Thousands of research staff layoffs averted with $450 million wage subsidy

The federal government has corrected what the health research sector has described as a “technicality” that prevented hospital-based research institutes from receiving temporary wage relief as a result of COVID-19 job disruptions.

Groups like HealthCareCAN and the University Health Network (UHN) argued that the government’s $73-billion wage subsidy bill, C-14, excluded public institutions, including health research institutes that are physically based in public hospitals.

Appearing May 6 before the House Standing Committee on Health, UHN’s executive VP for science and research Dr. Bradly Wouters said while hospitals and patient care in Ontario are funded by the provincial ministry of health “we are legislatively prohibited from using any of that provincial support for our research.”

The appeal worked. Just nine days later, Prime Minister Justin Trudeau announced $450 million in temporary wage relief to thousands of research staff at universities and affiliated research institutes affected by the pandemic.

The new aid program, to be delivered through the three federal granting agencies, will cover staffing costs that are not supported through other pandemic aid programs like Bill C-14 – even if the work has been suspended. Nearly all hospital-based, non-COVID-related research across Canada was suspended on March 15.

The government will provide up to 75% per individual, up to a maximum of $847 per week, to support activities such as the safe storage of dangerous substances, and restarting data sets that were interrupted during the pandemic. The funding will also help universities and research institutes ramp back up to full operations once physical distancing measures are lifted by covering up to 75% of total eligible costs, including those related to shutting down and then safely reopening labs.

Research staff are typically paid through a combination of public and private research grants, philanthropic donations, and contracts for clinical trials paid primarily by biotech and pharmaceutical companies.

“That revenue base has all but evaporated in view of the COVID-19 pandemic. All research and clinical trials not related to COVID-19 have been either suspended or cancelled, with severe implications for the sector's capacity to employ essential research staff and contribute crucial research toward improving Canadians' health outcomes,” Paul-Émile Cloutier, president and CEO of HealthCareCAN, also told the Health committee on May 6.

Across Canada, health-care research employs over 50,000 people, including clinical research associates, research nurses, laboratory technicians, biostatisticians, data managers, graduate students and post-doctoral fellows.

Cloutier warned that without wage relief, the health research sector would face 10,000 to 15,000 job losses in May. The UHN alone employs about 4,000 research staff, with about 80% unable to continue research into non-COVID diseases such as cancer and diabetes.

“On May 1, we were forced to begin the process to identify roughly 1,500 staff for a first round of job layoffs because of the suspension-induced loss of revenue. If we continue to be unable to access these federal supports, we will face large end-of-year operating deficits, additional layoffs and insufficient revenues to support our cause,” Wouters told the committee.

Details on the funding program, eligible staff and costs will be announced at a later date.

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