IRCC Clarifies Non-Compliance in the International Mobility Program

It is imperative that employers hiring foreign workers in the International Mobility Program (“IMP“) understand the consequences of non-compliance. Immigration, Refugees and Citizenship Canada (“IRCC“) has finally published information on its website which summarizes how it will determine when non-compliance has occurred and what the consequences will be.

Since December 1, 2015, IRCC has had the legislative authority to apply administrative tools, including warning letters, administrative monetary penalties (“AMPs“) and bans on employers accessing the IMP to certain employers where an IRCC officer has determined that an employer has breached the terms and conditions of participating in the IMP. 

Breaches that Occurred Before December 1, 2015

It is important to note that the AMP and the bans described below only apply to employer breaches that occurred after December 1, 2015.  The penalty to an employer for unjustified breaches that occurred prior to December 1, 2015 is a two-year ban on that employer from being able to hire foreign workers under the IMP. However, while the consequences to an employer for being found non-compliant changed on December 1, 2015, the way in which IRCC assesses whether non-compliance has occurred remains substantially the same.  

The Administrative Monetary Penalty Regime

Under IRCC’s AMP regime, employer non-compliance is divided into three types of violations.  

Type A violations include where an employer:

  • is unable to demonstrate that any information that it provided in respect of a foreign national’s work permit application was accurate during a period of six years beginning on the first day of the foreign national’s employment;
  • did not retain document(s) that relates to employer compliance during a period of six years, beginning on the first day of the foreign national’s employment
  • did not report at any time and place specified by IRCC to answer questions and provide documents during an IRCC inspection of the employer’s compliance with the IMP;
  • did not produce required documents during an IRCC inspection; and
  • did not attend an IRCC inspection, nor give all reasonable assistance to the IRCC officer conducting the inspection.

Type B violations include where an employer:

  • did not comply with federal and provincial laws that regulate employment;
  • did not comply with federal and provincial laws that regulate the recruiting of employees in the province in which the foreign national works; and
  • did not provide the foreign national with employment in the same occupation and substantially the same, but not less favourable, wages and working conditions as outlined in the foreign national’s offer of employment.

Type C violations include where the employer:

  • was not actively engaged in the business in which the offer of employment was made; and
  • did not make reasonable efforts to provide a workplace that was free of abuse.

Once IRCC determines which type of violation an employer’s violation falls under, IRCC will assign points under the AMP regime based on the employer’s compliance history and the severity of the violation.

Points for the employer’s compliance history are calculated as follows:

Compliance History
Criteria Points
Type A and B violations, first violation 1
Type A, second or subsequent violation 2
Type B violation, second violation 2
Type C violation, first violation 2
Type B violation, third or subsequent violation 3
Type C violation, second violation 3
Type C violation, third or subsequent violation 4
 

Assessing the Severity of a Violation

Points for the severity of the violation are calculated as follows:

Severity of the Violation
Criteria Points
The employer derived competitive or economic benefit from the violation. 0 – 6
The violation involved abuse of a foreign national. 0 – 10
The violation negatively impacted the Canadian labour market or the Canadian economy. 0 – 6
The employer did not make reasonable efforts to minimize or re-mediate the effects of the violation. 0 – 3
The employer did not make reasonable efforts to prevent recurrence of the violation. 0 – 3

In considering whether the employer derived competitive or economic benefit from the violation, IRCC considers the economic gain derived from non-compliance (total gain to the employer), the money that the employer saved from non-compliance with program requirements, and whether the employer’s practices (led to a competitive advantage over other employers who were following IMP rules.

Examples of economic gain include:

  • significant underpayment or non-payment of foreign worker wages as well as wages for overtime for an extended period of time; and
  • an employer refusing to pay required benefits (e.g., health benefits/transportation costs) as outlined on the offer of employment.

Examples of competitive benefit include evidence that an employer won a bid or contract by underpaying foreign workers.

In considering whether an employer’s violation involved abuse of a foreign national, IRCC will assign points where abuse actually occurs.  IRCC will assign lower points where once the abuse was discovered, the employer was responsive in obtaining assistance for the foreign worker (i.e., notifying police or health care professional), the employer provided training to staff to prevent reoccurrence; or the employer developed policies and procedures that address situations of abuse in the workplace (e.g., steps to be taken if an employee or supervisor is aware of experiencing abuse).

In considering whether the violation negatively impacted the economy, IRCC will consider whether the employer’s actions resulted in a foreign national completing work that did not warrant a Labour Market Impact Assessment (“LMIA“) exemption.  Higher points will be assigned where the employer did not take steps to rectify the situation once it determined that it should have obtained a LMIA. 

