The federal government has launched an online application process for a workforce retention and retraining program designed to help Canadian businesses avoid layoffs and train employees as they respond to tariff pressures and changing market conditions.
The Workforce Retention and Retraining Program (WRRP), announced recently by Jobs and Families Minister Patty Hajdu, provides eligible employers with up to $1,000 per participating employee to help cover training and administrative costs. The initiative is part of a $3.5-billion federal investment in Rapid Response Supports for Workers and Employers announced in August.
The program is intended to help businesses retain skilled employees while adjusting operations, diversifying their activities and preparing workers for new opportunities. It will be available to businesses across all sectors from October 2026 through March 2028.
"Workers and businesses are at the heart of our economy, and of the communities where they live and work. That is why we are stepping up our support through the Workforce Retention and Retraining Program. This program will help employers keep the skilled people they depend on and give workers the chance to build new skills so they can meet today's challenges and seize tomorrow's opportunities,” said Hajdu, who is also Minister responsible for the Federal Economic Development Agency for Northern Ontario
Flexible training and income support
Under the program, employers can select training that meets their operational requirements and workforce needs. Eligible activities include technical instruction, digital and foundational skills development, peer-to-peer learning and on-the-job training.
Employees whose hours are reduced through Work-Sharing arrangements can maintain incomes closer to their normal levels through a combination of Employment Insurance (EI) Work-Sharing benefits and an income top-up tied to participation in employer-provided training. The approach is intended to allow businesses to reduce working hours temporarily rather than lay off employees while they adjust to economic disruptions.
The program also introduces greater flexibility in scheduling and distributing employees' hours to accommodate operational needs arising from tariffs. The government is temporarily removing the requirement that work be shared equally among participating employees.
Employers and workers will also be able to enter into successive agreements in response to tariff-related disruptions, temporarily allowing for up to 152 cumulative weeks of support.
The federal government expects the program to help prevent an estimated 20,000 layoffs and support more than 2,300 employers. Of those businesses, close to 1,790 are expected to receive funding to offset training and associated administrative expenses.
Employers already participating in Work-Sharing or receiving support through the Worker Retention Grant will not need to submit new applications, as they will be transitioned to the new program.
Temporary EI measures extended
Alongside the workforce program, the government is extending temporary Employment Insurance measures by up to one year to help workers manage periods of unemployment and job transitions.
The measures include waiving the one-week EI waiting period, providing an additional 20 weeks of benefits for long-tenured workers and temporarily suspending the rule governing monies received upon separation from employment. The latter change allows workers to access EI benefits immediately after losing their jobs, even if they receive payments such as severance or vacation pay.
The government has also introduced a temporary, one-year simplification of EI rules concerning reasons for separation from employment. Under the measure, workers who recently changed jobs will no longer be penalized when seeking EI benefits, provided their most recent job loss was through no fault of their own.
The measures are intended to maintain income support for workers affected by economic uncertainty, including those facing job losses or reduced hours as businesses adjust to trade pressures.
Regional support for businesses
The WRRP and EI changes form part of a broader federal response to economic uncertainty. The government is also directing support to small and medium-sized businesses affected by tariffs through the Regional Tariff Response Initiative (RTRI), delivered by Canada's regional development agencies.
The initiative is intended to help businesses strengthen their competitiveness, address liquidity pressures, diversify into new markets and build resilience over the longer term. The government says the combined measures are designed to protect jobs, maintain business continuity and help Canadian employers and workers prepare for future growth.
The launch follows earlier changes to the Work-Sharing Program. Since January 2025, temporary flexibilities under that program have helped avert about 25,000 layoffs through approximately 1,600 Work-Sharing agreements, according to the federal government.
Employers can apply to the Workforce Retention and Retraining Program through the federal government's online application process.