LMIA

Labour Market Impact Assessment (LMIA)

Canadian employers generally must obtain a positive Labour Market Impact Assessment (LMIA) before hiring a temporary foreign worker (formerly called an LMO).

The LMIA verifies labour market needs to protect Canadian jobs and regulate temporary foreign employment. Authorities grant LMIA-exempt work permits only in limited circumstances.

Assessing the Merits of an LMIA Application

Obtaining a Canadian work permit is typically a two-step process.   First, the Canadian employer must submit a qualifying LMIA application to Employment and Social Development Canada (ESDC). It is incumbent on the Canadian employer to also submit a detailed list of Canadians who applied for the position, the number of Canadians interviewed for the position, and detailed explanations for why the Canadian candidates considered were not hired. Canadian employers may be subject to compliance inspections once a work permit has been issued.

When assessing the merits of the applicant, ESDC will consider:

• Are there Canadians in the region available and willing to fill the job on offer?
• Has the employer made sufficient efforts to fill the position with a Canadian worker?
• Will hiring a foreign national help create or retain jobs in Canada?
• Is the employer offering a wage or salary that is consistent with the regional average for the position at hand?
• Are the working conditions acceptable by Canadian labour standards?
• Is the employer or the industry in which the job sits engaged in ongoing labour disputes?

If ESDC is satisfied that a given region and industry are healthy enough to sustain foreign labour, a positive LMIA will be issued.

LMIAs are specific to employers, the position being offered, and the region in which the job is located. Obtaining a positive LMIA does not allow you to change your career or employer, or move to another Canadian region after acquiring a work permit. In any of those instances, you are required to seek a new LMIA.

The LMIA process distinguishes between “high-wage” and “low-wage” employees. Temporary foreign workers whose remuneration is below the provincial/territorial median wage are considered low-wage. Temporary foreign workers whose remuneration is equal to or above the median wage are considered high-wage.

Median Hourly Wages by Province/Territory

High-Wage Workers

Submission of a transition plan is a compulsory requirement for all Canadian employers seeking to employ a temporary foreign worker(s) at a wage equal to or above the provincial/territorial median hourly wage. Transition plans exist to ensure the employer intends to reduce their reliance on temporary foreign workers in favour of Canadians.

Low-Wage Workers

Canadian employers looking to hire low-wage workers do not need to submit a transition plan when applying for a Labour Market Impact Assessment (LMIA). Unlike high-wage workers, however, they are subject to a cap that limits the number of low-wage temporary foreign workers a given business can employ.

Canadian employers with more than 10 employees may hire low-wage temporary foreign workers for up to 10% of their workforce. The government will phase in this cap over the next two years to give employers time to transition to a Canadian workforce.

LMIA Processing Times

LMIA processing times can be somewhat unpredictable, ranging from a couple of weeks to a few months. Employment and Social Development Canada (ESDC) has pledged to process specific LMIA applications within 10 business days. The following categories will now be processed with a 10-business-day service standard:

• All LMIA applications for the highest-demand occupations (skilled trades), or
• Highest-paid (top 10%) occupations, or
• Short-duration work periods (120 days or less).

LMIA Fees and Additional Employer Requirements

• Applicants must pay a processing fee of CAD 1,000 for each Labour Market Impact Assessment application, unless the application supports permanent residency only. They must also pay a CAD 100 privilege fee.
• Canadian employers must undertake advertisement efforts (Canada Job Bank) for at least four weeks before submitting an LMIA application.
• Employers must also demonstrate at least two additional recruitment methods used to target potential hires, beyond the Canada Job Bank website.
• ESDC also requires evidence that employers actively pursued and considered underrepresented Canadian groups, such as persons with disabilities, Indigenous peoples, and youth.
• Employers may list only English or French as language requirements in an LMIA application. ESDC officers often hesitate to approve applications that require other languages.
• Canadian employers must attest that they will not lay off or reduce the hours of Canadian workers while employing temporary foreign workers.