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CANADA: Significant Changes to the Canadian Temporary Foreign Worker Program Announced

On April 29, 2013, the Canadian government announced reforms to the Temporary Foreign Worker Program (TFWP) as a result of recent TFWP abuses reported by the media over the past two months. Although it is evident that Canada requires foreign talent and is experiencing a shortage of skilled talent in various economic sectors, the Canadian government has strengthened the policy to ensure that its own TFWP officers meet the legislative objectives of the program, which aim to place the interests of Canadian workers first.

The "Canadians first" legislative framework has been in operation for over 25 years, but was compromised in 2012 by the creation of a new Accelerated Labour Market Opinion (A-LMO) process. The A-LMO was intended to be an accelerated process for employers with a positive track record of compliance who hire high-skilled temporary foreign workers. This involved a simplified application process, pregnant with legal significance, which has been abused by employers largely because they misunderstood the legal significance of the material. The use of the accelerated process, together with a lack of training on this new program for Service Canada officers, precipitated an unprecedented failure to meet the legislative goals of the TFWP.

As a consequence, the government has introduced the following measures to ensure that employers are able to attract foreign talent not available in Canada, while protecting the domestic Canadian labor force:

  1. Effective immediately, require employers to pay temporary foreign workers at the prevailing wage by removing the existing wage flexibility;
  2. Effective immediately, temporarily suspend the A-LMO process;
  3. Increase the government's authority to suspend and revoke work permits and Labour Market Opinions (LMOs) if the program is being misused;
  4. Add questions to employer LMO applications to ensure that the TFWP is not used to facilitate the outsourcing of Canadian jobs;
  5. Make sure that employers who rely on temporary foreign workers have a firm plan in place to transition to a Canadian workforce over time through the LMO process;
  6. Introduce fees for employers for the processing of LMOs and increase the fees for work permits so that the taxpayers are no longer subsidizing the costs; and
  7. Identify English and French as the only languages that can be used as a job requirement.

Some of these TFWP changes constitute reversals of new government policies that were implemented over the past few years, such as #1, #2, #5, and #7 (the latter to a lesser extent, although the policy became much more flexible recently). The changes announced at #3 and #6 are new initiatives that have not yet been drafted. Regarding the additional questions on the application forms at #4, the forms have not yet been released.

Outsourcing is a global economic reality and a widely accepted and understood practice by employers. Hiring foreign workers to work for a Canadian employer for the purpose of outsourcing the same position is clearly an abuse of the TFWP. With correct legal guidance, an employer can use ethical and legally acceptable strategies to enable outsourcing without blatantly disregarding the law and creating an inexcusable political and public relations risk.

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