPP”) provides guaranteed and timely compensation of up to $3,400 in 2011 to workers for unpaid wages, vacation pay, and severance and termination pay earned in the six months preceding an employer’s bankruptcy or receivership.
The Wage Earner Protection Program (“WEPP”) was expanded, effective December 15, 2011 to give further protection to cover employees who lose their jobs when their employer’s attempt at restructuring is unsuccessful and ends in bankruptcy or receivership. The enhanced protection is estimated to provide an additional $4.5 million annually in support to workers affected by the bankruptcy or receivership of their employer.
The Implementation Act (once in force), will provide for the following modifications to the WEPPA:
• The modification to the WEPPA will be effective for bankruptcy and receivership proceedings commenced after June 5, 2011;
• The WEPP will be extended to include both proposals proceeding commenced under Division I of Part III of the Bankruptcy and Insolvency Act (“BIA”) and proceedings commenced under the Companies’ Creditors Arrangement Act (“CCAA”); and
• The definition of WEPP eligible wages by the WEPPA will be extended for the periods of:
o six months prior to the commencement of the proposal proceeding under the BIA and, ending on the date of the bankruptcy or the receivership of the employer; and
o six months prior to the beginning of the proceedings under CCAA and, ending on the date of the bankruptcy or the receivership of the employer.
Should there be any questions regarding the foregoing, we encourage you to call Service Canada at 1 866 683-6516.