Labour Market Impact Assessment (LMIA) allows Canadian employers to hire foreign workers in Canada to fill job positions unable to be filled by citizens or permanent residents.
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12. Conclusion
Canada's labour market is marked by diversity, inclusivity, and ample opportunities, making it a beacon for foreign workers worldwide. This vibrant labour market, combined with the quality of life and social security benefits the country offers, has resulted in Canada becoming one of the most sought-after destinations for foreign workers.
This article will delve into the intricacies of the Labour Market Impact Assessment (LMIA), a critical element of the process that foreign workers and employers need to navigate in their journey to Canada's labour market.
What is a Labour Market Impact Assessment (LMIA)?
Labour Market Impact Assessment (LMIA) is a process that allows Canadian employers to hire foreign workers in order to fill job positions that they have been unable to fill with Canadian citizens or permanent residents. A positive LMIA means that there is a need for foreign workers and that hiring them will not have a negative impact on the Canadian labour market.
How long is the validity of the Labour Market Impact Assessment (LMIA)?
Starting from the 31st of October, 2023, and continuing until further instructions, a Labour Market Impact Assessment (LMIA) will have a validity period of 12 months.
This validity period is intended to support the application process for a Temporary Foreign Worker's (TFW) work permit to Immigration, Refugees and Citizenship Canada (IRCC).
The expiry date on the LMIA specifies the duration within which the following must happen:
Employers must inform the TFW about the LMIA's approval.
Employers must dispatch the positive LMIA letter to the TFW.
TFWs must file their work permit application at IRCC.
In scenarios where the employers did not include the names of the TFWs in the LMIA application, they are required to persist in their recruitment efforts to hire Canadians and permanent residents until they choose a TFW.
If the above actions are not taken within the specified timeframe (before the expiry date), the LMIA loses its validity. In such a case, if the employer still intends to hire a TFW, they are required to submit a new LMIA application.
Who can be hired through the Labour Market Impact Assessment (LMIA)?
The LMIA process is used to hire foreign workers for various wage levels and specific programs.
High-Wage Workers
High-wage positions are at or above the provincial median hourly wage. Canadian employers must demonstrate that they have made significant efforts to hire Canadian citizens or permanent residents before they can apply for an LMIA. They must also submit a transition plan outlining their efforts to reduce their reliance on foreign workers over time.
Types of High-Wage Positions
High-wage positions encompass a variety of job roles across different streams. These include:
The Global Talent Stream
This stream is designed to enable Canadian employers to access highly skilled global talent to drive innovation and foster economic growth. The Global Talent Stream provides expedited processing for qualified foreign workers in specific occupations, such as those in the technology sector.
The High-Wage Stream
This covers a wide array of occupations that offer a wage at or above the provincial median hourly wage.
Currently, as of December 2023, ESDC has provided the following information regarding the median hourly wage for the provinces and territories.
The Agricultural Stream
This stream is specifically for agricultural workers. It covers positions related to on-farm primary agriculture such as general farm workers, nursery and greenhouse workers, and harvesting labourers.
Applications to Support Permanent Residency
In some cases, employers can use the LMIA process to support a foreign worker's application for permanent residency. This is typically applicable for high-wage positions that are full-time and permanent. The employer must offer a full-time permanent job to a skilled worker for them to be eligible for this category.
Low-Wage Workers
When it comes to low-wage positions, those that offer a wage below the provincial median hourly wage, employers are given a cap on the number of foreign workers they can hire. They must prove that they made efforts to hire Canadians and permanent residents first, and are required to provide affordable housing for their foreign workers.
Median Hourly Wages of the Provinces or Territories of Canada
This is the list of the updated median hourly wages of the provinces or territories of Canada as of May 31, 2023.
With that, Service Canada implemented a new wage determination strategy for Labour Market Impact Assessment (LMIA) applications submitted on or following May 31, 2023. The new practice will distinguish between high-wage and low-wage applications based on the updated median wages.
To accommodate potential delays, a special 90-day transition period has been initiated from May 31 to August 29, 2023. During this phase, Service Canada will assist employers whose application streams have been altered (either from high-wage to low-wage or the reverse) due to the new wage standards to correctly fill out the application form. The agency will also consider recruitment efforts that align with the initial submission's prerequisites as fitting the new stream's requirements.
