Temporary Foreign Workers: Navigating the Legal Landscape

April 17, 2017 | Paul E. Brace, Victoria de Luna

For employers looking to fulfill their personnel needs, foreign workers can be a valuable resource. However, navigating the requirements associated with hiring and managing foreign workers can be difficult. This article provides a brief overview of key immigration issues that should be considered.

Labour Market Impact Assessments

A labour market impact assessment (“LMIA”) is generally the first step in the hiring process for employers, though there are some exceptions. These exceptions include intra-company transferees, NAFTA professionals, and business visitors, which are discussed below. The purpose of the LMIA is to determine whether hiring a foreign worker will have a negative impact on the Canadian labour market. Therefore, the LMIA provides an employer permission to hire a temporary foreign worker.

LMIAs have two key requirements relating to advertising and wages. Employers must advertise the position on Service Canada’s Job Bank in addition to two other recruitment methods consistent with the hiring practice for the position being filled. These recruitment methods may include posting on job search websites or in magazines and newspapers, and the use of professional recruitment agencies. One of these recruitment methods must be national in scope. All advertisements must run for at least four weeks prior to the LMIA application, within three months of the LMIA application. Finally, one posting must remain active until a decision has been made on the LMIA application. A $1,000.00 processing fee must be paid, regardless of the outcome of the assessment.

Employers undergoing the LMIA process must also abide by wage requirements. Foreign workers must be paid at least the median prevailing wage for the position and location of the job, measured against Job Bank data. The wage must also be within a range of wages paid to other employees in the same occupation with the same employer. However, job advertisements may offer a salary within a stipulated range, so long as the foreign worker is paid the median prevailing wage. Employers should note that different procedures apply to low wage positions, which include positions offering less than $22.00 per hour in Ontario.

LMIAs are usually processed within eight to twelve weeks. Expedited processing, complete in ten business days, is available for applications where the wage paid is in the top 10% of wages in the relevant province ($46.00 per hour in Ontario, effective April 29, 2017) or where employment is for less than 120 days.

Employers must provide the same occupation to the foreign worker as set out in the Offer of Employment and LMIA application, in addition to “substantially the same” wages and working conditions. Service Canada has broad powers to conduct inspections and employer compliance reviews. Inspections may be conducted at any time and may include compliance issues apart from occupation, wages, and working conditions. Employer compliance reviews are conducted in the context of an LMIA application to ensure compliance with previously issued LMIAs. Employers can be assessed penalties for violating the Temporary Foreign Worker Program including monetary fines, ineligibility periods for accessing the program, and publication of the employer name on a black list.

Work Permits

Once an LMIA has been issued, the foreign worker can apply for a work permit.  A work permit is compulsory for any activity for which wages are paid or commissions are earned or for any activity that will be in direct competition with Canadians in the Canadian Labour Market. Work permits may be applied for before entering Canada or upon entry, depending on the circumstances.

Foreign workers classified as business visitors do not need to obtain an LMIA or a work permit. Business visitors are foreign nationals who are temporarily entering Canada for international business activities. To be considered a business visitor, foreign workers cannot have an intention to enter the Canadian job market, must partake in activities international in scope, their primary source of remuneration must come from outside of Canada, and their profits must accrue outside of Canada. Examples of business visitors include individuals attending business meetings, negotiating international sale contracts, or providing training at a Canadian affiliate. Employers should note that a visitor record may be obtained to facilitate entry by a business visitor. This is useful if the person will be re-entering Canada from time to time for the same business purpose.

Workers Exempt from the LMIA and/or Work Permit Requirements

Specialized repair personnel (“SRP”) require both an LMIA and a work permit. However, there are two exceptions to this rule. First, SRPs providing installation or warranty repairs under “after-sales service” provisions in a contract of sale may enter as business visitors, without an LMIA or work permit. Second, SRPs providing emergency repairs to industrial or commercial equipment “to prevent disruption of employment” do not require an LMIA, though they must obtain a work permit. In these circumstances the Canadian customer must file an Offer of Employment to a Foreign National Exempt from a Labour Market Impact Assessment for any LMIA exempt-Work Permit.

Intra-company transferees are also exempt from LMIAs. Intra-company transferees must be employed in an executive or managerial capacity or have “specialized knowledge”, i.e.  a high degree of proprietary knowledge and advanced expertise, and must have at least one year of prior employment within the last three years in a similar position with a foreign corporation that is related to the Canadian employer. The foreign employer and the Canadian employer must provide evidence that they are related, e.g. head office and branch, affiliates (under common control), or parent and subsidiary.

NAFTA professionals include approximately 60 professional occupations listed by NAFTA, such as engineers, accountants, and management consultants. NAFTA professionals require a work permit, but do not need an LMIA.  A NAFTA professional must have an offer of employment with a Canadian employer but there is no need to show prior employment with a related foreign corporation.

Looking Forward: The Global Talent Stream

Employers can anticipate the release of more information on the federal government’s new Global Talent Stream for in-demand technology workers. The program is slated to launch on June 12, 2017 and will enable eligible workers to have their work permit applications processed within ten business days. This new program is part of the Global Skills Strategy, which aims to help innovative companies grow by ensuring they can access the highly skilled talent they need quickly.


This blog sets out a variety of materials relating to the law to be used for educational and non-commercial purposes only; the author(s) of this blog do not intend the blog to be a source of legal advice. Please retain and seek the advice of a lawyer and use your own good judgement before choosing to act on any information included in the blog. If you choose to rely on the materials, you do so entirely at your own risk.