As of today, September 26, new regulations regarding the Labour Market Impact Assessment (LMIA) have come into force, significantly impacting the Temporary Foreign Worker (TFW) Program.
These changes were first announced on August 26, 2024, with the intent to enhance the employment landscape for Canadians by focusing on regions with higher unemployment rates—specifically those at 6% or above.
Key Changes to the TFW Program
The following modifications to the TFW Program are now implemented:
- Suspension of LMIAs in High-Unemployment Areas: The government will cease processing LMIAs in census metropolitan areas with unemployment rates of 6% or higher under the low-wage stream. Exceptions will be made for essential sectors such as primary agriculture, food processing, fish processing, construction, and healthcare.
- 10% Cap on Foreign Workers: Employers are now limited to hiring only 10% of their total workforce through the TFW Program, reduced from the previous cap of 20%. Critical industries like agriculture and healthcare will still have exceptions.
- Shortened Employment Duration: The maximum duration for low-wage stream workers has been cut to one year, down from two years.
Recent Measures to Combat LMIA Fraud
On August 6, 2024, the Canadian government introduced stringent measures to address misuse within the TFW Program. These changes aim to uphold the program’s integrity and ensure it is utilized correctly to address real labor shortages.
Key Measures from August 6, 2024
- Regulatory Changes: New regulations are being prepared to closely monitor employer eligibility. Employers found to misuse the program could face severe penalties, including fines and disqualification from the TFW Program.
- Enforcement of the 20% Cap: The existing rule limiting low-wage temporary foreign workers to 20% of an employer’s workforce will be strictly enforced to promote hiring of Canadian workers.
- Enhanced Oversight: There will be increased monitoring and inspections, particularly in high-risk regions and industries prone to program abuse.
- Fee Increase Consideration: To reflect the costs of processing LMIAs and discourage frivolous applications, the government is contemplating raising LMIA fees.
Ongoing Monitoring and Adjustments
The Canadian government will closely observe the effects of these changes, with a comprehensive review of the TFW Program planned within the next 60 days. This review may lead to further modifications to the high-wage stream, sector-specific exceptions, and adjustments in the processing of existing LMIA applications.
Addressing Unemployment and Program Integrity
These reforms are part of a larger strategy to realign the TFW Program in response to the changing labor market. With the unemployment rate reaching 6.6% as of August 2024, the government has already taken steps to reduce LMIA validity from 18 months to 6 months and decrease the cap on temporary foreign workers from 30% to 20%.
Additionally, Quebec’s request to temporarily freeze new TFW approvals in Montreal’s low-wage stream has been approved, halting LMIA processing for job offers below the province’s median hourly wage of $27.47.
Conclusion
The updated LMIA rules highlight Canada’s commitment to protecting job opportunities for its citizens while ensuring that the TFW Program functions as intended. As the economic environment evolves, further modifications may be necessary to maintain a balanced and equitable job market, reflecting the government’s focus on prioritizing Canadian talent.
