In anticipation of the sweeping U.S. tariffs set to take effect on April 2, 2025, the federal government has introduced temporary amendments to the Employment Insurance (“EI”) Work-Sharing program. Announced on March 7, 2025, these changes are designed to provide additional support for businesses, non-profits, and employees impacted by the upcoming tariffs. These temporary measures, effective until March 6, 2026, will expand access to the program and extend the duration of benefits.

What is the Work-Sharing Program?

The Work-Sharing program is a federal initiative aimed at helping both federally and provincially regulated employers and employees avoid layoffs during periods of temporary business slowdowns. When a company experiences a significant reduction in business activity due to factors beyond its control, the program allows employers and employees to reduce work hours, with the government supplementing employees’ lost wages through EI benefits.

By reducing hours instead of laying off workers, businesses can retain their workforce, while employees continue to receive income support. This also prevents the costs associated with rehiring and retraining staff once the economy stabilizes.

Temporary Changes to the Program

Under the temporary changes introduced in March 2025, the Work-Sharing program is now more flexible and offers additional benefits to both employers and employees. Key updates include:

Extended Benefits Duration

Previously, businesses could access Work-Sharing agreements for up to 26 weeks. With the temporary changes, the program now offers extensions for agreements up to 76 weeks. This mirrors changes made to the program during the COVID-19 pandemic, where extended benefits were provided to help businesses navigate prolonged periods of reduced activity.

Exemption from Cooling-Off Period

The temporary measures also exempt businesses from the typical “cooling-off” period required between successive Work-Sharing agreements. This exemption allows businesses to quickly reapply for Work-Sharing if they face another downturn related to the tariffs, without having to wait.

Expanded Eligibility for Employers and Employees

The eligibility criteria for the program have been expanded, making it easier for businesses affected by the tariffs to qualify for Work-Sharing.

In particular, employer eligibility has been expanded to include:

• Employers that have been operating in Canada for at least one year (previously, the requirement was two years);
• Non-profits and charitable organizations experiencing a reduction in revenue levels as a direct or indirect result of the tariffs;
• Cyclical or seasonal employers;
• Employers experiencing a decrease in work activity over the past six months of less than 10%; and
• Employers allowing utilization of Work-Sharing to exceed 60%.

Additionally, employee eligibility has been expanded to include:

• Seasonal or cyclical employees; and
• Employees assisting the employer recovery efforts.

What’s Next?

While these new measures are a direct response to the U.S. tariffs, the federal government has signaled that further steps could be taken depending on how the situation evolves, particularly as negotiations for the removal or reduction of the tariffs remain ongoing. We will continue to monitor developments and provide updates on any changes to the Work-Sharing program.

Employers seeking further information regarding the program are encouraged to visit the Government of Canada’s website or consult with our team.

This blog is provided as an information service and summary of workplace legal issues.

This information is not intended as legal advice.