diff --git a/src/bin/canopy_proxy.rs b/src/bin/canopy_proxy.rs
index f2e8ffc..acdf4de 100644
--- a/src/bin/canopy_proxy.rs
+++ b/src/bin/canopy_proxy.rs
@@ -154,6 +154,21 @@ struct StatsFile {
 	received_payload_bytes: u64,
 }
 
+/// Block until SIGTERM (kubelet, native-sidecar termination) or SIGINT
+/// (interactive ctrl-c) arrives, whichever comes first.
+async fn wait_for_shutdown() -> Result<(), String> {
+	use tokio::signal::unix::{SignalKind, signal};
+	let mut sigterm = signal(SignalKind::terminate())
+		.map_err(|err| format!("installing SIGTERM handler: {err}"))?;
+	let mut sigint = signal(SignalKind::interrupt())
+		.map_err(|err| format!("installing SIGINT handler: {err}"))?;
+	tokio::select! {
+		_ = sigterm.recv() => {}
+		_ = sigint.recv() => {}
+	}
+	Ok(())
+}
+
 /// Write `port` to `port_file` atomically (write `.tmp` then rename) so a
 /// partial read by the kopia container's wait-loop can't observe a torn value.
 fn write_port_atomic(port_file: &std::path::Path, port: u16) -> std::io::Result<()> {
@@ -208,10 +223,11 @@ async fn run(cfg: Config) -> Result<(), String> {
 	write_port_atomic(&cfg.port_file, port)
 		.map_err(|err| format!("writing port file {}: {err}", cfg.port_file.display()))?;
 
-	// Wait for SIGTERM (kopia container completion → pod termination).
-	tokio::signal::ctrl_c()
-		.await
-		.map_err(|err| format!("waiting for shutdown signal: {err}"))?;
+	// Wait for shutdown. As a native sidecar the kubelet sends SIGTERM once
+	// the main container exits; interactive runs get SIGINT. Handle both —
+	// ctrl_c() alone only catches SIGINT, so under k8s the proxy would hang
+	// until SIGKILL and lose its stats.
+	wait_for_shutdown().await?;
 	info!("shutdown signal received");
 
 	let traffic = proxy.traffic();
diff --git a/src/controllers/replica/resources.rs b/src/controllers/replica/resources.rs
index fea4198..b1b5f56 100644
--- a/src/controllers/replica/resources.rs
+++ b/src/controllers/replica/resources.rs
@@ -176,6 +176,11 @@ fi
 		}),
 		..Default::default()
 	}];
+	// The canopy-proxy runs as a native sidecar (init container with
+	// restartPolicy: Always) so the Pod completes once the main
+	// snapshot-list container exits; a plain sidecar container would keep
+	// the Pod Running and the Job would never succeed.
+	let mut init_containers: Vec<Container> = Vec::new();
 
 	if let KopiaSource::CanopyProxy {
 		group, backup_type, ..
@@ -193,9 +198,10 @@ fi
 		});
 		containers[0].volume_mounts = Some(kopia_volume_mounts);
 
-		containers.push(Container {
+		init_containers.push(Container {
 			name: "canopy-proxy".to_string(),
 			image: Some(proxy.image.to_string()),
+			restart_policy: Some("Always".to_string()),
 			command: Some(vec!["canopy-proxy".to_string()]),
 			env: Some(vec![
 				EnvVar {
@@ -280,6 +286,12 @@ fi
 				}),
 				spec: Some(PodSpec {
 					restart_policy: Some("Never".to_string()),
+					init_containers: if init_containers.is_empty() {
+						None
+					} else {
+						Some(init_containers)
+					},
+					termination_grace_period_seconds: Some(30),
 					containers,
 					volumes: if volumes.is_empty() {
 						None
diff --git a/src/controllers/restore/builders.rs b/src/controllers/restore/builders.rs
index 2d0a944..3e9383d 100644
--- a/src/controllers/restore/builders.rs
+++ b/src/controllers/restore/builders.rs
@@ -758,7 +758,13 @@ echo -n "$VERSION" > /dev/termination-log
 		("pgro.bes.au/restore".to_string(), restore.name_any()),
 	]);
 
