Update on Changes to Canada's Temporary Foreign Worker Program
As previously reported (see our bulletin at this link: Detailed Overview of Changes to Canada's Foreign Worker Program), major changes to Canada's Temporary Foreign Worker Program were introduced on April 1, 2011.
It is imperative that all employers, foreign workers and HR professionals be aware of the changes. Non-compliance may lead to a two year ban from being able to hire or employ foreign workers in Canada. This would negatively affect Canadian employers that rely on skilled foreign workers.
The changes include placing a four year time cap for working in Canada on some foreign workers; stricter assessment of the genuineness of employment offers; and stricter compliance requirements placed on employers.
Employers must make sure that they maintain substantially the same terms of employment for foreign workers. Prospective changes to salary, position, or other terms of employment will often mean that employers will need to obtain a new Labour Market Opinion (LMO) and/or work permit.
Immigration Canada (CIC) has provided further details about the new regulations and how they will be applied in these Operational Instructions on New Regulations.
Practical tips for dealing with the new rules are set out in our Detailed Overview bulletin.
It has been six months since the new regulations were introduced, and it is clear that one of the effects has been an increase in processing times for LMO processing at Service Canada offices.
One reason for this is that the additional requirement to assess the genuineness of job offers to foreign nationals has increased the amount of work that must be done on each LMO application by the reviewing officer. It remains to be seen if processing times will continue to increase, but employers should be aware that LMOs are taking longer and this means that they should be trying to apply for an LMO well before the expected start date of the worker.
Please contact a member of Gowlings' Immigration Group for assistance on LMO applications or to discuss how the new regulations may affect your business.
New LMO Application Forms
Employers seeking to hire a foreign worker by first obtaining a Labour Market Opinion (LMO) must make sure that they use the proper LMO application form.
As of April, new forms were introduced, and from time to time these forms are revised, so it is important to ensure that you are using the latest version that fits the category of worker for whom you are seeking a LMO.
Under the new regime, LMO forms include a declaration that the employer must sign, attesting that the employer will abide by all program requirements and that the employer is not in breach of employment or other legislation that regulates the occupation in question. The form also contains a declaration asking whether the company has provided substantially the same wages, working conditions and occupation as those described in the job offers to all foreign workers employed in the last two years.
Gowlings' Immigration Group can provide advice on dealing with potential compliance issues.
Intra-company Work Permits – Recapturing Time To Extend Time Cap
Those holding intra-company transferee (ICT) work permits in Canada are subject to time caps. Executive or managerial ICTs are eligible for a maximum of 7 years, while specialized knowledge ICTs are eligible for 5 years.
Until now, the calculation of time counted against the time cap was usually based on the duration of the work permits the person held, whether or not they were actually physically in Canada.
In September 2011, CIC published an Operational Bulletin that changed this approach to calculating the time cap for ICTs not physically present in Canada. Now, time spent outside Canada during the duration of the work permit can be recaptured. For example, if an ICT senior manager has a 1 year permit, but has only spent 2 months inside Canada during the course of holding that work permit, then only those 2 months would count against their seven-year ICT time cap.
Therefore, this policy will extend the overall number of calendar years that some foreign workers will be able to hold an ICT work permit. This will be useful where a person may have repsonsibilities in Canada and in another country. For example, some managers may be based in the U.S. but have responsibilities in Canada that require them to have a work permit, but only physically be in Canada one or two weeks per month. The new rules will faciliate this sort of situation over a longer period of time.
Employers should advise foreign workers holding ICT work permits to maintain documentation that would show when they are outside Canada, as the onus will be on the foreign worker to prove that they can recapture time towards the ICT time cap.
Clarification of "Specialized Knowledge" Intra-company Transferee Work Permit Category
The "Specialized Knowledge" ICT work permit category has often been difficult for employers to interpret as different immigration officers and offices seem to assess specialized knowledge differently.
In order to try to ensure better consistency in specialized knowledge ICT applications, CIC has published a list of factors that officers should consider when assessing a specialized knowledge worker under the ICT category.
According to the Operational Bulletin, an officer cannot just consider whether a worker has knowledge of the proprietary tools used or developed by the company.
Rather, a specialized knowledge worker would normally possess knowledge that is uncommon (i.e. beyond that generally found in a particular industry and within the company) and that has been gained through extensive experience and is difficult to acquire in a short period of time. The knowledge must be complex in that it cannot be easily transferred. The foreign worker should also be in a position that is critical to the well-being or productivity of the Canadian entity.
In addition, officers are required to use the National Occupational Classification (NOC) system to evaluate the requirements for the position and to ensure that the offered wages are consistent with Canadian wages. The Bulletin states that "salaries of specialized knowledge workers in Canada should normally approximate the average wage for the stated occupation in the specified geographical location while working in Canada."
