Click here to view this message in a browser window.

    

 

October 19, 2021

Your CFA Update on COVID-19

Join us for Franchise Awareness Days (virtual) – November 17,18 and 22

Join Canada's leading franchisers and the CFA by being part of Virtual Franchise Awareness Day.

By educating politicians and policymakers, you can help protect your business, your franchisees, and the franchise business model in Canada.

REGISTER HERE

Canadian firms see inflation staying high amid record confidence

Canadian business sentiment rose to record levels in the third quarter, though inflation expectations are elevated and labor shortages are getting worse, according to a Bank of Canada survey.

An easing of COVID-19 restrictions has driven a sharp improvement in business confidence, with executives in the quarterly survey citing a strong outlook for domestic and foreign sales. A broad gauge of business sentiment reached its highest level in records going back to 2003.

Still, businesses say a lack of available workers and supply-chain bottlenecks are hurting their ability to meet demand. That’s driving inflation expectations higher: 45 per cent of firms anticipate inflation will be above 3 per cent over the next two years.

“Most firms continue to anticipate healthy growth in both domestic and foreign demand, although for those offering hard-to-distance services this means recovering from low levels,” the bank said in the summary of its findings.

The report adds to evidence that firms are facing challenges meeting robust demand in the aftermath of pandemic lockdowns. More than half of firms said capital expenditures over the next two to three years will be higher than before COVID-19 hit.

David Doyle, head of North America strategy at Macquarie Group, expressed some caution about that data point, given the private sector’s subdued investment in machinery and other productivity drivers over the past decade. “It’s encouraging to see those intentions,” Doyle said on BNN Bloomberg Television. “I’ll be even more encouraged once we see that in the data.”

Bonds initially rose on the report, then dropped. The 10-year benchmark was trading at 1.609 per cent as of 11:28 a.m. In Ottawa, about 2 basis points higher than Friday’s close.

A separate survey of consumer expectations also showed Canadians also expect inflation above 3 per cent over the next couple of years. Both firms and consumers largely expect the high inflation levels to be transitory, as shortages ease.

 

Other highlights in the reports include:

·         Businesses expect the supply chain issues to last until the second half of 2022

·         Companies say they are likely to raise wages to address labor shortages

·         Capacity pressures are widespread with a large portion of firms saying they would have difficulty meeting an unexpected spike in demand

·         Canadians who accumulated savings during the pandemic expect to spend about one-third of the funds by end of 2022

·         Consumer have more confidence in the labor market, with an increase in the likelihood of leaving a job voluntarily versus before the pandemic

The surveys, along with September inflation figures due Wednesday, are the last major data points before policy makers led by Governor Tiff Macklem release the Bank of Canada’s next decision on Oct. 27.

The benchmark overnight interest rate has been on hold at 0.25 per cent since March 2020. No move is expected next week, though Macklem will likely reduce the bank’s weekly purchases of Canadian government bonds to $1 billion (US$809 million) from the current pace of $2 billion. Overnight swaps trading now suggests markets are pricing in at least three rate hikes over the next 12 months.

Despite the soaring inflation expectations, the bank asked a special question on what’s driving the price gains. The majority of firms said they will be temporary.

Ontario to tighten rules for temp agencies, firms that recruit foreign workers

The Ontario government is introducing legislation that would require temporary help agencies (THAs) and recruiters to have a licence to operate in the province. The proposed changes would enable officers to levy penalties against an unlicensed THA or recruiter or a business who is using an unlicensed operator.

Ontario is also proposing to hire a dedicated team of officers to crack down on THAs and recruiters who are exploiting and trafficking domestic and foreign workers. Recent inspections by ministry officers have shown that there are multiple temporary help agencies in Ontario that are illegally paying people below the minimum wage and denying other basic employment rights. In doing so, they gain an unfair competitive advantage over law-abiding agencies by undercutting rates.

“ACSESS strongly endorses the establishment of a licensing regime ensuring that all temporary help agencies comply with their legal obligations,” said Mary McIninch, Executive Director, Government Relations of the Association of Canadian Search, Employment and Staffing Services. “This initiative creates a level playing field and results in a fairer industry for THAs, their clients and assignment employees alike. We applaud the government for taking a bold approach that includes enforcement initiatives against THAs that operate illegally and the client companies that use them.”

