Updated January 10, 2021
Restaurant owners and staff would be forgiven for feeling transported back to 2020 in the early days of 2022, as indoor dining shuts down again in some areas in response to the Omicron variant of COVID-19.
Quebec blinked first, and Ontario soon followed. The closures are an attempt to stifle the spread of Omicron, but will be an almighty and potentially fatal blow to the thousands of restaurants that have barely survived the last two years, as well as those who managed to rise from the ashes in recent times.
On January 3, Ontario Premier Doug Ford announced that the province is reverting to a modified version of Step 2 of its COVID-19 response plan. That includes shutting all indoor dining again, this time for a minimum initial period of 21 days.
Starting January 5, indoor dining at restaurants, bars, and other foodservice establishments is off-limits until January 26, as well as food courts in malls. Outdoor dining, takeout, drive-thru, and delivery will still be allowed.
While admitting that Omicron’s high transmissibility means that it cannot be stopped, Ford stressed the intention of these measures is to slow its spread.
For the foodservice industry, persistently one of the most badly affected of all sectors by the near-two-year-old pandemic, this will be all too familiar.
Indoor dining in Ontario had only been reopened in July — for Toronto, that was the first time dining in was back on the table since fall 2020. That lengthy shutdown had widely been recognized as the longest in the world. Ontario restaurants were only finally able to operate without any capacity restrictions from October 25, 2021. That freedom ultimately lasted less than two months.
Things had moved incredibly quickly, in fact. On December 13, Kingston announced that restaurants must close to indoor dining between 10 p.m. and 5 a.m. Those were the first jurisdictional restrictions to be reintroduced. Fast-forward just three weeks to the day, and every single dining room in the province is now completely closed again.
“Absolutely terrible news”
Dan Kelly, President of the Canadian Federation of Independent Business (CFIB), called the announcement “absolutely terrible news for so many Ontario small business owners.”
Meanwhile, Ontario Restaurant, Hotel and Motel Association President & CEO Tony Elenis added in a statement that the latest “lockdown” comes after 22 months of continuous financial pressures.
“This time is significantly more severe than the initial March 2020 stage of COVID-19 as it’s hitting a vast amount of hospitality businesses who are already fragile and financially strained,” said Elenis.
Restaurants Canada added in a statement that once again, Ontario has made a move “that will irreparably harm our industry without any consultation. The foodservice industry continues to bear the brunt of the restrictions and pay the cost of fighting this pandemic, despite having done everything they have been asked.”
“The data that we have seen show that restaurants are NOT the problem, yet we continue to be singled out and have never been allowed to meet with the chief medical officer or the Ministry of Health to discuss data and strategies for restaurants, but have been turned down at every turn,” the association added.
Existing supports fall far short
The Ontario government had recently introduced some new supports for many businesses most impacted by public health measures in response to the Omicron variant of COVID-19.
For example, the new Ontario Business Costs Rebate Program will see eligible businesses including restaurants receive rebate payments equivalent to 50 per cent of the property tax and energy costs they incur while subject to the current capacity limits. Meanwhile, the federal government also announced on December 22 that it intends to expand the Local Lockdown Program, which offers wage and rent subsidies of between 25 and 75 per cent, to include employers subject to capacity-limiting restrictions, as well as lower the Lockdown Support Program 40 per cent loss bar has been lowered to 25 per cent.
Subsequently, after Ontario shut indoor dining, the provincial government announced it is offering a Small Business Support Grant of $10,000 to eligible businesses suffering closures, including restaurants and bars. Eligible businesses will be pre-screened to verify eligibility and will not need to apply, but newly established and newly eligible businesses will need to apply. Small businesses that qualify can expect to receive their payment in February.
However, industry leaders and advocates argue that far more assistance is needed.
Elenis said in an ORHMA statement that while the new $10,000 grant and additional energy relief “will not cover all the expenses operators are facing and we are calling for additional support. We are not done yet.”
Indeed, with restaurants shut entirely for indoor dining again, industry leaders and advocates argue that far, far more assistance is needed.
Restaurants Canada added that the new Small Business Support Grant “falls well short of the needs of the industry” and argued that limiting the measure to businesses with fewer than 100 employees is unfair to restaurants, which are typically more labour intensive and dependent on part-time employees than any other industry.
“[The] Premier hints at more financial support — this must happen today,” CFIB’s Kelly wrote after the shutdown announcement. “2 weeks to flatten the curve has turned into 2 years.” That was echoed by Elenis, who added that both the provincial and federal government “need to step it up now more than ever and support all fixed costs in an industry that is just barely hanging on.”
Just three weeks ago, CFIB and Restaurants Canada had issued a joint open letter to all Canadian Premiers urging the immediate provision of financial support to small businesses.
The letter called the new federal support programs “incredibly limited in scope” and stressed that pre-Omicron data showed that 80 per cent of small businesses in need of help will no longer qualify for those supports. For example, the letter noted that a restaurant suffering a 35 per cent revenue decline will now receive zero federal support.
Meanwhile, in Quebec
Ontario’s drastic measures come on the heels of similar moves in Quebec.
On December 30, Health Minister Christian Dube announced the closure of indoor dining across the province starting on New Year’s Eve. Quebec’s move goes one step further by imposing a nighttime curfew beginning at 10 p.m.
Quebec has seen a similarly quick turnaround as Ontario. It was just November 1, two months ago, that Quebec restaurants and bars were finally able to operate at full capacity for indoor dining again for the first time in more than a year.
François Vincent, Quebec vice president of CFIB, called the latest development “a nightmare”. He noted that the average restaurant has $200,000 in COVID-related debt since the start of the pandemic, and that the short-notice news of closing dining rooms could be a knockout blow for many, per Global News.
“We cannot play yo-yo and then stop industry, and [start] it back again, and then stop it again [on] short notice like that,” he added.
In addition, some other provinces such as Prince Edward Island have taken steps to reduce restaurant capacity again after a period of no capacity restrictions. However, Ontario and Quebec have taken by far the hardest stance in what will be a tremendous blow for an already beleaguered industry.