This latter factor appears to bring in the prevailing wage concept that is used to evaluate LMO applications. With such an approach, CIC or CBSA officers may deny applications where they feel that the wage being paid to the foreign worker is below the wages a Canadian worker would expect to be paid in the occupation. This is a trend that has been observed at some visa office outside Canada, where denials of specialized knowledge ICTs have been made based on the proposed wages being too low.
Employers should be aware of the assessment factors set out in the Operational Bulletin. The overall impact is to raise the threshold required to prove that a foreign worker qualifies for a work permit under this category.
Canada-Colombia Free Trade Agreement
The Canada-Colombia Free Trade Agreement came into force on August 15, 2011. It contains reciprocal provisions to facilitate the entry of business people and workers between the two countries.
There are provisions that will apply to citizens and permanent residents of Colombia seeking Canadian work permits, including intra-company transferees, traders/investors, spouses, professionals and technicians.
The FTA's intra-company transferee criteria allows a transferee to apply for a work permit after only six months work experience with the related Colombian entity, whereas the NAFTA and IRPA rules have a higher threshold as they both require a foreign national to gain 12 consecutive months of work experience with a related company outside of Canada prior to being able to get an intra-company transferee work permit.
Employers in Canada seeking to hire Colombian citizens or permanent residents should consider whether the FTA provides a work permit option.
Pilot Project for Work Permits for Spouses and Children of TFWs in B.C.
B.C. has joined Alberta and Ontario in offering a special pilot program that will allow certain dependants of temporary foreign workers (TFWs) in B.C. to obtain work permits. The principal TFW must have been issued an employer-specific work permit valid for at least 6 months.
The B.C. program will be in place to February 15, 2013, and will have a cap of 1,800 work permits.
Eligible dependent children aged 18 to 22 of TFWs in B.C. may obtain an open work permit that will allow the child to work in B.C.
The B.C. program also allows spouses, common-law partners and dependent children aged 18 to 22 of many TFWs in low-skilled occupations (NOC skill level C and D occupations) to obtain an Open Work Permit. Therefore, some accompanying spouses of low skill workers in B.C. will be able to obtain a work permit.
The Alberta and Ontario pilot projects have different eligibility rules, and apply only to eligible children of TFWs in those provinces who are working in NOC 0, A or B occupations. Those two programs do not apply to spouses or children of TFWs working in low skill occupations. Information on these programs is set out at the links below.
Information Technology Workers Program Extended in B.C.
The IT workers program has been extended in British Columbia to December 31, 2011. This program facilitates getting work permits for some types of software development occupations.
Employers interested in hiring TFWs for positions located in B.C. in one of the seven occupations covered under the IT workers program will be required to first notify Service Canada and the Ministry of Regional Economic and Skills Development of their offer of employment before proceeding to have the foreign worker apply to CIC to obtain a work permit. An LMO will not be required for IT workers in B.C. covered by the program.
This program has been extended on prior occasions in B.C. It is expected to be replaced by an alternative special program at some point.
Quebec also continues to participate in the program to facilitate the entry of IT workers to that province.
The program does not apply to IT Workers who will work in other provinces. To hire such foreign workers, the employer will usually need to obtain an LMO from Service Canada.
CIC Promotes Issuance of Longer Multiple-Entry Visas
CIC has announced that it is encouraging visa offices to issue longer term multiple-entry Temporary Resident Visas to low risk business visitors. This will facilitate business travel and ties to Canada. Visa officers are encouraged to issue multiple-entry visas for as long a validity period as possible (up to 10 years minus one month, or to the end date of the person's passport, whichever occurs first).
New CIC Application Forms
Citizenship & Immigration Canada ("CIC") has introduced new application forms.
As of July 18, 2011, applicants for Permanent Residence are asked to complete the new Generic Application Form for Canada (IMM 0008).
The new form features prompts and drop-down lists and will help prevent errors that create unnecessary processing delays. Completing the form electronically and validating the form before printing generates a unique bar code to allow for the efficient entry of data into CIC's case management system. Older versions of the permanent resident application form will still be accepted, but only until March 31, 2012.
CIC has also introduced a new Work Permit Made Outside of Canada form (IMM 1295) for work permit applications filed at visa offices outside Canada. This form needs to be completed electronically and then validated before being printed. Accompanying family members must also complete their own set of application forms.
Federal Skilled Worker Category Changes
As of July 1, 2011, Canada changed the rules of the Federal Skilled Worker Category.
To apply under this category, applicants have two options: (1) They must have "Arranged Employment" or (2) they must have one year of continuous full-time or equivalent part-time paid work experience within the last ten years in one of the 29 eligible occupations which appear on the Ministerial List of occupations.
