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News Analysis

Quebec's Video Game Layoffs Deepen: A Practical Guide for Laid-Off Montreal Game Developers

With Bethesda, Xbox, EA, and other Montreal studios cutting staff within the last four months, Quebec's video game workforce faces its most sustained downturn in years. Here's practical guidance on severance rights, Employment Insurance, and career transition options for laid-off developers.

By Refdesk Team

Quebec's Video Game Layoffs Deepen: A Practical Guide for Laid-Off Montreal Game Developers

What This Means for You

If you are a game developer, artist, designer, QA tester, or producer working in Montreal or elsewhere in Quebec's video game sector, the wave of layoffs hitting Bethesda, Xbox, Electronic Arts, Behaviour Interactive, and other studios over the past four months is not a one-off event — it reflects a structural shift in how major publishers are staffing Canadian studios, and it changes what you should be doing right now whether you have already been laid off or are watching your own employer's next move. Below is our practical guidance for navigating severance, Employment Insurance, and the job search in a sector that employs roughly 34,000 people across Canada, nearly half of them in Quebec.

If You Were Just Laid Off:

Immediate action:

  • Do not sign a severance or release agreement the same day you receive it. Quebec's Act respecting labour standards gives non-unionized employees statutory minimum notice or pay in lieu based on length of service, but many severance offers include a release of legal claims in exchange for anything beyond that statutory floor — and you are generally entitled to take time to review it. Have an employment lawyer or your union representative (if applicable) review the offer before signing, particularly if you were laid off with less than the two weeks' notice Quebec's labour standards board (CNESST) recommends confirming for your specific tenure.
  • If you were a union member, such as staff represented by CWA Canada at Bethesda's Montreal studio, contact your union representative immediately rather than negotiating severance individually. CWA Canada has publicly stated it is demanding immediate bargaining over severance terms, internal placement into open roles at other Microsoft-owned studios, and recall rights for members affected by the Xbox-wide cuts — protections an individual negotiating alone would not have access to.
  • Apply for Employment Insurance (EI) regular benefits within four weeks of your last day of work, even if you expect a severance payment. Service Canada requires you to apply promptly to preserve your claim date, and any severance or termination pay you receive will typically be allocated against your EI benefit period rather than disqualifying you outright — but the calculation depends on how the payment is structured, so apply first and let Service Canada determine the allocation rather than assuming you are ineligible.

What to prepare:

  • Request your Record of Employment (ROE) from your employer in writing if it has not been issued within five days of your last day worked or the end of your pay period, since Quebec employers are legally required to issue it electronically to Service Canada in most cases, and delays are one of the most common reasons EI applications stall.
  • Calculate your CNESST statutory minimum before evaluating any severance offer. Under Quebec's labour standards, notice or pay in lieu scales with service: roughly one week for employees with three months to one year of service, two weeks for one to five years, four weeks for five to ten years, and eight weeks for ten or more years of continuous service — these are floors, not caps, and unionized or contractually-protected employees may be entitled to substantially more.
  • Check whether your termination qualifies for Quebec's group termination rules. When an employer lays off 10 or more employees at the same establishment within a two-month period, Quebec law requires additional written notice to CNESST and, depending on the number affected, extended individual notice periods — a threshold several of the recent Montreal studio cuts have likely met given the scale reported.

Resources:

  • Service Canada EI application: canada.ca/en/services/benefits/ei
  • CNESST (Quebec labour standards) termination and notice calculator: cnesst.gouv.qc.ca
  • CWA Canada (for unionized game industry workers): cwacanada.ca
  • Emploi-Québec re-employment and training services: quebec.ca/emploi

Example scenario: A mid-level Montreal game developer with six years at a studio is laid off with a severance offer of four weeks' pay. Based on CNESST's statutory minimums, four weeks is within the floor for five-to-ten years of service but does not exceed it — meaning the developer has room to negotiate, particularly if the employer received government tax credits tied to employment levels (as several Quebec studios have) or if the layoff is part of a group termination requiring CNESST notification. The recommended approach is to apply for EI immediately while a lawyer or union rep reviews whether the offer reflects the legal minimum or includes additional consideration for signing a release.

