Last Updated On 9 April 2026, 8:41 AM EDT (Toronto Time)

The Government of Canada has officially launched the Early Retirement Incentive (ERI) program for federal public servants across the country.

Applications opened on March 27, 2026, and eligible employees now have until July 24, 2026, to submit their requests through the designated portal.

This program allows qualifying federal workers to retire earlier than their standard retirement age without facing any permanent pension reduction.

The initiative was first announced as part of the Canada Strong Budget 2025 and received Royal Assent on March 26, 2026.

It represents one of the most significant voluntary workforce transition programs the federal government has introduced in recent years.

According to Treasury Board spokesperson Mohammad Kamal, approximately 3,700 federal public servants submitted applications within the first 12 days of the program going live.

Around 68,000 public servants received eligibility letters inviting them to check whether they qualify for the incentive.

The federal government has estimated the total cost of this early retirement initiative at roughly $1.5 billion over five years, with nearly half of that spending expected in 2026.

What Is the Early Retirement Incentive Program

The Early Retirement Incentive program is a time-limited initiative designed to allow eligible federal public servants to retire before reaching their standard retirement age.

Under normal pension rules, employees who leave the public service before meeting the full age and service requirements for an immediate annuity face a permanent pension reduction.

This penalty amounts to 5 percent for every year the employee retires early.

For instance, if a federal worker retires five years ahead of schedule, their pension would normally be reduced by 25 percent.

The ERI program removes this penalty entirely for approved applicants.

Eligible employees who are approved through the program can retire with an unreduced pension based on their total years of pensionable service and their best five consecutive years of salary.

Treasury Board President Shafqat Ali stated that the program emphasizes voluntary and structured options that give employees clarity and predictability about their retirement.

Key Dates and Deadlines

Milestone	Date
Budget 2025 Royal Assent	March 26, 2026
Application Portal Opens	March 27, 2026
Application Deadline	July 24, 2026
Early Retirement Program Period	March 26, 2026 to January 20, 2027
Employee Retirement Deadline	January 20, 2027

Who Is Eligible to Apply for the Early Retirement Incentive

The government has divided eligible employees into two distinct groups based on when they first joined the public service pension plan.

Applicants must meet all of the following requirements on the day they cease to be employed, and their retirement date cannot be later than January 20, 2027.

Group 1: Employees Who Joined the Pension Plan On or Before December 31, 2012

Federal public servants in this group must be at least 50 years old at the time they leave employment.

They must have accumulated at least 2 years of pensionable service under the public service pension plan.

They must also have a minimum of 10 years of total employment in the federal public service.

Group 2: Employees Who Joined the Pension Plan On or After January 1, 2013

Employees in this group face a slightly higher age threshold and must be at least 55 years old.

They also need a minimum of 2 years of pensionable service and at least 10 years of employment in the public service.

Criteria	Group 1 (Joined Before 2013)	Group 2 (Joined After 2012)
Minimum Age	50 years	55 years
Pensionable Service	At least 2 years	At least 2 years
Employment in Public Service	At least 10 years	At least 10 years
Retirement Deadline	January 20, 2027	January 20, 2027

Pensionable service refers to the period during which an employee has contributed to the public service pension plan, including any years of service that were bought back.

“Years of employment” refers to the total time spent working in the federal public service, which may include periods when the employee was not contributing to the pension plan.

It is important to note that bought-back service from outside the public service does not count toward the 10 year employment requirement.

Key Benefits of the Early Retirement Incentive Program

The primary advantage of the ERI program is the complete elimination of the early retirement pension reduction for approved applicants.

Under ordinary circumstances, retiring before the standard age triggers a 5 percent penalty per year, which is permanent and applies to every pension payment for the rest of the retiree’s life.

Through this program, that penalty disappears, and the annual pension is calculated using the full years of pensionable service at the standard 2 percent accrual rate.

Employees also gain the ability to plan their departure with certainty, knowing exactly what their pension will look like without any reduction.

The government has made pension estimation tools available through the My GC Pension Portal and a basic pension calculator for employees without portal access.

Dedicated pension counselling appointments are also being offered through the Government of Canada Pension Centre to help employees make informed decisions.

Examples of Pension Calculations Under the ERI

Example 1: Alex, Group 1 Member With 19 Years of Service

Alex is 53 years old and has accumulated 19 years of pensionable service in the federal public service.

His best five consecutive years of salary average out to $55,556 per year.

