Ottawa limiting employers’ access to Temporary Foreign Worker Program

The federal government is limiting the use of the Temporary Foreign Worker Program (TFWP) to those who absolutely cannot find Canadians who can fill job openings.

Effective May 1, employers will need to explore every option before applying for a Labour Market Impact Assessments (LMIA). This includes recruiting asylum seekers with valid work permits here in Canada.

Employers will also have their access to temporary foreign workers reduced.

Under the new rules, new LMIAs will be valid for six months – a decrease from 12 months – to ensure accurate labour market needs, according to the federal government.

Also, all employers identified in the 2022 Workforce Solutions Road Map will have a reduction from 30% to 20% of their total workforce that can come in through the TFWP, under the low wage stream, with an exception for the construction and health care sectors.

The Workforce Solutions Road Map announced in 2022 applied to the following seven sectors: 

• Food Manufacturing
• Wood Product Manufacturing
• Furniture and Related Product Manufacturing
• Accommodation and Food Services
• Construction 
• Hospitals 
• Nursing and Residential Care Facilities

“Today, we announced our intention to reduce Canada’s reliance on temporary foreign workers and encourage employers to find the talent they need right here, at home.,” said Randy Boissonnault, minister of employment, workforce development and official languages. “The time-limited measures we introduced in 2022 were necessary as our labour market was facing unprecedented conditions – but now, as times change, we must ensure our Temporary Foreign Worker Program reflects our current needs.”

The change follows a call from the Alberta Federation of Labour (AFL) for Ottawa to close some streams under the TFWP which, they claim, is being exploited by low-wage employers. Specifically, the Alberta Federation of Labour (AFL) is referring to the Recognized Employer Pilot (REP) under TFW program.

‘Our labour market needs are tightening, so should our policies’

Since the start of this year, employers have been required to annually review the wages of temporary foreign workers to ensure they reflect increases to prevailing wage rates for their given occupation and region of work. 

Through wage increases, these reviews will ensure that employers continue to pay temporary foreign workers at the prevailing wage level throughout their period of employment, according to the federal government.

Ottawa noted that for the vast majority of cases, when wages are reviewed, “they are increased for the workers”. If not, they remain the same and cannot go down upon review.

“Our labour market needs are tightening, so should our policies. Today's announcement prioritizes our country’s needs to have enough construction workers to build houses, early childhood educators to teach our kids, and health-care workers to treat patients,” said Marc Miller, minister of Immigration, Refugees and Citizenship Canada.

“As we gradually reduce our reliance on temporary foreign workers, we will continue to help employers fill job vacancies while supporting Canadian workers.”

Ottawa noted that the unemployment rate in the country increased 0.1 percentage points to 5.8% in February 2024. It has held relatively steady in recent months, sitting at 5.8% for three of the past four months.

Also, job vacancies fell by 25,400 (-3.6%) to 678,500 in the fourth quarter of 2023, marking the sixth straight quarterly decline from the record high reached in the second quarter of 2022 (983,600).

Ottawa launched the REP in August 2023 to “essentially fast-track approval of LMIA approvals. This equates to the “loosening of the TFWP rules,” said AFL.