Canada: Government Introduces New Recruiting Requirements, Application Fee For LMOS

In conjunction with its Economic Action Plan 2013 and the National Action Plan to Combat Human Trafficking, the Government of Canada pre-published proposed amendments to the Immigration and Refugee Protection Regulations (IRPR) on June 8, 2013 that would impose stricter conditions on employers and allow for warrantless inspections of public workplaces. These regulatory amendments to Canada's Temporary Foreign Worker Program (TFWP) follow administrative amendments that were implemented in April 2013, as previously reported in BLG Immigration Law Alert.

Subsequently, on July 31, 2013, following the appointment of The Honourable Jason Kenney as the new Minister of Employment and Social Development, the Government of Canada imposed a new application fee on requests for Labour Market Opinions (LMO) and introduced new minimum advertising requirements effect immediately.

Although Canada is experiencing significant skills shortages in many sectors and regions, these new and proposed changes will make it increasingly difficult for employers to access the TFWP and hire Temporary Foreign Workers (TFWs).

Recent Changes Made to TFWP with Immediate Effect

In light of recent concerns that the TFWP was not doing enough to ensure that Canadian citizens and permanent residents were being given the first chance at job opportunities, the following changes were implemented by the Government of Canada on July 31, 2013 with immediate effect:

  • New Application Fee for LMOs – Imposed an application fee of $275.00 for each position requested in an application for a Labour Market Opinion. The imposition of a cost recovery fee is intended to  cover the costs of processing requests for LMOs and will hopefully ensure that Service Canada is given adequate resources to effectively and efficiently administer the program. That said, it will cost employers significantly more to access the TFWP, particularly those who face acute labour shortages for large scale capital projects or regions with a tight labour supply.
  • New Language Assessment Factor – Introduced a new language assessment factor such that English and French are the only languages that can be identified as a job requirement. Exceptions will be made in rare and specialized circumstances where an employer can demonstrate that another language is essential for the position.
  • New Minimum Advertising Requirements – The   new minimum advertising requirements are designed to ensure that employers will make greater efforts to hire Canadian citizens and permanent residents before making an offer of employment to a foreign national. For example, employers must now:
    1. Advertise the position for a minimum of 4 weeks before they can apply for an LMO starting from the first day the ad appears and is accessible to the general public (as opposed to the previous 2 week minimum);
    2. Advertise on the national Job Bank, or its provincial/ territorial counterpart, and the advertisement must remain posted to until the LMO is issued;
    3. Use 2 or more additional methods of recruitment consistent with the normal practice for the occupation. If the employer is hiring for a highly skilled occupation (NOC level "0", "A" or"B"), one of these methods must be national in scope (e.g., The Globe and Mail, www.monster.ca, etc.). If the employer is hiring for a low-skilled occupation (NOC level "C" and "D"), it must demonstrate that it has made efforts to target under-represented groups that face barriers to employment in the labour market (e.g., aboriginal peoples, youth, persons with disabilities, new immigrants and older workers);
    4. The advertisements must include a number of specific details, including the company operating name, business address, title of position, job duties, terms of employment (e.g. project based, permanent position), wages, benefits package, location of work, contact information and skills requirements.
    5. Continue to "actively" recruit qualified Canadian citizens and permanent residents from the time they submit the LMO application until the time it is approved by Service Canada.
  • These changes may not be consistent with normalbusiness practices for the position or the sectorand could pose a significant hardship for employerswho have already engaged in extensive and costly recruiting efforts prior to the imposition of these newrequirements. Employers recruiting higher-skilledworkers who are able to demonstrate that the use ofthe Job Bank is not an effective method of recruitment may be able to justify the use of alternative methodsof recruiting. That said, employers may still havedifficulties in attracting and retaining the best and brightest when they are required to continue to actively recruit for a role even after a conditional offer of employment has been made to a TFW.
  • New LMO Application Form with Questions Regarding Outsourcing/Offshoring of Canadian Jobs — New questions regarding outsourcing/offshoring have been added to the new LMO application form. Employers who indicate that an offer of employment toa TFW will lead to job losses for Canadian citizens andpermanent residents as a result of lay-offs, outsourcingand/or offshoring, whether in the short-term or theforeseeable future, will undoubtedly face increasedscrutiny of their application for an LMO. Further,employers will be required to provide a summary of the contractual arrangement between the employer of record and the company receiving services, including the purpose and scope of the project, the project timelines, the expertise required and the number of Canadian citizens and permanent residents working on the project, among other things. In addition, employers are asked to confirm whether any foreign nationals with any work permit-exempt or LMO-exempt processing streams have been engaged as part of the contractual arrangement with the client.