Refer to Service Canada's website for more details.
Province / Terrirotry | Median Hourly Wages as of May 31, 2023 |
Alberta | $28.25 |
British Columbia | $27.50 |
Manitoba | $23.94 |
New Brunswick | $23 |
Newfoundland and Labrador | $25 |
Northwest Territories | $38 |
Nova Scotia | $22.97 |
Nunavut | $35.90 |
Ontario | $27 |
Prince Edward Island | $22.50 |
Quebec | $26 |
Saskatchewan | $26.22 |
Yukon | $35 |
Seasonal Agricultural Worker Program (SAWP)
The LMIA is also used for hiring workers through the Seasonal Agricultural Worker Program (SAWP).
The Seasonal Agricultural Worker Program (SAWP) permits employers to engage temporary foreign labour when the local workforce comprising Canadians and permanent residents is unavailable.
This program allows for recruitment from predefined countries for a duration not exceeding eight months, within a year starting January 1 and ending December 15. This is conditional on the provision of a minimum of 240 work hours within a span of 6 weeks or less.
Employers must meet the following criteria to hire a seasonal agricultural worker through LMIA:
The seasonal agricultural workers that they are hiring should be nationals of Mexico or participatory Caribbean nations.
The industry should fall under specified commodity sectors, and
The work must pertain to primary agricultural activities performed on farms.
See IRCC's website for more information about the Seasonal Agricultural Worker Program (SAWP).
Agricultural Stream
Similarly, the Agricultural Stream allows employers to hire foreign workers for on-farm jobs. The position must be in a primary agricultural occupation, and the foreign worker must be from a specific list of eligible countries. Like the SAWP, employers must also prove that no Canadians or permanent residents are available to fill the position.
This stream comes with two essential prerequisites for employers:
The business operation must be within the defined commodity sectors; and
The work must involve primary agricultural tasks executed on farms.
Upon meeting these conditions, employers can proceed to submit an LMIA application under the Agricultural Stream, with the option of requesting an employment period lasting up to two years.
However, as of April 4, 2022, a recent change has been introduced for high-wage positions under this stream. Employers applying for high-wage positions can now request an employment period of up to three years, extending the previous limit.
See IRCC's website for more information about the Agricultural Stream.
How to Apply for a Labour Market Impact Assessment (LMIA)?
For Canadian employers seeking to employ foreign talent through the Labour Market Impact Assessment (LMIA), here is the application process:
Step 1: Eligibility Confirmation
Initially, employers must ensure their business qualifies for the LMIA application. This involves verifying if the organization fits the criteria set by the Canadian government.
Step 2: Meeting Advertising and Salary Standards
The second step necessitates compliance with specific norms related to advertising the job vacancy and setting a fair wage in line with prevailing regional rates. These demands are set to ensure transparency and fairness in the hiring process.
Step 3: Online Submission of LMIA Application
Upon meeting the initial prerequisites, employers are to fill out and submit the LMIA application form digitally.
Step 4: Evaluation by ESDC
Following the submission, the LMIA application and the job offer are assessed by Employment and Social Development Canada (ESDC). They scrutinize the application, ensuring it aligns with Canadian labour market needs and legislation.
Step 5: ESDC Interview
As part of the process, employers might be required to attend an interview with an ESDC officer. This is a measure to further validate the information provided in the application.
Step 6: Receiving ESDC Confirmation
The final step in the process is the issuance of a Confirmation Letter from ESDC, provided the application is successful. It signifies the approval of the LMIA, thus allowing employers to proceed with the hiring of foreign workers.
How to hire a skilled worker if employers are LMIA-exempt?
The International Mobility Program enables the recruitment of temporary overseas workers without the necessity of a Labour Market Impact Assessment (LMIA). Here is a list of the LMIA-exemption codes applicable through the International Mobility Program.
If the foreign worker is a citizen of a country participating in a Free Trade Agreement with Canada, they are excused from requiring an LMIA.
If the foreign worker is a resident of the United States or Mexico, they would probably qualify for the LMIA exemption.
CETA allows certain professionals from European Union nations to work in Canada without needing LMIA approval.
