The guide to wage subsidies and hiring programs in Canada

Wage subsidies and hiring programs in Canada pay part of the wages of a new employee, usually a student, a young person, someone facing barriers to work, an apprentice or a graduate research intern. You hire and pay the person, then the program reimburses a share after you send proof of payroll. The key rules are simple: apply and get approved before the person starts, follow the agreement, and keep complete payroll records.

What is a wage subsidy?

A wage subsidy is funding tied to a specific job. The program agrees to cover part of the wages (and sometimes benefits or training) for a set period. You remain the employer: you recruit, sign the employment contract, run payroll and supervise.

Most wage subsidies are paid by reimbursement. You pay the employee first, then send a claim to get the subsidy back. That means you need enough cash to carry the wages until the claim is paid. Each program sets its own share of costs and any limit per position; check the program page.

Wage subsidies are a type of non-repayable funding. If you follow the agreement, you don't pay them back. If the job ends early or changes, you may receive less.

What kinds of hiring programs exist?

Hiring programs are usually built around a group of workers the funder wants to help into jobs. The main kinds are below.

Summer jobs for young people

Summer job programs help employers create seasonal jobs for youth. The best known is Canada Summer Jobs, a federal program open to not-for-profits, public sector employers and small private businesses. It has a yearly application window that closes months before summer, so plan to apply well ahead of the season. Some provinces and cities run their own summer programs too.

Work placements for post-secondary students

Work-integrated learning programs support co-op terms, internships and other placements tied to a college or university program. The Student Work Placement Program is a federal program delivered through a network of delivery partners, often industry organizations. You apply to a partner, not to the government. Partners may focus on certain sectors and can reach capacity, so if one partner can't help, try another.

Research and business internships

Mitacs runs internship programs that pair organizations with students and researchers:

Mitacs Accelerate supports research projects with graduate students and postdoctoral researchers, supervised by a professor. Your organization contributes part of the cost and Mitacs adds funding. Talk to a Mitacs advisor first, and don't start the work before the award letter.
Mitacs Business Strategy Internship supports a post-secondary student working on a business problem such as strategy, operations or digital adoption. Your organization pays a share and Mitacs covers the rest.

These differ from a classic wage subsidy: the program funds the intern's project rather than reimbursing your payroll, and your organization's share is a contribution to it. Check each program page for how payments work.

Youth employment programs

Beyond summer jobs, there are programs that help young people who are not in school get their first job or build skills. They are often delivered by community organizations, colleges or industry groups. Browse programs for youth and hiring programs.

People facing barriers to work

Some programs support hiring people with disabilities, newcomers, Indigenous people, people who have been out of work for a long time, or others who face barriers. These are often run by provinces or by community employment agencies, and may include job coaching or training on top of a wage subsidy. Your local employment services centre is a good place to ask.

Apprentices and skilled trades

Apprenticeship support can include grants or tax credits for employers who hire apprentices, and training support for the apprentices themselves. The rules depend on the trade and the province. See training programs.

How does approval work?

The steps are similar across most programs:

Check eligibility. Your organization type, size, location and the position all matter. Read how to read eligibility rules.
Apply during the intake. Some programs have a fixed intake window; others take applications any time (continuous intake) until funding runs out. Some are first come, first served.
Describe the job. Expect to give a job title, duties, supervision plan, hours, wage, start and end dates, and how the job helps the worker build skills.
Wait for a decision. Many programs are competitive and take weeks or months to decide. See what happens after you apply.
Sign the agreement. If approved, you sign a contribution agreement or accept an award letter. Read its conditions carefully.
Hire and start. Only now should the person begin work, within the dates the program allows.

When should I apply?

Earlier than you think. Most wage subsidies pay only for work done after approval, so costs before then are retroactive and usually not claimable. Read apply before you spend.

A simple timeline:

Summer students: apply during the program's intake, which is usually well before the summer.
Co-op and placements: line up the subsidy at the same time you post the placement with the school, before the term starts.
Research and business interns: plan for review time; Mitacs asks you to allow several weeks before the start date.
Year-round programs: apply as soon as you know you'll hire, since funding can run out.

Watch closing soon for upcoming deadlines.

What paperwork and payroll records do I need?

Good records are the difference between a smooth claim and a delayed one. Keep:

the signed agreement or award letter, with any amendments
the job posting and job description
the employee's eligibility documents, if the program asks (for example proof of enrolment)
the employment contract or offer letter with the start date
timesheets or hours worked for each pay period
pay stubs and payroll registers showing gross wages, deductions and net pay
proof of payment, such as bank records of the deposits
any mid-point or final reports the program asks for

Run the subsidized employee through your normal payroll, with the usual source deductions. Programs generally reimburse wages actually paid, not wages promised. Read getting paid: claims and reports and our grant application checklist.

Can I stack wage subsidies with other funding?

Sometimes. Stacking means using more than one source of public funding for the same costs. Many programs set a limit on total government assistance for the same position, and some don't allow two wage subsidies for the same wages. You may be able to combine a wage subsidy for one hire with a grant for a different part of a project.

Always declare other funding when you apply and when you claim. If you aren't sure, ask the program before you sign. Read can you combine grants?.

Wage subsidies can also affect tax credits. For example, wages funded by a subsidy may reduce what you can claim under a tax credit program for the same work. Talk to your accountant.

What are the common mistakes?

Hiring before approval and losing the subsidy for those weeks.
Changing the job, hours or dates without telling the program.
Paying the worker in cash or outside payroll, with no clear records.
Missing claim or report deadlines in the agreement.
Assuming two programs can pay for the same wages.
Hiring someone who doesn't meet the program's definition of an eligible worker.
Paying a fee to someone who promises a "guaranteed" subsidy. Real programs don't charge to apply. See how to spot a grant scam and our scam warning signs.

Where do I start?

Decide what role you need and when.
Use the funding check to see hiring programs that fit your organization and location.
Read each program page for the current rules, amounts and dates.
Apply early, wait for approval, then hire.

For a shorter version focused on students, read hiring a student: how wage subsidies work. Small businesses can also see funding for small businesses, and non-profits funding for non-profits.

Frequently asked questions

Do I have to pay back a wage subsidy?

No, as long as you follow the agreement. If the job ends early, changes, or doesn't meet the program's terms, you may receive less or need to return part of what you received.

Can I use a wage subsidy for an employee I already have?

Usually not. Most programs are meant to create a new job or a new placement. Some allow existing staff in specific cases, such as training programs. Check the program page.

How long does it take to get paid?

It depends on the program. You usually pay wages first and then claim, and claims are processed after they are reviewed. Plan your cash flow so you can carry the wages in the meantime.

Can a non-profit use these programs?

Yes. Many hiring programs accept non-profits, and some give them better terms than businesses. See funding for non-profits and the non-profit funding guide.

Are Mitacs internships the same as wage subsidies?

Not exactly. Mitacs programs fund an intern's project, with your organization paying a share, rather than reimbursing your payroll. The idea is similar, but the paperwork and rules are different. Check each program page.

This article explains how funding generally works. Each program sets its own rules, amounts and dates: check the program page and the funder’s site before you apply. A CanGrant editor hasn’t reviewed this article yet.