Changes to the Temporary Foreign Worker Program – Part 1

On June 20, 2014 the Federal Government announced the much anticipated changes to the Temporary Foreign Worker Program (“TFWP”). In this article we provide a brief overview of the changes as well as some of the areas that still remain uncertain.

The New Program

a. Wages and Skill Level

The Federal Government previously introduced a number of changes that significantly reduced the effectiveness of the Program. Specifically, the Accelerated Labour Market Opinion (“A-LMO”) option which streamlined the procedure and allowed for much quicker processing was suspended. In addition, recruitment time was increased from two to four weeks and processing times increased significantly.
In the latest installment of changes to the TFWP, the Labour Market Opinion (“LMO”) process has been replaced with the Labour Market Impact Assessment (“LMIA”). Under the LMO process workers were classified in accordance with skill levels as provided by the National Occupation Classification (NOC), and was in theory developed to streamline the application process for higher skilled workers.
Under the LMIA process, skill level will be determined solely based on salary levels. Foreign workers offered a salary that meets or exceeds the median wage for the province in which the employer is seeking the LMIA will be classified as high skilled. Foreign workers who make less than the provincial median will be considered low skilled.

The table below contains the median hourly wage for each province and territory.

Province/Territory Wage ($/hr.)
Alberta $24.23
British Columbia $21.79
Manitoba $19.00
 New Brunswick $17.79
Newfoundland and Labrador $20.19
Northwest Territories $32.53
Nova Scotia $18.00
Nunavut $29.96
Ontario $21.00
Prince Edward Island $17.26
Quebec $20.00
 Saskatchewan $21.63
 Yukon $27.93

b. Cap on Low Skilled Workers

There are number of restrictions with respect to the percentage of the employer’s total workforce that can be composed of low skilled workers. Specifically, employers with 10 or more employees may only have 10 percent of their workforce consisting of low-wage temporary foreign workers. The program will be phased in over the next several years to provide employers with time to transition and adjust to the new cap.
There are a number of additional restrictions placed on low-skilled applications. For example an LMIA will not be issued if the employer is:

  •  applying for an LMIA in a Statistics Canada economic region with an annual unemployment rate over 6%; and
  •  applying for an LMIA in an occupation in the Accommodation & Food Services or Retail Sectors; and
  •  applying for an LMIA in other specific low skilled occupations.

c. Work Permit Time Limit

The duration of work permits set out in Labour Market Impact Assessments will be limited to a maximum of one year for all low-wage positions. Employers of low-wage temporary foreign workers will therefore have to reapply for an LMIA every year.

d. Changing the Provincial Agreement

The provincial nomination agreements that were negotiated by Alberta, British Columbia, Ontario, Nova Scotia and Yukon currently contain provisions that in some cases enable the province to nominate candidates for immigration without going through the LMO process. The Government plans to hold negotiations to restrict such options.

e. Transition Plans

Employers hiring a ‘high-wage’ employee will be required to present a transition plan. This transition plan must include information on how a permanent solution will be found for the temporary position being filled by the foreign worker.

f. Expedited Processing for Select Occupations

Certain LMIA applications are going to be processed within ten days:

  •  Applications within designated skilled trade applications such as carpenters and plumbers;
  •  Applications for employees with proposed wages in the top 10% of wages earned by Canadians in a given province; and
  •  Applications for short duration workers.

g. Recruitment Efforts and Transparency

In support of an LMIA application, employers will have to provide specific details with respect to their recruitment efforts. Specifically, employers will have to outline the number of Canadians that applied and were interviewed for the job and why those Canadians were not hired. Employers must also attest they are aware of the rule that Canadians cannot be laid-off or have their hours reduced at a worksite that employs temporary foreign workers.
Officers processing the LMIA applications will be able to rely on an annual wage survey conducted by Statistics Canada to determine whether the wages offered to the prospective foreign worker meet or exceed the prevailing median statistical wage.
In addition, the statistics will also contain information from the Employment Insurance (EI) program and other internal sources to accurately determine the availability of qualified Canadian workers.

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