Update on the Temporary Foreign Worker Program
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1 e x p e c t t h e b e s t Update on the Temporary Foreign Worker Program by Henry J. Chang Henry J. Chang is co-chair of the firm s International Trade and Business Group and a member of its Immigration Law Group. A recognized authority in the field of foreign law, Henry is licensed as a Foreign Legal Consultant by the Law Society of Upper Canada, and is the Official Research Partner of the International Bar Association and the Strategic Research Partner of the ABA Section of International Law. Henry acts for foreign and domestic companies seeking to engage in cross-border business transactions and advises multinational businesses on a broad range of legal issues. Henry may be reached directly at or hchang@blaney.com. Background In early April 2013, it was reported that forty-five Royal Bank of Canada ( RBC ) employees in Toronto would be losing their jobs because the company had outsourced several technology services to igate, a California-based firm that specializes in sending jobs offshore. RBC faced a severe public backlash over the incident. Questions were also raised regarding how igate had brought its own employees into Canada under the Temporary Foreign Worker Program ( TFWP ), so that they could be trained at RBC offices. As a result of the RBC incident, the Government of Canada proposed several changes to the TFWP. On April 29, 2013, the Minister of Human Resources and Skills Development ( HRSDC ) and the Minister of Citizenship, Immigration and Multiculturalism, announced that they were introducing changes, which would: Immediately require employers to pay temporary foreign workers at the prevailing wage by removing the existing wage flexibility; Immediately suspend the Accelerated Labour Market Opinion ( A-LMO ) process; Increase the Government of Canada s authority to suspend and revoke work permits and Labour Market Opinions ( LMOs ) if the program is being misused; Add questions to employer LMO applications to ensure that the TFWP is not used to facilitate the outsourcing of Canadian jobs; Ensure 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; Introduce employer fees for the processing of LMOs and increase the fees for work permits so that the taxpayers are no longer subsidizing the costs; and Identify English and French as the only languages that can be used as a job requirement. Several of the above changes have already been implemented; the remaining changes will require regulatory amendments. On June 8, 2013, Citizenship and Immigration Canada ( CIC ) published proposed regulatory amendments to the Immigration and Refugee Protection Regulations 1 ( IRPR ) in the Canada Gazette 2, which will implement the remaining proposed changes. However, these proposed regulations are not currently in force. 1 SOR/
2 Currently Implemented Changes Elimination of Prevailing Wage Flexibility HRSDC announced last year that it would permit employers to pay the temporary foreign worker ( TFW ) up to 15% less than the median wage for higher skilled occupations (NOC Skill Levels 0, A, or B) or 5% less than the average wage for lower skilled occupations (NOC Skill Levels C or D), if they could document that their Canadian workers were also receiving the same wage. This flexibility was actually due to the fact that the average wage figures established by Statistics Canada were not always appropriate. For example, they did not consider a particular worker s level of experience in the field or the presence of a very large employer in the region that paid above average wages to its workers. In any event, HRSDC eliminated this wage flexibility soon after the RBC incident. Ironically, this may require certain employers to pay TFWs more than their Canadian counterparts. Suspension of the A-LMO Program HRSDC also announced last year that it was implementing an A-LMO initiative that would allow certain employers, who had an established track record of compliance, to obtain expedited processing of their LMOs. Although the A-LMO program was considered a success, HRSDC has now suspended it. Although the announcement on April 29 suggested that the suspension of the A-LMO program was temporary, it is unknown whether the program will resume in the future. Due to the suspension of the A-LMO program, all LMO applications are now being processed much more slowly than before. The cases that would have otherwise been processed as A-LMOs must now be processed in the regular queue; this has resulted in increased backlogs. Although processing times will vary from one office to the other, it is not unreasonable to expect a processing time of eight weeks or longer for an LMO application. New Questions Regarding Outsourcing of Canadian Jobs Shortly after the RBC incident, HRSDC began requiring employers who submitted an LMO application to complete a Canadian Labour Market Impact Questionnaire, which asked questions about whether the entry of the TFW would lead to job losses due to outsourcing or offshoring, or otherwise facilitate