Proposed Regulatory Amendments to Come Into Force on a Date to Be Determined

In addition to these recent changes, the Government of Canada published proposed amendments to the Immigration and Refugee Protection Regulations (IRPR) on June 8, 2013. Comments on the pre-publication notice were open for a period 15 days, concluding on June 23, 2013.

In recognition that there is a somewhat limited authority  to conduct employer compliance reviews and to impose consequences on non-compliant employers, the following regulatory amendments will come into force on the date they are registered:

  • Six-year compliance period — The TFWP compliance verification period will be extended up to 6 years. Previously, the verification period was limited to 2 years. This change is significant because employers will have to ensure that appropriate record-keeping policies are in place for the purposes of responding to an employer compliance review. While employers will be required to maintain records for a much longer period, which may be expensive and inconvenient, these records are likely already subject to other record retention requirements, including those found in provincial employment standards legislation and/or the Income Tax Act.
  • New Inspections Powers to Verify Compliance — Citizenship and Immigration Canada (CIC) officers and the Minister in charge of Human Resources and Skills Development Canada (HRSDC) will have the authority   to conduct warrantless inspections of workplaces, without consent of the employer, at any time within the six-year compliance period. Their powers will include entering and inspecting any premises or place where a TFW works, and requiring employers to attend, produce documents, and answer questions. Inspections may be initiated at any time, triggered by reason to suspect non-compliance, past non-compliance, or random audit. These warrantless searches are subject to one exception: if the TFW is employed at a dwelling-place e.g. as a live-in caregiver – in which case inspectors may only enter the premises if they have a warrant.
  • These changes will reduce enforcement transparencyand will grant inspectors almost absolute discretionto conduct warrantless searches. While not withoutprecedent – for instance, employment standardsinspectors in certain provinces have similar powers – this amendment will expose employers to intrusive examinations.

  • Public ineligibility list – Employers that cannot justify non-compliance will be placed on a 2-year, public ineligibility list. Employers on this list may not access the TFWP and may not offer employment to Federal Skilled Trades or Federal Skilled Worker applicants for permanent residency. While imposing significant consequences on non-compliant employers may induce better treatmentof TFWs and may increase the preference given to Canadian workers, this change will penalize employees of non-compliant employers in that they may not be able to extend their work permits.
  • Conditions Applicable to LMO-Based Work Permits — Employers that are issued a positive LMO would be required to comply with the following conditions during the period of employment of the TFW or, where applicable, during any other period that has been   agreed to by the employer and HRSDC at the time the opinion was provided. Employers would also be required to demonstrate that they are meeting, or that they have met, these conditions, if required by HRSDC within the 6 year compliance verification period. For instance, employers must ensure that the employment of the TFW 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. Similarly, if the employer agreed to make reasonable efforts to hire or train Canadian citizens or permanent residents, it would be required to demonstrate same. The exact conditions with which a particular employer will be required to comply will depend on their specific LMO and will be established by HRSDC prior to the issuance of the LMO. Employers will be required to provide TFWs with positions, wages, and working conditions substantially the same, but no less favourable than, those outlined in their original job offer. They must also provide work places free of physical, sexual, psychological, and financial abuse. Employers who rely heavily on TFWs may already face some of these burdens but it may be difficult for an employer to demonstrate that some of these conditions have been met.

These changes will certainly encourage employer compliance and likely protect TFWs from exploitation, but they are quite far-reaching and may present a significant burden to employers who utilize the TFWP.

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