Because he joined the pension plan before 2013, he falls into Group 1, and his standard unreduced retirement age would be 60.

Retiring at 53 means he would be leaving 7 years early, which would normally trigger a 35 percent permanent pension reduction.

Without the ERI program, his annual pension would be approximately $13,722.

With the ERI program, the 35 percent reduction is completely waived, and his unreduced annual pension would be approximately $21,111.

Scenario	Pension Reduction	Yearly Pension
Without ERI	35% reduction	$13,722
With ERI	No reduction	$21,111

That represents an additional $7,389 per year in pension income for the rest of his life.

Example 2: Samira, Group 2 Member Turning 55 During the Program

Samira is 54 years old and has 10 years of pensionable service with a best five-year average salary of $63,448.

She joined the pension plan after January 1, 2013, placing her in Group 2, where the unreduced retirement age is 65.

She will turn 55 on November 1, 2026, making her eligible under the program once she reaches that age and before the January 20, 2027 deadline.

Retiring at age 55 would normally mean a 50 percent penalty because she would be leaving 10 years before her unreduced retirement age.

Without the ERI, her annual pension would be approximately $6,344.80 per year.

With the ERI approved, her annual pension doubles to approximately $12,690 per year because the 50 percent reduction is waived entirely.

Scenario	Pension Reduction	Yearly Pension
Without ERI	50% reduction	$6,344.80
With ERI	No reduction	$12,690

How to Apply for the Early Retirement Incentive

The application process involves several steps that employees should follow carefully before and after submitting their request.

Step 1: Confirm Your Eligibility

Eligible employees who have access to the My GC Pension Portal will receive an email notification about a letter available in the portal.

Those without portal access will receive their eligibility letter by regular mail.

If you believe you are eligible but have not received any communication, you should contact the Government of Canada Pension Centre directly.

Step 2: Estimate Your Pension

Before applying, employees are strongly encouraged to use the pension estimation tools provided by the government.

The My GC Pension Portal allows personalized pension estimates based on different retirement scenarios.

A basic pension calculator is also available online for employees who do not have access to the portal.

Employees can also book a dedicated ERI pension counselling appointment through the Pension Centre.

Step 3: Notify Your Manager

Before submitting your formal application, you must inform your manager of your intent to apply and discuss potential retirement dates.

However, formal approval of the retirement date by your manager should only occur after the Deputy Head has reviewed your application.

Step 4: Submit Your Application

Applications can be submitted through the Early Retirement Incentive tool in the TBS Applications Portal if your organization has access.

Alternatively, employees can use the manual Request for the Early Retirement Incentive form (PWGSC-TPSGC 2025E) available on the government website.

Step 5: Await Review and Approval

After submission, your Deputy Head will review the application against Treasury Board-approved criteria.

If accepted, the application moves to the Pension Centre for a final eligibility validation before your retirement is confirmed.

How Applications Are Reviewed and Approved

Meeting the eligibility criteria does not automatically guarantee that an employee will be approved for the Early Retirement Incentive.

Each application goes through a two-stage review process that involves both departmental and pension centre validation.

Deputy Head Review

Your Deputy Head or equivalent will assess the application against three key criteria established by the Treasury Board.

First, the organization must have an identified need to reduce its workforce.

Second, services to Canadians must be maintained at adequate levels even after the departure of the employee.

Third, current and future operational or business needs of the department must continue to be met.

Pension Centre Validation

Once the Deputy Head endorses the application, it is forwarded to the Pension Centre.

The Pension Centre performs a final validation to confirm that the employee meets all age, pensionable service, and employment eligibility parameters.

If everything checks out, the employee receives a retirement package through the My GC Pension Portal or by mail with instructions on completing the process.

Important: Resignation Is Irrevocable

Once an employee submits a resignation letter and it is accepted by their manager, the application can no longer be withdrawn.

The retirement date becomes irrevocable unless the Pension Centre later determines that the employee does not meet the eligibility parameters.

How Many Federal Employees Have Already Applied

According to the latest available data reported on April 8, 2026, approximately 3,700 federal public servants have already submitted applications for the Early Retirement Incentive.

This figure represents about 5.4 percent of the roughly 68,000 employees who received eligibility letters from the government.

The Treasury Board has indicated that not all applicants will necessarily be approved, as departmental needs and operational requirements play a significant role in the decision.

