The federal government is preparing to implement a significant increase in the minimum hourly wage employers must pay temporary foreign workers under the high-wage Labour Market Impact Assessment (LMIA) stream.
Starting November 8, 2024, employers will need to pay at least 20% above the provincial median hourly wage to qualify for a permit.
This adjustment, expected to be officially announced by Employment Minister Randy Boissonnault on Tuesday, aims to encourage businesses to prioritize hiring Canadian workers.
Under the current system, employers are required to pay at least the median income in their province to hire temporary foreign workers, but the new wage floor will push that minimum higher.
For example, in Ontario, where the median hourly wage for the high-wage bracket is $28.39, employers will soon be required to pay a minimum of $34.07 per hour under the new rules.
The change is set to impact up to 34,000 temporary foreign workers employed through the LMIA high-wage stream, though it will not affect current permits. However, those workers will be subject to the new wage requirements when they apply for permit renewals.
Response to Criticism
The adjustment comes amidst growing scrutiny of the Liberal government's approach to temporary foreign workers and temporary residents more broadly. Critics have linked the surge in temporary residents to issues such as housing shortages and increased costs of living in major cities.
Public data from Immigration, Refugees, and Citizenship Canada reveals a sharp rise in the number of temporary foreign worker permits, with 183,820 permits becoming effective in 2023—an 88% increase from 2019.
In response to this rise, the government has gradually implemented stricter eligibility requirements for foreign workers.
These include capping the percentage of low-wage foreign workers allowed in certain sectors and suspending permits in regions with high unemployment rates.
The upcoming wage increase continues this trend, signaling the government's intention to limit the number of temporary foreign workers and encourage employers to focus on recruiting Canadians for available jobs.
Impact on Employers and Workers
While these changes are intended to protect Canadian workers, they will present challenges for employers relying on foreign labor in high-wage sectors. The higher wage requirements could increase operational costs and pressure employers to adjust their hiring strategies.
However, the agriculture sector, which relies heavily on temporary foreign workers, remains unaffected by this and previous rule changes. Workers in low-wage streams and international students are also subject to separate restrictions that reflect the government’s broader effort to balance labor market demands with immigration policies.
The government continues to face pressure to address the ongoing issues of housing shortages and the rising cost of living, concerns that have been fueled by the increasing number of temporary residents in Canada.
As the November 8 deadline approaches, employers across various industries will need to prepare for the financial implications of the new wage threshold.
This latest move to tighten wage requirements reflects the government's broader goals of safeguarding the Canadian workforce while addressing the economic challenges associated with rising temporary immigration.
Source: Toronto Star