TFWP employer compliance rules

Canadian employers must observe certain compliance rules when hiring foreign workers through the Temporary Foreign Worker Program (TFWP).

The Government of Canada has set these rules to ensure the objectives of theTemporary Foreign Worker Programme (TFWP)are met. Among these objectives is ensuring that the arrival of foreign workers has no adverse effect on Canadian workers.

In addition, Canada seeks to ensure that the rights of foreign workers are protected in the country. Set out below are the requirements employers in Canada must meet as compliance rules if they wish to benefit from the Temporary Foreign Worker Program (TFWP).

Employer responsibilities

Employers must:

• Ensure they meet all the conditions and requirements of the Temporary Foreign Worker Program (TFWP), as set out in the applicationLabour Market Impact Assessment (LMIA), the LMIA decision letter and the annexes.
• Retain all records relating to the Labour Market Impact Assessment (LMIA) application and any other documents demonstrating compliance with the conditions of the programme for a period of 6 years.
• NotifyEmployment and Social Development Canada (ESDC)or Service Canada of any change or error relating to an approved Labour Market Impact Assessment (LMIA) or to a temporary worker.
• Regularly review activities relating to the employment of temporary workers to ensure they continue to comply with the conditions of the Temporary Foreign Worker Program (TFWP).
• Take action to correct any error or non-compliance as soon as it is discovered.

Employer compliance rules

Employment and Social Development Canada (ESDC) and Service Canada have the authority to review the activities of any employer using the Temporary Foreign Worker Program (TFWP), in connection with their Labour Market Impact Assessment (LMIA) or LMIA request, by conducting 1 of the following 3 types of review:

• An inspection.
• An Employer Compliance Review (ECR).
• A review under Ministerial Instructions.

Under any type of review, Labour Market Impact Assessments (LMIAs) may be temporarily suspended. This suspension prevents foreign workers from obtaining a work permit fromImmigration, Refugees and Citizenship Canada (IRCC)while the review is under way.

Inspection

The purpose of an inspection is to ensure that the employer continues to meet the conditions set out in the job offer, the positive Labour Market Impact Assessment (LMIA) letter and the annexes, thereby ensuring that workers are not mistreated and that the Temporary Foreign Worker Program (TFWP) is used for its intended purpose. An inspection may take place at any time within 6 years of the start date of the authorised period of employment for which the work permit was issued.

Reasons for an inspection

There are 3 reasons why an employer may be selected for inspection:

• There is reason to suspect non-compliance.
• The employer has been found non-compliant in the past.
• The employer is selected at random.

What is expected of an employer during an inspection

Employers must:

• Attend the inspection.
• Answer questions.
• Provide the documents or information requested.
• Assist the investigating officer.
• Retain all records relating to compliance with the conditions of the job offer, the Labour Market Impact Assessment (LMIA) application, letter and annexes for 6 years from the start date of the period of employment for which the work permit was issued.

During an inspection, an officer may also enter and inspect any place where a foreign worker carries out work and interview any foreign or Canadian worker at the workplace.

Penalties

Employers found non-compliant as a result of a violation may face a range of consequences. These consequences are determined on the basis of a points system that considers:

• The type of violation.
• Compliance history.
• The seriousness of the non-compliance.
• The size of the business (applies to financial penalties only).
• Whether the employer voluntarily disclosed information about possible non-compliance before an inspection was launched.

Penalties may include:

• A warning.
• A fine of between CA$500 and CA$100,000 per violation, up to CA$1,000,000 in 1 year per employer.
• A ban of 1, 2, 5 or 10 years, or a permanent ban for the most serious violations.
• Publication of their name and address on a public website with details of the violation or the consequence.
• Revocation of Labour Market Impact Assessments (LMIAs) previously issued.

Final decision

Employers found non-compliant receive a letter explaining the violation and the resulting penalties (set out below).

From that point, the employer has 30 days to respond in writing with further information about the violation, the resulting penalties, or both. This may include a justification for the non-compliance, as well as any other factors or considerations the employer feels are important for the officer to know before a final decision is made.

Employers may also request an extension beyond the initial 30 days in which to respond. Requests for an extension are considered on a case-by-case basis.

If the final decision is a finding of non-compliance, the employer receives a final notice setting out the condition breached, how the employer failed to comply, the reasons for the decision, the penalties and the next steps to be taken.

Justification for non-compliance

In some cases, non-compliance may be justified. Violations may be justified if they result from:

• A change in federal or provincial law.
• A change to the terms of a collective agreement.
• A significant change in economic conditions directly affecting the employer’s business.
• An unintentional error by the employer, such as an inadvertent administrative or accounting mistake, where the employer subsequently made efforts to make good the position of any affected worker.
• An unusual and unforeseeable event (for example, a natural disaster).
• Other similar circumstances.

During an inspection and before a final decision on non-compliance is made, the employer should submit information and supporting evidence explaining how the non-compliance is justified to Immigration, Refugees and Citizenship Canada (IRCC). If the officer finds the justification acceptable, the employer may avoid a finding of non-compliance.

