Summary of Changes to the Foreign Worker Program and How They Affect Employers

The main goal of these changes seems to be aimed at encouraging employers to focus on Canadian recruitment, retention and training even more. Some of the general processing has changed but all of our clients are still eligible to participate in the program.

How Constructive Solutions Inc. is assisting our clients with these changes:

  • Employers that are immediately affected by the program have been contacted and given a summary of how these changes directly impact them.
  • This document is a summary of the changes and can be used as a guide for your future applications and participation in the foreign worker program.

Highlights of the changes:

  • Changes to the program came into effect on June 20, 2014.
  • The application was previously called a Labour Market Opinion (LMO). It is now called a Labour Market Impact Assessment (LMIA).
  • The previous LMO processing fee of $275/position has been increased to $1000/position. This fee continues to be a non-refundable fee.
  • For certain ‘high demand’ positions, the LMIA application will be reviewed within 10 business days as opposed to the regular 2-3 months processing time. These high demand positions currently include skilled tradesmen as defined by Employment and Social Development Canada (ESDC).
  • The LMIA application has additional questions. We are now required to submit a breakdown of applications received in response to LMIA supported advertising. This breakdown will include the number of applications received, how many were interviewed, who was/wasn’t hired and why.
  • Some NOC codes or job titles are no longer eligible to apply for an LMIA and therefore cannot participate in the program. There are a number of factors considered including regional unemployment rates. Currently none of CSI’s clients are affected.
  • Applications are now categorized by skill level and sub categorized by wage. To understand this more, see the below.
  • There is now a cap of how many low-wage temporary foreign workers (TFWs) can be employed. This is based on hours of work for low-wage TFWs compared to hours of work for all other employees. Currently 30% of your workforce can be low-wage foreign workers and will continue to lower to 10% by July 2016.
  • You may have to submit a ‘transition plan’ with your LMIA. This transition plan must include 5 plans aimed at trying new recruitment, retention or training tactics. One plan must cover how you are assisting current TFWs transition to permanent residents. One plan must include efforts to hire underrepresented groups.

Skill level and wage categorization:

  • Previously LMOs were broken into two categories: high skilled and low skilled as indicated by the National Occupational Classification (NOC).
  •  LMIAs are now broken down further by adding a sub-category of high-wage and low-wage, which is based on a provincial median wage. ESDC determines what the median wage is for each province. Currently the Alberta median wage is $24.23/hour.
  •  For high-wage positions, employers are required to complete a transition plan. For low-wage positions, employers are required to submit an employment cap calculation. Below is a visual for this breakdown.
    •  High skilled LMIA
      • High wage >$24.23
        • Transition plan
      • Low Wage <$24.23
        • Cap calculation
    • Low Skilled LMIA
      • High wage >$24.23
        • Transition plan
      • Low Wage <$24.23
        • Cap calculation
  • Employers must still pay temporary foreign workers the regional prevailing wage. For example, welders must be paid $30/hr in the region of Edmonton as per the prevailing wage. This makes them a high skilled and high wage category.

Relevant links:

  • To read the full report of the changes, please click here.
  • To see provincial wage and regional unemployment rates, please click here.
  • Regional prevailing wages and NOC breakdowns can be found here.

As always, CSI will assist employers with the new LMIA process. If you have any further questions, please let us know. We believe that CSI can assist in such a way to still obtain positive LMIAs in regard to the items that affect employers.

*Disclosure – The above is CSI’s interpretation of the changes and our general assessment. If you want full knowledge of the changes, please read the links provided.

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