Labour Market Impact Assessment (LMIA)
Generally, employers are required to apply for a Labour Market Impact Assessment (LMIA) before they can hire foreign workers. In order to obtain a positive LMIA, a Canadian employer must prove that there is no Canadian or permanent resident worker available to complete the job in question and a foreign worker is therefore required.
Based on above, an LMIA application is flied with Employment and Social Development Canada (ESDC) which demonstrate the following:
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Reasonable efforts were made to recruit available Canadian citizens/permanent residents
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Wages offered for the position are consistent with the prevailing wage rate paid to Canadians/permanent residents in the same occupation in the region
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Working conditions for the occupation meets the current provincial labour market standards
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Any potential benefits that hiring a foreign worker might bring to the Canadian labour market, such as the creation of new jobs or the transfer of skills and knowledge
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Transition plans will be required for high-wage positions whereby employers must demonstrate increased efforts to hire Canadians in the long-term.
Based on above, a positive LMIA is provided to the foreign worker who submits his/her application for a work permit, which is typically issued for one year if granted.
The LMIA process is different depending on whether the targeted employee is classified as “high-wage” or “low-wage”. Temporary foreign workers being paid under the provincial/territorial median wage are considered low-wage, while those being paid at or above are considered high-wage. Depending on whether a prospective employee is classified as high-wage or low-wage, certain specific provisions apply.
High-Wage Workers
Employers seeking to hire high-wage workers must submit transition plans along with their Labour Market Impact Assessment (LMIA) application to ensure that they are taking steps to reduce their reliance on temporary foreign workers over time. High-wage workers are those earning above the median hourly wage for a given occupation in specified region.
The transition plans are designed to ensure that employers seeking foreign workers are fulfilling the purpose of the program. This entails that they are using the program as a last and limited resort to address immediate labour needs on a temporary basis when qualified Canadians are not available, ensuring that Canadians are given the first chance at available jobs.
Certain occupations in Quebec are “facilitated”, meaning that local recruitment efforts do not need to be performed by employers as part of their applications to hire temporary foreign workers for any of the facilitated occupations.
Low-Wage Workers
Employers seeking to hire low-wage workers do not need to submit transition plans with their Labour Market Impact Assessment (LMIA). They must, however, follow a different set of guidelines.
To restrict access to the Temporary Foreign Worker Program (TFWP), while ensuring that Canadians are always considered first for available jobs, the Government of Canada has introduced a cap to limit the number of low-wage temporary foreign workers that a business can employ. Furthermore, certain low-wage occupations may be refused for LMIA processing. Employers with 10 or more employees applying for a new LMIA are subject to a cap of 10 percent on the proportion of their workforce that can consist of low-wage temporary foreign workers.
Employers offering a wage that is below the provincial/territorial median hourly wage must:
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pay for round-trip transportation for the temporary foreign worker;
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ensure affordable housing is available;
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pay for private health insurance until workers are eligible for provincial health coverage;
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register the temporary foreign worker with the provincial/territorial workplace safety board; and
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provide an employer-employee contract.
As of April 30, 2015, the Temporary Foreign Worker Program uses the latest Labour Force Survey results for the unemployment rates in regions across Canada. These rates determine which regions are eligible for employers to submit Labour Market Impact Assessments (LMIAs) for low-wage/lower skilled occupations in the Accommodation and Food Services sector and the Retail Trade sector. LMIA applications for these sectors will not be processed in economic regions where the unemployment rate is 6 per cent or higher.
Given its unique labour market conditions, and as requested by the Government of the Northwest Territories, applications in these sectors for positions located in Yellowknife will be accepted for processing.
Need more information about the program?
We always advise clients to discuss their specific situation with an expert who can help steer you in the right direction. We offer one-to-one consultations as well in which our consultants will understand our clients requirements and will be available to answer any questions in the most precise manner. This process not only adds value but also avoids common mistakes that an applicant is prone to without having a professional consultation. We are your partner in this process, so feel free to book your consultation now!