TORONTO, Feb. 28, 2019 /CNW/ - "Thousands of Sears Canada employees who are entitled to federal Wage Earner Protection Program payments of up to $7,148 have yet to apply. It's pretty simple: if they don't apply, they won't get the money they're entitled to," says Employee Representative Counsel, Susan Ursel.
"We and the Monitor, which oversees Sears Canada's CCAA proceedings, have sent out notices to eligible employees, posted announcements on our websites, and followed up with email reminders, but over 6600 Sears employees who are entitled to Wage Earner Protection Program payments have not even applied for them yet. And time is running out," said Employee Representative Counsel. "To get their application in, all they have to do is apply online at the Government of Canada website or visit a Service Canada Centre."
The deadline for applications to Service Canada for the Wage Earner Protection Program is March 4, 2019. Late applications may be rejected by the Program and eligible Sears Canada employees have been strongly encouraged to apply as soon as possible.
Over 18,000 Sears Canada employees lost their employment in 2017 when Sears Canada stores and other locations across Canada were closed pursuant to liquidation proceedings for the insolvent company.
But over 15,000 of those employees are entitled to Wage Earner Protection Program payments under the federal statute. While many thousands have submitted applications and received their payments, as of February 24, 2019 there still remain over 6600 employees who have not even applied. These individuals would have received letters from FTI Consulting Canada, the Monitor overseeing Sears Canada's insolvency, advising them they were entitled to these monies.
Wage Earner Protection Program payments can cover up to $7,148.05 in severance and termination payments owing to these employees. Current estimates of recovery from the liquidated company hover around 6 to 8 cents on the dollar for most of the former employees.
"The Wage Earner Protection Program payments represent a significant amount of protection for severance and termination payments owing to these employees," said Employee Representative Counsel. "We are very concerned that anybody who is owed such money not miss out on their opportunity to apply for it. That's why we want to get word out about this."
On January 7, 2019, Sears Canada Inc. and certain affiliates ("Sears Canada") became subject to a limited receivership. As a result, eligible former Sears Canada employees became entitled to receive a payment under the Wage Earner Protection Program ("WEPP").
FTI Consulting Canada Inc. ("FTI") was appointed as the receiver and on or around January 8, 2019, FTI sent 15,573 notices to eligible Sears Canada employees. These notices alerted employees that action was necessary on their part to apply for the WEPP and detailed the process by which employees can apply for the WEPP either online at the Government of Canada website or by visiting a Service Canada Centre.
The notices also specified that applications to the WEPP must be received by no later than March 4, 2019. Although many former Sears Canada employees have submitted their WEPP applications, over 6600 employees have not yet applied.
Ursel Phillips Fellows Hopkinson LLP, Employee Representative Counsel to certain Sears Canada employees in the ongoing proceedings under the Companies' Creditors Arrangement Act, is concerned about the large number of former employees who have yet to apply to the WEPP. Employee Representative Counsel encourages any former Sears Canada employee who received a notice from FTI dated January 8, 2019 regarding the WEPP apply before the March 4, 2019 deadline.