Employer Compliance Review (ECR)

Unlike an inspection, an Employer Compliance Review (ECR) takes place before a Labour Market Impact Assessment (LMIA) application is approved, in order to verify past compliance with the programme requirements on wages, occupation and working conditions.

Returning employers attest to this past compliance on their Labour Market Impact Assessment (LMIA) application form. In an ECR, Employment and Social Development Canada (ESDC)/Service Canada may review the employer’s compliance for up to 6 years before the Labour Market Impact Assessment (LMIA) application was received.

The requirement on employers is to ensure that the foreign worker is:

• Employed in the same occupation as set out in the job offer.
• Provided with wages and working conditions that are substantially the same as, but not less favourable than, those set out in the job offer.

What is expected of an employer during an ECR

When applying again to the Temporary Foreign Worker Program (TFWP), employers may have to undergo a document-based review to ensure they have met the requirements on wages, working conditions and occupation.

Employers are asked to provide specific documents to demonstrate their compliance. During the review, employers have the opportunity to provide a justification for any preliminary findings of non-compliance and, in some cases, to take corrective action.

Pending Labour Market Impact Assessments (LMIAs) may not be finalised until the ECR is complete.

Penalties

Employers unable to demonstrate their past compliance are found non-compliant.

Employers found non-compliant are liable to:

• Possible refusal to process applications for 2 years from theTemporary Foreign Worker Programme (TFWP)andInternational Mobility Program (IMP).
• Receiving a negative Labour Market Impact Assessment (LMIA) for any pending application; and/or
• Revocation of Labour Market Impact Assessments (LMIAs) previously issued.

Review under Ministerial Instructions

The purpose of a review under Ministerial Instructions is to determine whether new information received from Employment and Social Development Canada (ESDC) or Service Canada justifies the revocation of an approved Labour Market Impact Assessment (LMIA); it may take place at any time after a positive Labour Market Impact Assessment (LMIA) has been issued.

Employers are selected for this type of review only where Employment and Social Development Canada (ESDC) or Service Canada receives an allegation through the tip line concerning a Labour Market Impact Assessment (LMIA) that may justify suspension or revocation on public policy grounds.

For the duration of the review, the Labour Market Impact Assessment (LMIA) is suspended.

What is expected of an employer during a review under Ministerial Instructions

Employers undergoing this type of review will:

• Be advised whether they are being reviewed for possible revocation under Ministerial Instructions.
• Be advised whenever a Labour Market Impact Assessment (LMIA) is suspended or revoked.
• Be given the opportunity to provide information relating to the allegation.

Revocation

Revocation is the permanent cancellation of a Labour Market Impact Assessment (LMIA) or the cancellation of one or more positions on a Labour Market Impact Assessment (LMIA). Once revoked, the Labour Market Impact Assessment (LMIA) can no longer be used to apply for a work permit from Immigration, Refugees and Citizenship Canada (IRCC).

If a Labour Market Impact Assessment (LMIA) is revoked after a work permit has been issued, Immigration, Refugees and Citizenship Canada (IRCC) may also revoke the associated work permit from the foreign worker.

Revocation may occur where:

• New information provided to Employment and Social Development Canada (ESDC) or Service Canada after a Labour Market Impact Assessment (LMIA) has been approved shows that hiring a foreign worker would have an adverse effect on the Canadian labour market.
• The employer (or group of employers) provided false, misleading or inaccurate information in the Labour Market Impact Assessment (LMIA) application.
• The employer has been found non-compliant through an inspection and their name has been added to the public website of employers found non-compliant.

Outcome of a review

There are two possible preliminary outcomes to any review:

• Satisfactory: the employer demonstrates compliance with the conditions examined or fully justifies the non-compliance.
• Non-compliant: the employer is unable to demonstrate compliance with the conditions examined or is unable to justify the non-compliance fully.

If the outcome of the review is “non-compliant”, a positive Labour Market Impact Assessment (LMIA) will not be issued and the Labour Market Impact Assessment (LMIA) processing fee will not be refunded.

Voluntary disclosure

Employers who believe they may have breached the conditions of the Temporary Foreign Worker Program (TFWP) are encouraged to take the steps needed to become compliant and to disclose this information voluntarily to Immigration, Refugees and Citizenship Canada (IRCC).

Immigration, Refugees and Citizenship Canada (IRCC) then determines whether the information received is relevant and credible, assesses the seriousness of the possible violation, and decides whether an inspection is required. Not every disclosure leads to an inspection.

If an inspection is carried out following a voluntary disclosure and the employer is found non-compliant, the employer may face a reduced penalty or no penalty at all. In such cases, Immigration, Refugees and Citizenship Canada (IRCC) considers a number of factors in determining whether the employer qualifies for a reduced penalty, including:

• The completeness of the disclosure.
• Whether the disclosure was genuinely voluntary (that is, the employer was not already the subject of an inspection or enforcement action).
• The seriousness of the impact of the violation on the foreign worker.
• The seriousness of the impact of the violation on Canadian workers or the Canadian economy.
• The timeliness of the disclosure.
• The employer’s history of voluntary disclosure.
• The nature of the condition the employer failed to meet.

Find out more about the TFWP employer compliance rules on the Government of Canada website athere.