The Canadian government is rolling out significant reforms to the Temporary Foreign Worker Program (TFWP), a move that will have far-reaching effects for both employers and workers across the country. On November 8, 2024, new wage requirements for high-wage positions will take effect, raising the minimum wage threshold by 20% above the provincial median. This adjustment is part of a broader strategy by the federal government to prioritize domestic hiring, ensure fair compensation for foreign workers, and address labour shortages in key sectors across Canada.

As Canada’s economy continues to grow, so too does the demand for skilled labour, especially in sectors such as construction, healthcare, technology, and agriculture. Labour shortages remain a critical issue, with many employers struggling to fill high-demand roles. The new wage requirements, announced by Employment Minister Randy Boissonnault, are designed to encourage employers to hire Canadian workers first, while also ensuring that foreign workers are compensated fairly.

Minister Boissonnault emphasized the government’s commitment to protecting Canadian workers, stating: “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, employers will be required to pay significantly more, which will also boost wage growth for Canadian workers.

In Ontario, the wage threshold will rise from $28.39 to $34.07 per hour. This wage increase is part of the government’s broader goal to enhance working conditions and make Canada’s labour market more competitive. The changes are expected to shift up to 34,000 jobs from the high-wage stream to the more restrictive low-wage stream, potentially resulting in 20,000 fewer positions approved through the TFWP.

Employers who rely on foreign labour will need to adjust their strategies to comply with the new rules. The reforms will impose stricter requirements, especially for low-wage stream jobs, which include additional obligations related to housing, transportation, and recruitment of workers already in Canada. These measures aim to protect foreign workers from exploitation and ensure fair treatment.

The federal government has also ended the use of attestations from accountants or lawyers to verify business legitimacy. Instead, it will rely on existing information-sharing agreements with provincial and territorial partners to ensure that only genuine job offers are approved.

Navigating Canada’s immigration and labour programs can be complex, especially with continuous reforms like those to the TFWP. For both employers and foreign workers, having the support of a qualified and licensed immigration consultant is crucial. The changes to the TFWP highlight the need for expert guidance in ensuring compliance and making the most of the opportunities available.

The reforms come at a time when labour shortages across Canada are at a critical point. The government’s focus on reducing unemployment rates, particularly among under-represented groups such as youth, is a step toward creating a more inclusive labour market. The youth unemployment rate currently sits at 13.5%—more than double the national average of 6.5%. By capping the number of low-wage foreign workers in a company’s workforce and freezing Labour Market Impact Assessment (LMIA) applications in regions with high unemployment rates, the government aims to encourage more Canadians to join the labour force.

However, despite these efforts, foreign workers remain a vital part of Canada’s economy. Sectors like agriculture, healthcare, and construction continue to rely heavily on foreign talent to meet their workforce demands. According to data from Immigration, Refugees, and Citizenship Canada, the number of work permits issued between January 1, 2023, and August 31, 2023, saw a staggering 152% increase compared to the same period in 2022.

The upcoming changes to the Temporary Foreign Worker Program represent a significant shift in how Canada addresses its labour market challenges. By prioritizing domestic workers and raising wage requirements for foreign workers, the government hopes to create a more equitable and competitive labour market. Employers must act now to adapt to these changes, and foreign workers need to ensure they are aware of their rights and opportunities.

At Directpath Canada,  we are committed to providing high-quality immigration and settlement services. Our team of licensed consultants offers personalized solutions to meet your specific needs, whether you’re an employer seeking skilled foreign workers or a professional looking to move to Canada. We are dedicated to supporting both employers and workers through these transitions. Our global recruitment, immigration, and settlement services are tailored to help you succeed in Canada’s evolving labour market.

Information Source: True North