outsourcing or offshoring. As of July 31, 2013, these outsourcing questions have been integrated into the latest version of the LMO application form. Answering yes to one or more of these outsourcing questions will almost certainly result in a denial. New Advertising Requirements As of July 31, 2013, Employment and Social Development Canada ( ESDC ), which is the new name for HRSDC, has increased the minimum recruitment requirements that employers will need to follow when submitting an LMO application. However, the new advertising requirements will not apply to: The Live-in Caregiver Program 3 ; Positions related to on-farm primary agriculture (specifically under NOC Codes 8251, 8252, 8253, 8254, 8256, 8431, 8432 and 8611); The Seasonal Agricultural Worker Program 4 ( SAWP ); or The Agricultural Stream 5. Employers must advertise available positions in Canada for at least four weeks before applying for an LMO; this requirement applies to all advertising methods. Previously, employers were only required to advertise for two weeks during the three months prior to the filing of the LMO application. In addition, for NOC 0 and A occupations, employers were permitted to conduct similar recruitment
3 activities consistent with the practice within the occupation (with no minimum period specified), instead of advertising the position in the national Job Bank; the two week advertising period only applied if the employer chose to advertise in the national Job Bank. Higher-Skilled Occupations Under the new requirements, employers seeking to hire a TFW in a higher-skilled occupation (NOC 0, A, or B) must advertise: On the national Job Bank 6 or its provincial/territorial counterpart in British Columbia, Saskatchewan, the Northwest Territories, Quebec or Newfoundland and Labrador: 1. The advertisement must be posted for a minimum of four weeks starting from the first day the ad appears and is accessible to the general public. 2. The advertisement must remain posted to actively seek qualified Canadians and permanent residents until the date that an LMO is issued. Using two or more additional methods of recruitment consistent with the normal practice for the occupation: 1. As a minimum, employers must choose one method that is national in scope, since people in higher-skilled positions are often mobile and willing to re-locate for work; and 2. Employers can choose one or more recruitment methods among these: (i) print media (national or provincial/territorial newspapers, national journals, magazines with national coverage, specialized journals, professional associations magazines, newsletters, etc.); (ii) general employment websites (i.e. canadastop100.com, vault.com, workopolis.com, monster.ca, etc.); and (iii) specialized websites dedicated to specific occupation profiles (i.e. accounting, marketing, biotechnology, education, engineering, etc.). 3. The advertisement must be posted for a minimum of four weeks starting from the first day the ad appears and is accessible to the general public. Lower-Skilled Occupations Under the new requirements, employers seeking to hire a TFW in a lower-skilled occupation (NOC C or D) must advertise: On the national Job Bank or its provincial/territorial counterpart in British Columbia, Saskatchewan, the Northwest Territories, Quebec or Newfoundland and Labrador: 1. The advertisement must be posted for a minimum of four weeks starting from the first day the ad appears and is accessible to the general public. 2. The advertisement must remain posted to actively seek qualified Canadians and permanent residents until the date that an LMO is issued. Using two or more additional methods of recruitment consistent with the normal practice for the occupation: 1. Employers can choose one or more recruitment methods among these: (i) print media (local newspapers, job boards, youth magazines etc.); and (ii) general employment websites (jobboom.com, workopolis.com, monster.ca, etc.). 2. The advertisement must be posted for a minimum of four weeks starting from the first day the ad appears and is accessible to the general public. Targeting underrepresented groups: 1. Employers can: (i) try to recruit workers from local or provincial/territorial employment centres, service centres for Aboriginal youth, new immigrants and people with disabilities; (ii) offer bursaries to attract students or youth, pursue online recruitment strategies, or undertake ongoing advertising and interviews in order to maintain a pre-screened applicant pool. 6
