In order to provide an estimate of the savings to the average brokerage in Ontario, some assumptions were made about the brokerage model. A staff of 6 permanent employees was used with 5 support staff at $45k/year and 1 managerial staffer at $90/k year. The brokerage was assumed to have 50 REATLOR® agents that are all independent contractors. The brokerage was also assumed to have an annual net revenue of between $800,000 and $1.2 million net of commission to REALTORS® and before overhead or expenses were included.
Companies which are not eligible for the Canada Emergency Wage Subsidy can access the Temporary Wage Subsidy for Employers, which provides a 10% wage subsidy for 3 months. The measure allows eligible employers to reduce the amount of payroll deductions required to be remitted to the Canada Revenue Agency.
The subsidy is equal to 10% of remuneration paid from March 18, 2020 to June 19, 2020, up to $1,375 for each eligible employee and to a maximum of $25,000 per employer.
In our model, the average brokerage has 5 employees at $45,000/year and 1 employee at $90,000 a year. It would breakdown as follows:
- Monthly payroll of $24,223. The wage subsidy would be 10%, or $2,422 a month. Over the 3-month period, 10% of remuneration is $7,266. As it is below the maximum allowable amount, the total wage subsidy would be $7,266.
Average Brokerage = Providing real savings of up to $7,266 over 3 months per brokerage (if ineligible for the Canada Emergency Wage Subsidy)