CIMM Committee Report
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CHAPTER THREE: ADMINISTRATION In this chapter, three administrative elements of the temporary foreign worker program are discussed. Specifically, observations and suggestions in relation to labour market opinions, prevailing wage rates, and work permits are considered. In order to hire a temporary foreign worker, an employer must first receive a positive or neutral labour market opinion (LMO) from Service Canada, (the service delivery arm of Human Resources and Skills Development Canada (HRSDC))[43]. The purpose of the LMO is to ensure that there really is a shortage of Canadians or permanent residents willing and able to do the job, and therefore that hiring a temporary foreign worker will not have a negative impact on the Canadian labour market. In assessing an LMO, Service Canada considers the following factors:
Some employers have complained that the LMO application process is unnecessarily complicated and that processing times, which may take months, are too long for busy employers who need workers immediately. Accordingly, the government took measures to speed up LMO processing times, such as introducing the Expedited Labour Market Opinion Pilot Project (E-LMO) and revising certain advertising requirements that employers have to fulfil before concluding there is no suitable domestic worker and hiring a foreign worker. The E-LMO, which operates in Alberta and British Columbia, is based on a list of occupations “identified as being in high demand sectors where there is a high degree of confidence in the labour market information for the sector and it is easily accessible.”[45] Service Canada processes qualified employer applications for LMOs for occupations on the E-LMO list within five days of receiving all required information. In March 2009, Service Canada implemented changes to the E-LMO process that require employers to submit evidence of recruitment efforts undertaken, the results of those recruitment efforts, and the rationale for not hiring interested Canadians.[46] A second measure the government took to speed up the LMO process was revising advertising requirements that employers had to fulfil before concluding that there was no suitable domestic candidate for a job. Initially, “Regional Lists of Occupations under Pressure” were developed for British Columbia, Alberta and Ontario. Employers seeking to hire for listed occupations had to meet less onerous job advertising efforts before hiring a temporary foreign worker. On January 1st, 2009, the Regional Lists of Occupations under Pressure were replaced by new national advertising requirements. Employers now have to advertise most positions for 14 calendar days.[47] Witnesses from across the country raised various concerns with the LMO process. While some of the views expressed from different witness groups seem contradictory (some employers want the process to be sped up, while some worker groups want LMO decisions to be more considered), in fact they can be articulated as a coherent goal: the LMO process must be transparent, quick and efficient, and it must produce an accurate evaluation of the likely impact on the labour market of bringing in a temporary foreign worker to fill a position. The Committee heard a range of suggestions as to how the LMO process could be improved in support of various aspects of this goal. A re-evaluation of LMO criteria is required given rural and regional unemployment across the country.[48] A number of witnesses questioned the current methodology Service Canada uses to determine whether there is a labour shortage in respect of an occupation. Some feel that the LMO assessment should better take into account factors such as regional unemployment and barriers to worker mobility across Canada. Many witnesses called for greater transparency in the methodology and of the criteria used to assess labour shortages, and for greater stakeholder input in making such decisions.[49] The Committee makes the following observations. The LMO process comprises two parts: assessment of whether there is a labour shortage for a certain occupation, and evaluation of an employer and job offer. Duplication of effort could be avoided if the first part, the assessment of a labour shortage, were performed once for a certain occupation in a province, and the outcome then used for subsequent LMO applications regarding the same occupation and province. For example, if, in considering an LMO for Company A, Service Canada determines that there is a shortage of cooks in Alberta, that finding should hold true for the LMO submitted by Company B, which also seeks to hire cooks in Alberta. Accordingly, the Committee suggests that the labour market assessment part of an LMO be separated from the employer and job offer evaluation part of an LMO. This idea has already been partially implemented as the “Occupations Under Pressure” list and the E-LMO process, each of which admit that certain occupations in a particular province are facing labour shortages. The Committee believes that this is the right direction for achieving efficiencies. Service Canada should not be repeatedly assessing whether a certain occupation is experiencing a labour shortage. It should make that assessment just once and properly, and then use the determination until a change in the market warrants re-visiting the determination. Recommendation 9 The Committee recommends that the Government of Canada work with provincial and territorial governments, with input from other stakeholders, to develop and maintain a list of occupations for which it has been determined that there is a bona fide labour shortage in the province or territory, and