Labour Market Impact Assessment

What is Labour Market Impact Assessment (LMIA)?

A Labour Market Impact Assessment (LMIA) is an official document issued by Employment and Social Development Canada (ESDC). This document evaluates the potential impact of hiring a foreign national to work in Canada. The primary purpose of the LMIA process is to ensure that there are no Canadian citizens or permanent residents available to fill a specific job position before an employer is allowed to hire a foreign worker.

The LMIA Process

1. Job Advertising and Recruitment:
• Mandatory Advertising: Employers must advertise the job position for a minimum of four weeks. This advertising must be comprehensive and include postings on various job boards and other relevant platforms.
• Interview Process: Employers are required to interview Canadian citizens and permanent residents who apply for the position and meet the basic qualifications.
2. Proving the Need for a Foreign Worker:
• Assessment of Candidates: The business must prove that none of the interviewed Canadian candidates fulfilled the job requirements. This involves detailed documentation and justification for why each Canadian applicant was not suitable.
• Approval to Hire a Foreign Worker: Only after demonstrating that no qualified Canadian candidate is available, the employer can receive approval to hire a foreign worker.
3. Work Permit Application:
• Supported by LMIA: Once an LMIA is approved, the foreign worker can apply for a Canadian work permit. The LMIA serves as a critical support document for this application. The foreign worker must obtain this permit before they can legally begin work in Canada.

What are the Documentation Requirements?

LMIA applications are comprehensive and require detailed documentation, including:

• Numerical Breakdown: Employers must provide a numerical breakdown of the number of Canadian applicants for the position.
• Job Offers and Rejections: Documentation must include the number of job offers made and the reasons for not hiring each Canadian applicant.
• Written Descriptions: Employers need to provide written explanations detailing why each Canadian applicant was not qualified for the job.

LMIA Exemptions

Not all work permits require an LMIA. Some work permit streams are exempt from the LMIA requirement and fall under the International Mobility Program. These exemptions typically apply to specific categories of workers or unique circumstances that do not necessitate an LMIA.

LMIA Application Requirements

LMIA applications must be submitted in hard copy by mail to the appropriate Service Canada Processing Centre. The application package must include evidence that the following criteria have been met:

1. Processing Fee:
• Standard Fee: Each LMIA application requires a processing fee of $1,000 CAD. This fee is non-refundable, even if the application is denied.
• Exemptions: Some applicants, such as those applying for in-home caregiver positions, may be exempt from this fee.
2. Business Legitimacy Documents:
• Proof of Legitimacy: Employers must provide documents proving that they are a legitimate Canadian business. This may include business registration documents, proof of operations, and other legal documentation.
3. Transition Plan:
• Long-Term Strategy: Employers must submit a detailed transition plan outlining how they intend to address the need to hire foreign nationals. This plan should include steps to eventually hire Canadian citizens and permanent residents instead of temporary foreign workers (TFWs).
4. Recruitment Efforts:
• Evidence of Recruitment: Employers must submit evidence showing substantial efforts to recruit Canadian citizens and permanent residents before considering hiring a TFW. This includes job advertisements, records of interviews, and detailed reasons for not hiring Canadian candidates.
5. Wages:
• Wage Information: Applications must include detailed information regarding the wages to be paid to TFWs. This ensures that TFWs are paid fairly and on par with their Canadian counterparts for the same job.
6. Workplace Safety:
• Health and Safety Standards: Employers must provide evidence that TFWs will receive the same workplace health and safety standards as Canadians. This includes proof of insurance coverage that is at least equivalent to the health coverage offered by the province or territory where the business is located.

Special Considerations for Low-Wage Workers

Employers hiring low-wage workers must meet additional requirements, including:

1. Cap on TFWs:
• Workforce Limits: Employers are subject to a cap on the percentage of their workforce that can be comprised of TFWs.
2. Transportation:
• Employer Responsibility: Employers must provide adequate transportation for low-wage workers to and from Canada at the employer’s expense.
3. Housing:
• Adequate Housing: Employers must ensure that low-wage workers have adequate housing for the duration of their employment.

