In a notable policy shift, the Canadian government has announced a significant change to the Temporary Foreign Worker Program (TFWP). Effective mostly from 26 September 2024, Employment and Social Development Canada (ESDC) will cease processing Labour Market Impact Assessments (LMIAs) for low-wage positions in certain high-cost urban centers. Minister Boissonnault assembled business organizations earlier this month to advise them of the government of Canada’s consideration of reducing access to the Workforce Development and Disability Inclusion Program. The program, which is spearheaded by Sean Fraser and focuses on cities like Toronto, Vancouver, and Montreal, is one that the minister targeted.
Key Changes and Dates based on the update
As of 26 September 2024, the ESDC will stop processing LMIA applications for low-wage jobs in the specified cities. The following changes will be implemented:
1. The Government of Canada will no longer process Labour Market Impact Assessments (LMIAs) for low-wage positions in metropolitan areas with an unemployment rate of 6% or higher. Exceptions will be made for jobs in food security sectors (primary agriculture, food processing, and fish processing), as well as in construction and healthcare.
2. Employers will be limited to hiring no more than 10% of their workforce through the Temporary Foreign Worker (TFW) Program. This cap applies to the low-wage stream and represents a further reduction from the March 2024 limits. Exceptions will be allowed for jobs in food security sectors and in construction and healthcare.
3. The maximum employment duration for workers hired under the low-wage stream will be cut to one year, down from two years.
What This Means for Employees
The new policy aims to address concerns about wage suppression and competition for local job seekers in high-cost cities. By halting LMIA processing for low-wage positions, the government is prioritizing higher-wage jobs and encouraging employers to focus on improving compensation for local workers. For businesses that rely heavily on low-wage foreign labor, this change necessitates a strategic reevaluation. Employers may need to invest in better wages or enhanced training programs for Canadian employees to fill these roles. Additionally, companies should brace for potential delays or adjustments in other types of LMIA applications as they navigate the new regulations. Staying informed and consulting with immigration experts will be crucial for managing these changes effectively.
Impact on Temporary Foreign Workers
For foreign workers, this policy change introduces uncertainty, particularly for those aiming to work in low-wage roles in high-cost cities. Individuals currently holding low-wage LMIA-based work permits or those planning to apply may face challenges due to the suspension of these applications, or these applications could possibly be put on hold. It would therefore be crucial to keep track of any updates about your work permit and explore other options to continue working in Canada. This might mean finding higher-wage jobs or considering different immigration pathways to stay in the country. Staying informed and proactive will help you manage these changes effectively.
Additional Consequences
This policy adjustment is part of Canada’s broader strategy to balance labor market dynamics and address regional disparities. By focusing on higher-wage positions in expensive urban areas, the government aims to ensure that immigration policies support both economic stability and fair employment practices. All parties involved in this policy, such as employers, employees, and immigration consultants, must adjust quickly once the policy goes into force. It will be easier to manage the transition and lessen any possible interruptions if you are aware of the complexities of the new laws and seek professional counsel.
To conclude, Canada is set to halt processing Labour Market Impact Assessments (LMIAs) for low-wage jobs in major cities like Toronto, Vancouver, and Montreal from September 26, 2024, as announced by Minister Boissonnault. This policy shift aims to address wage suppression and job competition by focusing on higher-wage positions. Employers will need to adapt by increasing wages or investing in local training. Foreign workers with low-wage permits may face challenges, so staying informed about updates and exploring alternative job or immigration options is crucial. Consulting with immigration experts will help navigate these changes effectively.
