Early Retirement Incentive
Budget 2025 received Royal Assent on , meaning that the Early Retirement Incentive program is now available and eligible employees may now apply until .
About the Early Retirement Incentive
Normally, when an employee retires before meeting the age and service requirements for an immediate annuity, their pension is permanently reduced by 5% for each year they retire early. For example, if they retire 5 years early, their pension will be reduced by 25%.
Under the Early Retirement Incentive program, eligible employees can apply to retire based on age and years of service with no reduction for early retirement. The annual pension amount will be calculated using the total years of pensionable service up to the early retirement date.
Who is eligible to apply
To be eligible to apply to the Early Retirement Incentive program, you must meet the following eligibility parameters on the day you cease to be employed (the day following your last day of employment), with your date of retirement being no later than .
Group 1: You joined the public service pension plan on or before , and
- are at least 50 years old
- have at least 2 years of pensionable service
- have at least 10 years of employment in the public service
Group 2: You joined the public service pension plan on or after , and
- are at least 55 years old
- have at least 2 years of pensionable service
- have at least 10 years of employment in the public service
Pensionable service is the time you contributed to the public service pension plan, including the years you bought back, if applicable.
Years of employment is the total time you worked in the public service. It may include periods when you were not contributing to the public service pension plan. It doesn’t include service you bought back from outside the public service.
Criteria
Meeting the eligibility parameters does not guarantee you will be approved for the Early Retirement Incentive. Your Deputy Head (or equivalent) will review your application to confirm whether the following Treasury Board-approved criteria have been met:
- The organization needs to reduce its workforce
- Services to Canadians will be maintained
- Current and future operational or business needs will continue to be met
If your application is accepted by your Deputy Head, it will be submitted to the Pension Centre for a final validation to ensure that you meet the age, and service eligibility parameters to retire under the Early Retirement Incentive program.
Workforce adjustment or other separation benefits
As established by the Treasury Board, the Early Retirement Incentive is not available to employees who are entitled to a separation benefit under the terms of any workforce adjustment or employee transition instruments or provisions. Being entitled to a separation benefit includes the following:
- Having chosen or being deemed to have chosen an option under workforce adjustment, career transition, or similar provisions;
- Being entitled to any other departure benefit or compensation to facilitate the involuntary end of employment.
This means, for example, that employees who have received an opting letter under workforce adjustment continue to be eligible to apply for the Early Retirement Incentive until such time as they have chosen or are deemed to have chosen an option under the terms of their workforce adjustment provisions or, in the case of executives, a career transition or similar measure.
For more information, visit:
- Workforce adjustment (for employees)
- Career transition (for executives)
Pension waivers
The Early Retirement Incentive is a different program than the existing pension waiver available under the Public Service Superannuation Act under certain conditions, such as workforce adjustment. Employees who resign or are laid off because of a workforce adjustment or career transition situation may be eligible for an existing pension waiver.
For more information about the existing pension waiver, visit:
- Pension Eligibility at Age 60 - Workforce Adjustment and Pension Waivers (for Group 1 members)
- Pension Eligibility at Age 65 - Workforce Adjustment and Pension Waivers (for Group 2 members)
Before applying
Timelines
- Early Retirement Incentive program period (300 days): , to
- Application period (120 days): , to
- Employee retirement deadline:
Note: If you meet the eligibility parameters during the program period, you must retire after you become eligible and before the Early Retirement Incentive program ends.
Confirming eligibility
Eligible employees who have access to the My GC Pension Portal will receive an email notifying them that a letter is available in the Portal. Eligible employees who do not have access to the Portal will receive the letter in the mail. If you think you are eligible but didn’t receive an email or a letter, contact the Pension Centre.
Estimate your pension
Two pension calculation tools are available to give you a general idea of your pension based on different scenarios:
My GC Pension Portal
Sign in to My GC Pension Portal to create or view your pension estimates (accessible only on the Government of Canada network).
Basic pension calculator
If you don’t have access to My GC Pension Portal, you may use the Basic pension calculator.
For assistance
- Schedule an Early Retirement Incentive program pension counselling appointment with the Government of Canada Pension Centre using the booking tool, available at Canada.ca/employee-pension-appointment, or by calling the Pension Centre.
- Refer to the examples of pension calculations provided to help understand the incentive.
Application process
Ahead of submitting your application, notify your manager of your intent to apply to the Early Retirement Incentive and discuss possible retirement dates. Formal approval of your retirement date by your manager should only be done if your Deputy Head has reviewed and confirmed that your application meets the program criteria.
When you are ready to apply, submit your Early Retirement Incentive application by using:
- the Early Retirement Incentive (ERI) tool in the TBS Applications Portal (TAP), if your organization has access; or,
- the Request for the Early Retirement Incentive form (PWGSC-TPSGC 2025E). Instructions on the manual application process are available on the form.
Application review
If your application meets the criteria
If you applied through the ERI tool in TAP, you must:
-
Submit a resignation request in writing to your manager with your retirement date. You must retire before the end of the 300-day Early Retirement Incentive program period (). Your manager must accept your resignation letter.
Note: Once your manager accepts your resignation, you can no longer withdraw your Early Retirement Incentive program application. Your retirement date is irrevocable, unless the Pension Centre later determines that you do not meet the age, service and employment eligibility parameters.
- Upload your approved resignation request to the ERI tool in TAP, then submit your application. It will automatically be sent to the Pension Centre.
- Once the Pension Centre has confirmed your eligibility and approved your application, you will receive a retirement package through the My GC Pension Portal. Follow the instructions in the retirement package.
If you applied using the Request for the Early Retirement Incentive form (PWGSC-TPSGC 2025E), you must:
- Complete ‘Section C: Confirmation of voluntary resignation date’ on the form.