Under the proposed legislation, THAs and recruiters would be vetted before being issued a licence to operate. Applicants would need to provide an irrevocable letter of credit, that could be used to repay owed wages to workers. Penalties could be issued against unlicensed agencies and recruiters as well as the companies who use them, with proactive inspection measures to ensure compliance with applicable requirements. If the legislation is passed, the government intends to require licences as early as 2024.

Ontario's vaccine verification app for businesses now available

Ontario's vaccine verification app for businesses, Verify Ontario, appears to be ready for download ahead of schedule, rolling out on the Google and Apple app stores Thursday afternoon.

According to its description, the app gives businesses and organizations the ability to scan the QR codes on province-issued vaccine certificates. After the code is scanned, a green checkmark will appear indicating a valid vaccine certificate, a red X for an invalid certificate or a yellow warning for a QR that cannot be read. 

The province had said it would release a digital verification app by Oct. 22, giving people a "safer, more secure and convenient" way to demonstrate that they've been vaccinated, according to the province. 

Ontarians still have the option of using paper vaccine receipts to prove their vaccination status.

The app description says it also scans most government-issued QR codes from B.C. and Quebec, and that nation-wide capabilities are "in development." It also says it does not request users's specific locations or collect information linking visitors, businesses or locations together.

Ford is set to speak about the enhanced vaccine certificate and verification app Friday morning.

Header: Growth & Exit

Thursday October 28, 2021 | Virtual Event | 12pm to 3pm EST

REGISTER NOW

This annual event will update franchisors, multi-unit franchisees and their owners on the state of the market and educate them on the right things they can do now and, in the future, to ensure that they are in the best position to maximize the value of their business and take advantage of the opportunities presented by one or more of these growth and exit strategies.  It is also designed to create a space to connect directly with Canadian and American potential investors and buyers, and for them to connect to the franchise community.

Growth & Exit: John DeHart

Liberals considering whether to extend expiring pandemic supports for businesses, individuals

A number of the federal government's pandemic supports for individuals and businesses are set to come to an end this week. Most of them can still be extended for the short term without introducing new legislation.

Deputy Prime Minister and Finance Minister Chrystia Freeland told CBC's The House in an interview that aired Saturday that the reopening of the Canadian economy is going well and that the country is in a different phase of the pandemic. "I was very happy about last week's job numbers, and it is the case that we are reopening, so this is a different phase from the phase we were in when those programs were put in place. And we're working now on what's appropriate for the conditions today," Freeland told host Chris Hall.

She said she was consulting with economists, business and labour groups, her department and Prime Minister Justin Trudeau on the appropriate next steps, but she also noted that there remains significant uncertainty about the future. "We have to remember that all of us collectively in the whole world have been really bad at predicting exactly the course that the coronavirus would take. So we also have to have an approach which is sufficiently flexible that we can respond to unpredicted developments," she said.

Write to Minister Freeland to get her to extend the CEWS, CERS and the repayment deadline for the CEBA loan forgiveness

Extend the CEWS and CERS

Extend the repayment deadline for CEBA loan forgiveness

Thank You to Our Advocacy Champions
Click Here to Donate to CFA Advocacy

Sugary drink tax coming to Newfoundland next September, says finance minister

The Newfoundland and Labrador government plans to implement a tax on sugar-sweetened beverages next year, Finance Minister Siobhan Coady announced Tuesday.

The new tax is expected to raise about $9 million annually, though Coady framed the new tax as a way for the government to encourage healthy choices.

"Our goal is to encourage residents to switch to healthier beverage choices, resulting in long-term health gains for our province," she said at a media briefing Tuesday.

Announced in the 2021 provincial budget, the new tax will be 20 cents per litre and, if the legislation is passed, will come into effect Sept. 1, 2022.

Coady said the tax is not meant to affect distributors or businesses and is supported by health organizations, including the Canadian Cancer Society.

The tax will apply to many ready-to-drink, concentrated and dispensed beverages. Those beverages include bottled soda, sports and energy drinks, fruit-flavoured drinks, frozen concentrated juices, flavoured powders, syrups, soda fountain drinks and slushies.

There are some exceptions to the new tax, including diet beverages, 100 per cent natural fruit and vegetable juices, ingredients primarily used in cooking and beverages prepared for the consumer at the point of sale — at coffee shops, for example.

Alcoholic beverages, medical and therapeutic beverages, milk — including chocolate milk — and yogurt beverages, beverages in containers less than 75 millilitres and fortified plant-based drinks are also exempt from the tax.

