Ottawa has announced a new program to help large employers maintain their employment levels, avoid bankruptcy, and position for a fast economic recovery.
"We know that many businesses of all sizes need our help in order to keep many of their employees on the payroll and their suppliers paid until the economy recovers," said Prime Minister Justin Trudeau.
A release from the federal government said the Large Employer Emergency Financing Facility will provide bridge financing and will be open to companies in all sectors.
"But let me be clear," said Trudeau. "These are bridge loans, not bailouts."
The help comes with strings attached. Companies will undergo an assessment of their employment, tax, and economic activity in Canada and abroad. Companies with prior tax evasion convictions need not apply, and there are strict limits on share buy-backs, dividends and executive payouts.
"If a company wants to access this tax-payer funded financing in order to protect employees across the country, the money has to go to support those employers and not high-paid executives. That's a condition," Trudeau stated.
Recipients will have to respect collective bargaining agreements, leave worker pensions alone, and publish annual reports on how they intend to address climate change.
The Canada Development Investment Corporation will deliver the program in cooperation with Innovation, Science and Economic Development Canada and the Department of Finance, and it will be open to businesses in all sectors with annual revenues of $300 million or more.
The Business Credit Availability Program will expand, so mid-sized companies with larger financing needs can apply for loans of up to $60 million per firm and guarantee financing up to $80 million.
"We know that Canadian workers and companies of all sizes are facing economic hardship and uncertainty," said Minister of Innovation, Science and Industry Navdeep Bains. "The measures we are announcing today will add to the supports currently available to large employers in Canada to help them weather the storm."
Last week, Trudeau announced his company is also extending the Canada Emergency Wage Subsidy beyond June.
The government is in the final stages of establishing the Large Employer Emergency Financing Facility and information about the application process is expected to be released soon.
Ottawa is also allowing businesses to defer all Goods and Services Tax/Harmonized Sales Tax payments until June to help ease cash-flow.