4 Content of Advertisement The advertisement must include the following information: Company operating name; Business address; Title of position; Job duties (for each position, if advertising more than one vacancy); Terms of employment (e.g. project based, permanent position); Wage; Benefits package being offered (if applicable); Location of work (local area, city or town); Contact information (telephone number, cell phone number, address, fax number, or mailing address); and Skills requirements: 1. Education; and 2. Work experience. Third-party representatives or recruiters can be the main contact for any job advertisements posted on behalf of the employer. However, the ad must be listed under the employer's Canada Revenue Agency Business Number. Proof of Advertisement Employers will be required to demonstrate that they meet the advertising requirements by providing proof of advertisement and the results of their efforts to recruit Canadian citizens and permanent residents (i.e. a copy of advertisement and information to support where, when and for how long the position was advertised). Records of the employers' efforts should be kept for a minimum of 6 years. ESDC may request these documents in connection with future assessments. New LMO Application Fee Effective July 31, 2013, employers who submit LMO applications on behalf of Temporary Foreign Workers ("TFWs") will be required to pay a processing fee of $275.00CAD for each position requested; prior to this date, no fee applied to the filing of an LMO application. However, the LMO processing fee does not apply to positions under the SAWP, the Agriculture Stream, or on-farm primary agricultural positions listed under National Occupational Classification ("NOC") Codes 8251, 8252, 8253, 8254, 8256, 8431, 8432 and Subject to the above exceptions, employers must now complete the LMO application and the processing fee payment form, and submit both items along with the required processing fee payment. The total payment must reflect the number of TFW positions requested on the LMO application. The processing fee payment (in Canadian dollars) can be made by: Certified cheque (payable to the Receiver General for Canada); Money order (postal or bank) Visa; MasterCard; or American Express. Employers and third-party representatives may not attempt to recover the LMO processing fees from the TFWs who are the beneficiaries of the LMO application.
5 ESDC must receive the entire processing fee along with the required documents before it will assess the employer's LMO application. LMO applications received prior to July 31, 2013 will not be subject to the new processing fee. However, applications received with a postmark dated July 31, 2013 (or later) without the processing fee will not be assessed. There will be no refund in the event of a negative LMO or if the application is withdrawn or cancelled since the fee covers the process to assess an application and not the outcome. Refunds will only be available if a fee was collected in error (i.e. an incorrect fee amount was processed). Language Restrictions On July 31, 2013, CIC published an amendment to the IRPR, which came into force on that date. 7 As a result of this amendment, English and French are now the only languages that can be identified as a job requirement, both in LMO requests and in advertisements by employers applying to hire TFWs, unless employers can demonstrate that another language is essential for the job. However, the language restriction does not apply to positions under the SAWP, the Agriculture Stream, or on-farm primary agricultural positions listed under NOC Codes 8251, 8252, 8253, 8254, 8256, 8431, 8432 and Although these amendments do not prohibit a foreign language requirement in all cases, the onus will be on employers to demonstrate that a language other than French or English is an essential requirement of the job. They will be required to clearly demonstrate, in writing, that the language requested is consistent with the regular activities of the job. For example, a translation company hiring a translator to work in a language other than English or French, or a tour company catering to foreign tourists only in a non-official language, might be able to establish a bona fide need for a foreign language skill. ESDC staff will now assess the employer's rationale for requesting a language other than English or French in relation to the occupation and information included in the LMO application. It will issue a negative LMO if the rationale does not demonstrate that the requested non-official language is an essential requirement of the job. Proposed Regulatory Amendments As mentioned above, CIC has published proposed regulatory amendments to the IRPR, which are described in greater detail below. Conditions Applicable to All Work Permits Under the proposed regulations, all employers will be required to demonstrate that they are complying with (or that they have complied with) certain conditions during the period of the TFWs work permit: The employer (other than the employer of a live-in caregiver) must be actively engaged in the business in respect of which the offer of employment was made; The employer must comply with the federal and provincial laws that regulate employment and the recruiting of employees in the province in which the TFW works; The employer must provide a TFW with employment in the same occupation as that set out in that TFW s offer of employment and with wages and working conditions that are substantially the same as, but not less favourable than, those contained in the offer; The employer must make reasonable efforts to provide TFWs with a work place that is free of abuse, specifically: o Physical abuse, including assault and forcible confinement, o Sexual abuse, including sexual contact without consent, o Psychological abuse, including threats and intimidation, and 7
