Government response includes temporary changes to Work Sharing Program
“In Canada, we protect our workers.”
So said Steven MacKinnon, Minister of Employment, Workforce Development, and Labour, at a press conference announcing a series of measures to help Canadian businesses and workers affected by new U.S. tariffs.
The mitigation efforts are meant to protect workers, he said, “and see them through the crisis come hell or high water.”
The moves follow the United States' decision to impose tariffs on Canadian goods, disrupting a strong trading relationship and raising costs for consumers on both sides of the border.
Ottawa’s $6-billion aid package intends to protect Canadian businesses and workers and to “support our businesses and ensure they have the liquidity they need through this turbulent time,” it said.
“For all the noise pulsating north, the US administration's repeated contradictions have brought more questions than answers,” said MacKinnon, citing questions about “whether Canadians will still have work in a week's time, much less a month.
“We have heard those concerns and obviously feel compelled to act upon them.”
Half (50 per cent) of Canadian employers are reducing production or laying off employees in anticipation of tariffs, according to a recent survey.
Changes to Work Sharing Program
As part of the changes, MacKinnon announced that temporary measures for the Work-Sharing Program would go into effect today. Under the “mitigation” plan, employers will be able to cut hours while keeping workers in their jobs with income support, he said during a press conference in Ottawa Friday.
“These measures will provide stability to our sectors at a time of great unrest and uncertainty, and more than anything else, they will help keep more workers in their jobs, more businesses running, and more factory floors humming.”
While the Work Sharing Program is not well-known, it is a vital one, he said, “and one that has repeatedly proven its utility and value, and one that has been accessed, I must say, more frequently of late.”
The program allows employers to keep workers on their payroll, in their jobs without resorting to layoffs, said MacKinnon at the press conference. It does this by temporarily reducing employee working hours during slower periods, so that workers can stay on the books until normalcy returns, at which point they would return to work full time.
“This allows workers to keep their jobs and the benefits that come with them, Employment Insurance Work Sharing benefits would then cover most or part of the lost wages brought on by reduced working hours,” he said.
Since 2019, the program has helped employers across Canada avoid laying off as many as 100,000 people, said MacKinnon.
Ottawa is also expanding the maximum length of agreements from 38 weeks up to 76 weeks.
“We are moving ahead with these changes despite yesterday's pause [on tariffs], because businesses and workers need assurance, assurances right now,” he said.
“We know the uncertainty that is out there. We know that uncertainty, in many ways, is worse than the proposals themselves, because businesses are frozen in their investment decisions and other issues. So we want to make sure that they have the comfort knowing that we have this backstop in place.”
Many employers are already using the Work Sharing program in anticipation of more threats and more uncertainty, said MacKinnon, “so, we're taking a calibrated response to address the uncertainty and damage this trade war is bringing and the risks it is creating for our businesses, our workers and all Canadians.”
Financial support for employers
Canadians are right to feel confused, said MacKinnon.
“The federal government and indeed governments at all levels in Canada have watched the US administration's chaotic messaging with great consternation and bewilderment.
To ensure companies have the resources to withstand economic uncertainty, the government is introducing targeted financial programs:
- Trade Impact Program: Export Development Canada (EDC) will provide $5 billion over two years to help exporters expand into new markets and manage financial risks, such as non-payment, currency fluctuations, and cash flow shortages.
- Business Development Bank of Canada (BDC) Loans: A $500 million loan program will offer favourably priced financing to businesses directly impacted by tariffs, as well as companies in their supply chains. Businesses will also have access to financial advisory services to navigate market disruptions.
- Farm Credit Canada (FCC) Financing: An additional $1 billion in financing will be made available to support agricultural and food industry businesses, ensuring they can manage cash flow challenges and continue operations.
"In these uncertain times, supporting Canadian exporters is not just a policy, it's a necessity," said Mary Ng, Minister of Export Promotion, International Trade and Economic Development. "The $5 billion Trade Impact Program will provide crucial tools—working capital, insurance, and financing—to shield Canadian businesses from the impact of possible tariffs and global volatility."
With businesses facing new economic pressures, the government is also taking steps to protect Canadian companies from foreign takeovers. Updates to the Investment Canada Act Guidelines will enhance safeguards against investments that could pose risks to Canada’s economic security.
"While we welcome foreign investments through an open and predictable investment climate, we must refuse foreign investments that would be harmful to our economic security," government officials stated.