therefore in respect of which employers may hire temporary foreign workers. The Committee agrees with the witnesses who called for greater stakeholder input in assessing labour shortages. More information that goes into making an assessment and more transparency in the process followed can only lead to a more accurate and fair determination. Recommendation 10 The Committee recommends that the Government of Canada make provincial and territorial lists of occupations experiencing labour shortages publicly available, including on the Internet, as well as the methodology used to arrive at that determination. Recommendation 11 The Committee recommends that the Government of Canada welcome stakeholder input in making labour shortage determinations. It should facilitate an Internet-based system through which stakeholders may provide observations or suggestions relevant to changing or making a labour shortage determination and thereby modifying the list of occupations experiencing labour shortages. The Government of Canada should:
If the labour market assessment portion of the LMO were performed as recommended above, employers would no longer be required to apply for an LMO in order to hire a temporary foreign worker. Instead, they would check to ensure the position they seek to fill is a listed occupation, and then they would apply for a “hiring permit” by providing all the job- and employer-specific information they currently provide for an LMO. The term “labour market opinion” would no longer be descriptive of the second part of the current LMO process, that is, evaluation of the employer and job offer. Recommendation 12 The Committee recommends that the Government of Canada modify the Labour Market Opinion process currently followed to include:
Positive determinations on both steps would lead to the issuance of a “hiring permit” for the employer (rather than a positive or neutral LMO, as is the current terminology.) B. Expediting the processing of “hiring permit” (currently LMO) applications Employers identified various processing concerns with the current LMO process, including the length of time, multiplication of forms, and the repetitive burdens placed on those who apply frequently. The Committee believes that separating the labour market assessment portion of the process from the employer- and job-specific assessment would greatly reduce the repetition of the labour market determination and thereby speed up processing times. In addition the following steps should be taken to speed up processing without compromising fairness of determinations. Recommendation 13 The Committee recommends that the Government of Canada automatically approve an application for a “hiring permit” if the application is certified to be substantially the same as a prior application that was approved, and no relevant factors have changed. Recommendation 14 The Committee recommends that the Government of Canada provide for electronic “hiring permit” extensions. C. Improving the process in other ways One witness expressed concern with the current practice of pre-approving LMOs in bulk. The witness felt that this “offers large employers the ability to ‘bank’ LMOs… and [recruit] specific crews of workers when they are needed. The problem is that labour markets change. Construction industry labour markets are particularly volatile.”[50] While welcoming stakeholder input in making labour shortage determinations will help keep those determinations up to date, as set out in Recommendation 11, problems would still arise if a “hiring permit” with no expiry date were issued during a period when a certain occupation was in demand, but the “hiring permit” was not used to hire someone until a later time when there was no longer a shortage of domestic workers in that occupation. Recommendation 15 The Committee recommends that all approved “hiring permits” have expiry dates. Six months may be an appropriate validity for a “hiring permit.” The following recommendation stems from other testimony the Committee heard and is self-explanatory. Recommendation 16 The Committee recommends that the Government of Canada maintain, on a voluntary basis, a list of all employers who have received “hiring permits,” and that information from the list be available for use by unemployed temporary foreign workers in Canada, and those helping them, in identifying employers seeking to hire temporary foreign workers. What we're saying is that rather than a labour shortage, in fact what we may have is a cheap labour shortage.[51] Without this escape hatch [temporary foreign workers], employers would have to offer better pay, benefits and training programs in order to attract labour.[52] The “prevailing wage” in respect of a certain occupation in a certain region is the wage that a Canadian would be paid in that occupation and region. When Service Canada receives an LMO application from an employer seeking to hire a temporary foreign worker, it checks to ensure that the wage the employer proposes to pay to the temporary foreign worker is equal to or higher than the prevailing wage. The purpose is to ensure that employers are not using temporary foreign workers as cheap labour and thereby creating downward pressure on wages and working conditions in Canada. In testimony before the Committee, Andrew Kenyon of HRSDC explained that the “prevailing wage” for an occupation is calculated as an average based on a variety of data sources, including EI databases, employer surveys, provincial wage surveys, and surveys of competitors.[53] While no one who appeared before the Committee disputed the principle of requiring that temporary foreign workers be compensated at the same wage rates as domestic workers, witnesses raised concerns about actual rates that have been set as well as with the process for setting them.