Work-Sharing explained for plant owners (and their employees)

REF. 01How it works

Everyone works a little less, nobody is laid off

Instead of laying off two or three people, you cut the hours of a whole team: your "Work-Sharing unit". On the application, the average cut must be between 10% and 60% of normal hours. On a 40-hour week, 10% is half a day (4 hours) and 60% is 3 days (24 hours). The cut can change from week to week, as long as the average stays in that range.

Each employee in the unit must lose at least 10% of their normal weekly pay. For the hours or days they do not work, eligible employees receive Employment Insurance (EI) Work-Sharing benefits. You keep your trained people for when orders come back.

Since October 2026, Work-Sharing is part of the Workforce Retention and Retraining Program (WRRP, "PMERMO" in French). The program adds a grant to train your employees during the hours they do not work: see our guide to the $1,000-per-employee training grant.

REF. 02Eligibility

Who is eligible, including the tariff special measures

The basic rule. Your business has operated year-round in Canada for at least 2 years. It is a private business, a publicly held company or an eligible non-profit. Your work activity has dropped by at least 10% over the last 6 months, for a reason outside your control: a lost contract, a shift in the market, lower sales, a shortage of raw materials. And you have a plan to get back to normal hours by the end of the agreement.

The drop must show in work hours, not only in sales. You show it with the number of hours lost, and by comparing your sales, production, hours worked, stock or new orders with the previous quarter or the previous year. Your unit needs at least 2 eligible employees.

With the tariff special measures, in effect until March 31, 2028, eligibility is broader:

• 1 year of operation in Canada is enough, with at least 2 employees eligible for EI who agree to reduce their hours and share the work;
• a drop of less than 10% is accepted, and the reduction in hours can exceed 60%;
• a business that must transform, retool or diversify can apply even if its activity has not dropped yet. In that case, it must also take part in the training grant;
• hours can be shared in different proportions, to fit the needs of the plant;
• seasonal employers, and non-profits and charities whose revenue dropped because of tariffs, are now eligible;
• seasonal workers and employees who help with the recovery can be included in the unit;
• a business that already has an agreement, or is in a waiting period, can also use these measures.

REF. 03Exclusions

Who is not eligible

On the employer side, Work-Sharing does not apply if the drop comes from a labour dispute (strike, lockout, slowdown or work stoppage). Nor does it apply if the drop comes from hiring too many people, or from a business decision, such as cutting staff to be more profitable. Outside the special measures, a normal seasonal slowdown does not count, and a non-profit whose layoffs are due only to lower revenue (fewer grants or donations) is not eligible. Public sector employers, organizations that only run a government program (a municipality, for example) and self-employed people are excluded.

On the employee side, the unit is made up of your core staff: permanent employees who work year-round, full-time or part-time. Core staff laid off just before you apply can be included. Not included: co-op students, casual and on-call workers, temporary agency staff and self-employed people. Also not included: the people you need to generate work, such as senior management, product development staff and sales and marketing staff, and anyone who runs the company and holds more than 40% of the voting shares.

REF. 04Agreement

Your employees agree, and in a unionized plant, the union too

Work-Sharing is a three-way agreement: you, your employees and Service Canada. The application is made by the employer, a representative of the employees and, in a unionized plant, a representative of the union. The list of employees in the unit is form EMP5101, called Attachment A. The name of the employee or union representative goes on it. The application must include an email from each named representative confirming they agree.

Employees agree to work fewer hours and share the work. Those who refuse, or who are not eligible for EI, must still cut their hours like the rest of the unit. Do not ask them whether they are eligible: they do not have to tell you, and eligibility is decided when they apply for EI benefits.

REF. 05Recovery plan

The recovery plan: how you will get back to normal hours

The application includes your recovery plan. It lists what you will do during the agreement to bring your people back to normal hours and normal staffing. Each action must be measurable, verifiable and realistic for the length of the agreement. You also describe what you already did before applying, and the results.

Under the tariff special measures, the plan focuses on keeping the business viable in the face of tariffs. If you apply to transform, retool or diversify, the plan describes the changes, their timeline, the planned training and the results you expect.

REF. 06Duration

How long: up to 152 weeks

Under the normal rules, the application asks for 6 to 26 weeks. An extension can bring the agreement to 38 weeks in total. After an agreement, there is a waiting period equal to the number of weeks you used, up to 38 weeks.

Under the tariff special measures, an agreement lasts at least 4 weeks and can be extended up to 152 weeks in total. After a total of 152 weeks, a mandatory 38-week waiting period applies before a new agreement.

REF. 07Deadlines

The mistakes that delay an application

These are the program's written rules. Missing one can cost you weeks.

• Applying too late. The start date must be a Sunday, at least 10 business days after you submit a complete application. A start date cannot be in the past.
• A missing Attachment A. Attachment A (EMP5101) must be uploaded with the application.
• An online account set up too late. You apply through Grants and Contributions Online Services (GCOS). Create your account early: your identity must be verified first. If you do not get a tracking number and an acknowledgement email, your application was not submitted.
• A separate application for each site. One application covers all the locations hit by the same work shortage, even in different provinces: you check each region on the form.
• A change sent too late. To change the agreement, for example to add or remove an employee, send form EMP5103 at least 10 days before the change. It cannot be sent through GCOS. The change applies only once it is approved.
• A forgotten extension. It is not automatic: ask for it at least 4 weeks before the agreement ends.
• A planned shutdown. It cannot last more than 4 weeks, must be approved in advance, and does not make the agreement longer.

extension: 4 weeks before the end