When a key employee leaves for military duty, your business still has bills to pay. Canada’s federal government recognizes this strain and offers targeted financial support to employers of military reservists who are called up for full-time operations. The main program doing this work is the Compensation for Employers of Reservists Program (CERP), delivered by Employment and Social Development Canada (ESDC).
This article explains how federal compensation works, who qualifies, and what you can expect if one of your employees is deployed.
The Compensation for Employers of Reservists Program (CERP) provides financial support to civilian employers when a reservist employee is deployed on full-time operational duty. This includes operations directed by the Chief of the Defence Staff, in Canada or abroad.
CERP is not a wage subsidy. Instead, it helps cover operational costs your business faces while the reservist is away, such as overtime, temporary replacements, or lost productivity.
You may be eligible for CERP if:
Self-employed reservists can also apply directly if they meet the program’s definition of a reservist.
CERP does not provide funding to:
CERP provides a lump-sum payment based on the length of the reservist’s deployment.
Key funding details include:
The exact dollar amount varies and is tied to program formulas set by ESDC, rather than your employee’s wage.
Because funding levels and deployment lengths differ, tools like GrantHub’s eligibility matcher can help you filter programs by federal scope and workforce impact in seconds, especially if you manage multiple locations or staff categories.
CERP applications are handled by the federal government and follow a clear process.
Here’s what to expect:
Deployment confirmation
You must confirm that your employee was deployed on a qualifying, full-time operation.
Employer application submission
Employers submit the application directly to ESDC. Self-employed reservists apply on their own behalf.
First come, first served review
Applications are processed in the order received, as long as funding remains available.
Payment issuance
Approved applicants receive a lump-sum payment after review and validation.
Timing matters. Delays in applying can increase the risk of missing available funding.
Assuming all reservist leave qualifies
Only Chief of Defence Staff–directed operations count. Training and routine service do not qualify.
Applying as a federal employer
Federal departments and Crown corporations are excluded, even if they employ reservists.
Waiting until deployment ends
CERP is first come, first served. Late applications may be rejected if funds are depleted.
Misunderstanding tax treatment
CERP funding is generally treated as business income. Always confirm with your accountant before filing.
Q: What is the Compensation for Employers of Reservists Program (CERP)?
CERP is a federal program that provides lump-sum financial compensation to employers and self-employed reservists when reservists are deployed on full-time operational duty.
Q: Which reservists qualify under CERP?
Only members of the Primary Reserve and Canadian Rangers on full-time operational deployments are eligible.
Q: Are federal government employers eligible for CERP?
No. Federal departments, agencies, and Crown corporations are explicitly excluded from the program.
Q: Is CERP funding taxable?
CERP payments are generally considered business income. The tax impact depends on your business structure, so professional advice is recommended.
Q: Is CERP funding guaranteed if I apply?
No. Applications are assessed on a first come, first served basis, subject to available federal funding.
Federal programs like CERP can ease the financial impact when a reservist employee is called to serve. The key is knowing which deployments qualify and acting quickly when they do.
GrantHub tracks active federal and provincial grant programs across Canada and helps you check which ones match your business profile, workforce structure, and location—so you don’t miss support that’s already available.
Was this article helpful?
Rate it so we can improve our content.
Canada Proactive Disclosure Data
The Canadian government has funded over 400,000 businesses through 1.27 million grants and contributions. Check your eligibility in 60 seconds.