Bill Matthews, the Secretary of the Treasury Board, stated that the government wants to ensure it preserves its capacity to provide services and advice while managing workforce reductions.

A public tracking dashboard is expected to be launched by the Treasury Board to monitor the number of applications received across the federal public service.

With the application window remaining open until July 24, 2026, these numbers are likely to increase substantially in the coming weeks and months.

Metric	Figure
Eligibility Letters Sent	Approximately 68,000
Applications Received (as of April 8, 2026)	Approximately 3,700
Estimated Program Cost (5 Years)	$1.5 Billion
Planned Public Service Reductions by 2029	Approximately 28,000 to 30,000 Positions
Application Deadline	July 24, 2026

Who Is Not Eligible for the ERI Program

The Early Retirement Incentive is not available to employees who are already entitled to a separation benefit under any workforce adjustment or employee transition agreement.

This includes employees who have already chosen or been deemed to have chosen an option under workforce adjustment provisions.

Employees entitled to any other departure benefit or compensation related to involuntary job loss are also excluded.

However, employees who have received an opting letter under workforce adjustment but have not yet selected an option remain eligible to apply for the ERI until they make their workforce adjustment selection.

Employees who already have an accepted retirement date on file are also not eligible to switch to the ERI program.

Union Response and Policy Grievances

The Public Service Alliance of Canada has filed a formal policy grievance against the Early Retirement Incentive program.

PSAC alleges that the government acted unfairly by announcing and implementing the program without negotiating the terms with the union first.

The union argues that offering separation packages directly to individual employees constitutes interference with the collective bargaining process.

PSAC has asked the Federal Public Sector Labour Relations and Employment Board to suspend the program pending formal negotiations.

The Professional Institute of the Public Service of Canada has also launched its own policy grievance over the initiative.

Both unions have emphasized that they are not opposed to early retirement options in principle but believe the process must be negotiated and compliant with existing collective agreements.

Legal experts have noted that the labour board process could take months to reach a conclusion, and in the meantime, the program is expected to continue operating as planned.

Employees who accept the incentive before any board ruling are unlikely to have their benefits clawed back retroactively, according to labour law analysis.

Important Considerations Before Accepting the ERI

Financial planners caution that while the ERI eliminates the early retirement penalty, it does not grant additional years of pensionable service.

This means that many eligible employees may not have accumulated the 35 years of service needed for a full pension at 70 percent of their best five-year salary average.

Employees should carefully assess their total retirement income from all sources, including CPP, OAS, personal savings, and any registered retirement plans.

Tax implications of early retirement should also be discussed with a qualified financial advisor or a fee-only certified financial planner.

Michael Lutes, COO of Ecivda Financial Planning Boutique in Ottawa, has advised employees to take a step back and thoroughly evaluate what they want for their future before making a decision.

He has cautioned that there is considerable misinformation circulating about the program and that the nuances of individual pension situations can vary widely.

Employees on long-term disability who are accepted for medical retirement generally will not benefit from the ERI, as medical retirement already offers the same early retirement adjustment waiver.

How to Succeed With Your Early Retirement Application

Start by carefully reviewing your eligibility using the My GC Pension Portal or by contacting the Pension Centre to confirm your age, service, and employment details.

Use the available pension calculators to model different retirement scenarios and understand exactly what your unreduced pension would look like.

Book a pension counselling appointment early, as the Pension Centre is experiencing high call volumes and wait times may be longer than usual.

Have an open conversation with your manager about your intentions before submitting the formal application to ensure a smooth process.

Do not delay your application if you are interested, as the July 24, 2026 deadline is firm and cannot be extended.

Consider consulting a certified financial planner to assess how the early retirement fits into your overall financial picture, including tax implications and long-term income planning.

Remember that once your resignation is accepted by your manager, it becomes irrevocable, so make sure you are confident in your decision before taking that step.

Frequently Asked Questions (FAQs)

Fact Checked: This article has been reviewed for accuracy based on official Government of Canada sources as of April 9, 2026.

Disclaimer: This article is for informational purposes only and does not constitute financial, legal, or professional advice. Readers should consult with qualified professionals before making retirement decisions.

---

---

You may also like: 3 New CRA Benefit Payments For Ontario Residents In April 2026

6 New Ontario Laws and Rules Taking Effect In April 2026

New Canada Laws and Rules Coming April 2026

New Canada Groceries Benefit Payments Coming In Mid-2026