[54] Specifically, some witnesses claimed that prevailing wage rates are set too high, and that they fail to take into account factors such as tips and gratuities, and levels of experience.[55] Some witnesses were unaware that lists of prevailing wage rates are publicly available on the Internet.[56] Several witnesses called for more transparency and stakeholder input in calculating prevailing wage rates.[57] The Committee is not in a position to comment on whether any specific prevailing wage rate has been set appropriately, or whether the process for setting a wage rate is optimal. We believe that stakeholders in the field are in the best position to make specific comments and recommendations in that regard. Accordingly, the Committee makes the following recommendations in support of modifying the system to increase transparency and to facilitate incorporating stakeholder input into prevailing wage rate calculations. Recommendation 17 The Committee recommends that the Government of Canada modify the information it provides to employers and the public at large on the topic of the temporary foreign worker programs (including websites and print information) to make it easier for people to find the lists of current prevailing wage rates and to clarify that “hiring permit” applications will be rejected if they indicate a wage rate that does not equal or exceed the prevailing wage rate. Recommendation 18 The Committee recommends that, in relation to the lists of current prevailing wage rates, the Government of Canada disclose the method of arriving at each rate, including the statistics relied upon. Recommendation 19 The Committee recommends that the Government of Canada establish a process by which stakeholders may provide input on any method used to arrive at a prevailing wage rate, and receive a response to their comments from the Government of Canada. The process may be Internet-based, and should be simple, public and obvious. Currently, the work permit that temporary foreign workers are required to obtain before working in Canada specifies a single employer for whom the worker may work. The Committee heard testimony of how this situation limits the worker’s ability to change employers and thereby gives the employer considerable power over the employee. Canadians, when confronted by a bad boss, can at the very least quit and get a job with a competitor across the street. But temporary foreign workers don’t have this option—and employers know it.[58] If a temporary foreign worker becomes unemployed for any reason, or discovers that there is no job waiting for him or her upon arrival in Canada, the worker cannot simply take another job. First, he or she must find another employer who has a positive or neutral labour market opinion (or is willing to apply for one) and who wishes to hire him or her. Then, the worker must wait for a period of weeks, which may stretch into months, while the work permit is amended to reflect the name of the new employer. Accessing the knowledge and the means to activate this process is beyond the resources of most [temporary foreign workers]. Language and cultural barriers are compounded by the challenges of being a newcomer with few connections or contacts in their new Canadian community.[59] Some employers and workers cannot wait that long. Employers with immediate labour needs may be frustrated with the wait and fill the position with another worker. Workers often face financial difficulty during a protracted period of unemployment, especially if they cannot access any government benefits. Witnesses stated that some temporary foreign workers resort to unauthorized employment, or make claims for refugee status as a result of some of these difficulties. On the other side of the issue are the employers who often make considerable investments of time and money in finding, recruiting, transporting and training new temporary foreign workers, and therefore who face significant losses if the worker leaves their employment to work for someone else before the end of the contract period. They signed employment contracts with us, but because of the way Canadian laws are written, these foreign workers are free to roam the country for the length of their visa and we were now worse off than before bringing these workers here. We were now short 11 workers and down the $55,000 we spent to bring them here, house them, transport them, etc.[60] A second employer can get a temporary foreign worker permit for the same worker and avoid the recruitment and start-up costs.[61] To address the concerns of employers and workers alike, a number of witnesses suggested that work permits no longer be employer-specific, but that instead they be sector- and province-specific.[62] While a temporary foreign worker might be required to register the name of his or her employer with the government, the worker should not be delayed from starting a new job while the government updates the work permit, as long as the worker continues to work in the same sector and region. To address interests of initial employers who may incur significant costs in bringing a worker to Canada, provision should be made for cost-recovery from the secondary employer to the initial employer on a pro-rated basis.[63] Also, to help reduce the time a temporary foreign worker spends between jobs, the government should facilitate workers and their advocates in identifying potential employers who have valid “hiring permits”, and are therefore eligible to hire a temporary foreign worker.