6 o Financial abuse, including fraud and extortion; The employer must not be convicted of an offence of human trafficking under the Immigration and Refugee Protection Act, unless there has been a final determination of an acquittal or a pardon/record suspension has been granted; and The employer must not be convicted, or discharged, under the Criminal Code of any of the following offences, unless there has been a final determination of an acquittal or a pardon/record suspension has been granted: o Trafficking in persons (or related offence); o An offence of a sexual nature (or an attempt) against an employee; o An offence causing death or bodily harm to an employee; o Uttering threats to cause death or bodily harm against an employee; or o An offence involving the use of violence (or an attempt) against an employee. In addition, the employer must not be convicted outside Canada of an offence that would constitute one of the above offences if committed in Canada, unless there has been a final determination of an acquittal. These conditions will typically be enforced by CIC. Conditions Applicable to LMO-Based Work Permits Where an LMO is required, employers who are issued a positive LMO will be required to comply with the several conditions during the period of foreign national s employment (or, where applicable, during any other period that has been agreed to by the employer and ESDC). As appropriate, employers will be required to demonstrate that they are complying with, or have complied with, one or more of the following conditions: Employers must ensure that the employment of the foreign national will result in direct job creation or job retention for Canadian citizens or permanent residents, if that was one of the factors that led to the issuance of the LMO and subsequent work permit; Employers must ensure that the employment of the foreign national will result in the development or transfer of skills and knowledge for the benefit of Canadian citizens or permanent residents, if that was one of the factors that led to the issuance of the LMO and subsequent work permit; Employers must make reasonable efforts to hire or train, or hire or train, Canadian citizens or permanent residents, if that was one of the factors that led to the issuance of the LMO and subsequent work permit; and In the case of an employer who employs a TFW as a live-in caregiver, the employer must: o Ensure that the TFW resides in a private household and provides, without supervision, the care for which the TFW was employed; o Provide the TFW with adequate furnished and private accommodations in the household; and o Have sufficient financial resources to pay the TFW the wages offered. The exact conditions with which a particular employer will be required to comply depend on their specific LMO and will be established by ESDC prior to the issuance of the LMO. These conditions will typically be enforced by ESDC. Improved Compliance Verification The current regulations provide that returning employers seeking to hire TFWs, including live-in caregivers, are required to demonstrate compliance before they are granted a positive LMO or the employer is granted a work permit. CIC and ESDC may examine previous offers of employment within the
7 two years preceding the date of receipt of a new LMO or work permit application and the employer may be required to produce evidence of compliance (i.e. that they provided each TFW with substantially the same wages and working conditions as those set out in their offer of employment). However, CIC and ESDC can only verify compliance at the time that a new LMO or work permit application is submitted by the employer. As a result, unless a subsequent LMO or work permit is filed, it is impossible to verify whether the employer has complied with the terms of a previous job offer. Under the proposed amendments, employers will now be required to demonstrate that, within the six years preceding the date of receipt of a new LMO or work permit application, that they provided each TFW with substantially the same wages and working conditions as, but not less favorable than, those set out in their previous offer of employment. Employers will also be required to retain documents that demonstrate their compliance with any conditions that were imposed on them, for a period of six years after the date that the TFWs work permit expires. In addition, the proposed amendments will allow a compliance verification inspection in the following cases: A CIC officer or the Minister of ESDC has a reason to suspect that the employer is not complying with or has not complied with any conditions imposed; The employer has not complied with conditions in the past; or The employer is randomly chosen for verification compliance. In other words, compliance verification will no longer be triggered solely by