Canada’s New Policy Changes for the Low-Wage Stream

Starting September 26, 2024, Canada will see significant updates to its Temporary Foreign Worker Program (TFWP), particularly affecting the Low-Wage stream. This decision marks a pivotal shift in the way Canada handles labor shortages and foreign worker applications, aiming to better address local employment needs and curb potential abuses of the program.

Understanding the Temporary Foreign Worker Program (TFWP)

The TFWP is a crucial part of Canada’s labor market strategy, designed to fill short-term labor gaps when qualified Canadian workers are unavailable. The program allows employers to bring in foreign workers on a temporary basis, but before hiring, they must secure a Labour Market Impact Assessment (LMIA) from Employment and Social Development Canada (ESDC). This assessment evaluates whether hiring a foreign worker will positively, neutrally, or negatively affect the Canadian job market.

There are two primary streams under the TFWP:

Low-Wage Stream: For positions that pay less than the median provincial hourly wage.
High-Wage Stream: For positions that offer wages above the median.

Key Changes to the Low-Wage Stream

Effective September 26, 2024, the Canadian government will cease processing LMIAs for the Low-Wage stream in census metropolitan areas (CMAs) where the unemployment rate is 6% or higher.

What This Means for CMAs with High Unemployment

This move aligns with the government’s goal of addressing the needs of Canadians who are actively seeking employment and ensuring that foreign workers are only used when absolutely necessary.

Exceptions to the New Rules

Despite these new restrictions, certain sectors will be exempt from the changes.

Food Security: Encompassing core agricultural activities, food manufacturing, and seafood processing.
Construction: Recognizing the sector’s ongoing need for skilled workers.
Healthcare: To address critical shortages in medical professionals.

Additional Changes for Employers

In addition to the LMIA processing changes, there are several other notable updates for employers:

Employment Restrictions: Companies will be capped at hiring a maximum of 10% of their overall staff via the Low-Wage category of the TFWP.
Employment Duration: The maximum duration for employment under the Low-Wage stream will be reduced from two years to one year. This shorter term is intended to encourage more rapid transitions to permanent employment for Canadian workers.

Government Perspective and Rationale

Currently, we have a greater number of qualified Canadians available to fill these roles.” The changes we are making today will prioritize Canadian workers and ensure that Canadians can trust the program is meeting the needs of our economy.

The Current Unemployment Landscape

Canada’s unemployment rate has been gradually increasing since April 2023, reaching 6.4% as of June 2024. This represents approximately 1.4 million unemployed individuals across the country.

Upcoming Review of the High-Wage Stream

In addition to the Low-Wage stream changes, ESDC will conduct a review of the High-Wage stream over the next 90 days.

Recent Developments in Quebec

On August 20, 2024, Quebec Premier François Legault announced restrictions specific to Montreal. Starting September 3, 2024, both the Quebec provincial and federal governments will suspend the processing of LMIA applications for certain Low-Wage positions in Montreal. This suspension will affect jobs paying less than the Quebec median hourly wage and will last for six months.

However, there will be exceptions for workers meeting specific criteria related to occupation, location, or wage, and those who have submitted LMIA applications before the September 3 deadline. This temporary measure is in line with the federal changes and aims to address local labor market conditions.

Broader Implications and Government Focus

These changes to the TFWP reflect a broader strategy by the Canadian government to manage the impact of temporary residents on the country’s social services and infrastructure. Both Employment Minister Boissonnault and Immigration Minister Marc Miller have highlighted issues related to the misuse of the TFWP, where some employers have exploited foreign workers instead of hiring Canadian talent.

In March 2024, Immigration Minister Miller announced the historic inclusion of temporary resident levels in the annual Immigration Levels Plan. Additionally, Canada has introduced a cap on study permits for international students, which will remain in effect until 2026. This cap aims to balance the needs of educational institutions with the capacity of Canadian social services.

What Employers and Foreign Workers Should Expect

For employers, these new restrictions mean adapting to a more stringent TFWP framework. They will need to carefully consider the sectors exempt from the changes and explore how best to align their hiring practices with the new regulations.

For foreign workers, the changes may lead to fewer opportunities in certain regions and industries, particularly in the Low-Wage stream. However, those in exempt sectors or those applying through the High-Wage stream may still find opportunities to work in Canada

Conclusion: Canada’s updated policy on the Low-Wage stream of the TFWP represents a significant shift in how the country manages labor shortages and foreign worker applications. By prioritizing Canadian workers and tightening regulations around the program, the government aims to address rising unemployment and prevent misuse of the TFWP.

These changes reflect a broader commitment to ensuring that the program supports the needs of the Canadian economy and workforce. As the government continues to review and adjust the TFWP, both employers and foreign workers will need to stay informed and adaptable to navigate the evolving landscape of temporary employment in Canada.

Disclaimer

The information provided in this article is intended for general informational purposes only and does not constitute legal or professional advice. We recommend consulting with legal or professional experts before making any decisions related to the Temporary Foreign Worker Program or other immigration matters. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of akstudyvisa.com.

Source: www.cicnews.com

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Canada’s New Policy Changes for the Low-Wage Stream of the TFWP