Labour Market Impact Assessment (LMIA)

Generally, a positive Labour Market Impact Assessment (LMIA) is required before a Canadian employer can hire a temporary foreign worker (formerly known as a Labour Market Opinion – LMO).

An LMIA is a form of labour market verification designed to protect Canada’s domestic job marketplace, as well as protect foreign workers employed in Canada temporarily. Only under select circumstances can LMIA-exempt work permits be obtained.

Assessing the Merits of an LMIA Application

Obtaining a Canada work permit is typically a two-step process.  First, the Canadian employer must submit a qualifying LMIA application to Employment and Social Development Canada (ESDC). It is incumbent on the Canadian employer to also submit a detailed list of Canadians who applied for the position; the number of Canadians interviewed for the position, and detailed explanations for why the

Canadian candidates considered were not hired. Canadian employers may be subject to inspection for compliance once a work permit has been issued.

When assessing the merits of the applicant ESDC will consider:

• Are there Canadians in the region available and willing to fill the job on offer?

• Has the employer made sufficient efforts to fill the position with a Canadian worker?

• Will hiring a foreign national help create or retain jobs in Canada?

• Is the employer offering a wage or salary that is consistent with the regional average for the position at hand?

• Are the working conditions acceptable by Canadian labour standards?

• Is the employer or the industry in which the job sits engaged in ongoing labour disputes?

If ESDC is satisfied that a given region and industry are healthy enough to sustain foreign labour, a positive LMIA will be issued.

LMIAs are specific to employers, the position being offered, and the region in which the job is located. Obtaining a positive LMIA does not allow you to change your job or employer, or move to another Canadian region after acquiring a work permit. In any of those instances you are required to seek a new LMIA.

The LMIA process distinguishes between “high-wage” and “low-wage” employees. Temporary foreign workers whose remuneration is below the provincial/territorial median wage are considered low-wage. Temporary foreign workers whose remuneration is equal to or above the median wage are considered high-wage.

High-Wage Workers

The submission of a transition plan is a compulsory requirement for all Canadian employers seeking to employ a temporary foreign worker(s) at a wage that is equal to or above the provincial/territorial median hourly wage. Transition plans exist to ensure the employer intends to reduce their reliance on temporary foreign workers in favour of Canadians.

Low-Wage Workers

Canadian employers looking to hire low-wage workers do not need to submit a transition plan when applying for a Labour Market Impact Assessment (LMIA). Unlike high-wage workers, however, they are subject to a cap that limits the number of low-wage temporary foreign workers a given business can employ. Canadian employers with more than 10 employees will be restricted to a maximum 10% cap on low-wage temporary foreign workers.

This cap will be phased in over the next two years, to allow Canadian employers time to transition to a Canadian workforce.

LMIA Processing Times

LMIA processing times can be somewhat unpredictable, ranging from a couple of weeks, to a few months. Employment and Social Development Canada (ESDC) has pledged to process certain LMIA applications within 10 business days. The following categories will now be processed with a 10-business-day service standard:

• All LMIA applications for the highest-demand occupations (skilled trades), or
• Highest-paid (top 10%) occupations, or
• Short-duration work periods (120 days or less).

LMIA Fees and Additional Employer Requirements

• A processing fee of CDN $1,000 applies to each Labour Market Impact Assessment application (unless the application is made strictly in support of permanent residency). A CDN $100 Privilege Fee is also required.

• Canadian employers must undertake advertisement efforts (Canada Job Bank) for at least four weeks prior to submitting an LMIA application. Employers are further required to demonstrate at least two other recruitment methods used to target potential hires, other than the Canada Job Bank website. ESDC will also be looking for evidence that underrepresented groups of Canadians were pursued and considered for the position (e.g. disabled people, aboriginals, youth).

• English and French are the only two languages eligible to be listed as employment requisites, for the purpose of LMIA application. ESDC officers are largely hesitant to approve an LMIA application if the employer has indicated a language other than English or French was used as a determinant.

• Canadian employers must attest that they are prohibited from laying off, or reducing the hours, of Canadians if their company employs temporary foreign workers.