Effective May 1, 2024 Canada policies tighten LMIA temporary foreign workers

The unemployment rate rose to 6.1% in March 2024, forcing the Canadian government to enact new policies to increase job opportunities for domestic workers and tighten regulations on temporary foreign workers under the LMIA work permit program, in response to shifting labor market conditions and a significant decrease in job openings to ensure that foreign workers are only used when no Canadians are available for essential positions.

LMIA stands for "Labour Market Impact Assessment," a type of "permit" allowing the recruitment of foreign workers granted by the Canadian Department of Labour and Social Development upon request of an employer facing difficulty in finding labor for vacant positions. A positive LMIA means an employer is allowed to hire foreign workers because they cannot find personnel for vacant positions from the domestic labor market.

So effective May 1, 2024:

1. To guarantee precise labour market needs, new Labour Market Impact Assessments will be valid for six months instead of the previous twelve. It is important to note that some may confuse it with work permit validity, but this is actually the validity of LMIAs. A timeframe within which an employer has to hire a foreign worker and apply for a work permit.
2. Except for the construction and health care industries, all industries listed in the 2022 Workforce Solutions Road Map will have to reduce the percentage of their entire workforce that may enter under the low wage stream of the Temporary Foreign Worker Program from 30% to 20%.
3. Before requesting an LMIA, employers will need to look at all of their options, including hiring asylum seekers who have valid work permits in this country. Previously, employers only needed to prove that they had made reasonable attempts to hire Canadian permanent residents and/or citizens, but now they will also need to include asylum claimants on work permits.

The publication of the Workforce Solutions Road Map in 2022 covered seven industries:

1. Food Manufacturing (NAICS 311)
2. Wood Product Manufacturing (NAICS 321)
3. Furniture and Related Product Manufacturing (NAICS 337)
4. Accommodation and Food Services (NAICS 72)
5. Construction (NAICS 23)
6. 6. Hospitals (NAICS 622)
7. Nursing and Residential Care Facilities (NAICS 623).

Previously, an important measure came into effect on January 1, 2024, which now requires employers to annually assess the pay of temporary foreign workers.This is to make sure it reflects changes to the going rates for their particular field and area of work. These evaluations will ensure that businesses pay temporary foreign workers at the going rate for the duration of their employment through pay raises.

What is the Temporary Foreign Worker Program (TFWP)?

A program that allows Canadian employers to hire foreign workers to fill temporary labour and skill shortages when qualified Canadians/PR are not available.

How many job openings are there in Canada?

There were 632,100 job vacancies across all sectors in January 2024, which saw a significant drop from the record high of 983,600 set in the second quarter of 2022.