June 20, 2014 – Ministers Jason Kenney and Chris Alexander today announced major changes to the Temporary Foreign Worker Program (TFWP) and, at the same time, lifted the moratorium on access to the program by the food services sector. The reforms have been anticipated since a series of media reports alleging abuse of both the program, and of foreign workers, by Canadian employers. These media reports and the ensuring controversy led to the imposition of the moratorium in April.
The program is being split into two distinct streams: The Temporary Foreign Worker Program and the International Mobility Program.
The International Mobility Program (IMP)
The IMP will be overseen by Citizenship and Immigration Canada (CIC) and will focus on high-skilled/high-wage employees who enter Canada pursuant to bi-lateral and multi-lateral agreements with other countries (e.g., GATS, NAFTA).
The New Temporary Foreign Worker Program
The TFWP will be overseen by Employment and Social Development Canada (ESDC) and refers to those streams through which foreign workers enter Canada pursuant to a Labour Market Impact Assessment (LMIA). Administration of the program will now be based on wage instead of the National Occupational Classification (NOC).
Highlights of the Changes
- The Labour Market Opinion will be replaced by the Labour Market Impact Assessment (LMIA). The LMIA will include a review of local job data, including EI data, and require employers of high-wage temporary foreign workers to submit transition plans in order to reduce their reliance on the program. Employers will now be required to report on the success of their plan annually during each LMIA re-application. No transition plan is required for short-duration occupations (120 days or less).
- LMIA applications for high-wage, high-demand and short duration occupations (120 days or less) will now be processed in 10 business days.
- Fees for program access will increase significantly. The Labour Market Impact Assessment fee will be $1,000.
- Work Permits for low-wage positions will be reduced to one year. Employers of low-wage temporary foreign workers will be required to renew their LMIA annually.
- A 10% cap will be imposed on low-wage temporary foreign workers, as a proportion of the workforce at each worksite. Employers that currently exceed the cap will have two years of phased-in targets, starting at 30% on July 1, 2014 and dropping to 20% on July 1, 2015. The Minister has indicated that this cap may be further reduced in future.
- No LMIAs will be approved for jobs in Accommodation, Food Services, or Retail Trade Services in any region with an unemployment rate at-or-above 6%.
- New enforcement measures, including a new Administrative Monetary Penalty regime with fines of up to $100,000 for non-compliance and misrepresentation.
- 1 in 4 employers who use the program will be inspected
- Annual disclosure to Canadians of all employers who currently avail themselves of the program
These reforms will have a profound impact on the way businesses in Canada employee Temporary Foreign Workers. If you have questions about these reforms and your particular situation, please contact Green and Spiegel LLP.