The company's decision last week to grant the equivalent of a 50% pay rise to six top executives sparked outrage.
Quebec's government agreed to a CA$1.34bn ($1bn; Â£800m) bailout in 2016, a year after it teetered on the edge of bankruptcy.
Prime Minister Justin Trudeau said he was "not pleased" with the pay hike.
But he welcomed the change of heart.
Protesters gathered outside the firm's headquarters in Montreal on Sunday, hours before Bombardier relented and said the rises would be deferred to 2020.
They will be payable only if the firm achieved performance goals, it said.
"Over the past 75 years, our fellow citizens have always been by our side," said Bombardier chief executive Alain Bellemare on Sunday night.
"It is because of this deep relationship that we are sensitive to the public reaction to our executive compensation practices."
He was one of the six executives who were set to receive payments of CA$43.7m ($32.6m; Â£26.1m) in 2016.
That was up from CA$30m the year before, according to regulatory filings.
Bombardier originally justified the pay increases as a necessary measure to retain top talent.
But two Quebec cabinet ministers pressured the company last week to heed the backlash.
The Quebec Premier Philippe Couillard tweeted that he was "satisfied" with Sunday's climb-down by the firm.
The Quebec government last year invested CA$1.34bn in Bombardier's C-Series aircraft programme in return for a nearly 50% stake.
In February, the federal government agreed to give the company CA$372.5m in interest-free loans.
In 2016, Bombardier also announced lay-offs for 14,500 people, including about 20% of its workforce in Belfast.
The redundancies came as the firm secured orders with Delta Air Lines and Air Canada and made its maiden commercial voyage with Swiss Air Lines.

The shutdown of the Atol-protected firm affects cruise lines Swan Hellenic and Voyages of Discovery, and has resulted in nearly 150 people losing their jobs.
The Civil Aviation Authority will help to repatriate the 400 people who are currently abroad, but future bookings for 13,000 others have been cancelled.
All holidaymakers will receive refunds.
Administrators Grant Thornton will manage the affairs of All Leisure Holidays, along with three other travel companies based at a site in Market Harborough.
A total of 250 people worked there, with 50 employed by All Leisure Holidays. All 50 have been made redundant along with virtually all of the company's 100 maritime staff.
The other 200 workers at the Market Harborough site have kept their jobs after the other firms were sold to a subsidiary of Canadian tour operator G Adventures.
Grant Thornton's Eddie Williams said: "Whilst I am extremely pleased to have concluded a sale of the business which safeguards the holidays and bookings for over 13,500 tours and passengers and preserves 200 jobs, I am very disappointed that we have no alternative other than to close the remaining ALH operations.
"The cruise operations have been significantly loss-making over a number of years and the ongoing cost of funding these operations by the tours operations has created significant cash issues for the entire group, which has ultimately led to the administration of all businesses."
Andy Cohen, head of Atol at the CAA, said: "We understand this will be concerning news for anyone who has booked to travel with the company.
"However, the Atol scheme exists for exactly this kind of situation and we are making immediate arrangements so all Atol-protected customers can claim full refunds as quickly as possible."
Canadian plane and train manufacturer Bombardier has said it will defer some hefty executive pay increases following a public outcry.
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Cruise company All Leisure Holidays has stopped trading with immediate effect and called in administrators, leaving hundreds of holidaymakers stranded.