Updated August 2026 · Verified against Employment and Social Development Canada / Canada Revenue Agency guidelines
Tax Credit Offset
Program Federal Active

EI Premium Reduction Program

Employment and Social Development Canada / Canada Revenue Agency
Maximum Funding
Not a fixed dollar grant. Employers with a qualifying...
Ongoing; employers may apply at any time and, once granted, entitlement conti...
Visit Official Program →
Difficulty
Hard
Payment
Tax Credit Offset
Trend
Stable
First-Timers
Co-Funding
Varies
EI Premium Reduction Program provides up to Not a fixed dollar grant. Employers with a qualifying short-term disability plan pay EI premiums at a rate lower than the standard 1.4 multiple. For 2026, the best reduced rate for Category 2 or 3 plans is 1.167, yielding a maximum savings example of $261.68 per employee per year. Reduces EI premium rates for employers who provide insured employees with a qualifying short-term disability or wage-loss replacement plan. Applications are accepted on an ongoing basis.
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Eligibility & Details

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Program Description

Reduces EI premium rates for employers who provide insured employees with a qualifying short-term disability or wage-loss replacement plan.

Eligibility Requirements

  • Employer, including for-profits, with insured employees covered by a short-term disability plan.
  • Plan must provide at least 15 weeks of benefits.
  • Plan must match or exceed the level of benefits provided under EI.
  • Benefits must be paid within 8 days of disability.
  • Eligibility period for benefits must be 3 months or less.
  • Plan must cover employees on a 24-hour-a-day basis.
  • Employer must return five-twelfths of the savings to employees covered by the plan.
Provinces
Industries
All
Business Stage
Startup Growth Established

Quick Assessment

Difficulty
Hard
Competition
Low
First-Timer
Not rated

Funding Details

Amount
Not a fixed dollar grant. Employers with a qualifying short-term disability plan pay EI premiums at a rate lower than the standard 1.4 multiple. For 2026, the best reduced rate for Category 2 or 3 plans is 1.167, yielding a maximum savings example of $261.68 per employee per year.
Type
Program
Level
Federal
Deadline
Ongoing; employers may apply at any time and, once granted, entitlement continues until the approved plan changes or is cancelled.

Program Scorecard

Competition, effort, and approval at a glance

Competition
Low
Deadline
Ongoing
Approval
Varies
Accessibility
--/5
Competition
--/5
Approval Rate
--%
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What's in this Playbook

Everything you need to win EI Premium Reduction Program

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How to Win

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Insider Tip

Category 2 enhanced cumulative paid sick leave plans or Category 3 weekly indemnity plans with 15 or more weeks qualify for the 2026 best reduced rate of 1.167.

Rejection Pitfalls 6

  • Plan does not provide at least 15 weeks of benefits
+5 more pitfalls
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Success Profile

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Evaluation Criteria

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Application Playbook

Step-by-step process, required documents, and expenses

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Application Steps

1 Complete the application form Fill out the Application for Employment Insurance Premium Reduction (NAS5022).

Required Documents 5

Completed Application for Employment Insurance Premium Reduction (NAS5022) form
Copy of the short-term disability plan(s) provided to employees

Intake Periods

Deadline Notes

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Funding Stack Strategy

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Clawback Risk

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How EI Premium Reduction Program Compares

Side-by-side with similar programs

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