Post-LMO compliance reviews
Consequences of non-compliance
Submitting A-LMO applications
On April 25 2012 Human Resources and Skills Development Canada (HRSDC) implemented its new accelerated labour market opinion (A-LMO) initiative. The A-LMO initiative is intended to expedite the regular labour market opinion (LMO) process for employers with an established track record of compliance.
An A-LMO application does not exempt employers from the criteria applicable to a normal LMO application. HRSDC will still assess the A-LMO based on:
- the genuineness of the job offer;
- the wage offered; and
- whether the job offer is likely to fill a labour shortage.
However, A-LMO applications filed with HRSDC will be approved within 10 business days, rather than after several weeks (or, in some cases, months).
The A-LMO initiative applies only to higher skilled positions, which include positions within skill type 0 (management occupations), skill level A (occupations usually requiring university education) and skill level B (occupations usually requiring a college education or apprenticeship training) under the National Occupational Classification. However, Canadian employers hiring in the film and entertainment and agriculture sectors must still apply under the regular LMO process, even for positions within skill type 0 or skill level A or B. In addition, the A-LMO is not being implemented in the province of Quebec.
In order to qualify to participate in the A-LMO initiative, employers must:
- have been issued at least one positive LMO within the previous two years;
- have a clean compliance record with the temporary foreign worker programme over the previous two years;
- have agreed to all of the attestations included in the A-LMO application;
- not have been the subject of an investigation, infraction or a serious complaint; and
- not have any unresolved violations or contraventions under provincial laws governing employment and recruitment.
Eligible employers who participate in the A-LMO initiative are required to comply with all programme requirements for higher skilled positions (ie, skill type 0, skill level A and skill level B), including the following:
- They must research and understand the prevailing wage for the proposed occupation in the area where the employee will work, using the information provided on the Working in Canada website, and agree to pay a wage level at least equal to this amount. Under HRSDC's new wage structure, employers can pay wages that are up to 15% below the average wage in the area where the employment will occur, in the case of a high-skill occupation. However, employers must provide documentation that clearly demonstrates that the wage being paid to a temporary foreign worker is the same as that being paid to their Canadian employees in the same job and in the same location.
- They must comply with same advertisement and recruitment requirements that apply to regular LMO applications, before offering the job to a temporary foreign worker and submitting the A-LMO application.
In connection with an A-LMO application, employers must consent to participate in a post-LMO compliance review. By consenting, employers allow HRSDC to perform a compliance audit of any positive LMO issued to the employer during the previous two years. During the review, employers must submit documentation to demonstrate compliance with the terms and conditions of the positive LMO or A-LMO letters and their annexes.
HRSDC has indicated that up to 20% of positive A-LMOs will be selected for a compliance review. These reviews will usually be based on random selection. However, cases may also be selected in response to information received subsequent to the issuance of an A-LMO. In addition, in cases where the employer files an A-LMO application offering to pay wages that are below the average wage in the area where the employment will occur (in accordance with HRSDC's new wage structure), that employer is likely to be flagged for post-LMO compliance review.
According to the HRSDC, in order to demonstrate compliance during a post-LMO compliance review, employers may be required to submit the following documents:
- payroll information for the temporary foreign worker and potentially for Canadian citizens and permanent residents;
- collective bargaining agreements;
- job descriptions;
- copies of recruitment advertising;
- proof of no labour dispute;
- copies of the temporary foreign worker's work permit; and
- proof of registration with provincial or territorial workplace safety (where applicable).
Employers should retain all documents related to the A-LMO application and attestations, as well as any documents related to other positive LMOs, for up to six years. Failure to provide the requested documentation will disqualify the employer from future participation in the A-LMO initiative.
Consequences of non-compliance
When non-compliance is determined, employers will have an opportunity to provide justification as well as to take corrective action, where applicable. HRSDC will work with the employer to implement the appropriate corrective action and may request proof to this effect in order for the employer to be deemed compliant. Employers found to be non-compliant with the A-LMO initiative will be subject to several adverse consequences, which may include:
- ineligibility for the A-LMO initiative in future;
- revocation of other LMOs for which work permits have not yet been issued;
- the sharing of HRSDC's findings with its federal and provincial partners for further investigation; and
- greater scrutiny in the review of any pending or subsequent LMO applications filed by that employer.
Employers which want to hire temporary foreign workers using the A-LMO initiative can apply online using the HRSDC's temporary foreign worker w wwweb service, which is also used for regular LMO applications, or send a paper application. However, the employer and any third-party representative must first register by completing, signing and then faxing or mailing the necessary registration forms to the HRSDC before being permitted to file an A-LMO or LMO application online. This can make the online application process less convenient for both the employer and its third-party representative.
For further information on this topic please contact Henry J Chang at Blaney McMurtry LLP by telephone (+1 416 593 1221), fax (+1 416 593 5437) or email ([email protected]).