Can Payments From The Canada Emergency Response Benefit (CERB) Be Garnished?

Can Payments From The Canada Emergency Response Benefit (CERB) Be Garnished?

Written by Veronica Ott
Fact-checked by Caitlin Wood
Last Updated May 4, 2021

As a response to the COVID-19 pandemic, the Canadian government has introduced financial support payments known as the Canada Emergency Response Benefit (CERB). The purpose of these support payments is to provide financial assistance to workers who lost their income from the COVID-19 crisis. 

If you’ve incurred a wage garnishment on your wages before losing your job, you might be wondering whether these support payments are subject to a garnishment too. In general, the answer is no, but there are exceptions. 

What Is Wage Garnishment? 

If a consumer is in debt to a lender, the lender may take the borrower to court to collect the debt through wage garnishment. A wage garnishment allows the lender to take money directly from the borrower’s wages or paycheque. In addition, if another party holds the borrower’s wages, the lender can take it directly from the third party. If a wage garnishment judgment has been made against you, your wages will be referred to as garnished. 

Can My Canada Emergency Response Benefit (CERB) Be Garnished? 

The CERB payments have been made possible under the COVID-19 Emergency Response Act. This act states the following: 

  • CERB is not considered income or property during a bankruptcy
  • CERB cannot be assigned or given as collateral for financing
  • CERB cannot be garnished 
  • CERB is not garnishable for support payments
  • CERB cannot be kept by right of set-off by the government for their debts

To summarize, you are allowed to keep the full amount of CERB support payments and they cannot be garnished. The reasoning for this is that the support payments are meant to provide financial assistance to Canadians during the economic crisis resulting from the COVID-19 lockdown. Therefore, the payments should benefit the recipient solely, not lenders. 

Keep in mind that if you owe your bank money, they can still be offset by your bank. Once the CERB payment is deposited into your account, it is considered cash which is subject to legal right offset from your bank. 

Despite the fact that your CERB payments cannot be garnished, creditors may still try to collect payment. Do not let them collect money from your CERB payments, this money is meant to help you through this difficult financial time. 

Beware Of Scammers

Scammers have begun to exploit the public fear surrounding COVID-19, unfortunately. You may notice increased calls to your home or cell phone in addition to fraudulent emails containing false information about COVID-19. Do not respond to any communication asking you to make a payment, click on a link, send personal information, send banking information or send passwords. If it seems phishy – it probably is!

Learn more about dealing with scams during the COVID-19 pandemic.

Frequently Asked Questions

My wages were being garnished at my job, but I lost my job due to COVID-19. Will the garnishment continue if I receive CERB?

A garnishment will not be taken from CERB payments. The only exception is if you owe your bank money. Once a CERB payment is deposited to your account, it is considered cash and your bank has the right to seize it if you owe them money. 

What kind of wages cannot be garnished?

The following wages cannot be garnished: unemployment income, pension income, Ontario Works Act payments (with the exception of the Family Responsibility and Support Arrears Enforcement Act), Ontario Disability Support Program (ODSP) Act payments, Ontario Pension Benefit payments (in most cases), Canada Pension Plan payments (in most cases) and Old Age Security (OAS) payments (in most cases). 

I cannot keep up with my payments due to COVID-19. Should I apply for bankruptcy or a consumer proposal right now? 

If you’ve been dealing with debt, the recent COVID-19 pandemic may have thrown your repayment plans awry. If your income has been reduced or cut off altogether and you feel like you can’t manage your debt any longer, you may not need to file for a consumer proposal or bankruptcy right away. The reason for this is “creditor proof”. To be creditor proof means you have no assets or income that can be seized for the purpose of debt repayment. Without assets or wages for a creditor to seize, you have nothing to protect. For this reason, a consumer proposal or bankruptcy may not be necessary at the moment.  The only exception to this is with banks and the CRA. The bank may try to seize payments directly from your bank account. The CRA does not need a court order to garnish income and can garnish pension and EI payments. In these cases, any income you receive is not safe and a consumer proposal or bankruptcy may be necessary.  At the end of the day, there is no “if you’re experiencing this, then file for a proposal or bankruptcy” solution. Only you can decide what’s best for you and your finances. Although, you can speak with a credit counsellor or Licensed Insolvency Trustee to get financial advice. 

CERB Payments And Your Financial Health

The entire purpose of CERB payments is to help Canadians financially throughout the COVID-19 pandemic. Allowing these payments to be garnished would be detrimental. If you’re eligible for CERB payments, be smart with your money during this challenging economic time.

Rating of 4/5 based on 11 votes.

Veronica is a writer who specializes in creating unique and educational personal finance content. She has extensive experience writing blog posts for companies in the financial sector. Veronica's background is in accounting as she graduated from Western University in 2017 with a degree in accounting. She is passionate about using her accounting expertise to help others with their personal finance questions and issues and enjoys using her writing to educate Canadian readers. When Veronica is not writing, she enjoys film, reading, travelling, going to the gym, and listening to music.

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