A Complete Guide to LMIA
Canada has experienced a foreign worker boom over the last few decades. More than 600,000 foreign workers have come to Canada, doubling figures from the 2000s.
Canada faces a tricky balancing act when bringing in foreign talent. Foreign workers add a lot to the economy, but Canadians worry about losing out in the job market as a result. Canadian policy compromises between these concerns with the Labour Market Impact Assessment (LMIA).
Are you an employer interested in hiring a foreign worker? Maybe you’re a foreign worker interested in a Canadian work permit. Either way, keep reading to learn about the LMIA and what it means for you.
LMIA: The Basics
An LMIA indicates that the benefits of hiring a temporary foreign worker beat the potential costs to the Canadian economy. A “positive” LMIA indicates that Canadian immigration authorities agree a foreign employee would be the best fit.
Canada has different LMIA processes for different types of workers. It calls these processes streams.
Streams change with the needs of the labor market. Right now, high-wage workers and low-wage workers have different streams. Two additional streams exist for agricultural workers.
These streams have specific requirements employers must fulfill as part of the process. They share many common elements during the application process. The agricultural streams have further requirements an employer must adhere to.
What Is a “Labour Market Impact?”
All four LMIA streams serve the same purpose: looking at how a temporary foreign worker affects the overall economy. These requirements sound iron-clad, but it casts a fairly wide net.
While some of these ask about the presence of Canadian workers, others get complicated. One question on the LMIA forms asks whether not hiring a foreign worker will lead to a loss of other jobs. Another looks at the potential that the foreign worker can impart skills and training not available in Canada.
Some things can complicate an LMIA application. Having recently fired a Canadian worker or permanent resident often makes it a harder sell.
While intimidating at first glance and thorough besides, all of these questions drive at the same idea. The government wants to be sure that allowing a foreign worker in will drive Canadian economic growth. This includes the long term, not just the time period in which the foreign worker will be employed.
The temporary foreign worker program usually demands recruitment effort. Before reaching out to the global marketplace, a company needs to advertise to local workers.
Posting a single advertisement does not satisfy the requirements. The advertisements need to be available for a specific amount of time, and must be made within three months of the LMIA request. The amount of time required varies with the LMIA stream.
Employers must advertise in a normal, reasonable way for the position. Advertising in a place where Canadians with the necessary experience will never see it doesn’t satisfy the requirements.
Under some circumstances, some streams waive the advertising requirement. One common waiver occurs when hiring new agricultural workers to replace the same position that was already filled by a temporary foreign worker. This ensures swift continuity of necessary work without too much red tape.
Recruitment Reporting Requirements
Employers who try to recruit Canadians must report the results of their efforts. If a job draws no applications from PR or Canadian Citizen, this step of the LMIA doesn’t take much time.
If PR or Canadian Citizen do apply, however, the hiring company needs to make sure to provide clear documentation of how the process went. Why didn’t the local applicants satisfy the criteria? Were there not enough qualified applicants to fill all positions?
If you’re an employer, avoid giving specific names as part of the application. Simply note the number of applicants and how they were handled.
Not all job offers require an LMIA. If you work for an employer for at least a year on your current work permit, have a valid job offer, and your work permit meets one of a handful of exemption requirements, you will skip the LMIA process.
Relevance to Canadian national interests can lead to skipping an LMIA as well. Some countries have agreements for immigration to Canada that speed up the trade of skilled laborers. Other exemptions come from strong cultural or social benefits.
Finally, some academic and charitable workers get exemptions in the LMIA process. These include guest lecturers and visiting professors as well as religious workers.
If you or your employer think you qualify for an exemption, get in contact with us. You don’t need to try searching for the “best immigration lawyer near me.” We’re on call for your needs.
Wages and Compensation
As an employer, you need to report the wage you intend to pay your temporary foreign worker in Canadian dollars. Salaried positions must give an effective hourly wage.
Wages and compensation must still meet provincial standards. In addition to base wages, the LMIA requires a list of benefits, vacation days, and other factors not covered by the base wage. Union positions also require information on the union’s pay agreement.
Pay for those working in Canada must match the pay for Canadian workers. Temporary foreign workers cannot be underpaid compared to their Canadian counterparts. Employers must still adhere to all Canadian employment law.
High-wage worker LMIA applications request that the applicant fill out a transition plan. This shows how the business plans to fill this position with a Canadian citizen or permanent resident in the long run.
Businesses must make a good faith effort to fulfill their transition plans. While a temporary foreign worker might need to fill the same position multiple times, businesses do need to show that they did the work. This includes both general efforts to find and train Canadians and efforts specific to underserved populations.
Remember, the temporary foreign worker program and the LMIA serve to strengthen the Canadian economy. Building up Canadian workers to meet the needs of the economy helps everyone.
Housing Requirements Under LMIA
Employers must make sure that their temporary foreign workers outside the high-wage stream can find housing.
For applications in the agricultural categories, an LMIA requires some discussion of the temporary foreign worker’s housing situation. Agricultural workers often live on the farms where they work, or on nearby property owned by the company. Making the living situation clear helps evaluate the LMIA more quickly.
If the worker will live on-site or will perform lower-skilled work while living off-site, the business reports its intended weekly deduction for housing costs. A business can only deduct a maximum of $30 from the worker’s weekly paycheck for housing costs.
If the worker performs higher-skilled agricultural work and lives off-site, the business must document the housing situation. Housing cannot cost more than 30% of the worker’s expected wages.
LMIA and Workers
An employer applies for LMIA, not a worker. The LMIA comes first; once an employer receives a positive LMIA for the position, a worker can apply for a Canadian work permit.
This is a separate process entirely and has its own unique demands. If you need a work permit, or your employer needs to go through the LMIA streams to make a job offer, contact an immigration lawyer.
LMIA and COVID
Canadian immigration has moved to address issues caused in the labour market by COVID. While LMIA represents only one tool in the box, it does serve to shore up major gaps in the essential workforce. For employers in certain industries, this has sped up the LMIA process a lot.
During much of 2020, the minimum recruitment requirements for local workers were waived for several occupations. These requirements went back into place early in 2021, but most positions they were waived for still enjoy faster processing. To learn more about the types of occupations receiving these benefits, check the Canadian government’s website.
On the other hand, COVID-19 has also caused some negative effects on the temporary foreign worker program. Travel restrictions have slowed the entry of foreign workers from some countries. Foreign workers also need to quarantine upon arrival, which can make getting them onboard more difficult.
The government warns on multiple websites that the COVID situation can change rapidly and policy can change with it. As you get closer to an LMIA application or work start date, check in with Canadian immigration services to make sure you adhere to all rules.
Putting It Together
After all that, if you think a foreign worker would work well for your company, or if you’re a foreign worker who’d like to fill a gap in the Canadian labour market, welcome. Canada would love to have you.
On top of that, we’d love to get started with meeting your needs. Check out our section on immigration law. Get connected with the best immigration lawyer in Mississauga.
Minhas Lawyers LLP is a multi-practice law firm based in Mississauga. We advise and represent clients across various segments and practice areas.
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