[64] Recommendation 20 The Committee recommends that the Government of Canada discontinue making work permits of temporary foreign workers employer-specific, and that it make such work permits sector- and province-specific instead. Where there is a change of employers, employers should be able to claw-back the recruitment and associated costs from subsequent employers to earlier employers on a pro-rated basis. To address financial difficulties faced by some temporary foreign workers who find there is no job waiting for them upon arrival in Canada, several witnesses suggested that employers be required to post a bond in the amount of one month’s wages that would be released to the worker if the employer failed to provide a minimal level of employment.[65] While the Committee agrees with the principle of this approach, we are concerned with the administrative burden and cost this would impose upon the system and employers. Accordingly, we recommend a common emergency pool be created instead. Funds for the emergency pool could be raised from all employers of temporary foreign workers in connection with the “hiring permit” process. Emergency funding would then be available to support unemployed temporary foreign workers in need, on a short term basis, in accordance with guidelines that should be established. Provincial advocates of temporary foreign workers may play a role in identifying meritorious candidates. Recommendation 21 The Committee recommends that the Government of Canada levy a fee on employers in connection with issuing “hiring permits” in order to fund a pool of money for emergency support of unemployed temporary foreign workers in Canada. It should also establish guidelines for disbursements from the pool. [43] Some jobs do not require a labour market opinion: http://www.cic.gc.ca/EnGLIsh/work/apply-who-permit.asp. This report on temporary foreign workers generally applies in respect of workers holding jobs that do require an LMO. [44] This text was taken directly from the CIC website: http://www.cic.gc.ca/EnGLIsh/resources/publications/tfw-guide.asp. Also see section 203 of the Immigration and Refugee Protection Regulations, S.O.R/2002-227. [45] Government of Canada, “Government of Canada Announces Expansion of Temporary Foreign Worker Program Pilot Project to Ease Labour Shortages for Employers in B.C. and Alberta”, http://news.gc.ca/web/article-eng.do?nid=371869. [46] HRSDC, Temporary Foreign Worker Program, Expedited Labour Market Opinion Pilot Project, http://www.hrsdc.gc.ca/eng/workplaceskills/foreign_workers/communications/elmoppchanges.shtml. [47] HRSDC, Temporary Foreign Worker Program: Minimum Recruitment Requirements, http://www.hrsdc.gc.ca/eng/workplaceskills/foreign_workers/communications/advertrecrutment.shtml. [48] British Columbia and Yukon Territory Building and Construction Trades Council, executive summary, March 31, 2008. [49] Joyce Reynolds, Executive Vice-President, Government Affairs, Canadian Restaurant and Foodservices Association, Committee Evidence, Meeting No. 28, 9 April 2008, 14:20,. Lynn McDonagh Hughes, Manager, Operations, Nova Scotia Tourism Human Resource Council, Committee Evidence, Meeting No. 34, April 16, 2008, 10:15. The Waterloo, Wellington, Dufferin, Grey Building and Construction Trades Council strongly encourages HRSDC and CIC to consult with local building trades councils to more accurately determine the availability of skilled trades people in the local marketplace prior to opening the door to temporary foreign workers: resolution on foreign workers. [50] British Columbia and Yukon Territory Building and Construction Trades Council, written brief, March 31, 2008, p. 7. [51] Carol Phillips, Assistant to the President, Canadian Auto Workers Union, Committee Evidence, Meeting No. 26, April 8, 2008, 14:15 [52] Canadian Auto Workers Union, written brief, April 8, 2008, p. 4. [53] Andrew Kenyon, Director General, Temporary Foreign Workers Directorate, HRSDC, Committee Evidence, Meeting No. 13, February 25, 2008, 16:00. [54] Hotel Association of Canada, written brief, May 9, 2008, p. 2. [55] Daniel Hirschkorn, Director, Saskatoon Immigration and Employment Consulting Services Inc., Committee Evidence, Meeting No. 20, April 2, 2008, 11:15; Joyce Reynolds, Executive Vice-President, Government Affairs, Canadian Restaurant and Foodservices Association, Committee Evidence, Meeting No. 28, April 9, 2008, 14:15 [56] See: www.labourmarketinformation.ca, and click on “wages & salaries.” [57] United Food and Commercial Workers Union, The Status of Migrant Farm Workers in Canada 2006-2007, written brief, p. 3. [58] Alberta Federation of Labour, written brief, 1 April 2008, pp. 10-11. [59] British Columbia and Yukon Territory Building and Construction Trades Council, written brief, March 31, 2008, p. 3. [60] Stewart Mussel Farms Inc., written brief, April 15, 2008, p. 2. [61] Canadian Restaurant and Foodservices Association, written brief, April 9, 2008, p. 4. [62] For example, the International Brotherhood of Electrical Workers, Local Union 424, written brief, April 1, 2008, p. 4; John Doyle, Researcher, Manitoba Federation of Labour, Committee Evidence, Meeting No. 22, April 3, 2008, 09:55; Farida Osmani, Coordinator, Undocumented and Temporary Foreign Workers, Association des aides familiales du Québec, Committee Evidence, Meeting No. 30, April 10, 2008, 14:10. [63] Canadian Restaurant and Foodservices Association, written brief, April 9, 2008, p. 4. [64] Edmonton Mennonite Centre for Newcomers, written brief, April 1, 2008, p. 2. [65] Alberta Federation of Labour, Temporary Foreign Workers: Alberta’s Disposable Workforce, The Six-Month Report of the AFL’s Temporary Foreign Worker Advocate, November 2007, Recommendation 18, p. 19. Also, Manitoba Federation of Labour, written brief, April 3, 2008, p. 5. |