the filing of a subsequent LMO or work permit application by the employer. It can be initiated at any time during the compliance verification period. New Verification Compliance Inspection Powers Under the proposed amendments, for the purposes of verifying compliance, CIC or ESDC will have the authority to require an employer to report at any specified time and place in order to answer questions and provide documents that relate to compliance with any condition imposed on it. ESDC may also exercise its authority to verify the conditions that would typically be enforced by CIC, at the request of a CIC officer. More significantly, CIC and ESDC will have the authority to enter and inspect any premises or place where the TFW works, without the consent of the employer. Upon entering the premises or place where the TFW works, CIC or ESDC may: Ask the employer and any person employed by the employer any relevant questions; Require from the employer, for examination, any documents found in the premises or place; Use copying equipment in the premises or place, or require the employer to make copies of documents, and remove the copies for examination or, if it is not possible to make copies in the premises or place, remove the documents in order to make copies; Take photographs and make video or audio recordings; Examine anything in the premises or place; Require the employer to use any computer or other electronic device in the premises or place in order to allow the officer to examine any relevant document contained in or available to it; and Be accompanied or assisted in the premises or place by any person required by CIC or ESDC. The above powers may be exercised by CIC or ESDC without the consent of the employer and without a warrant. There is only one exception described in the proposed amendments - if the TFW is employed at a dwelling house (for example, in the case of a live-in caregiver), CIC and ESDC may
8 only enter without the occupant s consent if they are in possession of a warrant issued pursuant to the regulations. Information Sharing Between CIC and ESDC The proposed regulatory amendments include an information-sharing provision that will allow the disclosure of information from CIC to ESDC, in relation to an application for a work permit or an employer s compliance with the conditions imposed upon them. They also include a provision that will allow the disclosure of information from CIC to the competent authorities of the provinces and territories in relation to the above matters. Miscellaneous Amendments The proposed regulatory amendments will also implement the following miscellaneous changes: Subsection 203(1.1) of the IRPR, which describes circumstance in which an employer s failure to comply with the conditions imposed is justified, will be amended to include force majeure as an additional justification ground. The issuance of an LMO or work permit will be prohibited where the foreign national intends to work for an employer who, on a regular basis, offers stripping, erotic dance, escort services, or erotic massages. The Ministerial Instructions issued in 2012 already prohibited the processing of work permit applications filed by TFWs who would be working in a sector where there were reasonable grounds to suspect a risk of sexual exploitation of some workers. All temporary residents will be prohibited from entering into an employment agreement or extending the term of an employment agreement with an employer who, on a regular basis, offers stripping, erotic dance, escort services, or erotic massages. The prevailing wage rate will now be determined by ESDC, by taking into account the rates that are made publicly available by the Minister of ESDC and the wages paid to Canadian citizens and permanent residents by the employer making the offer, if that information is provided by the employer on request of that Minister. Currently, work permits may not be issued when the specific work that the foreign national intends to perform is likely to adversely affect the settlement of any labour dispute in progress or the employment of any person involved in the dispute, except where all or almost all of the workers involved in the labour dispute are not Canadian citizens or permanent residents and the hiring of workers to replace the workers involved in the labour dispute is not prohibited by the Canadian law applicable in the province where the workers involved in the labour dispute are employed. To ensure consistent assessments of this factor, the above exception will be eliminated. Effective Date of Regulatory Amendments The above regulatory amendments will come into force on the day that they are registered. Conclusion The RBC incident has already resulted in several significant changes to the TFWP; additional changes are also expected once the proposed regulatory changes come into effect. 8 Nevertheless, it is still possible to hire a TFW, provided that Canadian employers take steps to ensure compliance with these new requirements. 8 Supra, Note 2.
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