If You're Still Employed But Concerned:

Immediate action:

  • Update your portfolio and resume now, before a layoff notice, not after. Recruiters in Quebec's game sector report that candidates who apply within the first weeks of a public layoff round face the least competition, since the broader talent pool takes time to mobilize.
  • Research Quebec's tax credit changes for the sector. The province reduced its multimedia titles tax credit formula roughly two years ago, cutting the effective subsidy from up to 37.5% of eligible salaries by about a third and excluding a portion of each employee's wages from the calculation — a policy shift several industry analysts point to as a contributing factor in studios' Montreal cost calculations, alongside the broader industry contraction.

What to prepare:

  • Diversify your skill set toward adjacent, higher-demand areas such as technical art, systems/gameplay programming with transferable engine experience (Unreal, Unity), or narrative and live-service operations roles, which have held up better than pure content-production roles industry-wide.

For All Canadians:

Why this matters beyond the game industry: Quebec's video game sector generates more than $1.4 billion in annual economic output and directly employs roughly 15,000 people in the province, according to industry figures cited in recent reporting — meaning sustained layoffs ripple into Montreal's broader tech rental market, downtown business districts, and provincial tax revenue. If you work in an adjacent creative-tech field (film VFX, animation, interactive media), watch this sector closely, since some of the same cost pressures — reduced provincial tax credit generosity, AI-driven production changes, and major publishers' consolidation — apply broadly across Quebec's creative-technology economy.

The News: What Happened

According to CBC News, Quebec's video game industry is "in limbo" as studios across Montreal continue cutting staff, with Eidos, Electronic Arts, Behaviour Interactive, and other developers all announcing layoffs in the city over the past four months. Microsoft's Xbox division announced roughly 3,200 job cuts across its global game business, to be completed by the end of its 2027 fiscal year, with about 1,600 positions eliminated immediately, according to reporting on the announcement.

Within that broader Xbox reduction, roughly a dozen unionized employees at Bethesda Game Studios' Montreal office learned they had lost their jobs during a video call lasting about three minutes, in which a director based in Maryland delivered the news and did not take questions, according to Tech Times and Game Developer. CWA Canada, the union representing the affected Bethesda Montreal staff — who had certified fewer than two years earlier and remained in first-contract bargaining — publicly criticized Microsoft's handling of the layoffs and said it is demanding immediate bargaining over severance terms, internal placement opportunities, and recall rights.

Other Montreal-area cuts this year include Epic Games reducing its global workforce by more than 1,000 positions, or roughly 20%, with some Montreal staff affected, and Ubisoft laying off nearly 140 employees tied to the closure of its Halifax and Winnipeg studios, according to CBC News. Quebec is home to more than 300 game studios and approximately 45% of Canada's roughly 34,000 game industry workers, according to industry data cited in CBC's reporting.

Quebec's multimedia titles tax credit, which previously covered up to 37.5% of eligible employee salaries for participating studios, was revised roughly two years ago to reduce the credit by about a third and exclude a portion of wages from the calculation, according to reporting from The Walrus — a change some industry observers have linked to studios' Montreal cost decisions, though publishers have publicly attributed the broader round of cuts primarily to competition from other entertainment formats and restructuring tied to artificial intelligence tools.

Analysis: Why This Matters

Based on our analysis of the pattern across Montreal studios this year, this round of layoffs differs from previous industry downturns in one important respect: it is concentrated among major publishers with large, established Montreal footprints (Microsoft/Bethesda, Electronic Arts, Ubisoft, Epic) rather than smaller independent studios, suggesting the pressure is coming from corporate-level restructuring decisions rather than purely local market conditions. That distinction matters for affected workers because severance and recall terms at large, often partially unionized studios tend to be more standardized and negotiable than at small independents with limited resources.

