Wage Subsidy Grant Guidelines 

Wage Subsidy Service Agreement

The Wage Subsidy Service Agreement is the legal document that outlines the funding conditions for centres or agencies receiving wage subsidy. It is the responsibility of the centre or agency to comply with the service agreement. Contact the Manager of Child Care Administration at the County of Wellington Child Care Services if you have any questions about a service agreement or the grant guidelines and procedures.

Purpose of Wage Subsidy

Wage Subsidy is to be used to improve the salaries and non-mandatory benefits of child care staff to enhance staff stability and to make licensed child care more affordable for all parents. Wage Subsidy is to be used to enhance the base salary. Base salaries must be at least minimum wage, as per the Employment Standards Act, 2000. Licensed child care programmes, and special needs resourcing agencies may be eligible for the Wage Subsidy to enhance staff salaries and benefits of employees working in a licensed child care programme and for payments to home child care providers.

Wage Subsidy Policy

The County of Wellington has established a process for managing child care Wage Subsidy including reallocation of available funding to eligible, under funded child care agencies. The County plans for and manages the available Wage Subsidy funds in a manner that:

  • Is within contracted funding levels
  • Is consistent with stated government priorities and policy directions
  • Is consistent with negotiated service contracts
  • Meets service targets and standards of quality
  • Is applied to increases in services
  • Establishes and maintains a waiting list of wage subsidy pressures that may arise as a result of new programmes opening or expansions of services
  • Balances funding between the for-profit and non-profit sectors based on a formula approved by Wellington County Council
  • Increases stability within the child care sector.

Wage Subsidy Eligibility

There are two types of Wage Subsidy funding:

  • Wage Subsidy
  • Wage Improvement

The following is a list of positions may be eligible for Wage Subsidy:

  • Trained and untrained Programme Staff
  • Supervisors/Administrators (dependent on the size of the programme)
  • Private Home Child Care Home visitors
  • Resource Teachers
  • Clerical Staff
  • Cooks
  • Housekeeping and Janitorial Staff (employed by the child care programme)

The following is a list of positions that may be eligible for Wage Improvement. To be eligible staff must work directly with children:

  • Trained staff
  • Supervisors
  • ECE or Director approved programme staff
  • Resource teachers
  • Private Home Child Care Home Visitors
  • Untrained programme assistants and programme staff with incomplete training

Only full & part time employed staff that are part of a programme's regular staffing complement are eligible; supply staff do not qualify for wage subsidy.

The County of Wellington reserves the right to determine the number of staff eligible to receive Wage Subsidy and Wage Improvement based on staffing requirements outlined in the DNA, the size of the agency and current community staffing practices. If you have any questions about eligibility please call our office.

Pay Equity Funding 

The Pay Equity amount funded by the province, prior to the transfer to municipalities, for the period 1991-1999/2000 is included as a component of your wage subsidy allocation. Pay Equity must be distributed in accordance to your Pay Equity Plan. Any programme that was receiving this funding will continue to receive it. The Post 1999 Pay Equity funding, as a result of the memorandum of agreement with the province, will be issued to qualified programmes as a separate payment.

Allowable Usage of Wage Subsidy Funding 

The Service Provider will use Wage Subsidy funds to increase the salary and non-mandatory benefits of staff employed in licensed child care services and funded support services for children with special needs; or to increase payments to private home child care providers.

The Service Provider will use Wage Subsidy funds to increase salary and non-mandatory benefits of staff filling eligible positions unless non salary related use is specifically approved in writing by the County of Wellington. A portion of the Wage Subsidy funding may be used to cover the increased mandatory portion of wages funded from Wage Subsidy. Mandatory benefits are: CPP, EI, WSIB and Employer Health Tax (if over $400,000 in wages). Wage Subsidy funds may not be used to cover base salary or mandatory benefits resulting from base salary costs. Base salary must be minimum wage or above.

