Canada: Administrative Monetary Penalties For Employer Non-Compliance Effective As Of December 1, 2015

Last Updated: November 10 2015
Article by Henry Chang

Background

As was previously mentioned, Jason Kenney, Minister of Employment and Social Development, and Chris Alexander, Minister of Citizenship and Immigration, announced changes to Canada's Temporary Foreign Worker ("TFW") program on June 20, 2014. Among these changes was a proposal to impose fines of up to $100,000 on employers who violated the TFW program. The names of employers who were fined, and the amount of the fine, would also be published on the public list of violators.

At the end of September 2014, Employment and Social Development Canada ("ESDC") published a discussion paper, which proposed to implement a system of Administrative Monetary Penalties ("AMPs") for violations of the TFW program. It also proposed to increase the maximum ban for employers who violate the TFW program from two years to ten years (a permanent ban was also being considered).

On June 12, 2015, the Minister of Citizenship and Immigration published amendments (the "Amendments") to the Immigration and Refugee Protection Regulations ("IRPR"), which were intended to implement these proposed changes. These Amendments will now come into force on December 1, 2015.

Overview

According to R209.94, the purpose of AMPs is to encourage compliance with the provisions of the Immigration and Refugee Protection Act ("IRPA") and the IRPR, and not to punish. According to R209.95(1), an employer who fails to comply with one of the conditions listed in Schedule 2, Table 1, if the failure to do so is not justified under the IRPR, commits a violation and:

  1. Is liable to an administrative monetary penalty of an amount that is determined in accordance with R209.98 [see Schedule 2, Table 2] or if it is determined under that section that there is no penalty, is issued a warning informing the employer that there is no administrative monetary penalty for the violation but that the violation will be considered in the calculation of the total number of points under R209.991(1)(a)(i) [see Schedule 2, Tables 4 and 5] for any subsequent violation; and
  2. If applicable, is ineligible to employ a foreign national for whom a work permit is required for the period determined in accordance with R209.99 [Schedule 2, Table 3].

Calculation of AMPs

The AMPs will be determined by the Minister of Employment and Social Development ("ESDC") or a Citizenship and Immigration Canada ("CIC") officer based on:

  1. The type of violation;
  2. Whether the employer is an individual, small business, or large business;
  3. The employer's history of violations that occurred on or after December 1, 2015; and
  4. The severity of the violation according to a system of points.

AMPs are cumulative, and separate AMPs will be imposed for each violation.

According to R209.93, the term "small business" is defined as any business, including its affiliates, that has fewer than 100 employees or less than $5 million in annual gross revenues at the time a request for an assessment is received, or if no such request is made, at the time a copy of an offer of employment for a work permit application is provided to the Minister. The term "large business" is defined as any business that does not meet the definition of "small business."

According to R209.991, the total number of points in respect of each violation is determined by adding the points resulting from the employer's compliance history [Schedule 2, Table 4] to the points resulting from the severity of the violation [Schedule 2, Table 5]. However, where the employer has made an acceptable voluntary disclosure, the total number of calculated points may be reduced as follows:

  1. If the total number is four or more, four points will be subtracted from the total; or
  2. If the total number is less than four, the value will be replaced with a value of zero.

The voluntary disclosure made by an employer with respect to the commission of a violation by the employer is considered acceptable if:

  1. The disclosure is complete; and
  2. At the time the voluntary disclosure is made, the employer's compliance is not being reviewed and no enforcement action related to an offence under IRPA is being undertaken against the employer.

However, a CIC officer or the Minister of ESDC may still conclude that the voluntary disclosure is not acceptable after considering

  1. The severity of the impact of the violation on the foreign national;
  2. In the case of an LMIA-exempt work permit, the severity of the impact of the violation on the Canadian economy, or in the case of an LMIA-based work permit, the severity of the impact of the violation on the Canadian labour market;
  3. Whether the disclosure was made in a timely manner;
  4. The number of times an acceptable voluntary disclosure is made by the employer; and
  5. The nature of the condition with which the employer failed to comply.

The maximum AMP is $100,000 per violation and the total that can be imposed is capped at $1 million on a single notice of final determination. In addition, the total AMPs imposed on a single employer cannot exceed $1 million in the one-year period preceding the date of the final determination.

There is no limitation on the collections period for AMPs. A new Labour Market Impact Assessment ("LMIA") or work permit application will not be accepted if the employer has not paid an outstanding AMP or is not complying with a payment agreement (if it has entered into one).