In a statement following the briefing, PC opposition member Tony Wakeham called the tax "regressive," saying it would harm low-income earners. "We need to invest in health-care measures that can inform better consumer choices, not penalize those already struggling to make ends meet," he said. Wakeham also said he's heard concerns from small-business owners who may be affected by the new tax.

PEI review of Employment Standards Act is underway

A thorough review of the Employment Standards Act is underway to ensure it is current and meets the needs of Islanders across the province. A three-person panel was established to complete the review.

The panel will conduct the review in three stages:

  • conduct background research and meetings with stakeholders, including employer and employee organizations, to identify issues related to the current employment standards;
  • provide an interim report that identifies issues, to be used to help guide a larger public consultation process; and
  • write a final report that makes recommendations to the Minister on changes to employment standards in the Province. 

The last time the Act was reviewed was in 2006. Since then, calls to complete a comprehensive review have been made by several interest groups and the Employment Standards Board. A review is also included as an action item in the Poverty Reduction Action Plan for Prince Edward Island. 

CFA will be participating in the process.

Expect Manitoba's vaccine mandates to remain in place until spring

Access to many businesses and services in Manitoba, granted only to those with vaccination cards or QR codes, should be expected to last until spring, says the province's top doctor. "We have to expect that this would carry us through the typical respiratory virus season. So, through winter into spring," Chief Provincial Public Health Officer Dr. Brent Roussin said on Monday.

The vaccination requirements came into effect Sept. 3 for a wide variety of businesses and services deemed non-essential, such as restaurants, gyms, movie theatres, casinos and nightclubs, as well as indoor and outdoor ticketed sporting events and concerts. It was later expanded to include additional public spaces, such as museums and galleries, while dine-in patrons at food courts were also added to the list.

New Ontario New Business Registry launched

The new Ontario Business Registry replaces an out-dated and inefficient process, providing business owners and not-for-profit operators with direct access to government services, available online 24 hours a day, 365 days a year. Registrations or filings that were previously submitted by mail or fax, taking four to six weeks to complete, can now be done instantly through the online registry. Annual returns can also be completed in the registry, which means corporations can keep all their important filings in one place. Additionally, the new Ontario Business Registry is integrated with the Canada Revenue Agency, enabling the identification of a business or not-for-profit corporation by a single business number, further streamlining administrative processes.

Ontario businesses and not-for-profit corporations can visit Ontario.ca/BusinessRegistry for more information and to access the Ontario Business Registry.

Vaccine mandate coming to House of Commons, MPs rule

Anyone entering the House of Commons precinct—including MPs—will need to be fully vaccinated as of Nov. 22, the Board of Internal Economy has ordered.

According to Speaker Anthony Rota, as of the day the 44th Parliament kicks off, anyone looking to enter the House of Commons precinct will have to be fully vaccinated against COVID-19.

“This requirement will apply to any person who wishes to enter the House of Commons Precinct, including members and their staff, political research office employees, administration employees, members of the parliamentary press gallery, parliamentary business visitors, contractors and consultants,” reads a statement issued after a two-hour closed door meeting on Tuesday.

OUR WEBINARS ARE AVAILABLE ON-DEMAND

Access Recordings
Access Recordings

PRE-REGISTER FOR THE CFA'S CFE PROGRAM

VIEW PAST WEBINARS
ON DEMAND HERE

MORE BUSINESS & CFA RESOURCES
AVAILABLE HERE

GET UPDATES BY REGION
AVAILABLE HERE

COVID-19's impact on the world is creating waves across all sectors and industries.

Every member of the CFA community is dealing with an issue that is affecting the world, our industries, our communities, our businesses, and our people.

We would like to hear from you if you have any topics, issues or questions to navigate turbulent times in order to support you further: 

SUBMIT YOUR TOPIC

Subscribe to the COVID Update

If you would like to subscribe all your franchisees to receive our COVID Update, please contact Alex Mann at amann@cfa.ca

SUBSCRIBE HERE
Forward To a Peer
CFA National Sponsors
     
  
Canadian Franchise Association
116-5399 Eglinton Avenue West
Toronto, Ontario M9C 5K6
Tel: 416-695-2896/800-665-4232
Fax: 416-695-1950
You have received this email from the Canadian Franchise Association (CFA). Click here to update your communication preferences or click here to unsubscribe from all CFA e-mail communications.