Securing Wages & Vacation Pay
Source: Canadian Labour Congress
Published: July 9th 2008

Every year, Canadian workers lose from $36 to $50 million in unpaid wages and vacation pay because their employer files for bankruptcy. Combined with the loss of a job and future income, this can be a devastating blow for any working family.

Thanks to some persistent and focussed political advocacy, and the hard work of countless union activists, there's good news for everyone who worries about what could happen to them if the boss goes bankrupt.

The Canadian Labour Congress has won an important new program that offers working people a better deal. Starting this summer, the Wage Earner Protection Program (WEPP) will offer immediate payment of lost wages and vacation pay owed to workers for up to six months before their employer declared bankruptcy.

On July 7, the Minister of Labour, Jean-Pierre Blackburn held a news conference together with Hassan Yussuff, Secretary-Treasurer of the Canadian Labour Congress to announce that the WEPP was up and running.

How it works

The Government of Canada will issue an immediate cheque, for as much as $3,162, and then seek to recover the money from the bankrupt employer. That's right... the government will stand in line with the banks and other creditors, instead of you.

Over time, the amount of lost wages and vacation pay workers can recover through the WEPP will rise, as the current $3,162 is indexed to inflation. Thanks to some extra pressure from the CLC, a proposed three-months-on-the-job-to-qualify rule has been removed from the program's regulations.