-	let mut containers = Vec::with_capacity(2);
+	let mut containers = Vec::with_capacity(1);
+	// The canopy-proxy runs as a native sidecar (an init container with
+	// restartPolicy: Always) so that when the main `restore` container
+	// exits the kubelet SIGTERMs the proxy and the Pod completes on the
+	// main container's exit code. A plain sidecar container would keep the
+	// Pod Running forever and the Job would never succeed.
+	let mut init_containers: Vec<Container> = Vec::new();
 	containers.push(Container {
 		name: "restore".to_string(),
 		image: Some(kopia_image.to_string()),
@@ -799,9 +805,14 @@ echo -n "$VERSION" > /dev/termination-log
 				..Default::default()
 			});
 
-		containers.push(Container {
+		init_containers.push(Container {
 			name: "canopy-proxy".to_string(),
 			image: Some(proxy.image.to_string()),
+			// Native sidecar: an init container that never exits on its
+			// own. `restartPolicy: Always` tells the kubelet to keep it
+			// running alongside the main containers and to SIGTERM it once
+			// they complete.
+			restart_policy: Some("Always".to_string()),
 			// Same image as the operator; run the `canopy-proxy` binary
 			// instead of the default `operator` entrypoint.
 			command: Some(vec!["canopy-proxy".to_string()]),
@@ -902,6 +913,14 @@ echo -n "$VERSION" > /dev/termination-log
 						fs_group: Some(999),
 						..Default::default()
 					}),
+					init_containers: if init_containers.is_empty() {
+						None
+					} else {
+						Some(init_containers)
+					},
+					// Give the native sidecar time to flush its final stats
+					// on SIGTERM before the kubelet SIGKILLs it.
+					termination_grace_period_seconds: Some(30),
 					containers,
 					volumes: Some(volumes),
 					..Default::default()
diff --git a/src/controllers/restore/tests.rs b/src/controllers/restore/tests.rs
index 37ba527..676e2e2 100644
--- a/src/controllers/restore/tests.rs
+++ b/src/controllers/restore/tests.rs
@@ -148,6 +148,61 @@ fn test_restore_and_replica() -> (PostgresPhysicalRestore, PostgresPhysicalRepli
 	(restore, replica)
 }
 
+#[test]
+fn canopy_restore_job_proxy_is_native_sidecar() {
+	// Regression: the canopy-proxy must be an init container with
+	// restartPolicy=Always (a native sidecar), NOT a plain container. As a
+	// plain container it keeps the Pod Running after the main `restore`
+	// container exits, so the Job never succeeds and eventually hits
+	// activeDeadlineSeconds → DeadlineExceeded.
+	let (restore, mut replica) = test_restore_and_replica();
+	replica.spec.kopia_secret_ref = None;
+	replica.spec.canopy_source = Some(CanopySource {
+		group: "11111111-1111-1111-1111-111111111111".to_string(),
+		r#type: "tamanu-postgres".to_string(),
+	});
+	let proxy = super::builders::CanopyProxyArgs {
+		image: "ghcr.io/beyondessential/postgres-restore-operator:latest",
+		broker_base_url: "http://operator.pgro-system.svc:9091",
+		stats_callback_url: "http://operator.pgro-system.svc:8080/api/v1/canopy-stats/ns/job",
+	};
+	let job = build_restore_job(
+		&restore,
+		"test-restore-restore",
+		"default",
+		&replica,
+		"kopia:latest",
+		"http://operator/api/v1/cache-pressure/default/test-restore",
+		Some(&proxy),
+	)
+	.unwrap();
+	let pod_spec = job.spec.unwrap().template.spec.unwrap();
+
+	// The proxy is NOT a regular container.
+	assert!(
+		!pod_spec.containers.iter().any(|c| c.name == "canopy-proxy"),
+		"canopy-proxy must not be a plain container (Pod would never complete)"
+	);
+	// It IS an init container with restartPolicy=Always.
+	let init = pod_spec
+		.init_containers
+		.as_ref()
+		.expect("canopy path must declare init containers");
+	let sidecar = init
+		.iter()
+		.find(|c| c.name == "canopy-proxy")
+		.expect("canopy-proxy must be a native sidecar (init container)");
+	assert_eq!(
+		sidecar.restart_policy.as_deref(),
+		Some("Always"),
+		"native sidecar must set restartPolicy=Always"
+	);
+	assert!(
+		pod_spec.termination_grace_period_seconds.unwrap_or(0) > 0,
+		"canopy Pod must allow grace time for the sidecar to flush stats on SIGTERM"
+	);
+}
+
 #[test]
 fn restore_job_has_ttl_seconds_after_finished() {
 	let (restore, replica) = test_restore_and_replica();