The Ministerial List is amended from time to time, and was last changed earlier this year (see link below).
The government also announced that a maximum of 10,000 applications under the Ministerial List category will be considered for processing in the 12 months starting on July 1, 2012. Within this quota, a maximum of 500 federal skilled worker applications per eligible occupation will be considered for processing.
Under the Arranged Employment category, one way to show Arranged Employment is for the applicant to have a valid Canadian work permit at the time the application is made, and the time the application is finalized. In addition, the Canadian employer must make an offer to hire the TFW on a permanent basis upon the worker becoming a permanent resident. The quotas mentioned above are not applicable to the Arranged Employment category.
Many TFWs in Canada obtain permanent resident status by transitioning to it using the Arranged Employment Skilled Worker category.
Canadian Government Curtails Investor and Entrepreneur Immigrant Categories
This past summer, the Canadian government significantly curtailed two immigration options for business people wishing to obtain permanent resident status in Canada.
A moratorium on accepting new applications under the Federal Entrepreneur category was announced. This moratorium remains in effect.
As well, the Federal government announced in late June that it would only accept 700 new Federal Immigrant Investor Category applications for the 12 month period starting July 1, 2011. The entire quota was filled on the first day applications were accepted. This means that no new applications under this category will be accepted until July 1, 2012, assuming that the Canadian government sets a new annual cap for next year.
This reduces immigration options for business people and investors. It is likely that many people will prepare Federal Investor applications this fiscal year in anticipation of applying on July 1, 2012. It will be interesting to see if the Canadian government comes up with rules setting out how it will choose which applications to process, as we predict that the number of Investor applications that will be filed on the first day will be in excess of next year's annual quota.
Given the curtailment of these two Federal immigration options, foreign business people seeking permanent resident status in Canada will need to look to Quebec's programs for investors and entrepreneurs, or some of the business immigration options offered under various provincial nominee programs.
B.C. Enhances its Provincial Nominee Program
B.C.'s provincial government is trying to encourage business immigrants to invest in B.C. communities by enhancing the B.C. Provincial Nominee Program ("B.C. PNP"). An aim of these enhancements is to attract more entrepreneurs from outside of Canada to help create jobs in B.C.
The B.C. PNP provides a 'fast-track' to permanent resident status to entrepreneurs and skilled workers based on labour market and economic development priorities.
The changes include:
- Reducing the minimum size for eligible employers located outside of the Greater Vancouver area from five employees to three.
- Making the Entry Level and Semi-Skilled pilot category of the BC PNP a permanent program category to help meet the needs of employers in key sectors such as tourism.
The B.C. government is also negotiating with the Federal government to increase the number of B.C. nominations for 2012, hoping to have more than the maximum 3,500 nominations of 2011.
Further details of the enhancements can be found at B.C. Enhances PNP (news release).
U.S. H-1B Cap Room Still Remains
Most Canadians seeking work visas for the United States obtain NAFTA TN work visas, or L-1 work visas if they are being transferred between related companies.
H-1Bs work visas are sometimes an option that needs to be considered. This is especially true for non-Canadians who cannot use NAFTA's work visa options.
The H-1B limit, or "cap," is the number of H-1B cases that can be approved each year as "new" H-1B filings. The annual limit on regular H-1B cap-subject approvals is 65,000, with a separate allocation of 20,000 cap exemptions for beneficiaries who hold U.S. master's degrees or higher.
There is still currently cap room for H-1Bs for Fiscal 2012, as set out below:
Annual Cap Amount
Cap Eligible Petitions as of October 7, 2011
H-1B Regular Cap
H-1B Master's Exemption
Employers that may need H-1B work visas for foreign hires prior to October 1, 2012 will need to monitor the cap count, and apply before the cap is reached. The availability of H-1Bs will run out prior to the end of Fiscal 2012 (the fiscal year runs from October 1 to September 30).
U.S. Global Entry Program Available at U.S. Pre-Clearance at Canadian Airports
U.S. Global Entry program's kiosks have started to be introduced at U.S. pre-clearance locations at major Canadian airports. This is part of the process to integrate the Global Entry and NEXUS Trusted Traveler programs.
Global Entry is a voluntary pilot program designed to smooth international arrivals processes for pre-approved travelers through the use of self service kiosks located at major U.S. airports. The pilot program is an alternative to regular passport processing procedures, allowing members to bypass the regular line.
Global Entry is available to U.S. citizens and U.S lawful permanent residents, as well as Mexican nationals. Citizens of the Netherlands may also apply under a special reciprocal arrangement that links Global Entry with the Dutch Privium program in Amsterdam. Canadian citizens and residents may participate in Global Entry through membership in the NEXUS program.
Canadian citizens who frequently travel into the U.S. should review whether they should signing up for the NEXUS program.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.