Post-Approval Process

After an LMIA application is processed, the employer receives a decision:

• Positive LMIA:
• Validity Period: A positive LMIA is valid for six months from the date of issue.
• Next Steps: The employer must inform the foreign worker, who then applies for a work permit using the LMIA as support.
• Negative LMIA:
• Denial to Hire: If the LMIA is negative, the employer is not approved to hire a foreign national for the position.

Expedited Processing

Under certain conditions, LMIA applications can be processed within 10 days if the employer meets specific criteria, such as:

• Highest Wage Positions: Jobs in the top 10% of wages in the province or territory.
• Skilled Trades: Positions that pay at least the median provincial or territorial wage.
• Short-Term Positions: Jobs lasting 120 days or less.
• Express Entry: Positions intended to support an Express Entry candidate.

Evaluation Criteria by ESDC

ESDC considers several factors when assessing an LMIA application:

• Salary Comparison: The salary offered to the foreign worker compared to local averages.
• Compliance with Labour Laws: Ensuring working conditions comply with labour laws and collective agreements.
• Labour Shortages: Assessing whether there is a labour shortage for the occupation in the area.
• Recruitment Efforts: Evaluating the employer’s efforts to recruit Canadian workers.
• Job Creation and Skill Transfer: Considering if hiring the foreign worker will create or retain jobs for Canadians or transfer unique skills.

LMIA Streams

1. High-Wage Workers:
• Wage Requirements: The offered wage must meet or exceed the median wage for the occupation and location.
• Advertising and Transition Plan: Extensive job advertising and a detailed transition plan are required.
2. Low-Wage Workers:
• Wage Requirements: The offered wage must meet or exceed the median wage for the occupation and location.
• Advertising and Recruitment: Additional requirements for job advertising and targeting under-represented groups.

Wages Prior to May 31, 2023

• Alberta: $28.85
• British Columbia: $26.44
• Manitoba: $23.00
• New Brunswick: $21.79
• Newfoundland and Labrador: $24.29
• Northwest Territories: $37.30
• Nova Scotia: $22.00
• Nunavut: $36.00
• Ontario: $26.06
• Prince Edward Island: $21.63
• Quebec: $25.00
• Saskatchewan: $25.96
• Yukon: $32.00

Wages as of May 31, 2023

• Alberta: $28.85
• British Columbia: $27.50
• Manitoba: $23.94
• New Brunswick: $23.00
• Newfoundland and Labrador: $25.00
• Northwest Territories: $38.00
• Nova Scotia: $22.97
• Nunavut: $35.90
• Ontario: $27.00
• Prince Edward Island: $22.50
• Quebec: $26.00
• Saskatchewan: $26.22
• Yukon: $35.00

Global Talent Stream (GTS)

The Global Talent Stream is a fast-track option for hiring skilled workers:

• Category A: Requires referral by a designated partner.
• Category B: Positions must be on the Global Talent Occupations list.
• Wage Requirements: The wage must meet or exceed the median wage, with specific salary floors for unique and specialized positions.

Agricultural and Seasonal Agricultural Positions

This stream addresses seasonal labor shortages in the agriculture sector and has specific requirements tailored to the industry's needs.

In-Home Caregiver Positions

This stream allows families to hire foreign caregivers for children or individuals with high medical needs. Employers must meet the requirements for high-wage or low-wage streams, including wage and recruitment standards.

Fees and Work Permit Duration

• Application Fee: A non-refundable fee of $1,000 CAD per position.
• Work Permit Duration:
• Low-wage: Up to one year.
• High-wage: Up to three years.

Cap on Low-Wage Temporary Foreign Workers

Employers with 10 or more employees applying for a new LMIA under this stream are subject to a cap, limiting them to hiring up to 20-30% of their workforce through the low-wage stream, depending on sector-specific labor shortages.

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