Key investments
Comment


Budget 2022 includes several investments that aim to enhance Canada's capacity to meet immigration demands, as well as to support the labour force. More than one in four workers are foreign-born, and as the Canadian population ages, immigration is expected to account for an increasingly large share of the workforce. In 2021, Canada welcomed 405,000 new permanent residents, more than any year in Canadian history. By 2024, Canada aims to welcome 451,000 new permanent residents, the majority of whom will be skilled workers, which will help address ongoing labour shortages.

Key investments

Budget 2022's key investments in immigration include:

  • C$385.7 million over five years and C$86.5 million ongoing for Immigration, Refugees, and Citizenship Canada (IRCC) and the Canada Border Services Agency to facilitate timely and efficient entry of foreign workers and students. This is a much-needed investment to help with chronic processing delays and backlogs;
  • C$187.3 million over five years and $37.2 million ongoing for the IRCC to respond to a growing volume of enquiries from foreign nationals and to invest in technology to support those using its services. Given the significant interest in immigration to Canada, this will allow for timely updates to those who wish to make Canada their home;
  • modernising the citizenship programme to allow for electronic applications and some automation, in response to a growing number of citizenship applications. The Citizenship Act and the process to become a citizen remain very manual and paper-based. Moving to an automated and electronic system will provide timely access to permanent residents who are about to transition to Canadian citizens;
  • amending the Immigration and Refugee Protection Act (IRPA) to provide the minister with authority to select candidates who best meet Canada's labour market needs among the pool of candidates who wish to become permanent residents through the express entry system. Canada is experiencing significant labour shortages across a variety of sectors. By implementing flexibility by way of ministerial instructions, Canada will be better equipped to respond to skills gaps through adjustments to the express entry system, providing businesses with key access to global talent when and where it is needed;
  • recognising current processing times for employer-based applications under the temporary foreign worker programme, the government will invest C$64.6 million over three years to increase capacity to process employer applications within established service standards, as well as C$29.3 million to create a "trusted employer model". This model will be available to repeat employers and reduce administrative burdens to those who meet the highest standards of working and living conditions and wages in high-demand fields; and
  • service fee exemptions. The budget proposes to amend the IRPA to exempt the following four services/application types from government processing fees under the Service Fees Act:
    • authorisation to return to Canada;
    • criminal rehabilitation;
    • restoration of temporary resident status; and
    • temporary resident permit.

In order to support workers, Budget 2022 further includes several investments aimed to increase labour and employment protections, as well as benefits. The key investments in this area are:

  • minor amendments to the Canada Labour Code (CLC) through Bill C-3, which will provide federally regulated workers with greater leave entitlements. Once these amendments come into force, federally regulated workers will receive 10 days of paid medical leave that is in addition to the current entitlements under the CLC of three days' annual paid personal leave and two days' annual unpaid personal leave. Additionally, Bill C-3 will provide a bereavement leave of up to eight weeks for the death or stillbirth of an employee's child, or the child of their spouse or common-law partner. While mostly unpaid, payment will be provided for the first three days for employees who have completed three months of continuous employment;
  • doubling funding for the union training and innovation programme by investing C$84.2 million over four years to improve access to skilled trades for underrepresented groups of people. This investment aims to boost diversity and inclusion by providing training to groups such as newcomers, women, persons with disabilities, Indigenous peoples and racialised minorities to help them obtain employment in the skilled trades. Budget 2022 estimates that each year, the funding will allow 3,500 apprentices to enter the skilled trades job market;
  • a C$1.9 million investment to complete a review of the Employment Equity Act and provide a final report in autumn 2022. Based on the final report, recommendations will be made to amend federal equity legislation and to strengthen employment equity obligations;
  • a C$2.5 million investment for Employment and Social Development Canada to create a union-led advisory table. This advisory table will work with the government to recommend what investments to make in order to support workers, with an emphasis on skilled workers who work in at-risk sectors or jobs. This advisory table is intended to empower workers and unions by providing a meaningful opportunity to contribute to planning the future of work. These contributions may lead to recommendations to amend federal employment legislation, which will impact employers. Details of this advisory table are yet to be announced;
  • further amendments to Part II of the Employment Insurance Act (EI Act) to expand assistance eligibility for workers facing unemployment, and to help employers receive direct support to re-train workers. Budget 2022 also proposes to extend the increased 45 weeks of EI leave for eligible seasonal workers, introduced in 2018, until October 2023. These amendments continue the federal government's trend of expanding the EI system and its available entitlements;
  • a C$115 million investment, over five years, to bolster the foreign credential recognition programme, which will streamline the credential recognition process for more internationally trained health care professionals and allow them to find work. While assisting newcomers to find meaningful work in their fields, this programme will also help cover labour shortages in the health care sector created by the pandemic;
  • the introduction of the employee ownership trust (EOT), which aims to encourage employee ownership of businesses. This builds on the work that the federal government proposed in Budget 2021, in which it consulted with stakeholders to analyse the barriers preventing the creation of these trusts. This consultation led to the finding that the main barrier was the lack of a legislated trust vehicle, and so the EOT is proposed to be created under the Income Tax Act; and
  • amendments to the Pension Benefits Standards Act 1985 and the Pooled Registered Pension Plans Act to strengthen the long-term security, and improve the sustainability, of federally regulated pension plans. These amendments will be aimed to improve governance and administration of federal pension plans and will also create new frameworks for solvency reserve accounts and variable payment life annuities.

Comment

As more information on Budget 2022 becomes available, and as legislative amendments are implemented, employers should review their workplace policies and agreements to ensure compliance. Employers that attract foreign talent should also connect with immigration counsel to ensure that they continue to receive timely updates regarding their employees' immigration matters.

For further information on this topic please contact Lisa Cabel, Qasid Iqbal, Amira Zubairi or Graeme Black at KPMG Law by telephone (+1 416 777 8000‚Äč) or email ([email protected], [email protected], [email protected] or [email protected]). The KPMG Law website can be accessed at www.kpmg.com.