Canada’s escalating trade confrontation with the United States has created an unusual alignment between organized labour and Prime Minister Mark Carney’s government — but it is far from unconditional. Unifor, Canada’s largest private-sector union, has backed Ottawa’s decision to retaliate against the latest U.S. tariffs, calling the countermeasures an important first response to pressure from President Donald Trump.
The union’s endorsement comes with a major warning. While Ottawa has paired its tariff response with billions of dollars in business assistance, Employment Insurance changes and worker-retention measures, Unifor says too many employees remain vulnerable if layoffs spread. The dispute is therefore becoming about more than tariff rates. It is testing whether Canada can defend its industrial base while ensuring workers do not end up carrying the financial cost of an increasingly unpredictable cross-border trade fight.
Unifor Says Canada Was Right to Fight Back
Unifor National President Lana Payne welcomed Ottawa’s August 25 decision to impose matching counter-tariffs after Washington placed new 50% duties on $27.6 billion worth of Canadian goods. The union has argued for months that Canada should not respond to U.S. pressure with additional concessions, particularly when industries employing thousands of its members are already coping with tariffs. Payne described the counter-tariffs as a “good first response,” while urging the government to combine retaliation with policies capable of keeping production and employment inside Canada.
That distinction matters. Unifor is not simply supporting tariffs as punishment against the United States. Its position is that retaliation must create leverage while Canada strengthens the economy behind the tariff wall. The union wants procurement spending accelerated, national industrial strategies expanded and Canadian businesses encouraged to buy domestically. It also praised Canadian negotiators for refusing the trade arrangement offered by Washington before talks broke down. For organized labour, accepting permanent tariffs in exchange for short-term certainty could potentially make manufacturing investment in Canada less attractive for years.
Ottawa Is Matching Washington Dollar for Dollar
The Carney government’s retaliation is substantial but deliberately targeted. Starting September 8, Canada plans to apply new tariffs of 15%, 25% and 50% to U.S. products representing $27.6 billion in annual imports. Ottawa says the value matches the Canadian goods affected by Washington’s latest tariffs. Products being targeted include steel and aluminum, appliances, dairy products, agricultural equipment, pulp and paper, electronics, furniture and clothing. Existing Canadian counter-tariffs on U.S. automobiles will remain in place.
The government is also trying to prevent retaliation from becoming simply an exercise in raising import costs. Alongside the tariffs, Ottawa unveiled $7.5 billion in new and expanded assistance for workers and companies, building on nearly $25 billion in tariff-related measures introduced during the previous 18 months. That package includes another $1.5 billion for the Regional Tariff Response Initiative, $500 million in additional Business Development Bank of Canada liquidity and $2 billion for a Canada Strong Diversification Fund. Another $3.5 billion is being directed toward rapid-response programs for workers and employers. The scale shows Ottawa is preparing for a dispute that may last considerably longer than a few negotiating rounds.
The New EI Measures Could Matter Quickly
Some of Ottawa’s most immediately relevant changes involve Employment Insurance. The government is extending the temporary waiver of EI’s one-week waiting period by another year and similarly extending rules allowing eligible workers to begin receiving EI without first exhausting separation payments such as severance or vacation pay. Long-tenured workers will continue to have access to an additional 20 weeks of regular EI benefits for another eight months. A separate temporary change will help some workers who previously quit a job qualify when their most recent job subsequently disappears through no fault of their own.
Ottawa is also restructuring support designed to prevent layoffs before workers reach the EI system. A new Workforce Retention and Retraining Program will combine Work-Sharing measures with the Worker Retention Grant, while employers can receive up to $1,000 per participating employee for training and administrative expenses. There is evidence that work-sharing can operate on a meaningful scale during a downturn: by mid-March 2026, the federal government said roughly 1,500 tariff-related Work-Sharing applications had covered more than 54,000 workers and helped prevent an estimated 20,000 layoffs. For a factory facing reduced orders, keeping workers attached to the workplace can be far less disruptive than laying them off and attempting to rehire later.
Unifor Says the Biggest EI Gaps Are Still There
Despite those extensions, Unifor argues that Ottawa has largely reinforced temporary protections instead of repairing weaknesses in the underlying EI system. The union specifically wants lower qualifying-hour requirements for part-time, seasonal, part-year and precarious workers, a higher replacement rate or minimum benefit, and broader extensions to the number of weeks people can receive regular benefits. Under existing rules, most workers need between 420 and 700 hours of insurable employment to qualify, depending on unemployment in their EI economic region.
Benefit adequacy is another concern. For most claimants, regular EI replaces 55% of average insurable weekly earnings, up to a maximum of $729 per week in 2026. Standard regular benefits generally last between 14 and 45 weeks, with the duration determined by accumulated hours and regional unemployment. The government’s extra 20 weeks therefore provide significant protection for eligible long-tenured employees, but Unifor notes that the extension does not apply universally. That distinction can become important when tariff shocks spread through subcontractors, temporary staffing firms and seasonal industries whose workers may have less stable employment histories than employees at major unionized plants.
