When a company faces bankruptcy or enters receivership, employees often find themselves struggling to recover unpaid wages, vacation pay, severance, or termination pay.
Fortunately, Canada’s Wage Earner Protection Program (WEPP) offers a safety net for eligible workers. In 2025, workers can receive up to $8,844 to cover unpaid earnings.
This guide explains who qualifies for WEPP, how much you can receive, the application process, and common mistakes to avoid.
Overview of WEPP in 2025
| Topic | Details |
|---|---|
| Maximum Payment (2025) | $8,844 |
| Covers | Wages, vacation pay, termination pay, severance pay |
| Eligibility | Employees of bankrupt or insolvent employers |
| Application Deadline | Within 56 days of termination or bankruptcy |
| Application Method | Online or paper via Service Canada |
| Taxable | Yes, it is taxable (you will receive a T4A slip) |
| More Information | Canada.ca – WEPP |
What is the Wage Earner Protection Program (WEPP)?
The WEPP is designed to help workers collect unpaid wages when their employer goes bankrupt or enters receivership. If you lose your job and are owed earnings, the program can provide financial relief.
The maximum payment in 2025 is $8,844, which is equivalent to seven times the maximum weekly insurable earnings under Employment Insurance (EI) rules.
The program covers the following:
- Unpaid wages
- Vacation pay
- Termination pay
- Severance pay
Eligibility Criteria
To qualify for WEPP, workers must meet the following criteria:
Employer Status
- Your employer must be bankrupt, in receivership, or undergoing another form of federal insolvency proceeding.
Employment Status
- You were terminated due to your employer’s insolvency, or
- You were terminated within six months prior to the bankruptcy or receivership.
Amount Owed
- You must be owed wages, vacation pay, or termination/severance pay for work done within the six months before the employer’s insolvency.
Exclusions
You are not eligible if you were:
- An officer or director of the company.
- A person with controlling interest.
- Responsible for financial decisions impacting wage payments.
How Much Can You Receive?
The maximum WEPP payout for 2025 is $8,844. The actual amount depends on what you are owed but will not exceed this limit. Here’s an example:
- If you are owed $3,000 in unpaid wages and $2,000 in vacation pay, you can receive the full $5,000, as long as it falls within the six-month window and under the $8,844 cap.
Application Process for WEPP
Here’s a step-by-step guide on how to apply:
- Step 1: Trustee’s Role
- Your employer’s trustee or receiver must submit a Trustee Information Form (TIF) to Service Canada to start the WEPP process.
- Step 2: Submit Proof of Claim
- You must submit a Proof of Claim to the trustee or receiver, detailing the wages and benefits you’re owed. This must be done before you can apply for WEPP.
- Step 3: Apply Within 56 Days
- You must apply within 56 days of one of these events:
- Bankruptcy/receivership date
- Termination date
- Date all employees were terminated
- You must apply within 56 days of one of these events:
Common Mistakes to Avoid
Missing the Deadline
- Missing the application deadline will make you ineligible for WEPP. Make sure you apply within 56 days.
Incorrect Information
- Double-check your Proof of Claim. Errors in wage data can delay or block your payment.
Not Tracking the Application Status
- Stay in touch with your trustee and monitor your Service Canada account for updates on your application status.
What Happens After You Apply?
If your application is approved, the payment will be sent via direct deposit or cheque. You will receive a T4A slip for tax purposes, and you must report the WEPP amount as taxable income on your next tax return.
Is WEPP Enough?
While WEPP provides vital financial relief, it may not cover all your losses if you were owed large severance or bonuses. It’s advisable to consult with a legal or financial professional for further assistance in seeking additional compensation.
The Wage Earner Protection Program (WEPP) offers critical support for workers facing financial hardship due to employer bankruptcy or insolvency. Eligible workers can receive up to $8,844 in unpaid wages, vacation pay, severance, and termination pay. Be sure to apply within the 56-day deadline and avoid common mistakes to ensure timely relief.
FAQs
How do I apply for WEPP?
You can apply online through the Service Canada website or submit a paper form. Be sure to submit your Proof of Claim first.
How much can I receive through WEPP in 2025?
You can receive up to $8,844, depending on how much you are owed in wages, vacation pay, and severance.
Are WEPP payments taxable?
Yes, WEPP payments are considered taxable income, and you will receive a T4A slip for your tax return.