This stream offers the opportunity to engage highly competent overseas professionals, which is another situation where foreign workers can be exempt from LMIA.
If an overseas company runs an office in Canada, they can, through the ICT program, relocate their foreign employees from international branches to Canada, bypassing the need for an LMIA.
Employer Requirements for Labour Market Impact Assessment (LMIA) Application
As an employer applying for a Labour Market Impact Assessment (LMIA), there are several key requirements that you must meet to ensure a successful application. These requirements not only validate the necessity of hiring a foreign worker but also protect the interests of Canadian citizens and the integrity of the labour market.
Proof of Business Legitimacy
Employers must provide evidence that their business is legal and operational.
Efforts to Hire Locally
Employers must demonstrate that they have made genuine efforts to hire Canadian citizens and permanent residents for the job position before considering a foreign worker. This can include advertising the job opening on multiple platforms and providing evidence of recruitment efforts.
Compliance with Advertising Requirements
The job offer must be advertised for a minimum of 4 weeks on at least three different platforms, including the government's Job Bank website. The advertisement must also meet certain language and content requirements.
Wage Offer
Employers must offer a wage that is consistent with the prevailing wage rates for similar positions in the same region. This ensures that foreign workers are not paid less than their Canadian counterparts.
Transition Plan
Employers must develop a transition plan that outlines how they will eventually reduce their reliance on foreign workers and hire Canadian citizens or permanent residents to fill the job positions in the future. This plan must be regularly updated and reported to the government.
Compliance with LMIA Regulations
Employers must adhere to all LMIA regulations, including providing accurate information, responding to requests for additional documentation, and complying with any other requirements set by the government.
How much does a Labour Market Impact Assessment (LMIA) application cost?
The application fee for the Labour Market Impact Assessment (LMIA) is set at $1,000 for each worker, and it is the duty of the employer to cover these costs.
In addition, any legal service expenses related to the LMIA application also fall under the employer's financial responsibility. This means that the employer must bear the burden of these charges, ensuring that the process remains cost-free for the foreign employee.
Labour Market Impact Assessment (LMIA) Processing Time
The timeline for processing Labour Market Impact Assessment (LMIA) work permit applications can vary, typically falling within a range of 10 days to 2 months. This duration is influenced by several factors such as the complexity of the case, the volume of applications received by Employment and Social Development Canada (ESDC), and the adequacy of the information provided in the application.
Expedited processing, which takes approximately 10 days, is often reserved for high-demand professions or short-term work of 120 days or less. However, most applications require a more standard processing time, which can extend up to 2 months. It’s crucial for employers and prospective foreign employees to factor in these timelines when planning their recruitment and employment start dates to ensure a smooth transition.
Where to send the Labour Market Impact Assessment (LMIA) application?
The process of filing Labour Market Impact Assessment (LMIA) applications is managed by Employment and Social Development Canada (ESDC), the governing body responsible for evaluating these submissions. Employers can utilize the Employer Portal to submit their LMIA applications.
FREQUENTLY ASKED QUESTIONS ABOUT LABOUR MARKET IMPACT ASSESSMENT
What is the difference between a positive Labour Market Impact Assessment (LMIA) and a negative Labour Market Impact Assessment (LMIA)?
A positive Labour Market Impact Assessment (LMIA), also known as a confirmation letter, is issued when Service Canada assesses that employing a foreign worker will have a neutral or beneficial impact on the Canadian job market. This assessment is based on various factors, such as whether the job offered to the foreign worker will help create more job opportunities or maintain employment for Canadian citizens.
On the other hand, a negative LMIA is issued when Service Canada determines that hiring a foreign worker for the job position could potentially lead to adverse effects on the job opportunities, wages, and working conditions of Canadian citizens and permanent residents. The employer, in this case, would not be allowed to hire the foreign worker under the Temporary Foreign Worker Program (TFWP). These assessments ensure that foreign labor does not adversely affect opportunities for Canadians.
Do foreign workers also need to apply for a Labour Market Impact Assessment (LMIA)?
Foreign workers do not directly apply for a Labour Market Impact Assessment (LMIA). It is the responsibility of the Canadian employer to obtain an LMIA, which proves that there is a need for a foreign worker to fill the job and that no Canadian worker is available to do the job.