Manufacturing Workers Have More at Stake Than the National Numbers Suggest
Canada’s overall labour market does not currently resemble a nationwide employment crisis. Employment rose by 75,000 in July 2026 and the national unemployment rate slipped to 6.4%. Manufacturing employment itself increased by about 11,000 during the month. Those headline figures, however, can obscure what happens in highly trade-dependent industrial communities when a specific plant loses orders, delays investment or moves production. Statistics Canada estimates that U.S. demand supported roughly 694,000 Canadian manufacturing jobs in 2024, equivalent to about 41% of manufacturing payroll employment.
The longer-term pressure is already visible. Manufacturing employment fell by nearly 36,000 between December 2024 and December 2025. Employment in motor-vehicle-parts manufacturing dropped 9.3% during that period, while iron and steel mill employment fell 8.7%. More than half of manufacturing businesses responding to a Statistics Canada business-conditions assessment in early 2026 said U.S. tariffs had negatively affected them during the previous year. These figures help explain Unifor’s insistence on income protection. A tariff that affects a relatively small share of national exports can still be devastating when its impact is concentrated in a factory town or a specialized supply chain.
Brampton Shows Why Unifor Is Demanding More Than Cheques
The uncertainty surrounding Stellantis’ Brampton Assembly Plant offers a particularly visible example of the union’s concern. More than 2,200 Unifor members have been on layoff from the facility, which was idled for retooling before Stellantis ultimately shifted planned Jeep Compass production to Illinois. In August, Unifor said Stellantis had informed the union that it was considering discussions involving a potential sale of the Brampton plant. Reuters separately confirmed that the automaker was considering a sale, although no formal closure notice had been issued at the time.
Similar pressures have appeared elsewhere in Ontario’s auto industry. General Motors reduced Oshawa Assembly from three shifts to two earlier in 2026, eliminating roughly 500 jobs directly, while Unifor estimated the impact across the broader supply chain could reach about 1,200 workers. By August, approximately 30% of Unifor members at GM facilities in Canada were on layoff as the union entered bargaining with the company. Situations like these explain why employment insurance alone cannot satisfy labour leaders. EI helps after work disappears; Unifor’s broader objective is to stop strategically important production from disappearing in the first place.
The Union Wants Ottawa to Turn Tariff Defence Into Industrial Policy
Unifor’s preferred strategy extends well beyond retaliatory duties. Payne has called for faster government procurement, stronger domestic industrial strategies and a larger commitment from corporate Canada to buy Canadian products. The union has also promoted a “Sell Here. Build Here.” approach in the auto sector, arguing that companies benefiting from access to Canadian consumers and public support should maintain significant production and employment in Canada. That agenda is designed to make government spending and market access tools for preserving industrial capacity rather than relying primarily on emergency assistance after jobs are lost.
Ottawa has already moved partly in that direction. The federal Buy Canadian procurement framework, introduced in December 2025, prioritizes Canadian suppliers and Canadian content in strategic federal contracts. Its threshold was lowered from contracts worth at least $25 million to those worth at least $5 million in June 2026, greatly expanding its reach. By June 25, the government reported that 14 contracts worth a combined $726.4 million had been awarded under the policy. The new $2-billion Canada Strong Diversification Fund adds another mechanism for companies facing tariffs to finance capital projects and maintain industrial capacity. Unifor’s argument is essentially that these initiatives now need to become the centre of the response, not its supporting cast.
Support for Carney Could Depend on What Happens to Jobs
For the moment, the Carney government and Unifor are broadly aligned on one fundamental point: Canada should not accept a trade agreement that locks damaging U.S. tariffs into place simply to end the political confrontation. That alignment could become increasingly important as Washington raises the stakes. Trump has threatened to increase U.S. tariffs on Canadian cars, trucks and automotive parts to 50% beginning January 1, 2027, while Carney has said Canada remains open to a mutually beneficial agreement if Washington approaches negotiations as a genuine partner and respects Canadian sovereignty.
There is still time for diplomacy to alter that trajectory, and the January auto deadline leaves months for renewed negotiations. But the immediate milestone is September 8, when Canada’s newest counter-tariffs are scheduled to take effect. If the dispute persists, the debate inside Canada will increasingly shift from whether Ottawa should retaliate to whether its domestic protections are strong enough. Unifor has already drawn its line: counter-tariffs are necessary, but workers should not be expected to survive a prolonged trade conflict on temporary programs alone. For Carney, maintaining labour support may ultimately depend less on how forcefully Canada answers Trump than on how many Canadian jobs remain intact while it does.
