Labour Market Impact Assessment (LMIA)
Labour Market Impact Assessment (LMIA) is a document that a Canadian employer may need to obtain before hiring a foreign worker. The LMIA process, administered by Employment and Social Development Canada (ESDC), evaluates the impact of hiring a foreign worker on Canada’s labour market. A positive LMIA indicates a need for a foreign worker to fill the job because no suitable Canadian citizen or permanent resident is available, and the foreign worker’s employment will not negatively affect Canadian workers. Conversely, a negative LMIA suggests the proposed hiring would not benefit the Canadian labour market. The LMIA process ensures the employment of foreign workers supports economic growth in Canada while protecting the interests and employment opportunities of Canadian workers.
Labour Market Impact Assessment (LMIA) Requirements
Subject to certain exceptions, Canadian employers must complete a Labour Market Assessment (LMIA) to hire foreign temporary workers to show the Canadian government a foreign worker is required for that employment opportunity. A foreign national cannot complete an LMIA. This document is necessary for all Temporary Foreign Worker Program (TFWP) streams. There are limited cases where LMIA is not required. The most common scenarios are positions that fallunder an international treaty, such as the Canada-United States-Mexico Agreement (CUSMA), or a Canadian multinational office requiring an intra-company transfer of an employee of high skill and value from branches in a different country.
There are several requirements the employer must meet to complete the LMIA.
Application Fee: The employer must pay a processing fee of $1,000 CAD per position applied for. This fee is non-refundable, even if the LMIA application is denied.
Business Legitimacy Documentation: Employers may need to provide evidence that their business is legitimate and capable of fulfilling the terms of the job offer. This could include business licenses, tax documents, and financial statements.
Job Offer: The employer must present a detailed job offer that outlines the role, duties, wages, and working conditions, ensuring they are consistent with Canadian standards for the occupation.
Advertisement and Recruitment Efforts: Employers must conduct extensive recruitment efforts within Canada to demonstrate that they have attempted to find suitable Canadian citizens or permanent residents for the position. This typically involves advertising the job across multiple platforms for at least four weeks.
Wages and Working Conditions: The offered wage must meet or exceed the median wage for the occupation in the specific province or territory, ensuring foreign workers are paid fairly. The working conditions must also comply with all applicable federal and provincial labour laws.
Labour Market Benefits Plan (for High-Wage Positions): Employers offering a high-wage employment opportunity must submit a Labour Market Benefits Plan, demonstrating how hiring a foreign worker will positively impact the Canadian labour market through job creation or skills transfer to Canadian workers.
Transition Plan (for High-Wage Positions): A detailed transition plan must be submitted to show how the employer intends to reduce reliance on temporary foreign workers over time, primarily through hiring and training Canadian citizens or permanent residents.
Upon submission, employment and Social Development Canada (ESDC) assesses the LMIA application to ensure the employment of a foreign worker will not negatively impact the Canadian labour market. The application’s approval or denial hinges on demonstrating a genuine need for a foreign worker and the absence of suitable Canadian candidates.
The ESDC will determine positive or negative results from the submission of the LMIA by the employer:
- A positive LMIA result indicates that a foreign worker is needed to fill the job, confirming that no Canadian worker is available for the role. The employer’s next step is to provide the LMIA document to the foreign worker, who can then proceed with applying for a work permit from Immigration, Refugees, and Citizenship Canada (IRCC).
- A negative LMIA result means the application did not demonstrate a need for a foreign worker or that the employment would negatively impact the Canadian labour market. The employer may consider reapplying with additional information or evidence of continued recruitment efforts to find a suitable Canadian candidate or explore alternative staffing solutions.
Each stream under TFWP is designed to cater to different labour markets and may, therefore, have extra requirements or certain exemptions from the LMIA.
Global Talent Stream (GTS): Part of the Global Skills Strategy, this stream offers expedited LMIA processing for employers hiring unique and highly skilled foreign talent. It requires employers to submit a Labour Market Benefits Plan outlining commitments to create lasting benefits for the Canadian labour market.
Agricultural Stream: Employers in this stream benefit from a streamlined LMIA process for the agricultural sector. It focuses on seasonal and non-seasonal agrarian workers and emphasizes housing and transportation provisions for workers.
High-wage Streams: Employers must submit a Transition Plan and Labour Markets Benefit Plan with their LMIA application, demonstrating efforts to reduce reliance on temporary foreign workers by investing in training or hiring Canadian citizens and permanent residents.
Low-wage Streams: Employers hiring under the Low-Wage Workers Stream must comply with specific requirements, including a cap limiting the proportion of low-wage temporary foreign workers at a worksite, providing inspected, affordable, and suitable housing, covering transportation costs for workers to travel to and from Canada, and ensuring workplace safety insurance while informing workers of their rights in Canada.
Seasonal Agricultural Worker Program (SAWP): This program is exempt from the regular LMIA process and instead follows a set of specific guidelines agreed upon by Canada and participating countries. It allows foreign workers to work in the agricultural sector for up to eight months.
Caregivers Program: Employers hiring through the caregiver streams may be subject to specific LMIA application processes that consider caregivers’ living arrangements and genuine need for care.