However, foreign workers do need a copy of the LMIA and a job offer letter to apply for a work permit, which is a separate process managed through Immigration, Refugees and Citizenship Canada.
Therefore, while the LMIA process is employer-driven, it is a crucial step in enabling foreign workers to legally work in Canada.
Do Employers need to apply for another Labour Market Impact Assessment (LMIA) after a year if they want to retain their skilled workers?
Yes. A Labour Market Impact Assessment (LMIA) is a crucial certification that an employer might be required to get prior to employing a foreign workforce.
In an instance where the employer wishes to extend the tenure of a foreign worker, it is mandatory to apply for a renewed LMIA.
The inspection and approval of this application fall under the jurisdiction of Employment and Social Development Canada, or Service Canada, which ensures that the job role in question has no potential applicants among Canadian citizens and permanent residents.
Refer to ESDC and Service Canada's website for more details.
The employer is moving to a new province or territory in Canada, does the foreign worker need a new work permit?
The foreign worker is required to secure a new work permit before commencing work in the relocated area. It's highly advisable to initiate the application for a new work permit ahead of the employer's move. To avoid any lapses in your work authorization, make sure to apply a minimum of 30 days prior to the expiration of your current work permit.
What is the use of the Labour Market Impact Assessment (LMIA) in Canada’s labour market?
LMIA is an important tool for employers who are struggling to find workers, especially in industries where there is a shortage of skilled workers. It allows them to access outside talent and fill job positions that are critical for their business operations.
Additionally, it ensures that the hiring of foreign workers does not have any negative impact on the Canadian labour market by ensuring that Canadians and permanent residents have priority for available job opportunities.
What happens after receiving a positive Labour LMIA?
Upon receiving a positive LMIA, the employer can extend a temporary job offer to a foreign worker. The foreign worker can then use this positive LMIA to apply for a work permit, which allows them to work in Canada legally.
Who pays for the Labour Market Impact Assessment (LMIA) application?
The cost of the Labour Market Impact Assessment (LMIA) application is shouldered by the employer, not the foreign worker. This expense is considered part of the recruitment costs.
As per the regulations established by Employment and Social Development Canada (ESDC), any attempt by the employer to recover the LMIA application fee from the foreign worker can lead to the employer being considered ineligible for the program.
Can I receive Express Entry points for an LMIA application?
With a successful Labour Market Impact Assessment (LMIA) application, a foreign worker can accumulate either 50 or 200 points toward their Comprehensive Ranking System (CRS) score for Express Entry. These points can serve as a significant boost to foreign workers' applications under the Federal Skilled Worker (FSW), Federal Skilled Trades (FST), and Canadian Experience Class (CEC) programs.
Let a Regulated Canadian Immigration Consultant Handle Your LMIA Application!
Chitra & Associates is your trusted ally when it comes to hiring a foreign employee in Canada. With our extensive experience and knowledge in immigration matters, we can navigate the complexities and requirements of the Labour Market Impact Assessment (LMIA) application on your behalf, ensuring a hassle-free and efficient process.
Our team of Regulated Canadian Immigration Consultants (RCICs) is equipped with the skills to handle a wide range of cases, whether your prospective employee needs a work permit or falls under LMIA exemptions. We extend our services to Canadian employers as well, guiding them through their LMIA application and assisting them to ensure a successful application.
Conclusion
In conclusion, the Labour Market Impact Assessment (LMIA) plays a pivotal role in Canada's immigration process, serving as an essential mechanism for employers to legally hire foreign workers. This system, while complex, is structured to ensure a fair and ethical recruitment process, protecting both domestic and foreign workers.
At Chitra & Associates, our commitment is to navigate this intricate journey on your behalf, ensuring compliance with regulations while securing the diverse talent your business needs.
Contact us today, and let us make your global recruitment process a smooth and efficient one.
Disclaimer: For the most accurate and updated information, we strongly recommend referring directly to the websites of Immigration, Refugees and Citizenship Canada (IRCC), Employment and Social Development Canada (ESDC), and Service Canada.
A Cautionary Note: The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained, and the readers are asked to refer to the government website for the most updated information.
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