Labour Market Impact Assessment (LMIA)
Most of the temporary foreign workers require a Labour Market Impact Assessment (LMIA) formerly known as a Labour Market Opinion (LMO) to be able to legally work in Canada. Depending on the type of industry, a foreign worker may require a positive LIMA, to obtain a work permit.
What is the Labour Market Impact Assessment?
An LMIA is a document from the Employment and Social Development Canada (ESDC) allowing Canadian employers to hire temporary foreign workers due to the shortage of a particular skill in the Canadian economy. They may be allowed to hire temporary foreign workers without an LMIA if:
- Employment can contribute to a broader economic and cultural benefit to Canada.
- Canadians and PR enjoy equal benefits from such employment.
Recruitment without an LMIA can be done through the International Mobility Program (IMP) by paying a compliance fee of $230 before the worker applies for a work permit.
Labour Market Impact Assessment (LMIA) is a verification process that aims to ensure that the recruitment of a foreign worker will not negatively impact the Canadian labour market. This is done by the Department of Employment and Social Development Canada (ESDC) also formerly known as Human Resources and Skills Development Canada (HRSDC).
Labour Market Impact Assessment is a complex process and employers who intend to hire a foreign worker for the position have to provide comprehensive information about the position offered and many other factors needed to be considered.
The employers will have to provide information of the position being offered to a foreign employee, how many Canadian Citizens or Permanent Residents (PR) has applied for the position, how many Canadian Citizens or Permanent Residents has been shortlisted and subsequently interviewed, and a profound explanation of why they were not hired.
If the verification process turns out to be positive the employer will be given a positive decision on Labour Market Impact Assessment (LMIA), allowing the recruitment of a foreign worker. Generally, the more specialized the position with a competitive salary being offered, the more the chances of getting a positive decision on LMIA application. Once the employer has been issued a positive LMIA, the foreign worker can apply for a work permit visa.
To give a positive decision on LMIA application, the Employment and Social Development Canada (ESDC) will analyze according to the following parameters:
- Do the working conditions coincide with labor laws and collective bargaining agreements?
- Whether the salary being offered is competitive to the position being offered and as per the wage rate of the location of employment?
- Is the job being offered categorized as high wage or low wage?
- Is there genuinely a shortage of a particular occupation in that location?
- Has the employer legitimately made efforts to find a suitable candidate i.e. Canadian Citizen or permanent resident of Canada?
- Are there any labour disputes about the company/organization?
- Will the foreign workers be able to bring unique skills and expertise to Canada?
- How will the foreign worker affect the job market?
- Will such employment create more jobs and retain previous ones?
Types of LMIA
There are six types of Labour Market Impact Assessment other than hiring for Quebec:
- High-wage or low-wage LMIA
- LMIA for Agricultural Worker
- Dual Intent LMIA (Express Entry)
- LMIA for Caregiver
- Temporary Foreign Academic
- Temporary Foreign worker through Global Talent Stream
High-wage or low-wage LMIA
These types of LMIA(s) are used to process an application for a work permit under the Temporary Foreign Worker Program (TFWP). The employer has to prove the business legitimacy and also prove that their business is located within Canada and is providing goods or services to Canadians, and the foreign worker who has been offered a position will work for the same business in Canada. Although high-wage or low-wage application can be part of dual intent LMIA as well as agricultural stream. Whilst applying for dual intent LMIA or agricultural stream, the employer has to define whether he/she wants to hire a foreign worker under the low or high wage as per the wage offered. if the wage offered is lower than the provincial median wage rate then the employer should follow the instruction for the low wage stream and if it is higher than the provincial median wage rate then the employer must apply under the high-wage stream. The median wage rate is normally considered as the indicator of the prevailing wage rate of the occupation.
Recruitment of Temporary Foreign workers based upon Wages:
The need for an LMIA is determined according to the wage being offered under the stream for High-wage positions or Low-wage positions. If the wage being offered is:
- Above or at the provincial median hourly you must apply under the stream for high wage positions.
- Below the provincial median hourly wage, you must apply under the stream for low-wage positions.
LMIA for Agricultural Worker
These types are used to process an application for a foreign worker under one of the programs of Agricultural Worker Streams.
There are 4 sub-division of LMIA for Agricultural Workers:
- LMIA for Seasonal Farm Workers
- LMIA for Agricultural Workers (non-seasonal)
- LMIA for High Wage
- LMIA for Low Wage
Hiring a Temporary Foreign Agricultural Worker:
Temporary foreign workers can be hired under the following streams:
Seasonal Agricultural Worker Program:
This program is for workers from Mexico or from participating Caribbean countries whose production is included in the National Commodities List.
This stream is for temporary workers from any country whose production is included in the National Commodities List.
This stream is for temporary foreign workers whose production is NOT included in the National Commodities list and is hired on a high-wage agricultural position.
This stream is for temporary foreign workers whose production is NOT included in the National Commodities list and is hired on a low-wage agricultural position.
Dual Intent LMIA (Express Entry)
This type is used to support, both a work permit and an Express entry application. Such an LMIA can be beneficial for an application for Permanent Residence in Canada. This type may help an applicant obtain 50-200 CRS points, depending upon the National Occupation Classification (NOC) type. As mentioned before the employer has to choose whether he wants to hire the foreign worker under high wage or low wage variant as per the wage offered. The employer has to demonstrate the business legitimacy through documents and also should be in operation for at least one year before they make an application under Dual Intent (Permanent Residence support stream) LMIA.
LMIA for Caregiver
When Canadians and permanent residents are not available families may hire foreign caregivers for children under 18, the old, or people with certified medical needs. The employer can hire caregivers on a live-in or live-out basis. The worker will be responsible for:
- Providing full-time care (min 30 hrs. per week)
- Working in the private household
- Meet the requirements of Employment and Social Development Canada (ESDC).