Positive and Negative Labour Market Impact Assessment (LMIA)
Once an employer submits a Labour Market Impact Assessment (LMIA), the application will be assessed, and a decision will be made by the Employment and Social Development Canada (ESDC). If the employer receives a positive LMIA, this indicates there is a need to hire a foreign temporary worker. All positive LMIAs have a validity of 6 months from the date issued. Once the positive LMIA is issued, the employer must advise the foreign national to start their work permit application. If a negative LMIA is received, the employer is not approved to hire a foreign national and will have to decide whether to hire a Canadian citizen or permanent resident or submit a new LMIA.
Frequently Asked Questions About the Canadian Experience Class
Can I apply for Canadian experience class outside Canada?
Yes, candidates can apply outside of Canada for the Canadian Experience Class if they fulfill the eligibility criteria, including having one year of work experience in Canada within three years immediately preceding the application. Candidates in Canada on a temporary work visa nearing its expiration can obtain a bridging open work permit, allowing them to maintain employment in Canada while awaiting their invitation to apply for permanent residency.
Do you need to show financial proof for the Canadian Experience Class?
No, if you receive an invitation under the Canadian Experience Class, the requirement to demonstrate financial proof does not apply to you. However, by default, the Express Entry system will request proof of funds documents from all candidates. To be exempt, invitees for permanent residency can fulfill this step by uploading a letter stating their invitation under the Canadian Experience Class or uploading evidence of a valid job offer, bypassing the need to show proof of funds.
Do internships and co-ops in Canada count toward Canadian Experience Class work experience?
No, however, it is a bit nuanced. The eligibility of a paid internship to count towards the Express Entry work experience requirement varies depending on its relation to your educational program. If your paid internship was conducted outside of your academic curriculum and not as a requirement for your degree or diploma, it could be considered valid work experience for Express Entry. This means that internships undertaken independently of academic obligations, where you gain practical skills relevant to your professional field, may contribute to fulfilling the work experience criteria for Express Entry applications.
Frequently Asked Questions Labour Market Impact Assessment (LMIA)
Who is eligible for LMIA in Canada?
It is the employer, not the foreign worker, whose eligibility is accessed when applying for a Labour Market Impact Assessment (LMIA) in Canada. Canadian employers are eligible to apply for an LMIA when they demonstrate a genuine need to fill a job vacancy that cannot be satisfied by the domestic labour market, including Canadian citizens or permanent residents. To be eligible, employers must prove they have conducted sufficient recruitment efforts within Canada to find a suitable Canadian employee without success. Additionally, they must offer wages and working conditions that comply with Canadian occupation standards. The LMIA process ensures that hiring a foreign worker will not negatively affect the Canadian labour market.
Importantly, if an employer does not comply with the obligations of an LMIA, this may result in a ban on future LMIAs and the hiring of foreign nationals. It may also result in publication on a public list of non-compliant employers.
Do I need a Labour Market Impact Assessment?
Whether you need a Labour Market Impact Assessment (LMIA) depends on the specific work permit stream you’re applying for in Canada. For the Employer-Specific Work Permit under the Temporary Foreign Worker Program (TFWP), an LMIA is typically required, demonstrating that there is a need for a foreign worker and that no Canadians or permanent residents are available for employment. However, under the International Mobility Program (IMP), work permits can be issued without an LMIA based on Canada’s broad economic, cultural, or other competitive interests. These include categories like intra-company transferees, workers under international agreements, or individuals eligible for open work permits.
How much does the LMIA cost?
The employer bears the cost of obtaining a Labour Market Impact Assessment (LMIA), with a processing fee of $1,000 CAD for each temporary foreign worker position requested. This fee applies to most streams under the Temporary Foreign Worker Program (TFWP), including high-wage and low-wage positions. For the Seasonal Agricultural Worker Program (SAWP) and positions related to the agricultural stream, the processing fee is $0.
From the employee’s perspective, there is no direct cost associated with the LMIA process itself. However, foreign workers will incur other costs related to their work permit application, including the work permit processing fee, biometrics fee if applicable, and any costs associated with gathering necessary documentation or medical examinations. The work permit processing fee is $155 CAD for an individual application and is subject to change.
What is the LMIA process?
The Labour Market Impact Assessment (LMIA) process involves Canadian employers applying to Employment and Social Development Canada (ESDC) to demonstrate the need to hire a foreign worker because no suitable Canadian citizen or permanent resident is available. This requires advertising the position in Canada, offering a wage that meets or exceeds the prevailing wage for the occupation in the region, and providing evidence of recruitment efforts. A positive LMIA indicates that hiring a foreign worker will not negatively affect the Canadian labour market, allowing the employer to proceed with offering a job to a foreign national.
What is the LMIA processing time?
The duration of the Labour Market Impact Assessment (LMIA) processing time is contingent upon the specific stream under which the application is submitted, with timelines fluctuating between two weeks and five months. Factors influencing this variance include:
- The volume of applications received.
- The complexity of the job offer.
- The efficiency of the documentation provided by the employer.
Upon completion of the evaluation, the LMIA process culminates in a decision: a positive LMIA indicates approval to hire a foreign worker, reflecting the absence of suitable Canadian candidates for the position, while a negative LMIA suggests the opposite. This decision is critical, as it directly impacts the employer’s ability to hire a foreign national.
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