New rules for Canada’s Labour Market Impact Assessment (LMIA) take effect today, signifying a significant change in the Temporary Foreign Worker (TFW) Program.
Initially announced on August 26, 2024, these regulations officially come into force today, September 26.
The new policy focuses on metropolitan regions where unemployment rates are at 6% or higher, aiming to give priority to Canadian workers and reduce dependency on foreign labor.
Major Updates to the Temporary Foreign Worker Program Now in Force
As of today, the following modifications have been implemented in the TFW Program:
- LMIA Suspension in High Unemployment Regions: The government will stop processing LMIAs under the low-wage stream in census metropolitan areas with unemployment rates of 6% or higher. However, critical sectors such as primary agriculture, food processing, fish processing, construction, and healthcare will be exempt from this rule.
- 10% Limit on Foreign Workers: Employers can now hire up to 10% of their workforce through the TFW Program, reduced from the previous 20% limit. Certain essential industries, including agriculture, food processing, construction, and healthcare, are exempt from this restriction.
- Shortened Employment Term: The employment period for workers under the Low-Wage stream is now limited to one year, down from the previous two-year maximum.
Earlier Measures Implemented to Prevent LMIA Fraud
In response to growing concerns over misuse and fraud in Canada’s Temporary Foreign Worker (TFW) Program, the Canadian government introduced a set of stricter measures on August 6, 2024.
These changes aim to reinforce the program’s integrity, ensuring it is used to address genuine labor shortages when no qualified Canadian workers are available.
Key Measures Introduced on August 6, 2024:
- Regulatory Adjustments: New regulations are being developed to more closely assess employer eligibility. These rules will ensure that employers misusing the program face substantial consequences, including fines and bans from future access to the TFW Program.
- Strict Enforcement of 20% Cap: The government has reinforced the 20% cap on low-wage temporary foreign workers within an employer’s workforce. This policy seeks to limit reliance on foreign labor for low-wage jobs and promote the hiring of Canadian workers.
- Increased Oversight: The government has heightened monitoring and inspections, particularly in regions and industries flagged as high-risk for TFW Program abuse. This is part of a broader initiative to crack down on employers bypassing Canadian workers.
- Potential LMIA Fee Increase: To better cover the costs associated with processing Labour Market Impact Assessments (LMIAs) and discourage frivolous or fraudulent submissions, the government is considering raising LMIA application fees. This is intended to reduce non-serious applications from employers.
Ongoing Monitoring and Future Modifications
The Canadian government will actively monitor these changes and implement additional adjustments as necessary.
A comprehensive review of the TFW Program is scheduled within the next 60 days, potentially resulting in further modifications to the high-wage stream, sector-specific exemptions, and the processing of current LMIA applications.
Tackling Increasing Unemployment and Program Misuse
These changes are part of a comprehensive strategy to adjust the TFW Program in response to the evolving Canadian labor market. With unemployment rising to 6.6% as of August 2024, the government has shortened the validity period of LMIAs from 18 months to 6 months and reduced the cap on temporary foreign workers from 30% to 20%.
Additionally, the government has recently granted Quebec’s request to temporarily halt new TFW approvals in Montreal’s low-wage stream, leading to the suspension of LMIA processing for job offers that fall below the province’s median hourly wage of $27.47.
Promoting Appropriate Utilization of the TFW Program
The updated LMIA regulations demonstrate Canada’s commitment to protecting job opportunities for Canadians and ensuring the TFW Program fulfills its intended purpose.
As the economic environment continues to evolve, additional adjustments are anticipated to support a balanced and equitable job market.
These changes are now in effect, highlighting the government’s focus on prioritizing Canadian talent and ensuring that the TFW Program adapts to the country’s changing needs.