 

Calculating the AMP

IRCC adds the number of points based on the employer’s compliance history and the severity of the violation to determine the AMP.  In calculating the AMP, employers are divided into “large businesses” and “small businesses.”  

A “small business” is any business, including affiliated entities, that have fewer than 100 employees or less than $5,000,000 in annual general revenue.

For Type A violations, the size of the AMP is as follows:

Type A
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 500 750
3 750 1000
4 1000 2000
5 4000 6,000
6 8,000 10,000
7 12,000 20,000
8 20,000 30,000
9 or 10 30,000 45,000
11 or 12 40,000 60,000
13 or 14 50,000 70,000
15 or more 100,000 100,000

For Type B violations, the size of the AMP is as follows:

Type B
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 750 1,000
3 1,250 2,000
4 3,000 7,000
5 7,000 12,000
6 12,000 20,000
7 20,000 30,000
8 35,000 45,000
9 or 10 50,000 60,000
11 or 12 60,000 70,000
13 or 14 70,000 80,000
15 or more 100,000 100,000

For Type C violations, the size of the AMP is as follows:

Type C
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 1,000 2,000
3 5,000 10,000
4 10,000 20,000
5 15,000 30,000
6 20,000 40,000
7 35,000 50,000
8 45,000 60,000
9 or 10 60,000 70,000
11 or 12 70,000 80,000
13 or 14 80,000 90,000
15 or more 100,000 100,000

In addition to fines under the AMP, the number of points that an employer receives determines the ban length as follows:

Total number of Points Type A Violation Type B Violation Type C Violation
0 to 5 None None None
6 None None 1 year
7 None 1 year 2 years
8 1 year 2 years 5 years
9 or 10 2 years 5 years 10 years
11 or 12 5 years 10 years 10 years
13 or 15 10 years 10 years 10 years
15 or more Permanent Permanent Permanent

Where an employer fails to comply with multiple conditions, each unjustified failure to comply is treated as a separate violation.  As well, violations of a single condition that involve more than one foreign worker will be treated as separate violations for each foreign worker affected. For conditions that have separate elements, a failure to comply with each element that is not justified will be treated as a separate violations.

As the size of the AMP can soar dramatically depending on the number of foreign workers involved and the number of condition(s) breached, the maximum AMP that IRCC can impose is $1,000,000.00 for a breach.  As well, the total AMPs imposed on a single employer cannot exceed $1,000,000 in the one-year period preceding the date of the final determination.

Voluntary Disclosure

If an employer voluntarily discloses non-compliance, then IRCC, at an officer’s discretion, may reduce the number of points, depending on the circumstances.

Warning Letters 

When IRCC determines that total points of an employer’s non-compliance are fewer than two, IRCC will issue a warning letter to the employer.  Warning letters count as violations for the purpose of calculating points on future violations.

Best Practices

As of writing there is one employer listed on the IRCC website for having not complied with the IMP. The consequence to the employer was a $750.00 fine.  It is anticipated that there will be many employers subject to the AMP in the future. The regime is still new, and the rigidity with which IRCC assesses compliance within the IMP is still being developed.  In the meantime, it is imperative that employers completing their employer compliance portal job offers understand the terms and conditions that they are attesting to complying with.

 


Priority Processing in LMIA Applications

Labour Market Impact Assessment (“LMIA”) applications typically take 1-2 months to process. However, the Department of Employment and Social Development Canada (“ESDC”) processes LMIAs for in-demand occupations (skilled trades), highly paid occupations (top 10%) or short-duration (120 days or less) entries within a 10 business day service standard.

High-Demand

To be considered a High-Demand LMIA, the position must be for a skilled trade on the list of eligible occupations below, and the wage being offered for the position must be at, or above, the provincial / territorial median wage where the job is located.