Rules Applicable to Violations

As violations are calculated based on the number of violations that have occurred, the following rules will determine when certain conduct will be treated as a separate violation:

  1. A violation of a condition that affects more than one foreign national constitutes a separate violation for each foreign national affected [R209.96 (1)].
  2. A violation of any one of the following conditions constitutes a separate violation:
    1. To provide the foreign national with employment in the same occupation as the occupation that is set out in the foreign national's offer of employment;
    2. To provide the foreign national with wages that are substantially the same as — but not less favourable than — those set out in the foreign national's offer of employment; and
    3. To provide the foreign national with working conditions that are substantially the same as — but not less favourable than — those set out in the foreign national's offer of employment [R209.96(2)]
  3. For employers who employ foreign nationals as live-in caregivers, a violation of either one of the following conditions constitutes a separate violation:
    1. To ensure that the foreign national resides in a private household in Canada,
    2. To ensure that the foreign national provides child care, senior home support care or care of a disabled person in that household without supervision [R209.96(3)].
  4. A violation of the condition of making reasonable efforts to provide a workplace that is free of abuse within the meaning of R72.1(7)(a) [physical abuse, sexual abuse, psychological abuse, and financial abuse] constitutes a separate violation [R209.96(4)].

Assessment Procedure

If it is assessed during an inspection that a violation has been committed because the employer failed to comply with a condition and that failure was not justified under the IRPR, a preliminary finding must be issued to the employer. A notice of preliminary finding may be corrected or cancelled before a final determination is made.

After the notice of preliminary finding is issued, employers will be provided the opportunity to make written submissions regarding the information in the notice within 30 days after it is received. An employer may be granted an extension to this opportunity to respond if the Minister of ESDC or the CIC officer is satisfied that there is a reasonable explanation for requesting a longer period.

The Minister of ESDC or a CIC officer shall issue a notice of final determination if it is determined that a violation was committed because the employer failed to comply with a condition and that failure was not justified. This determination is final and binding except for judicial review.

Ineligibility to Participate in the TFW Program

Employer violations may also result in a ban from future participation in the TFW program. As of December 1, 2015, the maximum period of ineligibility will change from two years to a permanent ban in the most serious cases.

According to R209.99(1), the period of ineligibility for a violation is the period set out in Column 2, 3 or 4 of Schedule 2, Table 3. If a ban is imposed, the duration of the ineligibility can vary from one year to a permanent bar, depending on the circumstances. According to R209.99(2), the ban begins on the day that the determination is made in respect of the employer.

Publication of Employer's Information

According to R209.997(1), if the Minister of ESDC or a CIC officer makes a determination under R209.996 that a violation has occurred, the employer's details will be added to the public list of violators, except where the employer has received only a warning and no AMP has been imposed. The public list will include the following information:

  1. The employer's name;
  2. The employer's address;
  3. The criteria or conditions with which the employer failed to comply;
  4. The day on which the determination was made;
  5. The eligibility status of the employer; and
  6. If applicable:
    1. The AMP amount, and
    2. The ineligibility period of the employer.

Conclusion

In light of the increased penalties that will become effective on December 1, 2015, it is critical that employers ensure their compliance with all conditions imposed upon them, in connection with any LMIA-based or LMIA-exempt work permit, and that they continue to comply with these conditions for the duration of the TFWs work permit in Canada.

SCHEDULE 2

VIOLATIONS

TABLE 1
EMPLOYER CONDITIONS

Item

Column 1
Provision

Column 2
Short-form Description

Column 3
Classification

1

209.2(1)(b)(i)

Be able to demonstrate that any information provided in respect of a work permit application was accurate during a period of six years, beginning on the first day of the foreign national's employment

Type A

2

209.2(1)(b)(ii) and 209.3(1)(c)(ii)

Retain any document that relates to compliance with cited conditions during a period of six years, beginning on the first day of the foreign national's employment

Type A

3

209.3(1)(a)(iii)(C)

For employers of a live-in caregiver: have sufficient financial resources to pay wages that were offered

Type A

4

209.3(1)(c)(i)

Be able to demonstrate that any information provided for the assessment was accurate during a period of six years, beginning on the first day of the foreign national's employment

Type A

5

209.4(1)(a)

Report at any time and place specified to answer questions and provide documents

Type A

6

209.4(1)(b)

Provide required documents

Type A

7

209.4(1)(c)

Attend any inspection, unless the employer was not notified, give all reasonable assistance to the person conducting the inspection and provide that person with any required document or information