The Service Provider may not use the Wage Subsidy funding to cover the costs of non mandatory benefits that were already in effect at the time the Service Provider began to receive Wage Subsidy. Where Wage Subsidy is used to provide new or enhanced non-mandatory benefits, the Service Provider will provide the County with a list of benefits and the costs associated with each that are covered by Wage Subsidy. This will be provided on an annual basis with the Wage Subsidy Utilization Form.

The Service Provider will ensure that each employee receives a reasonable portion of Wage Subsidy, and that such distributions are consistent with achievement of the service provider's Pay Equity Plan. The Service Provider will ensure that all payments to employees, including Wage Subsidy, are reflected in the job rates used by the Service Provider in Pay Equity calculations. Wage Subsidy payments will be provided in addition to any planned Pay Equity increases, or other salary increases.

The Service Provider will provide each employee with written communication regarding the amount of salary and/or benefit covered by Wage Subsidy and the method used to determine each employee's share. Copies of all such communication must be kept on file at the head office of the child care programme and made available to County staff upon request. A copy of the child care programme's policy regarding the distribution of Wage Subsidy is to be submitted to the County with the annual Wage Subsidy Utilization Statement.

Distribution of Wage Subsidy will not exceed $9,534 per 1.0 Full Time Equivalent (FTE) position. This amount is pro-rated i.e. if a staff member is employed 0.5 FTE the Wage Subsidy would not exceed $4,767. Wage Improvement Funding is in addition to Wage Subsidy funding and is not included in this amount.

Non-Salary Use of Wage Subsidy  

Where a collective agreement precludes increasing payments to staff, or other such exceptional circumstance exists, non salary use of wage subsidy funds may be approved by the County of Wellington. A portion of the subsidy may be used for non salary purposes such as for staff training or to increase affordability by reducing per diems to parents, with prior approval from the County of Wellington.

Home Child Care Agencies  

Service providers that operate a licensed private home child care agency will distribute a portion of wage subsidy funding to enhance payments to private home child care providers, as well as to employees of the private home child care agency such as home visitors.

Service Provider Wage Subsidy Funding Conditions

Service providers will immediately report to the County of Wellington any significant reduction in the service levels, such as the operating capacity or the staffing level. When the reduction is expected to be ongoing it will result in a recalculation of the amount of Wage Subsidy the service provider is eligible to receive. Where the reduction is of a temporary nature the County of Wellington will work with the Service Provider to determine the appropriate level of Wage Subsidy support.

Service providers will determine and administer distribution of Wage Subsidy in accordance with these funding guidelines as well as Ministry of Education and County of Wellington policies, procedures and requirements in effect at the time of distribution.

Wage Subsidy funds not utilized in accordance with any of these funding guidelines and /or in accordance within the Service Agreement between the Service Provider and County of Wellington will be recovered by the County of Wellington.

Documentation

Service Providers must comply with the following reporting requirements:

  • A bi-annual and year-end Wage Subsidy Utilization Statement showing how Wage Subsidy and Wage Improvement funds were applied to salaries, benefits or other approved expenditures by January 31 for the previous year.
  • A bi-annual and year-end Wage Subsidy Special Purpose Report is required by January 31.
  • Supply a Service Provider Programme Form annually and upon request.
  • Annually submit a copy of the programme's Wage Subsidy Distribution Policy.

Audit Requirements 

The County of Wellington requires that any Service Provider receiving more than twenty thousand dollars ($20,000) in annual Wage Subsidy must submit an audited financial statement of the corporation.

The corporation must obtain an audit of its compliance with these Wage Subsidy Grant Guidelines and the Centre Wage Subsidy Distribution Policy. The audit is to be conducted in accordance with CICA handbook section 5815-special reports - audit reports on compliance with agreements, statutes and regulations. Compliance is the responsibility of the child care programme operator. The Auditor's responsibility is to express an opinion on compliance based on the audit. The Auditor's reports are to be signed by "An accountant licensed under The Public Accounting Act, 2004 (Ontario)"

Audited Report Requirements  

On the report, the Auditor will disclose his/her address, the name or firm of the Auditor, the date of the report and the place of issue. An Auditor's report will include three standard paragraphs:

An "introductory paragraph" identifying that the reports have been audited, and identify any provisions of the agreement, statute or regulation. It will refer to any disclosure of any significant interpretations of the provisions made by the child care programme operator.