Tables about unemployment, Median wages, 10-day speed of service

NOC
2006
NOC
2011
Occupation Title
7212 7202 Contractors and supervisors, electrical trades and telecommunications occupations
7215 7204 Contractors and supervisors, carpentry trades
7219 7205 Contractors and supervisors, other construction trades, installers, repairers and servicers
7271 7271 Carpenters
7216 7301 Contractors and supervisors, mechanic trades
7217 7302 Contractors and supervisors, heavy equipment operator crews
8211 8211 Supervisors, logging and forestry
8221 8221 Supervisors, mining and quarrying
8222 8222 Contractors and supervisors, oil and gas drilling services
8241 8241 Logging machinery operators
8252 / 8253 8252 Agricultural service contractors, farm supervisors and specialized livestock workers
9211 9211 Supervisors, mineral and metal processing
9212 9212 Supervisors, petroleum, gas and chemical processing and utilities
9214 9214 Supervisors, plastic and rubber products manufacturing
9231 9231 Central control and process operators, mineral and metal processing
7351 / 7352 9241 Power engineers and power systems operators
9424 9243 Water and waste treatment plant operators
7231 7231 Machinists and machining and tooling inspectors
7261 7233 Sheet metal workers
7263 7235 Structural metal and plate work fabricators and fitters
7264 7236 Ironworkers
7265 7237 Welders and related machine operators
7241 7241 Electricians (except industrial and power system)
7242 7242 Industrial electricians
7243 7243 Power system electricians
7244 7244 Electrical power line and cable workers
7245 7245 Telecommunications line and cable workers
7246 7246 Telecommunications installation and repair workers
7251 7251 Plumbers
7252 7252 Steamfitters, pipefitters and sprinkler system installers
7253 7253 Gas fitters
7311 / 7317 7311 Construction millwrights and industrial mechanics
7312 7312 Heavy-duty equipment mechanics
7313 7313 Refrigeration and air conditioning mechanics
7314 7314 Railway carmen/women
7315 7315 Aircraft mechanics and aircraft inspectors
7318 7318 Elevator constructors and mechanics
7371 7371 Crane operators
7372 7372 Drillers and blasters – surface, mining, quarrying and construction
7373 7373 Water well drillers
8231 8231 Underground production and development miners
8232 8232 Oil and gas well drillers, servicers, testers and related workers
9232 9232 Petroleum, gas and chemical process operators

Highest-Paid

To be considered a Highest-Paid LMIA, the wage being offered for the position is at or above the top 10% of wages earned by Canadians or permanent residents in the province/territory, where the job is located.  This amount is:

Tables about unemployment, Median wages, 10-day speed of service

Province/Territory Wages prior to
April 30, 2016
2014 Wage ($/hour)
Wages effective
April 30, 2016
2015 Wage ($/hour)
Alberta $47.60 $48.74
British Columbia $40.38 $41.63
Manitoba $38.46 $40.00
New Brunswick $36.06 $37.00
Newfoundland and Labrador $42.53 $42.00
Northwest Territories $55.00 $55.00
Nova Scotia $38.00 $38.46
Nunavut $53.85 $54.00
Ontario $43.75 $45.19
Prince Edward Island $35.00 $35.90
Quebec $38.71 $40.00
Saskatchewan $43.17 $44.23
Yukon $43.59 $45.67

Short Duration

To constitute a Short Duration LMIA, the length of employment must be 120 calendar days or less. It is applicable for any occupation. The wage being offered for the requested occupation must be at or above the provincial / territorial hourly median wage for the occupation.

Things to Note

There are several things that employers should know about the 10 day service standard, including that:

  • An Employer Compliance Review or Inspection takes precedence over the 10-Day Speed of Service.
  • To be eligible for the 10-Day Speed of Service a file must be complete. If additional information is required, an application will alos be removed.
  • Complex files will also be removed from the 10-Day Speed of Service.


Administrative Monetary Penalty Regime Coming to Foreign Worker Program

On July 1, 2015, the Government of Canada published regulations in the Canada Gazette that introduce an Administrative Monetary Penalty (“AMP“) regime into the Temporary Foreign Worker Program (“TFWP“) and the International Mobility Program (“IMP“).  Both Citizenship and Immigration Canada (“CIC“) and the Ministry of Employment and Social Development (“ESDC“) will administer the AMP.  In addition, the regulations will replace the exiting two-year ban period for employer non-compliance with 1, 2, 5, 10 year, and permanent bans. 

The amendments will take effect on December 1, 2015. 

The Administrative Monetary Penalty Regime

Under the new AMP regime, employer non-compliance will be divided into three types of violations.  

Type A violations will include where an employer:

  • is unable to demonstrate that any information that it provided in respect of a work permit application was accurate during a period of six years beginning on the first day of the foreign national’s employment;
  • did not retain document(s) that relates to employer compliance with cited conditions during a period of six years, beginning on the first day of the foreign national’s employment
  • did not have sufficient resources to pay a live-in caregiver(s);
  • could not demonstrate that any information that it provided for a Labour Market Impact Assessment (“LMIA“) application was accurate during a period of six years beginning on the first day of the foreign national’s employment;
  • did not report at any time and place specified to answer questions and provide documents during an ESDC audit;
  • did not produce required documents during an ESDC inspection; and
  • did not attend any ESDC inspection, nor give all reasonable assistance to the ESDC officer conducting the inspection.