- Submit the completed form to your departmental Early Retirement Incentive coordinator, who will email it to the Pension Centre.
- Once the Pension Centre has confirmed your eligibility and approved your application, you will receive a retirement package by mail. Follow the instructions in the retirement package.
If your application does not meet the criteria
You may contact your departmental Human Resources should you have questions about why your application does not meet the criteria.
Examples of pension calculations
Group 1 member with 19 years of service
Alex is 53 years old and has 19 years of pensionable service. His average salary (best 5 consecutive years) is $55,556. He’s a Group 1 member.
Eligibility
Alex qualifies for the Early Retirement Incentive program because:
- He has at least 10 years of employment in the public service
- He has at least 2 years of pensionable service
- He’s at least 50 years old
Pension calculation
Under normal circumstances, because Alex is retiring 7 years before qualifying for an immediate annuity at age 60, his pension would be reduced by 35% (7 years × 5% reduction per year = 35% reduction). Based on 19 years of pensionable service with an average salary of $55,556, Alex would receive a reduced pension amount of approximately $13,722 per year.
But if Alex is approved to participate in the program, the 35% pension reduction wouldn’t apply. Based on the same 19 pensionable years of service and average salary, Alex would instead receive an unreduced pension of approximately $21,111 per year.
| Scenario | Pension reduction | Yearly pension amount |
|---|---|---|
| Without the Early Retirement Incentive program | 35% reduction | $13,722 |
| With the Early Retirement Incentive program | No reduction | $21,111 |
Group 2 member turning 55 during the Early Retirement Incentive program period
Samira is 54 years old and has 10 years of pensionable service. She’ll turn 55 on . Her average salary (best 5 consecutive years) is $63,448. She’s a Group 2 member.
Eligibility
Even though Samira is 54 today, she qualifies for the Early Retirement Incentive program because:
- She has at least 10 years of employment in the public service
- She has at least 2 years of pensionable service
- She’ll meet the minimum age requirement of 55 years when she ceases to be employed but before the retirement deadline under the incentive.
Pension calculation
Under normal circumstances, if Samira retires at age 55, she would be retiring 10 years before qualifying for an immediate annuity at age 65. Samira’s pension would be reduced by 50% (10 years × 5% reduction per year = 50% reduction). Based on 10 years of pensionable service with an average salary of $63,448, Samira would receive a reduced pension amount of approximately $6,344.80 per year.
But if Samira is approved to participate in the program, the 50% reduction wouldn’t apply. Based on the same 10 years of pensionable service and average salary, Samira would instead receive an unreduced pension amount of approximately $12,690 per year. Samira’s earliest eligible retirement date would be , her 55th birthday.
| Scenario | Pension reduction | Yearly pension amount |
|---|---|---|
| Without the Early Retirement Incentive program | 50% reduction | $6,345 |
| With the Early Retirement Incentive program | No reduction | $12,690 |
For more information
Pension reduction and pension options
For more information on how the pension reduction usually applies if you retire early, and on other pension options, visit:
Health and dental benefits
You may be eligible for health and dental coverage in retirement. For more information, visit Life events: Preparing for retirement
Frequently asked questions
Eligibility
What if I meet the required age or years of service after the program begins?
The eligibility parameters (age and years of service and employment) must be met during a 300-day period from when the program began. If you meet them during the 300-day period, you would only be able to retire after you have met them. This means you would need to retire after you become eligible but before the program ends.
How will I know if I’m eligible?
Eligible employees will receive a letter confirming their eligibility to apply for the Early Retirement Incentive program and advising of next steps. For eligible employees who have access to the My GC Pension Portal, they will receive an email notifying them that the letter is available in the Portal. Eligible employees who do not have access to the Portal will receive the letter in the mail.
If you think you’re eligible but didn’t receive an email or a letter, please contact the Pension Centre.
If I meet eligibility parameters, does that guarantee I will be approved to retire under the Early Retirement Incentive program?
No. Meeting the eligibility parameters of the program (age, years of service and employment) does not guarantee your approval to participate in the program. Eligible employees must submit an application and their Deputy Head must confirm that the following criteria are met:
- The organization needs to reduce its workforce
- Services to Canadians will be maintained
- Current and future operational or business needs will continue to be met
Application process
Can my application be denied?
If you do not meet the eligibility parameters or criteria, your application will be denied.
Can I be required to participate in the program?
No. Participation in the Early Retirement Incentive program is entirely voluntary.
Impacts to benefits
Will my health and dental benefits continue if I’m approved for the program?
You may be eligible to apply for health and dental coverage in retirement. For more information, visit Life events: public service group insurance benefit plans.
ERI tool in TAP
What’s the purpose of the ERI tool in TAP?
The Early Retirement Incentive (ERI) program tool in the TBS Applications Portal (TAP) was created to facilitate the ERI program application process.
Eligible employees can complete and submit their Early Retirement Incentive program application if their organization has access to TAP.
Deputy Heads can confirm if applications meet the program criteria.
Who will have access to the tool?
The ERI tool in TAP is available to all employees within organizations with access to the TBS Applications Portal (TAP). Alternatively, employees can apply by completing the application form manually.
Can I complete a regular retirement request within the ERI tool in TAP?
No. This tool is only for completing and submitting applications to the Early Retirement Incentive program.
Where can I access the ERI tool in TAP?
The ERI tool is accessible through the TBS Applications Portal.
If I don’t want to use the ERI tool in TAP or don’t have access, would I still be able to submit my application?
Yes. You can complete the Request for the Early Retirement Incentive form (PWGSC-TPSGC 2025E) and submit it to your departmental Early Retirement Incentive coordinator.