Type A

8

209.2(1)(a)(ii) and 209.3(1)(a)(ii)

Comply with the federal and provincial laws that regulate employment and the recruiting of employees in the province in which the foreign national works

Type B

9

209.2(1)(a)(iii) and 209.3(1)(a)(iv)

Provide the foreign national with employment in the same occupation and substantially the same, but not less favourable, wages and working conditions as outlined in the foreign national's offer of employment

Type B

10

209.3(1)(a)(iii)(A)

For employers of a live-in caregiver: ensure that foreign national resides in a private household in Canada and provides child care, senior home support care or care of a disabled person in that household without supervision

Type B

11

209.3(1)(b)(i)

Ensure that the employment of the foreign national will result in direct job creation or retention for Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit

Type B

12

209.3(1)(b)(ii)

Ensure that the employment of the foreign national will result in the development or transfer of skills and knowledge for the benefit of Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit

Type B

13

209.3(1)(b)(iii)

Hire or train Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit

Type B

14

209.3(1)(b)(iv)

Make reasonable efforts to hire or train Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit

Type B

15

209.2(1)(a)(i) and 209.3(1)(a)(i)

Be actively engaged in the business in which the offer of employment was made, unless the offer was made for employment as a live-in caregiver

Type C

16

209.3(1)(a)(iii)(B)

For employers of a live-in caregiver: provide the foreign national with adequate furnished private accommodation in the household

Type C

17

209.2(1)(a)(iv) and 209.3(1)(a)(v)

Make reasonable efforts to provide a workplace that is free of abuse within the meaning of paragraph 72.1(7)(a) of these Regulations

Type C

TABLE 2
ADMINISTRATIVE MONETARY PENALTY AMOUNTS

Item

Column 1
Total Number of Points

Column 2
Type A Violation

Column 3
Type B Violation

Column 4
Type C Violation

1

Individual or Small Business ($)

Large Business ($)

Individual or Small Business ($)

Large Business ($)

Individual or Small Business ($)

Large Business ($)

2

0 or 1

none

none

none

none

none

none

3

2

500

750

750

1,000

1,000

2,000

4

3

750

1,000

1,250

2,000

5,000

10,000

5

4

1,000

2,000

3,000

7,000

10,000

20,000

6

5

4,000

6,000

7,000

12,000

15,000

30,000

7

6

8,000

10,000

12,000

20,000

20,000

40,000

8

7

12,000

20,000

20,000

30,000

35,000

50,000

9

8

20,000

30,000

35,000

45,000

45,000

60,000

10

9 or 10

30,000

45,000

50,000

60,000

60,000

70,000

11

11 or 12

40,000

60,000

60,000

70,000

70,000

80,000

12

13 or 14

50,000

70,000

70,000

80,000

80,000

90,000

13

15 or more

100,000

100,000

100,000

100,000

100,000

100,000

TABLE 3
PERIOD OF INELIGIBILITY

Item

Column 1
Total Number of Points

Column 2
Type A Violation

Column 3
Type B Violation

Column 4
Type C Violation

1

0 to 5

none

none

none

2

6

none

none

1 year

3

7

none

1 year

2 years

4

8

1 year

2 years

5 years

5

9 or 10

2 years

5 years

10 years

6

11 or 12

5 years

10 years

10 years

7

13 or 14

10 years

10 years

10 years

8

15 or more

permanent

permanent

permanent

TABLE 4
COMPLIANCE HISTORY

Item

Column 1
Criterion

Column 2
Points

1

For Type A and Type B violations — first violation

1

2

For Type A violations — second or subsequent violation

2

3

For Type B violations — second violation

2

4

For Type C violations — first violation

2

5

For Type B violations — third or subsequent violation

3

6

For Type C violations — second violation

3

7

For Type C violations — third or subsequent violation

4

TABLE 5
SEVERITY OF THE VIOLATION

Item

Column 1
Criterion

Column2
Points

1

The employer derived competitive or economic benefit from the violation

0 to 6

2

The violation involved abuse of a foreign national (physical, psychological, sexual or financial)

0 to 10

3

The violation negatively affected the Canadian labour market or the Canadian economy

0 to 6

4

The employer did not make reasonable efforts to minimize or remediate the effects of the violation

0 to 3

5

The employer did not make reasonable efforts to prevent recurrence of the violation

0 to 3

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Henry Chang
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

    Disclaimer

    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

    Registration

    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

    Cookies

    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

    Links

    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

    Mail-A-Friend

    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

    Emails

    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

    Security

    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions