Important Changes to the Temporary Foreign Workers Program

After receiving much media attention and public scrutiny, Canada’s rules and policies for admitting and processing temporary foreign workers into the country were recently overhauled. Then, this past summer, the government announced new and potentially tougher penalties for employers who violate the new rules. The new penalties come into effect later this year.

Program Overview

The old temporary foreign worker program has been split into two: the new Temporary Foreign Worker Program (TFWP), under which employers can apply to fill positions in Canada with foreign workers after receiving  a Labour Market Impact Assessment (LMIA) approval and a new set of International Mobility Programs (IMP) under which no LMIA is required.

While the new TFWP is focused on addressing labour shortages in specific sectors or niches of the economy, IMP is based in large measure on reciprocity and on bilateral and multilateral free trade agreements to which Canada is a party.

The labour market opinions provided under the old system have been replaced by the more rigorous LMIA under which employers must indicate the number of Canadians that applied for a given job opening and the number of Canadians the employer interviewed. Employers also have to explain why one or more of the Canadians interviewed for the position(s) in question were not hired.

Importantly, the number of TFWP employees an employer may hire is capped – employers who employ 10 people or more may not have more than 10% of their workforce comprised of low-wage temporary foreign workers, subject to certain transitional measures.

New Penalties

Starting on December 1, 2015, employers who fail to comply with the new TFWP and IMP requirements will be subject to a new sanctions regime which includes:

  • warnings;
  • fines ranging from $500 to $100,000 per violation, up to a maximum of $1 million over one year, per employer;
  • being banned from accessing the programs for one, two, five, or ten years or permanently; and
  • publication of the employer’s name on a public list with details of the violation(s) and sanction(s).

The discretion in applying this broad range of available penalties will be guided in part by:

  • the type of violation;
  • an employer’s compliance history;
  • the severity of non-compliance; and
  • the size of the employer’s business (for financial penalties only).

In addition, employers will have the opportunity to voluntarily disclose non-compliance and potentially receive a reduced consequence, where applicable. Employers will also have a chance to respond to a Notice of Preliminary Finding with respect to an alleged infraction and to have the matter reviewed by another officer before a final determination is made.

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With the TFWP and IMP rules having undergone important and broad-ranging changes and with the new penalties regime about to come into force, employers considering hiring foreign workers should ensure that they have a thorough grasp on the new rules and potential consequences. Timely professional advice and guidance in that regard can help mitigate employers’ exposure to the potentially severe new penalties for non-compliance.