  1. The "scope paragraph" will state that the audit was conducted in accordance with Canadian generally accepted auditing standards, and that the audit was planned and performed with reasonable assurance that the child care programme operator complied the County of Wellington Wage Subsidy Grant Guidelines and Procedures and is in compliance with the centre's Wage Subsidy Distribution Policy. 
  2. The "Opinion paragraph" is where the Auditor will express an opinion whether the child care programme operator has complied, in all material respects, with the following terms and conditions:
In signing the audited statement, the Auditor has agreed that:
  • Only staff employed at sites that have been identified in Wage Subsidy Service Agreement Schedule A: Schedule of Approved Wage Subsidy Sites received Wage Subsidy funds.
  • Wage Subsidy was distributed according to the Allowable Usage section of the County of Wellington Wage Subsidy Grant Guidelines and Procedures.
  • Funds were flowed in agreement with the programme's Wage Subsidy Distribution Policy.

Special Purpose Report Filing  

A Special Purpose Report which verifies that wage subsidies have been used for the purpose(s) intended must be included as part of the audit to reconcile Wage Subsidy allocation against actual expenditures.The Special Purpose Report reconciles the Wage Subsidy funding received and expended. It demonstrates compliance with the terms of the Wage Subsidy Service Agreement, Ministry of Education and County of Wellington Wage Subsidy Guidelines and Procedures and compliance with the programme's Wage Subsidy Distribution Policy. The corporation's submission must include the Wage Subsidy Special Purpose Report verifying that the Wage Subsidies have been used for the intended purpose.

The Special Purposes Reports will identify:
  • Staff Full Time Equivalent, Staff Name, and Base Salary (salary prior to any wage subsidy/improvements received).
  • Amount of funding each staff was individually flowed.
  • Will identify amount of employer mandatory benefits, non-mandatory benefits and any pre-approved non salary related use.
The Special Purposes Reports are to be signed by the corporation's signing authority as follows:
  • Non-Profit Organizations - two signing authorities, one of which must be the Treasurer of the Board of Directors.
  • For-Profit Organizations - the Owner/Operator of the Programme and bookkeeper/accountant.

Statements are due to the County of Wellington within 4 months of the fiscal year end of the Service Provider. Any monies to be recovered as a result of surplus due to staffing reductions will be requested with the report due January 31st.

The County of Wellington reserves the right to withhold future Wage Subsidy payments and/or take steps to recover any payments owing as a result of the reconciliation process.

Staff Reporting Procedures

Service Providers must, in writing:

  • Report immediately any downsizing or plans to downsize or to close a programme
  • Report any changes in staffing levels and/or service levels
  • Report change in ownership in for-profit centre, or Board of Directors in a non-profit centre
  • Report a change in supervisor

Non-Compliance

  • Failure to comply with reporting requirements will result in suspension or withdrawal of future Wage Subsidy payments.
  • If there is reason to suspect the operator has failed to provide the negotiated service level, failed to notify the County of Wellington of any reduction in permanent staff or has reported more staff than actually employed in the programme the County of Wellington will take steps to recover any payments for which the service provider was not eligible.
  • County staff reserves the right to inspect records of employment to ensure that the FTE staff reported on the Wage Subsidy Utilization Statement, Special Purpose Report and the programme updates is consistent.

 

New or Expanding Programmes

New or expanded programmes will be placed on a pressures list and will be eligible to receive Wage Subsidy based on a formula approved by County Council once new funds become available. Where there are insufficient funds in the County's budget to provide the full amount of Wage Subsidy a programme may receive a percentage of their eligible allocation until new funding is available.