On the heels of intense media scrutiny of Canada's foreign worker program, the Harper Government announced sweeping changes to the Temporary Foreign Worker Program. Some of the changes are effective immediately.

Please note many of the changes that are effective immediately concern work permits granted pursuant to the Labour Market Opinion ("LMO") program. These changes significantly transformed the LMO process, making it more onerous to hire foreign nationals. The changes underscore a greater trend within Service Canada to encourage hiring local Canadian citizens or permanent residents in lieu of hiring Foreign Nationals.

The general work permit category in Canada requires a LMO. This is an application made by the employer to The Ministry of Employment and Social Development Canada ("Service Canada") to weigh factors in assessing the impact on the Canadian labour market of hiring a foreign worker for a proposed job or activity. Service Canada will consider wages, working conditions, the availability of Canadians or permanent residents to perform the duties in question, whether skills and knowledge transfer would result from confirming the foreign worker and whether the work is likely to create other jobs for the benefit of Canadians or permanent residents.

  1. Accelerated Program Suspended

The LMO process requires recruitment for the position and the LMO is specific to each province. The processing time currently ranges between approximately 10 to 12 weeks, depending on the province. Under the former regulatory scheme, a company having obtained one positive LMO would be eligible for an Accelerated Labour Market Opinion ("ALMO"), which is processed in 5-10 business days. The ALMO program was been suspended on April 29, 2013 without any warning to employers. Therefore, no applications will be permitted under the ALMO process. All applications requiring a Labour Market Opinion will now be processed according to regular (and longer) processing times.

  1. LMO Application Process

Effective July 31, 2013, every employer must pay a processing fee of $275.00 CAD for each position requested in an LMO application. Therefore, if an employer is advertising to fill three positions, the employer must then pay $825 CAD. No refunds will be provided by Service Canada if the application is withdrawn, cancelled or refused. Moreover, a request for reconsideration of a negative decision by Service Canada will require the employer to first submit a new application (including the requisite forms and new fees).

LMO application forms now solicit significant additional information from the employer. The new questions seek information regarding the impact on the Canadian job market including whether the employer has engaged in any outsourcing activities and additional verification that Canadian employees are not being replaced by foreign workers.

Along with the LMO application, the employer will be required to submit a detailed transition plan outlining the employer's intended actions regarding recruitment, training, and residency. The transition plan's level of detail will depend on a number of factors including whether the position is lower- or higher-skilled, the type and size of the industry, and the regional unemployment rate. This is a significant change to the process. Service Canada will also review an employer's progress against the transition plan if that employer applies for additional LMOs in the future. Therefore, employers will also be required to document their ongoing efforts to adhere to their transition plan and effectively transition to a Canadian workforce.

  1. No Flexibility in the Prevailing Wage Offered to a Foreign Worker

Service Canada previously allowed some wage flexibility to pay less than the prevailing wage in specific instances. Specifically, employers previously were able to pay foreign workers 5-15% less than prevailing wage if Canadians in that position were paid at the same wage rate. Effective immediately, all employers must pay foreign workers at the prevailing wage rate.

  1. Significant Increase in Demonstrated Recruitment Efforts

Effective July 31, 2013, Employers must now advertise positions for at least four weeks prior to submitting an application for an LMO. Advertisements must continue to run throughout the entire 10 to 12 week processing period currently estimated by Service Canada. Previously, employers were required to advertise for only two weeks prior to submitting an application. Consequently, this is a significant increase in the requirements.

Moreover, employers must now recruit in three sources. Employers must continue to advertise on the standard government websites including either the national Job Bank website or the designated provincial/territorial website, depending on where the foreign national will be working. In addition, employers must also provide evidence that they have also used two other recruitment methods which are consistent with the recruitment practice for the intended occupation. For example, high-skilled positions require at least one of the advertising methods to be national in scope whereas low-skilled positions will require that the employer has demonstrated efforts to hire under-represented groups in the labor force. Employers must also continue to actively seek qualified Canadians to fill the advertised positions until an LMO has been issued.

In sum, Employers seeking to fill high-skilled positions (which includes occupations within National Occupational Classification 0, A, and B) will be required to:

  • advertise on the national Job Bank or its provincial/territorial counterpart for at least 4 weeks and throughout the processing period--until the date the positive LMO is issued;
  • advertise in two additional mediums (at least one of which is national in scope) for a period of at least 4 weeks and until the LMO is issued, including:
    • print media (national or provincial/territorial newspapers, national journals, magazines with national coverage, specialized journals, professional associations magazines, newsletters, etc.);
    • general employment websites (canadastop100.com, vault.com, workopolis.com, monster.ca, etc.); and
    • specialized websites dedicated to specific occupation profiles (e.g. accounting, marketing, biotechnology, education, engineering, etc.)
  • Employers must demonstrate that the advertising medium is appropriate for the position;

Employers are also required to maintain copies of the advertisements and the results of their recruitment efforts for a minimum of six years. Service Canada reserves the right to request these documents for future assessments.

  1. Language Restrictions

Effective July 31, 2013, English and French are the only languages that can be identified as a job requirement, both in LMO requests and in advertisements by employers applying to hire a foreign national. There is a limited exception when employers can demonstrate that another language is essential for the job. The onus will be on employers to demonstrate that a language other than French or English is an essential requirement of the job. Service Canada will issue a negative LMO if the rationale does not demonstrate that the requested non-official language is an essential requirement of the job.

Given the burdensome nature of this process, many employers opt to seek "Labour Market Exempt" work permits (such as NAFTA Professionals and Intra-Company Transferees). At this time, no changes have been announced to the LMO-exempt work permit categories.