Employer Compliance

The Canadian government looks to ensure employers comply with its foreign worker policies, laws, and regulations.

Whether employers have hired a foreign national through the TFWP or the IMP, the company may be chosen for an inspection or compliance review at any time during the six years after a work permit has been issued. 

Temporary Foreign Worker Program Employer Compliance

The Temporary Foreign Worker Program (TFWP) allows Canadian employers to hire foreign nationals to fill labour shortages in their company. In this program, employers must first apply for and obtain a Labour Market Impact Assessment (LMIA) before the foreign national can apply for a work permit. When applying for a LMIA, employers must commit to meeting certain conditions, such as salary requirements and working conditions. 

Employers are obliged to continue meeting these requirements and conditions throughout the entire duration of the foreign national’s employment with the company.

Canadian employers have certain responsibilities when hiring foreign workers through the Temporary Foreign Worker Program (TFWP).

The Canadian government has these rules in place to ensure the TFWP's objectives are being met. Among these objectives include the arrival of the foreign worker not having a negative impact on Canadian workers. In addition, Canada seeks to ensure the rights of foreign workers are protected in the country. Below are the requirements that employers in Canada must follow if they want to benefit from the TFWP.

Employers must:

• ensure they meet all of the conditions and requirements of the Temporary Foreign Worker Program (TFWP), as outlined in the Labour Market Impact Assessment (LMIA) application, the LMIA decision letter and annexes;
• keep all records associated with their LMIA application and any other documents that demonstrate their compliance with the program conditions for a period of six (6) years;
• inform Employment and Social Development Canada (ESDC)/Service Canada of any changes or errors relating to an approved LMIA or the temporary foreign worker;
• regularly review the activities related to the employment of temporary foreign workers to ensure they continue to uphold the TFWP conditions; and
• take action to rectify any errors and/or non-compliance as soon as it is discovered.

Reviewing Employer Compliance

ESDC/Service Canada has the authority to review the activities of any employer using the TFWP, in relation to their LMIA or LMIA request, by conducting one of the three following forms of review:

• Inspection;
• Employer Compliance Review (ECR); and/or
• Under Ministerial Instruction

During any form of review, LMIAs may be temporarily suspended. This suspension prevents foreign workers from obtaining a work permit from Immigration, Refugees and Citizenship Canada (IRCC) while the review is in process.

Inspection

The purpose of an inspection is to make sure the employer continues to satisfy the conditions set out in the offer of employment, the positive LMIA letter and the annexes, thereby ensuring that workers are not mistreated and that the TFWP is being used as intended. The inspection may occur anytime in the six years following the date of the authorized employment period for which the work permit was issued.

Reasons for an Inspection

There are three reasons an employer could be selected for an inspection:

• there is reason to suspect non-compliance;
• the employer has been found non-compliant in the past; or
• the employer has been randomly selected.

Expectations of Employers during an Inspection

Employers must:

• attend the inspection;
• answer questions;
• provide requested documents or information;
• provide assistance to the investigator; and
• retain all records relating to his/her compliance with the conditions of the offer of employment, LMIA application, letter and annexes for six (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 in which a foreign national performs work and interview any foreign or Canadian workers at the worksite.

Penalties

Employers who were found non-compliant for a violation could face a range of consequences. These are determined on a points system that considers:

• the type of violation;
• compliance history;
• the severity of non-compliance;
• the size of the business (for financial penalties only); and
• whether the employer voluntarily disclosed information about possible non-compliance before an inspection was initiated.

Possible penalties may include:

• warnings;
• monetary penalties ranging from $500 to $100,000 per violation, up to a maximum of $1 million over one year per employer;
• a ban of one, two, five, or ten years, or permanent bans for the most serious violations;
• the publication of their name and address on a public website with details of the violation(s) and/or consequence(s);
• the revocation of previously-issued LMIAs.

Final Decision

Employers who are found to be non-compliant will receive a letter that explains the violation and the resulting penalties (outlined below).

From this point, the employer will have 30 days to respond in writing with additional information regarding the violation, the resulting penalties, or both. This may include justification for non-compliance, as well as any other factor or consideration that the employer feels is important for the officer to know before a final decision is made.

Employers may also ask for an extension beyond the initial 30 days for responding. Extension requests will be considered on a case-by-case basis.

If the final decision is a finding of non-compliance, the employer will receive a final notice, which includes information about the condition(s) violated, how the employer failed to comply, the reason(s) for the decision, the penalties and next steps to take

Justification for Non-compliance

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

• a change in federal or provincial law;
• a change to the provisions of a collective agreement;
• a major change in economic conditions that directly affects the business of the employer,
• an error made in good faith by the employer, such as an unintentional administrative or accounting mistake, and the employer later made efforts to correct it for any workers who were affected;
• an exceptional and unforeseen event (ie. natural disaster); and
• other similar situations.

During an inspection, and before a final decision of non-compliance is made, the employer should submit information and supporting evidence that explains how the non-compliance is justified to IRCC. If the officer finds the justification acceptable, the employer may avoid being found non-compliant.

Employer Compliance Review (ECR)

Unlike inspections, ECRs occur before the LMIA application is approved in order to verify past compliance with respect to program requirements for wages, occupation, and working conditions. Returning employers attest to this past compliance on their LMIA application form. In the ECR, ESDC/Service Canada may look at an employer's compliance for up to six years prior to the receipt of the LMIA application.

Employer requirements ensure that foreign workers are:

• employed in the "same" occupation (previously “substantially the same” occupation) set out in the offer of employment; and
• provided with wages and working conditions that are substantially the same as - but not less favourable than - those set out in the offer of employment (previously “substantially the same wages and working conditions”).