Canada tightens its foreign worker regulation to favour domestic workers

The newly implemented regulations aim to incentivise companies to hire Canadians before resorting to foreign talent

Canada has introduced stricter hiring regulations for temporary foreign workers, making it more difficult for them to secure employment and establish residency in the country. The Temporary Foreign Worker Programme (TFWP) has been amended to promote equitable labour market conditions and reduce reliance on foreign workers. This programme allows Canadian employers to recruit foreign workers for temporary roles when suitable Canadian candidates are unavailable.

 

Starting from November 8, 2024, the wage criteria for the high-wage stream will be adjusted to be 20 per cent above the median hourly wage, with increases ranging from $5 to $8 per hour, depending on the province or territory. This change may prompt Canadian employers to prioritise domestic workers over temporary foreign workers.

 

The Canadian government has emphasised that the TFWP has been exploited to sidestep the hiring of qualified Canadian workers, with some employers paying temporary foreign workers lower wages than their Canadian counterparts. This practise has hindered wage growth and job availability, placing foreign workers in vulnerable positions. The new regulations will incentivise companies to hire Canadians before resorting to foreign talent.

 

The Canadian government also aims to enhance scrutiny of employer applications to combat the submission of misleading information. Effective October 28, 2024, rigorous data verification processes will be introduced to ensure that only genuine employment offers receive approval.

 

Furthermore, effective September 26, 2024, employers have been restricted to hiring no more than 10 per cent of their workforce through the TFWP.

 

Streamlined job classifications

 

The adjustments to the TFWP are anticipated to shift approximately 34,000 roles from the high-wage stream to the more restrictive low-wage stream, potentially resulting in up to 20,000 fewer approved positions in conjunction with other recent policies.

 

The TFWP categorises positions into low-wage and high-wage streams based on the wage level offered.

 

For jobs where wages are below the provincial or territorial median hourly wage plus 20 per cent, employers are required to:-

 

- Provide support for workers, including return transportation to their home country and suitable accommodation.

- Conduct at least two additional recruitment methods relevant to the occupation.

- Limit their temporary foreign worker complement to 10 per cent of the workforce at any given site.

 

Moreover, LMIA applications for positions in Census Metropolitan Areas (CMAs) with an unemployment rate of 6 per cent or higher will not be processed under the low-wage stream.

 

Conversely, the high-wage stream applies to positions where wages exceed the provincial or territorial median hourly wage plus 20 per cent. For this category:-

 

- There are currently no limits on the number of workers an employer can hire.

- Unemployment rates in Census Metropolitan Areas do not affect LMIA application assessments.

 

These reforms represent Canada’s commitment to prioritising local employment and ensuring fair conditions within the labour market.