Ottawa job cuts: Layoff letters starting to ‘trickle out’ across system

How to handle layoffs properly should be top of mind for human resources professionals in the public sector right now as some federal government departments have started issuing formal workforce adjustment notices.

In Budget 2025, the government outlined plans to eliminate thousands of jobs over the next few years. Ottawa plans to eliminate roughly 40,000 federal positions by 2028-29 as part of broader fiscal restructuring.

According to the Ottawa Citizen, the reductions “amount to around 10 per cent of the public service’s overall headcount from its peak in 2023-2024," and workforce adjustment letters are now starting to “trickle out” across the system.

Departments reducing workforce count

Treasury Board President Shafqat Ali declined to provide a detailed breakdown of where the cuts will fall, arguing it would be unfair to disclose that information publicly before affected employees are told, according to the article.

But early data cited in the story point to several departments where impacts are already being felt.

According to the Public Service Alliance of Canada (PSAC), more than 200 of its members at Natural Resources Canada (NRCan) received notices warning they may lose their jobs as the federal government pushes ahead with its plan to slash critical public services.

Another 109 employees at the Public Service Commission of Canada have been notified, along with 92 public servants at Crown–Indigenous Relations and Northern Affairs Canada and 74 at the Department of Finance, reported the Ottawa Citizen.

The Professional Institute of the Public Service of Canada (PIPSC) has also said that about 200 of its members at Natural Resources Canada had received workforce adjustment notices on Dec. 4, according to the report.

Canada Post expects to eliminate 30,000 more jobs in the next few years, on top of job cuts already announced this year, the Crown corporation recently said.

Meanwhile, Employment and Social Development Canada (ESDC), the largest department in the core public service, has said a workforce adjustment process and a “reduction” in its “executive complement” will begin in January. Shared Services Canada told staff in an internal letter, shared with the Ottawa Citizen, that “there will be impacts on work units and positions within our organization” and that employees “impacted by workforce adjustments will be notified in January 2026.” Environment and Climate Change Canada has also confirmed it expects to inform workers in mid-January.

Statistics Canada spokesperson Maryse Carrière said the agency is “still assessing the scope of the approved reduction targets and the measures required to achieve them,” adding that “employees can expect further communication on our next steps in January,” according to the Ottawa Citizen report. Meanwhile, Correctional Service Canada has indicated that decisions will be finalized in the new year, with spokesperson Kevin Antonucci noting the agency is “taking the time necessary to finalize our plans” given its size and mandate.

Earlier in the year, 264 employees at the Department of Justice were told their services may no longer be required. Around 320 positions at the Public Health Agency of Canada were affected as part of post-pandemic staffing changes, and about 70 positions were impacted at Library and Archives Canada, according to the Ottawa Citizen.

Under federal rules, permanent employees whose roles may be eliminated enter a formal workforce adjustment process set out in collective agreements. The process is designed to find alternative employment where possible. Receiving a notice does not automatically mean a job loss; options can include redeployment or “alternation,” in which an affected worker can exchange positions with an employee who wishes to leave.

Ottawa is also in the process of sending information about a voluntary early retirement program to nearly 70,000 employees, according to a recent CBC article.

Reactions to adjustments

PIPSC President Sean O’Reilly has opposed the proposed job cuts under Budget 2025.

“When governments make changes that are this drastic, Canadians always pay the price. Food inspections slow down. Emergencies take longer to contain. Digital systems grow weaker just as cyberattacks become more frequent,” he said in an op-ed posted on the union’s website.

“These are not abstract risks. They are the daily functions that hold the country together. Canadians want their government to spend wisely. Public service professionals want that too. But there is a big difference between improving how government works and hollowing out its ability to deliver. Efficiency cannot come at the expense of safety, stability or trust.”

Options for affected workers

In a post about workforce adjustment in the core public administration, the federal government noted that the deputy head of an organization determines whether an employee with workforce adjustment (WFA) status will be declared:

• surplus with a guarantee of a reasonable job offer; or

• opting and provided with WFA options.

“An employee who is declared surplus with a guarantee of a reasonable job offer can expect to be offered another job within the CPA, normally at an equivalent level,” said the federal government.

An employee who is declared opting must select one of the following options within 120 days:

Option A: 12-month surplus priority entitlement

• The employee has a 12-month paid surplus priority surplus priority entitlement to secure a reasonable job offer in the public service.

• If a reasonable job offer is not secured by the end of this period, the employee will be laid off.

Option B: Transition support measure

• The employee resigns and receives a cash payment based on their years of service.

Option C: Education allowance

• Option C(i)
  The employee resigns, receives a cash payment and an education allowance to attend a recognized learning institution.

• Option C(ii)
  The employee receives a cash payment, an education allowance and up to two years of leave without pay while attending a recognized learning institution. If a reasonable job offer is not secured at the end of their leave without pay, the employee will be laid off.

“If an employee does not confirm their selection within the 120-day period, option A will apply,” Ottawa said.