The CWA Canada dispute over the Bethesda Montreal layoffs is also worth watching closely: because the union had certified less than two years before the layoffs and remained in first-contract negotiations, its legal leverage is currently limited to Quebec's statutory minimums plus whatever it can negotiate through "effects bargaining" — meaning the outcome of this specific dispute could set a practical precedent for how much protection early-stage unionization actually provides game workers facing a parent-company-wide layoff.

Historical Context:

Quebec built its position as a global game development hub substantially through its multimedia tax credit program, introduced in the late 1990s, which at its peak covered up to 37.5% of eligible salaries and drew major studios including Ubisoft, EA, and Warner Bros. to open large Montreal operations. The credit's reduction roughly two years ago coincided with a broader global contraction in game industry hiring following a post-pandemic hiring surge, making it difficult to isolate the provincial policy change's specific contribution to the current layoffs from the industry-wide downturn.

What Happens Next:

  • Near-term: Watch for the outcome of CWA Canada's effects bargaining with Microsoft over the Bethesda Montreal layoffs, expected to take shape over the coming months according to labour reporting.
  • Ongoing: Additional Xbox-wide cuts are expected through the 2027 fiscal year, meaning further Montreal-area reductions tied to Microsoft's restructuring remain possible.
  • Policy watch: Quebec's government has faced calls from industry associations to reconsider the multimedia tax credit reduction; any policy reversal would likely be signalled in a future provincial budget.

Your Action Plan

Immediate (This Week):

  • If laid off, apply for EI within four weeks of your last day, regardless of severance status.
  • Request your Record of Employment in writing if not received within five business days.
  • Do not sign a severance release before having it reviewed by a lawyer or your union representative.

Short-term (This Month):

  • Calculate your CNESST statutory minimum notice/pay before evaluating any severance offer.
  • Check whether your layoff is part of a group termination requiring CNESST notice (10+ employees within two months).
  • Update your portfolio and resume, emphasizing transferable engine and technical skills.

Long-term (This Year):

  • Explore Emploi-Québec retraining and re-employment support programs if transitioning out of game development.
  • Monitor CWA Canada updates if you are a unionized game worker affected by ongoing Xbox restructuring.
  • Track any provincial budget changes to the multimedia tax credit that could affect future studio hiring in Quebec.

Other Perspectives

Employer View:

Microsoft has characterized the Xbox-wide cuts as part of a broader business "reset" aimed at addressing heightened competition in the games business, framing the reductions as a company-wide restructuring rather than a Quebec- or Canada-specific decision.

Union View:

CWA Canada has publicly criticized how Microsoft delivered the Bethesda Montreal layoffs, describing affected workers as "used, abused, and discarded" and demanding immediate bargaining over severance, vendor-contract decisions, internal placement, and recall rights for laid-off members.

Industry Analysts' View:

Industry observers cited in Quebec reporting point to a combination of factors behind the sector's contraction, including post-pandemic hiring corrections, competition from other forms of interactive entertainment, the reduced provincial tax credit, and the early effects of AI tools on production workflows.

Affected Workers' View:

Laid-off Montreal developers and industry commentators have described the current environment as "not a fun time" for the sector, with sustained uncertainty compounding the stress of individual layoffs as studio after studio has announced cuts over the past four months.

Note: Including multiple perspectives doesn't imply all views are equally valid, but ensures readers can make informed judgments.

Corrections Policy

We strive for accuracy. If you find an error in this analysis, please email us at [email protected]. We will promptly investigate and correct any factual inaccuracies.

Updates:

  • No corrections to date (as of July 13, 2026)
  • AI-Proof Careers in Canada: /topics/ai-proof-careers-canada
  • Employment Insurance Benefits in Canada: /topics/ei-benefits-canada

Sources

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