Canada’s LMIA rules are changing, and the latest update focuses on something employers cannot afford to get wrong: who actually qualifies as the employer.
On September 18, 2026, Service Canada updated employer guidance across multiple Temporary Foreign Worker Program streams. The new guidance explains how Service Canada determines whether an entity is actually the employer when assessing an LMIA application.
If you’re a Canadian business planning to hire foreign workers, this update deserves your attention.
What Changed in Canada’s LMIA Rules?
Under the updated guidance, an employer is the entity that:
- Hires the temporary foreign worker
- Sets the worker’s working conditions
- Directly pays the worker
The employer can be an individual, business, corporation or organization.
But Service Canada doesn’t simply look at the name written on the LMIA application.
It can examine the actual employer-employee relationship.
That means businesses with complicated structures, affiliated companies, contractors or third-party arrangements need to pay close attention to how the employment relationship is presented.
How Does Service Canada Determine Who the Employer Is?
This is where the new LMIA employer requirements become important.
Service Canada may consider factors such as:
- Who benefits directly from the worker’s services
- Who pays wages and other compensation
- Who decides where and when the worker performs the job
- Who determines job duties and expectations
- Who supervises the worker
- Who monitors performance
- Who has authority to dismiss the worker
- Who signs the employment agreement
- Who the worker recognizes as their employer
These factors help Service Canada assess whether a genuine employer-employee relationship exists.
Why Does This Matter?
Because an LMIA application is more than paperwork.
The information submitted needs to match the real employment arrangement.
For example, an employer shouldn’t identify one entity on the LMIA application while another entity actually controls the worker’s duties, schedule and compensation.
Service Canada states that employers cannot restructure the relationship after approval to avoid payroll, compensation or Temporary Foreign Worker Program requirements.
LMIA Requirements Employers Need to Check
Before submitting an LMIA application, employers should review the requirements for their specific stream.
This can include:
Business legitimacy
The employer may need to demonstrate that the business is genuine, provides goods or services in Canada, has a reasonable employment need and can fulfill the terms of the job offer.
Recruitment and advertising
Employers may need to demonstrate efforts to recruit Canadians and permanent residents before hiring a temporary foreign worker. Requirements vary by LMIA stream.
Wage requirements
The offered wage must meet the requirements applicable to the position and LMIA stream. Canada also updated hourly wage thresholds effective July 17, 2026.
Working conditions
The employer must comply with applicable requirements for wages, working conditions, workplace safety and other employment conditions.
Employer compliance
After hiring a temporary foreign worker, employers remain responsible for complying with the LMIA decision and applicable Temporary Foreign Worker Program requirements.
High-Wage vs Low-Wage LMIA
Not every LMIA application follows exactly the same rules.
Canada has different requirements for high-wage positions and low-wage positions.
For high-wage positions, employers must meet the applicable TFWP requirements, including requirements around recruitment, wages and, where applicable, a transition plan.
Low-wage positions have additional rules, including measures related to unemployment rates in certain census metropolitan areas and limits on the proportion of low-wage temporary foreign workers.
So, using an old LMIA checklist without checking the current rules can create problems.
What Does This Mean for Foreign Workers?
For foreign workers, an approved LMIA is not the same thing as an approved work permit.
An LMIA work permit generally involves two separate stages:
- The employer obtains a positive LMIA when one is required.
- The foreign worker applies for an employer-specific work permit.
IRCC explains that an employer-specific work permit allows the worker to work under the employer, location and occupation conditions listed on the permit.
So if you’re planning to work in Canada, don’t assume that an LMIA alone guarantees a work permit.
What Should Employers Do Now?
If your company is preparing an LMIA application, check these points before submission:
- Confirm the legal employer
- Review the actual employer-employee relationship
- Verify wages against current requirements
- Review recruitment and advertising requirements
- Prepare business legitimacy documents
- Confirm the correct LMIA stream
- Check whether the position is high-wage or low-wage
- Review current TFWP requirements
- Make sure employment documents match the LMIA
- Keep required employment records
Employers are required to retain relevant records for 6 years beginning on the first day of the employment period for which the work permit was issued.
The Bottom Line for Canada’s 2026 LMIA Update
The latest Canada LMIA rules 2026 update puts additional focus on identifying the real employer behind a temporary foreign worker position.
For businesses, that means the company structure, job duties, supervision, wages and employment agreement should tell the same story.
For foreign workers, understanding the LMIA process Canada, employer requirements and work permit process can help you avoid relying on outdated information.
Need Help With Your Canada Immigration Process?
VisaNexa can help employers and foreign workers understand Canadian immigration pathways, including LMIA applications, employer-specific work permits and Temporary Foreign Worker Program requirements.
If you’re planning to hire a foreign worker or exploring an LMIA-supported work permit, getting the requirements right before submitting an application can save unnecessary delays and complications.
