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She had two jobs. With CEWS, she’s getting only one of them back but losing all her CERB

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Thanks to the Canada Emergency Wage Subsidy (CEWS), Kathleen Lanphere is getting back one of the two jobs she lost amid the novel coronavirus pandemic. But that will leave her worse off, financially, than she was before.

That’s because Lanphere, a Newmarket, Ont.-based dental hygienist, will likely become ineligible for the Canada Emergency Response Benefit (CERB), which pays $2,000 a month to Canadians who’ve lost all or most of their income due to COVID-19.

READ MORE: CEWS vs. CERB — How the two benefits fit together and who may have to return payments

Lanphere says she’ll receive less than $2,000 through the CEWS but more than the $1,000 income threshold that would allow her to stay on the CERB. Worse, she’ll now probably have to pay back much of the CERB money she already received.

“Normally this is a good thing for people because they’re going to be paid more than the CERB and they’re staying on payroll,” Lanphere says. “But because I only work part time, it is, in fact, doing the opposite (for me).”

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Employers are also concerned about the potential unintended financial impacts of the CEWS-CERB overlap, said Joe Figliomeni, tax manager at Vaughan, Ont.-based Fazzari + Partners.

“They don’t want to obviously impact the employees’ ability to get CERB,” Figliomeni says. “That’s a big factor for a lot of employers.”

The CEWS, a much more complex program than the CERB, covers 75 per cent of employee wages for eligible businesses that saw dramatic declines in revenue after governments mandated widespread shutdowns in an effort to curtail the spread of the virus.

READ MORE: Adding ‘insult to injury’ — Canadians stuck on CERB payments get government email prompt

The subsidy is capped at $847 per week per worker for a period of up to 12 weeks, starting retroactively on March 15 and ending on June 6.

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Applications for the CEWS opened April 27, three weeks after the April 6 rollout of the CERB, whose eligibility period also starts on March 15.

The federal government has said it hopes many Canadians who are currently receiving the CERB will move to the CEWS as employers hire them back. Ottawa said the wage subsidy is meant to help put workers back on payroll so businesses will quickly be able to resume activity as the economy gradually reopens.

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But the rules clearly state workers cannot receive funding from both programs at the same time.

“It is one or the other,” Prime Minister Justin Trudeau said on the day the CEWS launched.

Workers who are retroactively hired back for periods for which they have already received the CERB may have to pay back at least some of the benefits to the government, Figliomeni says.

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To be eligible for the CERB, Canadians must have earned no more than $1,000 for at least 14 consecutive days within the first four-week period for which they claim the benefit. For subsequent claims, they must have income of no more than $1,000 for the entire four-week period.

READ MORE: 6 ways to trim your budget when you think you’ve already cut spending to the bone

That leaves Lanphere, who will receive more than $1,000 per month through the CEWS, in a tough financial spot.

Lanphere, who worked at two dental offices, was laid off from both jobs on March 15, the same day the Royal College of Dental Surgeons of Ontario issued a strong recommendation that all non-essential dental services be immediately suspended.

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With the CEWS, she says she’ll receive less than she’s been getting through the CERB or than what she would be entitled to through regular unemployment insurance.

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She believes she can’t decline to go on the CEWS, as that would also make her ineligible for the CERB, which isn’t available for those who voluntarily quit their job.

At the same time, she says, she cannot return to work as a dental hygienist.

READ MORE: Applying for the Canada Emergency Student Benefit? Here’s what you need to know

While one of her employers is putting her back on the payroll, she isn’t going to work for now. The CEWS allows employers to re-hire employees even while they remain off the job.

Lanphere says she’s worried about paying her rent and bills, even as her husband is able to work from home.

“Luckily, I’ve been able to use my savings,” she says. “But, you know, savings can only go so far.”

The quick roll-out of massive emergency aid programs means “we’re sacrificing good policy design for speed,” says economist David Macdonald of the Canadian Centre for Policy Alternatives.

“We’re getting money into most workers’ pockets at the expense of some workers who will fall through the cracks as these programs overlap and are implemented and the rules change week to week.”

Often, lower-income and part-time workers are the ones who bear the brunt of this, because it’s more difficult for policymakers to envision and take into account their particular circumstances, Macdonald says.

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“These programs are probably much more straightforward for someone who’s working full time for a year,” he says.

Macdonald called for the development of an ombudsman-like authority that would review individual circumstances where Canadians may be feeling the impact of the unintended effects of these policies. Some workers caught in the CEWS-CERB overlap likely should pay back only part of the CERB payments they’ve received, he adds.

The Department of Finance did not respond to a request for comment by publication time.

Lanphere, for her part, says she understands that her employer’s hands are tied. She also believes her situation is an unintended side-effect of the interaction between the two financial aid programs.

However, she says, she thinks it’s important to flag the problem.

“This has to be happening to other dental hygienists or even just other workers.”