Thank you very much, Chair.
Thank you to the committee for taking the time to meet with us today and to listen to us talk a little bit about Brandt and about the wage subsidy program and some of the issues we're having.
Perhaps it's beneficial to give a quick overview of Brandt. We're an 88-year-old, family-owned business headquartered in Regina, doing business across Canada with facilities in virtually all provinces. We have two facets to our business: manufacturing and distribution. We manufacture agricultural equipment and rail equipment that we sell throughout North America and offshore. Our largest business, however, is in the distribution business, and that is Brandt Tractor, which we're here to talk about today.
Brandt Tractor exclusively owns and operates all of the John Deere construction and forestry equipment dealerships in Canada. We have 56 locations across the country, 34 of which are in eastern Canada. We have 3,200 employees, and over 700 are in eastern Canada.
The construction equipment that we sell is used in road building, mining, sewer and water, residential development, forestry and so on, just to mention a few sectors. Since the pandemic hit us, our customers have been negatively impacted in virtually every market in which we operate. In the areas where work has resumed with some projects, it's at a much lower level, and there remains a high level of uncertainty about future prospects for the business.
We initially laid off 160 people, but we've been trying hard to retain our 3,200 employees in the hopes that we would qualify for the wage subsidy. As you know, to be eligible for the wage subsidy, we have to experience at least a 15% reduction in sales revenue in March, 30% in April and 30% in May, as compared to those same months in 2019. On that basis, Brandt would qualify for the program. However, in fall 2019, we purchased 29 dealerships in Ontario, Quebec and Newfoundland from a company called Nortrax, which was owned by John Deere. We purchased it on an asset purchase basis, even though we acquired the entire business; however, because we purchased it on an asset basis instead of a share basis, we do not qualify for the wage subsidy program.
The effect of that is that, when we go to fill out the wage subsidy application, we're required to include the 2020 sales of the combined company, but for 2019, we're precluded from including the sales of the company we acquired. It has the effect of looking like our sales have increased when we've had a substantial decrease. Furthermore, the seasonality of our business doesn't allow us to choose the alternative of using the average of January and February because they're not comparable months to March, April and May in the construction industry.
We've been communicating this issue to the ministry of finance through the Canadian manufacturers association, the association of equipment distributors, the chambers and other business organizations since early April, with no resolution to the matter at this point. I want to point out that this isn't just a Brandt problem; there are other companies affected in a similar manner.
I do want to compliment the government on the Canada emergency wage subsidy program. It's an excellent program. It's ideal for a company like ours in the current situation that we find ourselves. The objectives of the wage subsidy program are in complete alignment with Brandt's objectives. We want to retain our 3,200 employees, call back our laid-off employees, retain the benefits for the employees and keep them connected to the company so that when COVID-19 passes, we can resume our operations and not have lost all of the employees we've worked so hard to get for the last five years.
To sum up, due to a technicality in the wage subsidy program, Brandt is unable to access the subsidy, despite having adequately reduced our revenues to qualify. We want to keep our 3,200 employees and we need the wage subsidy to do it. We're hoping we can count on your support to help us with this matter.
We thank you, once again, for giving us some time today to explain the situation.