As we reported in January 2015, Employment and Social Development Canada circulated a Discussion Paper (PDF) which contained a framework for its plans to penalize non-compliant employers of temporary foreign workers. The Government of Canada has now published regulations introducing a new Administrative Monetary Penalty (AMP) regime. The AMP regime will come into force on December 1, 2015 and apply to noncompliance occurring after that date.

Administrative Monetary Penalties

While the regulations specifically state that their purpose is to encourage compliance and not to punish, the range of possible violations is very wide and the consequences potentially very severe.

At present, employers found non-compliant further to an inspection face a two year ban from the Temporary Foreign Worker Program (TFWP), which governs Labour Market Impact Assessment (LMIA)-based work permits or the International Mobility Program (IMP), which governs LMIA-exempt work permits. Under the new regime, employers' failure to comply with conditions of either program will be assessed according to a complex point system based on factors such as:

  • type of violation
  • prior non-compliance history
  • size of the business
  • severity of  the violation.

Depending on the number of points awarded, an AMP could vary from zero to $100,000 per violation. In addition, the ban from the program could be imposed for 1, 2, 5 or 10 years - or permanently! A failure to comply that affects more than one worker will constitute a separate violation for each worker affected.

In the event of multiple violations, AMPs will be cumulative, up to a total of $1 million. What's more, the employer's name and address will be published on the government website for an undetermined period, with details about the violation, the AMP and the duration of the ban. 

Types of Violations

Violations may cover any of the long list of obligations now imposed on employers in the course of an LMIA or an LMIA-exempt work permit application. These include:

  • providing accurate information in the LMIA or work permit application,
  • retaining documents during the 6 years following the beginning of the foreign worker's employment,
  • providing required documents and information during an inspection,
  • providing the foreign worker with the same occupation and substantially the same wages and working conditions as outlined in the employment offer or the LMIA application,
  • complying with the federal and provincial employment laws applicable in the province, or
  • making reasonable efforts to provide a workplace free of abuse.

Employer Defences

During the consultation period on the proposed regime, employers and legal stakeholders expressed a number of concerns. Some of them were heard. In particular, the justifications of good faith and inadvertent errors committed by employers can now be argued to avoid a non-compliance determination. Those who voluntarily disclose non-compliance may receive a reduced AMP and a shorter ban, or even only a warning in the case of a first violation. However, disclosing will not suffice. The regulations grant wide discretionary power to an officer in assessing whether a voluntary disclosure is acceptable, based on the circumstances. The opportunity will also be given to employers to respond in writing within 30 days to a preliminary finding of non-compliance before a notice of  final determination is issued. 

Employers must ensure Compliance

More than ever, with the implementation of this additional piece in the TFWP/IMP enforcement system, employers of temporary foreign workers must make sure that they are closely monitoring their participation in the program. We suggest that you implement internal compliance controls and mechanisms to ensure you are in compliance. Such systems may help you avoid the serious consequences that could result under the new framework.