October 24th, 2024 at 05:08 am

Canada Government Announces New Temporary Foreign Worker Program Reforms

Significant changes to the Temporary Foreign Worker Program have been announced by Minister Boissonnault in an effort to protect the rights of both domestic and foreign workers and improve the integrity of Canada’s labor market.

With a growing need for skilled labor across a range of industries, these reforms seek to address current issues within the program and guarantee that it not only satisfies the demands of companies but also offers strong protections for workers who are essential to Canada’s economy. These adjustments are an essential first step in developing a more equitable and balanced labor market.

Introduction

The Temporary Foreign Worker Program in Canada is intended to be employed as a last resort in cases where a competent Canadian cannot be found to fill a position. The Canadian government has been taking action to improve the TFW program’s integrity in recent months, and on August 26, 2024, it pledged to finish additional reviews within the next ninety days to make sure the program continues to meet labor market demands while also assisting in safeguarding temporary foreign workers against fraud and abuse.

The Minister of Employment, Workforce Development, and Official Languages, Randy Boissonnault, announced specific changes to one of the TFW program streams for this reason. The starting hourly rate for workers entering Canada through the high-wage stream will rise to 20% on November 8, 2024, over the existing threshold, which is the median wage in the relevant province or territory of employment.

Depending on the province or region of employment, this amounts to an increase over the current threshold of $5 to $8 per hour. Consequently, it is anticipated that more occupations will be subject to the more stringent regulations of the low-wage stream, which include additional business obligations concerning accommodation, transportation, and hiring workers who are already in Canada.

Minister Boissonnault stated in a speech at the 21st Century Workforce Summit on October 17, 2024, that this reform is also intended to give priority to employing domestic workers in line with the TFW program’s objective of safeguarding Canada’s economy and Canadian workers.

Further Details

Employers in Canada can access untapped talent pools, such as young people, whose unemployment rate is more than twice the national average. Other marginalized groups, such as women, people with disabilities, and Indigenous people, face similar challenges.

Additionally, Minister Boissonnault declared that employers will no longer be able to use professional accountants’ or lawyers’ attestations to demonstrate the validity of their businesses as of October 28, 2024. To improve data sharing, he continued, the TFW initiative will expand on the information that is already available through sharing agreements with provincial and territorial Partners and current employer registries.

While the majority of companies use the TFW program as intended, these steps will help to ensure that only real and authentic job offers are allowed, preventing program abuse and providing improved worker protection.

The Canadian government is still keeping a close eye out for fraud and abuse, as well as changes in the job market. If necessary, more changes will be implemented to guarantee that the TFW program is only available to compliant firms with observable labor needs.

Quick Facts

• The Labor Market Impact Assessment is still a crucial instrument for safeguarding the Canadian labor market from potential drawbacks of employing temporary foreign workers, such as pay suppression or worker displacement.
• Before they can look to engage temporary foreign workers, employers must apply for an LMIA and be approved.
• Two TFW program components—the low-wage stream and the high-wage stream—are distinguished by the wage level they offer. The streams differ significantly from one another.

Low-wage stream

Jobs in the low-wage stream pay less than the median hourly wage plus 20% for the province or territory. Employers are required under this stream to support their employees by offering appropriate housing, insurance, and return transportation to their country of origin.

Employers are expected to use at least two other recruitment strategies that align with the goals of the occupation and target an audience with the professional experience, education, and skill level needed for the position.

At any one job site, employers are only allowed to have 10% of their workforce be temporary foreign workers (up to 20% in some high-demand industries). Additionally, the TFW program will not accept LMIA applications for jobs in census metropolitan regions with unemployment rates of 6% or above.

High-wage stream

The high-wage stream is reserved for positions where the pay is 20% more than the median hourly wage in the province or territory. Employers are currently free to hire as many people as they like under this stream, and LMIA application evaluations do not take CMA unemployment rates into account.

Results of the Declared Modifications

34,000 jobs are expected to shift from the high-wage stream to the low-wage stream’s stricter regulations as a result of the announced revisions. When paired with other regulations that will be in place as of September 26, 2024, this change may lead to up to 20,000 fewer posts being authorized through the TFW program. These regulations include the following:

• With a few exceptions for industries with considerable demand, the Canadian government does not process LMIA in the low-wage stream in CMAs with an unemployment rate of 6% or above.
• With a few exceptions for industries with strong demand, employers are only permitted to use the TFW program to hire 10% of their workforce.
• The LMIA requires employers to evaluate all employment offers to verify that the company and the offer are authentic and lawful.
• Candidates must submit the supporting documentation listed on this page.

Final Thoughts

The recent changes to the Temporary Foreign Worker Program demonstrate Canada’s dedication to promoting ethical employment practices and defending the rights of all workers as it continues to negotiate the intricacies of a changing labor market.

The government seeks to achieve a delicate balance that promotes social justice and economic prosperity by prioritizing Canadian workers’ needs while simultaneously recognizing the vital contributions of international labor. Stakeholders will be closely observing how these changes affect the workforce and the state of the Canadian economy as they go into effect.