Caregivers' positions are exempted from the need of LMIA and are now dealt with under LMIA exemption code C90 and the caregiver can get Occupation restricted Open Work Permit rather than an employer-specific work permit. The government introduced a new program on June 18, 2019, due to labour shortage of skilled and experienced caregivers. The new program is dealt with under the Home Child Care Provider and Home Support Worker Pilot. Since June 18, 2019, an outside Canada applicant whose LMIA was even issued will not be able to apply for a work permit under LMIA based work permit application route, but Canadian employer who is facing labor shortage for Caregivers for Children or Caregiver for Elderly/Patient can continue to hire caregivers from within Canada.
This program is not for the province of Quebec and the employer from the province of Quebec can still hire caregivers under the LMIA route This type of LMIA is used to hire a foreign worker to provide caregiver services to children, old ailed persons, or persons with special medical needs.
There are 2 sub-division of LMIA for Caregiver:
- LMIA for Caregiver for Children
- LMIA for Elderly People or People with High Medical Needs
Canadian employers who wish to hire foreign workers who are outside Canada can hire them through New Caregiver Program i.e. Home Child Care Provider Pilot (HCCPP) or Home Support Worker Piot (HSWP) Programs.
Temporary Foreign Academic:
Degree-granting postsecondary educational institutes can hire foreign academics to meet staffing needs. This can help attract diverse knowledge and fulfill teaching needs in Canadian institutes. The criteria to hire foreign academics are versatile and designed by the ESDC and IRCC in cooperation with universities and degree-granting institutes. To hire a foreign academic the following has to be taken into consideration:
- The foreign academic must have at least one postgraduate degree after a pertaining bachelor’s degree. The academic must earn the majority of his/her income from teaching or conducting research.
- This type of recruitment is only for academics and not for other departments of universities/colleges.
This criterion aims to take the career development and employment of Canadian academics in Canada.
Temporary Foreign worker through Global Talent Stream:
The Global Talent Stream program was launched on June 12, 2017, for Canadian firms to be able to attract and hire high-skilled global talent. This program falls under the Temporary Foreign Worker program and is designed for innovative firms who need specialized foreign nationals for development or need to fill the in-demand highly skilled positions on the Global Talent Occupation List. They are referred to the Employment and Social Department Canada (ESDC) by a designated referral partner. The criterion for the program is as follow:
- If you hire a worker, you must develop a Labor Market Benefits plan that states the employer-specific commitment to activities that will benefit the Canadian Labor Market. Your plan will be reviewed annually to assess how far the commitments are being met.
- This plan is distinctive from all compliance-related activities that will be done under the Temporary Foreign Worker Program.
Certain occupations do not require Labour Market Impact Assessment (LMIA) and are LMIA exempt. See LMIA-Exempt job offers to take further information about professions that are LMIA exempted.
Requirements for an LMIA
All employers applying for an LMIA will have to:
- Pay a processing fee of CAD 1,000 (certain exemptions apply to LMIA supporting PR applications only and LMIA for a caregiver to low-income families.
- Advertise a position for at least FOUR weeks in the Canadian job market before moving forth to offer a position to a foreign worker.
- Provide evidence of having used at least two other recruitment processes other than the Canadian Job Bank website.
- Provide a transition plan to ESDC explaining how reliance on foreign workers will be reduced.
- Present evidence of investment in skill training of Canadian apprenticeship.
- Attest that Canadian workers will not be laid off.
- English/French are the only languages to hire foreign workers, as the ESDC officer may refuse the application if any other language is required.
NOTE: Employers hiring in the airline industry such as foreign pilots may need additional requirements.
Rejection on Applications
The ESDC may consider an application ineligible if any of the following conditions exist:
- If an employer is declared ineligible by the Immigration, Refugees, and Citizenship Canada (IRCC).
- An employer has a record of noncompliance or nonpayment.
- If there is a high unemployment rate in a particular region and the employer applies for a low-wage job.
- If the occupation is a National Occupation Classification (NOC) type 72, 44, or 45. (Check occupation list)
- If the occupation is listed as Skill level D in the National Occupation Classification (NOC).
- If the economic region where the employment takes place has been facing an annual unemployment rate of over 6 %.
- If there is fraudulent information in the application.
- If incomplete documentation is provided.
Who needs an LMIA?
Most of the Canadian employers who are facing a labor shortage can apply for a Labour Market Impact Assessment (LMIA). In most cases, LMIA is required before a foreign worker can apply for a work permit. You can find out whether you need an LMIA by reviewing the LMIA Exemption Codes or by reviewing information on the International Mobility Workers Unit section.
How to review the LMIA Exemption Codes:
- Go to the LMIA exemption table and review the regulations.
- Chose an LMIA exemption code relevant to your hiring conditions and read its description.
- Note the exemption code and mention it in your offer of employment.
Contacting the International Mobility Workers Unit:
The International Mobility Workers Unit will help employers determine if the temporary worker they want to hire can be exempt from an LMIA or a work permit. This can be done by requesting an opinion from IMWU to determine whether the employee belongs from:
(a) visa-exempt country, or
(b) currently outside of Canada.
The opinion shall take 14 days to be issued. Requesting an opinion must be done at least 30 days before the worker decides to enter Canada. In case the worker is already present inside Canada his/her status shall be determined at the port of entry by the immigration officer.
Revoked LMIAs are the result of the cancellation of one or more positions that restricts a foreign worker from obtaining a work permit from Immigration, Refugees, and Citizenships Canada (IRCC). An LMIA may be revoked be if:
- Additional new information is provided after the employment of a worker indicating potential negative effects on the labor in Canada.
- Information provided by the employer is fraudulent.
- The employer’s name is on the list of revoked LMIA.