Type B violations will include where an employer:

  • did not comply with federal and provincial laws that regulate employment;
  • did not comply with federal and provincial laws that regulate the recruiting of employees in the province in which the foreign national works;
  • did not provide the foreign national with employment in the same occupation and substantially the same, but not less favourable, wages and working conditions as outlined in the foreign national’s offer of employment;
  • did not ensure that a live-in caregiver resided in a private household in Canada and provided child care, senior home support care or care of a disabled person in that household without supervision
  • did not ensure that the employment of the foreign national would result in direct job creation or retention for Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit;
  • did not ensure that the employment of the foreign national would result in the development or transfer of skills and knowledge for the benefit of Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit
  • did not hire or train Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit; and
  • did not make reasonable efforts to hire or train Canadian citizens or permanent residents, if that was a factor that led to the issuance of the work permit.

Type C violations will include where the employer:

  • was not actively engaged in the business in which the offer of employment was made, unless the offer was made for employment as a live-in caregiver;
  • of a live-in caregiver did not provide the foreign national with adequate furnished private accommodation in the household; and
  • did not make reasonable efforts to provide a workplace that was free of abuse.

Once ESDC and/or CIC has determined which type an employer’s violation falls under, it will assign points under the AMP regime based on the employer’s compliance history and the severity of the violation.

Points for the employer’s compliance history will be calculated as follows:

Compliance History
Criteria Points
Type A and B violations, first violation 1
Type A, second or subsequent violation 2
Type B violation, second violation 2
Type C violation, first violation 2
Type B violation, third or subsequent violation 3
Type C violation, second violation 3
Type C violation, third or subsequent violation 4

Points for the severity of the violation will be calculated as follows:

Severity of the Violation
Criteria Points
The employer derived competitive or economic benefit from the violation. 0 – 6
The violation involved abuse of a foreign national. 0 – 10
The violation negatively impacted the Canadian labour market or the Canadian economy. 0 – 6
The employer did not make reasonable efforts to minimize or remediate the effects of the violation. 0 – 3
The employer did not make reasonable efforts to prevent recurrence of the violation. 0 – 3

ESDC and/or CIC will add the number of points based on the employer’s compliance history and the severity of the violation to determine the AMP.  In calculating the AMP, employers will be divided into “large businesses” and “small businesses.”  A “small business” is any business, including affiliated entities, that have fewer than 100 employees or less than $5,000,000 in annual general revenue.

For Type A violations, the size of the AMP will be as follows:

Type A
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 500 750
3 750 1000
4 1000 2000
5 4000 6,000
6 8,000 10,000
7 12,000 20,000
8 20,000 30,000
9 or 10 30,000 45,000
11 or 12 40,000 60,000
13 or 14 50,000 70,000
15 or more 100,000 100,000

For Type B violations, the size of the AMP will be as follows:

Type B
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 750 1,000
3 1,250 2,000
4 3,000 7,000
5 7,000 12,000
6 12,000 20,000
7 20,000 30,000
8 35,000 45,000
9 or 10 50,000 60,000
11 or 12 60,000 70,000
13 or 14 70,000 80,000
15 or more 100,000 100,000

For Type C violations, the size of the AMP will be as follows:

Type C
Points Individual or Small Business ($) Large Business ($)
0 or 1 None None
2 1,000 2,000
3 5,000 10,000
4 10,000 20,000
5 15,000 30,000
6 20,000 40,000
7 35,000 50,000
8 45,000 60,000
9 or 10 60,000 70,000
11 or 12 70,000 80,000
13 or 14 80,000 90,000
15 or more 100,000 100,000

In addition to fines under the AMP, the number of points that an employer receives will determine the ban length as follows:

Total number of Points Type A Violation Type B Violation Type C Violation
0 to 5 None None None
6 None None 1 year
7 None 1 year 2 years
8 1 year 2 years 5 years
9 or 10 2 years 5 years 10 years
11 or 12 5 years 10 years 10 years
13 or 15 10 years 10 years 10 years
15 or more Permanent Permanent Permanent

Where an employer fails to comply with multiple conditions, each unjustified failure to comply will be treated as a separate violation.  As well, violations of a single condition that involve more than one foreign worker will be treated as separate violations for each foreign worker affected. Finally, for conditions that have separate elements, a failure to comply with each element that is not justified will be treated as a separate violations.

