Significant Special Measures for the Employment Insurance Work-Sharing Program Introduced for Businesses, Non-Profits Impacted by U.S. Tariffs

By: Andrew Easto

On March 7, 2025, the federal government introduced special measures to the Employment Insurance Work-Sharing Program (Program) to provide additional support to businesses and non-profit organizations impacted by the threat or realization of U.S. tariffs. These measures will be in place from March 7, 2025 to March 6, 2026, and significantly expand the potential application of the Program to businesses, non-profit organizations and employees who would not otherwise be eligible.

In our FTR Now of February 20, 2025, we provided an overview of the eligibility requirements for the Program. As a result of the special measures introduced, the following key adjustments to the Program’s parameters will now apply to a business or non-profit organization that has experienced a decline in business activities (or general revenues, in the case of non-profit organizations) due to actual or threatened U.S. tariffs.

Enhanced Entitlements

• An eligible business or non-profit organization may apply for extensions to their work-sharing agreement to a maximum of 76 weeks, if required, rather than being subject to the 38-week maximum that would otherwise apply. There is no change to the current practice that the initial work-sharing agreement will be approved for up to 26 weeks.
• An eligible business or non-profit organization will be exempt from the regular “cooling-off” period that would otherwise apply to successive work-sharing agreements. Under the regular Program requirements, a business is subject to a cooling-off period between agreements that is equal to the number of weeks, including extensions, used in the prior agreement.
• A business or non-profit organization may be eligible for the Program even if they are focusing their recovery efforts on maintaining business viability in the face of U.S. tariffs, rather than demonstrating recovery measures regarding the employer’s ability to return to normal staffing levels and hours by the end of the work-sharing agreement as would otherwise be required under the Program.

Employer Eligibility

• A business or non-profit organization will be eligible to apply to the Program if it has been operating in Canada for at least one year, rather than being subject to the regular two-year eligibility requirement.
• Non-profit and charitable organizations will be eligible to participate, even if the basis for their participation is due to a reduction in revenue (including grants, donations, memberships, investment income or other funding streams), provided the reduction is the direct or indirect result of the tariffs. Under the regular terms of the Program, a non-profit or charitable organization is not eligible to participate if the temporary layoffs are the result of a reduction in revenue levels alone.
• Cyclical and seasonal employers who are generally ineligible for the Program will be eligible to participate if the basis for participation is related to the U.S. tariffs.
• Under the regular Program requirements, an employer is eligible for the Program if they have seen a decrease in work activity in the past six months of at least 10%. The special measures will permit a business to participate even if the decrease in business activities in the past six months is less than 10%.
• Under the regular Program requirements, an employer is eligible to participate if the proposed work-sharing arrangement does not result in the affected employees’ hours being reduced by more than 60% of the hours that would have otherwise been worked. The special measures will expand eligibility in the Program to businesses even where the reduction in employees’ hours exceeds 60% of hours that would otherwise be worked.

Employee Eligibility

• The special measures waive the Program requirement for employees to be year-round, permanent, full-time or part-time employees (“core” employees) to be eligible. Seasonal and cyclical employees may now be included while the special measures are in effect. Under the regular Program requirements, employers are expected to first reduce staff to core levels before entering into a work-sharing arrangement.
• The Program generally excludes any employee from participation who is needed to help generate work and assist in business recovery. This often includes senior management, executive-level marketing and sales employees, and technical employees engaged in product development. The special measures remove this exclusion and allow employees to be eligible regardless of whether they are assisting the employer in recovery efforts.

Conclusion

For any business that is, or may be, impacted by the imposition or threat of U.S. tariffs, the Program’s expansion may be a valuable tool to weather this period of economic uncertainty.

For questions about the special measures introduced, or for assistance with the preparation of a work-sharing application for your organization, please contact your regular Hicks Morley lawyer or a member of the firm’s Pensions, Benefits and Compensation practice group.

The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Hicks Morley Hamilton Stewart Storie LLP and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Hicks Morley Hamilton Stewart Storie LLP. ?

Practice Areas: Pensions, Benefits & Compensation

Tags: Employment Insurance Work Sharing Program, Federal Government, Tariffs