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New Regulatory Amendments Result in Increased Protections for Temporary Foreign Workers and Headaches for Some Employers

By CILA on février 1, 2023

This article is authored by Laura Schemitsch, Race and Company LLP, Betsy Kane, Capelle Kane, and Barbara Jo Caruso, Corporate Immigration Law Firm

On September 26, 2022, amendments to the Immigration and Refugee Protection Regulations (IRPR) came into effect with the aim of increasing protections for temporary foreign workers (TFW). The amendments assigned greater responsibilities to Canadian employers to be found compliant under the Temporary Foreign Worker Program (TFWP) and the International Mobility Program (IMP). Under the IRPR, Employment and Social Development Canada (ESDC) has the authority to inspect employers due to suspicion of non-compliance. Unfortunately, some of amendments are problematic and failure to comply can lead to serious administrative penalties for the employer.

The Regulatory Amendments

The main changes to the IRPR are the following:

  • Employers are required to provide information to TFWs about their rights in Canada throughout their employment. This information must be provided on or before the TFW’s first day of work and in the worker’s official language of choice (English or French). The Government of Canada provides this information for foreign workers hired under the TFWP and workers hired under the IMP.
  • Employers must provide an employment agreement to the temporary foreign worker. According to Employment and Social Development Canada (ESDC), this amendment ensures that Immigration, Refugees and Citizenship Canada (IRCC), ESDC and the TFW all have the same information regarding the conditions of employment.
  • The definition of “abuse” was amended to include “reprisal” against TFWs. Employers are now required to make reasonable efforts to provide TFWs with a workplace free of abuse and reprisal.
  • Employers are prohibited from charging or recovering recruitment fees. This includes fees for the provision of services relates to a Labour Market Impact Assessment, employer compliance fees and any other fees related to recruitment.
  • Employers under the TFWP and IMP are required to make reasonable efforts to provide access to health care services when a TFWP is injured or becomes ill at the workplace. Employers under the TFWP must obtain and pay for private health insurance that covers emergency medical care during the period which the TFW is not covered by their provincial or territorial health insurance system (except in the case of employers who employ a TFW under an agreement reached between Canada and another country concerning seasonal agricultural workers, where the agreement includes health insurance.)
  • ESDC and IRCCC now have the legislative authority to require, without the consent of the employer or worker, any third-party document that relates to the employer’s compliance with the IRPR.

Consequences of non-compliance

Employers who are found to be non-compliant for a violation that occurred on or after December 1, 2015, could face the following serious penalties:

  • A warning
  • Penalties up to $100,000 per violation to a maximum of $1 million per year
  • A permanent ban from the TFWP and IMP for the most serious violations
  • Publication of the employer’s business name and address on an IRCC website with details of the violation(s) and/or consequence(s)
  • Suspension or revocation of previously issued LMIAs

The Issue: Section 209.11e – Challenges for the Employer Regarding New Requirements for Employment Agreements

For LMIA based work permits under the TFWP, a copy of the employment agreement is not required at the time of LMIA submission, however, employers must commit to providing a complete and signed employment agreement to each TFW on or before their first day of work.

For work permits under the IMP, employers use the Employer Portal to submit offers of employment. As of September 26, 2022, 3 new attestations appear as part of the employer declaration, including an attestation that the employer has already provided the foreign worker with a signed copy of the employment agreement.

Since the new regulations came into effect, CILA’s network of immigration lawyers have expressed concerns regarding the new requirements for employers to provide signed, written employment agreements to each TFW, particularly for employers involved in the IMP. The new attestation is causing challenges for many employers who do not have a traditional employer-employee relationship with the TFWs and cannot declare accurately that they have provided and signed an employment agreement with the TFW. Some examples include, an intra-company transfereewho comes to Canada to work intermittently and remains an employee of a foreign entity, a CUSMA consultant who is employed by an American consulting firm, emergency repair personnel, a foreign worker who is the employee of a third party vendor, and a self-employed foreign worker who is hired directly by a Canadian company to provide professional services.

In cases where employers cannot accurately make the attestation, one suggested workaround is to prepare a declaration stating why the employer was unable to make the attestation but that the employer had no choice but to make the required attestation on the Employer Portal to submit the offer of employment. This is a problematic solution that demonstrates the issue with a standard, fixed set of unchangeable electronic attestation.

Barbara Jo Caruso, a CILA Steering Committee member, suggests that the Employer Portal be updated to include a further drop-down menu giving the Canadian company the option of declaring instead:

  • that they know there to be an employment agreement between the TFW and the related foreign entity, or
  • that they know there to be an employment agreement between the TFW and the third-party vendor they have contracted to provide services, or
  • that they there is no employment agreement but there is an agreement for services between themselves and the TFW.

While advocates seek to ensure that employers are not caught up in potential non-compliance due to limited guidance on the new Regulations, it is crucial that employers review the new requirements and seek counsel in cases of uncertainty to diminish the risk of non-compliance and subsequent penalties. Given Canada’s historic labour shortage, it is imperative that the Government of Canada seeks to resolve this issue so that  Canadian companies, customers, government agencies, NGO’s and individuals can access foreign talent without concerns of having to enter an “employment agreement”, as commonly it is understood.

The current wording of the regulations is causing concern about exposure of being found non-compliant and subject to penalties resulting from poorly drafted regulations. By imposing an “employment agreement” term into the body of the regulation, the law fails to recognize independent professional and contractual service supplier business relationships that are clearly spelled out in the bilateral mobility provisions of free trade agreements that Canada is party to, such as the Comprehensive European Union Trade Agreement (CETA) , the Canada-United Kingdom Free Trade Agreementand Canada-Korean Free-Trade Agreement. The legislative drafters and policy developers appear to have  failed to recognize the existing business relationships that are built into the International Mobility Program. It is incumbent on the government to either amend the regulations for clarity or offer detailed instructions that explain the government’s interpretation of employment agreement if it is to be interpreted as something other than the common understanding of an “employment agreement”. The government has published guidance on employment agreements elsewhere and it behoves the government to publish their interpretation for the purposes of these regulations that create the equivalent of strict liability offences on users of the International Mobility Program.

IRCC must immediately issue clear directives on the meaning of an employment agreement for the purposes of the International Mobility Program. Given that an employment agreement can be synonymous with an employment contract under provincial employment law, imposing a federal regulatory requirement to have an employment agreement in place appears to have been conceived without appreciating that employment law is matter of provincial jurisdiction or that Canada has existing international trade commitments that do not envision the use of traditional employment agreements.

Considering the potential serious consequences to Canadian employers, a serious and immediate response is required.  Failure to correct this situation, will erode the integrity of the compliance regime under IRPA.  Without clear attestations that account for the various situations in which employers may contract foreign workers for services, the current attestations will facilitate employers being non-compliant.  In the current circumstances where the wording of the attestation does not accurately reflect the nature of the legal relationship between the Canadian employer and the foreign worker, it undermines the intention of the regulations to hold employers accountable to the contractual terms of work with the foreign worker.

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