Given how the size of the AMP can soar dramatically depending on the number of foreign workers involved and the number of condition(s) breached, the maximum AMP that ESDC and/or CIC can impose is $1,000,000.00 for a breach.  As well, the total AMPs imposed on a single employer cannot exceed $1,000,000 in the one-year period preceding the date of the final determination. As well, ESDC will allow employers to enter into payment agreements where an employer cannot pay the AMP immediately in one instalment.

There is no limitation on the collections period for AMPs, and new LMIA and work permit applications will not be accepted if an employer has not paid an AMP or is not complying with a payment agreement if one has been entered into.

Justification and Voluntary Disclosure

The Government of Canada’s amendments specify in legislation that the purpose of the new regime is to encourage compliance with the TFWP and IMP, and not to punish employers. As such, non-compliant employers will not face bans or monetary penalties where the non-compliance was the result of good faith or unintentional errors in interpretation, accounting, or administration.

As well, if the employer voluntarily discloses non-compliance, then ESDC, at an officer’s discretion, may reduce the number of points, depending on the circumstances.

Best Practices

The Government of Canada’s amendments state that the AMP and new fine regime will not apply to non-compliance that occurred before December 1, 2015.  ESDC has also published an Employer Compliance Guide which contains best practices for complying with the TFWP.  All employers of foreign workers in both the TWFP and the IMP should read this guide.

The Employer Compliance Guide is for the most part a summary of existing policy.  However, it does clarify for the first time when raises to foreign workers will result in non-compliance.  In brief, pay increases resulting from good performance or pay increments that are greater than 2% or the rate of inflation will only be acceptable if this was advertised as part of the employer’s recruitment efforts and the increases apply to all employees working in the same occupation.

More information about the new AMP and ban regime can be found here.

The Employer Compliance Guide can be found here.

We have reproduced the internal ESDC Inspections Manual here:

Please contact us if you have any questions or concerns about these changes.



Federal Court Affirms New ESDC Internal Part-Time Recruitment Policy

In January 2015 the Federal Court released its decision in Frankie’s Burgers Lougheed Inc. v. The Minister of Employment and Social Development Canada, 2015 FC 27 (“Frankie’s Burgers“).  Frankie’s Burgers is one of the first Federal Court decisions involving an employer seeking judicial review of a decision of the Ministry of Economic and Social Development Canada (“ESDC“) to not issue a positive Labour Market Impact Assessment (“LMIA“), which was then referred to as a Labour Market Opinion (“LMO“).

Frankie’s Burgers should be read by all representatives and employers who submit LMIAs.  In my opinion, the case shows that the Federal Court seems prepared to show much greater deference to ESDC in its administration of the Temporary Foreign Worker Program (the “TFWP“) than it does to both Citizenship and Immigration Canada and the Immigration and Refugee Board.  Lawyers who were anticipating that the Federal Court would force ESDC to change some of its (often internal and secretive) policies should also take pause.

Continue reading “Federal Court Affirms New ESDC Internal Part-Time Recruitment Policy”


ESDC’s Mail Audits

One of the most perplexing aspects about the Ministry of Employment and Social Development Canada (“ESDC“) is its insistent that all Employer Compliance Reviews be done by mail.  Apparently, as confirmed in this reproduction of internal ESDC correspondence obtained through an Access to Information Act request, it is because the potential for electronic transmission of information to be intercepted by wireless devices is too great.

I’m sure most employers would be willing to take this risk (which is probably less than the risk of something getting lost in the mail) if it meant that the Employer Compliance Reviews took days instead of (often) months.

Compliance


The National Occupational Classification System

Much of Canada’s immigration system is based on Human Resources and Skills Development Canada (“Service Canada’s“) National Occupational Classification (“NOC“) system.  Economic class applicants generally need to understand the NOC system because the success of their applications will depend on them demonstrating that they have qualifying experience or pre-arranged employment in certain NOCs.  Employers submitting Labour Market Impact Assessment applications to the Ministry of Economic and Social Development Canada (“ESDC“) need to know which NOCs their vacant positions fall under because this will determine the respective prevailing wage and recruitment requirements.  Indeed, it is arguable that international graduates should pay attention to the NOC of their first jobs out of post-secondary school because only experience in certain NOCs will count towards immigration.

Continue reading “The National Occupational Classification System”