Temporary Foreign Worker (TFW) Program in Canada is intended as a last resort for filling job vacancies when qualified Canadians are unavailable. Recently, the Government of Canada has made strides to enhance the integrity of the TFW Program. On August 26, 2024, the government committed to further reforms over a 90-day period to ensure that the program remains adaptable to labour market needs while safeguarding temporary foreign workers from fraud and abuse.
On October 17, 2024, Randy Boissonnault, Minister of Employment, Workforce Development, and Official Languages, announced key reforms to the TFW Program’s high-wage stream. Effective November 8, 2024, the starting hourly wage for workers entering Canada through the high-wage stream will rise to 20% above the median wage of the respective province or territory. This change will result in an increase of $5 to $8 per hour, depending on the location of work.
These reforms are anticipated to move a significant number of jobs to the low-wage stream, which imposes stricter regulations, including requirements related to housing, transportation, and the recruitment of domestic workers. The goal is to prioritize Canadian workers for job opportunities while supporting wage growth.
Addressing Untapped Domestic Talent
In his address at the 21st Century Workforce Summit, Minister Boissonnault emphasized the importance of tapping into under-utilized talent pools within Canada. Youth unemployment, for instance, stands at more than double the national average, and similar gaps exist for Indigenous persons, women, and people with disabilities.
The new reforms aim to encourage Canadian employers to explore these pools of talent before turning to the TFW Program. The minister stressed the importance of prioritizing Canadian workers and creating opportunities for marginalized groups, ensuring that the workforce reflects Canada’s diverse population.
Enhancing Program Integrity
Another significant reform announced is that, starting October 28, 2024, employers can no longer rely on attestations from lawyers or professional accountants to prove business legitimacy. Instead, the TFW Program will expand its information-sharing agreements with provincial and territorial governments, as well as use existing employer registries to validate job offers. This will help prevent misuse of the program and enhance worker protection.
While the majority of employers use the TFW Program responsibly, the government remains vigilant, monitoring for fraud and misuse. Further adjustments will be made as necessary to ensure that only legitimate employers with genuine labour needs can access the program.
Minister Boissonnault’s Statement
“This change to the Temporary Foreign Worker Program reinforces our commitment to protecting temporary foreign workers, while prioritizing the Canadian workers available to join the labour force. By raising the threshold for high-wage stream positions, we are supporting wage growth for Canadians,” said Minister Boissonnault.
Key Facts and Program Details
The Labour Market Impact Assessment (LMIA) remains a central tool in protecting the Canadian labour market from potential negative consequences, such as wage suppression or the displacement of Canadian workers. Employers must receive a positive LMIA before hiring temporary foreign workers.
Two TFW Streams: High-Wage and Low-Wage
- Low-Wage Stream: For jobs offering wages below the provincial/territorial median plus 20%. Employers must provide return transportation and accommodation for workers, conduct additional recruitment efforts, and limit the number of temporary foreign workers to 10% of their workforce.
- High-Wage Stream: For jobs offering wages above the median wage plus 20%. This stream has no limits on the number of workers an employer can hire, and unemployment rates are not factored into LMIA assessments.
The changes are expected to shift 34,000 positions from the high-wage stream to the low-wage stream. Coupled with other recent policies, this could reduce the number of positions approved through the TFW Program by as many as 20,000.
Representation of Underrepresented Groups in the Workforce
Canada is also committed to improving the representation of underrepresented groups in the labour market. Notable challenges include:
- In September 2024, youth unemployment was 13.5%, compared to the national average of 6.5%.
- Indigenous unemployment rates in 2023 were significantly higher (7.7%) compared to the non-Indigenous population (4.5%).
- The employment rate for Canadians aged 16 to 64 with disabilities was 65.1%, 15 percentage points lower than those without disabilities (80.1%).
These reforms are part of a broader effort to create a more inclusive labour market while ensuring the TFW Program is used responsibly and remains aligned with Canada’s economic goals.