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Canada’s New Temporary Foreign Worker Programme Changes: What Employers Need to Know

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Canada’s Temporary Foreign Worker (TFW) Programme has long provided a solution for employers facing labor shortages. However, recent updates by Employment and Social Development Canada (ESDC) are introducing stricter regulations, particularly for those hiring through the Low-Wage stream. These changes, effective September 26, 2024, will require employers to adjust their labor strategies to comply with the new rules.

What’s Changing in the TFW Programme?

  1. New Limitations on Low-Wage LMIA Applications
  1. LMIAs for Low-Wage stream positions will no longer be processed in regions with unemployment rates at or above 6%. This restriction aims to prioritize local workers for job opportunities in areas with higher unemployment, particularly in larger cities. Employers in these regions will need to explore domestic labor solutions.
  2. Tighter Caps on Low-Wage Workers
  1. The maximum percentage of temporary foreign workers that an employer can hire through the Low-Wage stream will be reduced to 10% of their workforce. This is a reduction from the previous cap of 20%. Employers who rely on foreign labor for low-wage roles will face new constraints, making it essential to reassess their hiring strategies.
  2. Reduced Employment Duration for Low-Wage Stream
  1. Workers hired through the Low-Wage stream will now be limited to a one-year employment term, down from the previous two years. This reduction shortens the time foreign workers can remain in these roles, requiring employers to plan for more frequent recruitment or transition efforts.
  2. Exemptions for Key Sectors
  3. Certain sectors deemed critical to food security and essential services—such as primary agriculture, food processing, fish processing, construction, and healthcare—will benefit from exemptions to these changes. These industries will continue to have access to the TFW Programme despite the broader restrictions.

What Does This Mean for Employers?

Employers, particularly those in urban regions with higher unemployment, will feel the immediate impact of these changes. The restriction on processing LMIA applications for low-wage roles and the new caps on workforce percentages make it necessary for companies to rethink their approach to staffing and workforce planning.

Looking Forward: Potential Further Adjustments

The Canadian government is also considering additional changes to the TFW Programme as part of its broader strategy to reduce the number of temporary foreign workers and focus on domestic employment. Employers should stay informed as reviews of the High-Wage stream and additional restrictions could follow in the coming months.

Next Steps for Employers

Employers who rely on the TFW Programme need to:

  • Evaluate their workforce and determine how these changes may affect current and future staffing.
  • Explore alternative solutions to fill labor gaps, including increased efforts to recruit domestic workers.
  • Prepare for a potential review of the High-Wage stream, which could further impact their hiring strategies.

Conclusion

With the new changes to Canada’s Temporary Foreign Worker Programme, employers must be proactive in reviewing their labor needs and staying compliant with updated regulations. Staying informed and adjusting to these regulations will be key to navigating the evolving landscape of labor and immigration policies in Canada.

VISASERVE is here to help you navigate these changes and ensure your business stays compliant. Contact us today for expert guidance on adjusting your hiring strategies and meeting your labor needs.