Canada to stop processing Low-Wage LMIAs for the Temporary Foreign Worker Program in some cities

As of September 26, Canada’s government will no longer process Labour Market Impact Assessments (LMIAs) for the Low-Wage stream of the Temporary Foreign Worker Program (TFWP) in some census metropolitan areas (CMAs).

Employment and Social Development Canada (ESDC) will not process LMIAs in the Low-Wage stream in CMAs with an unemployment rate of 6% or higher. No further details have been released regarding which cities will be impacted.

The department notes, however, exceptions will be made for seasonal and non-seasonal jobs in food security sectors (primary agriculture, food processing and fish processing), as well as construction and healthcare.

Further, employers will not be permitted to hire more than 10% of their total workforce through the TFWP and the maximum duration of employment for workers hired through the Low-Wage stream will be reduced to one year (from two years).

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Minister of Employment, Workforce Development and Official Languages, Randy Boissonnault, says that Canada has been relying too heavily on the program.

“The Temporary Foreign Worker program was designed to address labour market shortages when qualified Canadians were not able to fill those roles. Right now, we know that there are more Canadians qualified to fill open positions. The changes we are making today will prioritize Canadians workers and ensures Canadians can trust the program is meeting the needs of our economy.”

According to data from the Labour Force Survey, Canada’s unemployment rate has been creeping up since April 2023. The current rate of unemployment stands at 6.4% (as of June 2024). This represents 1.4 million unemployed people.

The Minister says theses new restrictions will help “weed out TFWP misuse and fraud.” He also notes that Canadian employers have an obligation to retrain and upskill current employees to ensure they can adapt to workplace demands in the future.

Over the next 90 days, ESDC will review the High-Wage stream of the TFWP. The Ministry says this could result in changes to existing LMIA applications for which positions have not been filled, to sectoral exceptions, or refusing to process other LMIA applications, including for rural areas.

The TFWP is a popular pathway for newcomers looking to gain work experience in Canada. Employers wishing to use the program are required to submit an LMIA to ESDC to determine if hiring a foreign national will have a positive, neutral, or negative impact on Canada’s workforce and economy.

There are two streams under the TFWP, Low-Wage and High-Wage. Low-wage positions are defined as those paid less than the median provincial hourly wage.

Recent changes to the temporary worker levels in Montreal

On August 20th Quebec Premier François Legault announced temporary foreign worker restrictions targeting the “administrative region” of Montreal.

Starting September 3rd , both the Quebec provincial government and the federal Canadian government will suspend the processing of LMIA applications for some occupations (in Montreal) within the Low-Wage stream of the TFWP (those earning an hourly wage less than the Quebec median hourly wage).

The policy is in line with today’s announcement by ESDC, with certain workers who meet occupation, location, and/or wage criteria; or those who submit an LMIA before September 3rd, 2024, being exempt from these changes. This suspension is expected to last for six months.

Part of a wider plan

These changes to the TFWP come at a time when the Canadian government is placing greater attention on the program, and temporary resident (those on a work/study permit or a visitor visa/electronic Travel Authorization (eTA)) levels in the country overall.

In recent months both Employment Minister Boissonnault and Immigration Minister Marc Miller have publicly (together and separately) called out abusive employers within the TFWP for taking advantage of temporary foreign workers and ignoring Canadian workers in favor of cheaper labour.

In their first joint address on the matter in March, Immigration Minister Miller also unveiled the historic inclusion of temporary resident levels within the annual Immigration Levels Plan to better manage pressures this population puts on Canadian social services and infrastructure. In accordance with this goal, Canada also announced a study permit cap on international students, set to be in place until 2026.

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