Report recommends that Canada phase out closed work permits

Edana Robitaille
Published: June 17, 2024

The Standing Senate Committee on Social Affairs, Science and Technology (SCSAST) has released a report recommending that Immigration Refugees and Citizenship Canada (IRCC) stop issuing closed work permits.

The report examined the structure and use of the Temporary Foreign Worker Program (TFWP), which was introduced in 1973 to help Canadian employers fill urgent, unstaffed positions when no Canadians or permanent residents were qualified or applied.

According to the report, the TFWP was meant to be a “last resort” for Canadian employers but has morphed into a “central component of the Canadian labour market.”

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Standing committees such as the SCSAST conduct investigations and research issues impacting Canada and present them to the government for consideration and action. The Senate is the upper house of Canada’s parliament and acts as an investigative and legislative branch.

How does the TFWP work?

Programs such as the TFWP have become a mainstream pathway to permanent residence for many newcomers. They come to Canada to obtain in-country work experience, which can be advantageous when applying for permanent residence pathways such as Express Entry’s Canadian Experience Class.

Employers who wish to hire using the TFWP must receive a positive or neutral Labour Market Impact Assessment (LMIA) from Employment and Social Development Canada (ESDC). This document proves to the Canadian government that hiring a foreign national will not have a negative consequence on the national economy or labour force.

Employers must meet several requirements before submitting an LMIA such as advertising for a specific period of time and providing evidence that there is no Canadian or permanent resident qualified for the position, or that none had applied.

Once an employer has a valid LMIA, they may share it with the candidate they wish to hire so they can include it in their work permit application to IRCC.

Once an employee arrives, the employer must provide support such as housing and healthcare, ensure that they pay the employee a specified wage, and provide work conditions safe and free of abuse or harassment.

Work permits obtained through the TFWP are closed, meaning that the employee may only work for one employer while they are in Canada. If they leave the job, they may no longer be eligible to remain in the country. There are exceptions to this in cases of employer abuse.

Improvements for employers and employees

The TFWP has not evolved without criticism, much of which is outlined in the SCSAST report. One of the prevailing themes is that the TFWP is “not working well for employers or workers. The employer-specific work permit inherently makes migrant workers more vulnerable to abuse at the hands of bad actors as well as imposing structural barriers to accessing rights and protections.”

Another recent report by the Cooper Institute highlights other issues with the program from an employer perspective, especially regarding seasonal workers. It said that employers felt frustration over not being able to properly train or plan their year’s work with a transient labour force and spoke of the pressures that come with the almost “paternalistic” relationship that develops between employers and employees while they rely on employers for necessities such as housing and healthcare.

The SCSAST report further notes that well-intentioned and compliant employers lack the flexibility to move workers to other locations as needed or promote high-skilled employees for good work or long service.

Phasing out closed work permits

To reduce the vulnerability of temporary foreign workers, the SCSAST would like the government to phase out employer-specific work permits within the next three years. This is echoed by the Cooper Institute which calls on IRCC to end employer-specific work permits and instead offer permanent resident status to all migrant workers.

The Cooper Institute suggests that it would be beneficial because, “Without full, permanent residency status, migrant workers live and work under drastically different circumstances than their Canadian counterparts. Their temporary immigration status places them in a separate class of workers and creates significant barriers to protection of their labour rights.”

It notes that many settlement services funded by IRCC are not accessible for TFWs, leaving them at a disadvantage when it comes to adjusting to life in Canada and understanding their rights.

Alternatively, the SCSAST report recommends that the Government explore sector and/or region-specific work permits in place of the current TFWP

It suggests that this can be an advantage for employers as they typically bear a significant financial responsibility related to worker’s healthcare, transportation, and housing.

The report says that to continue supporting workers with sector or region-specific work permits, employers could pay a regional authoritative body that would take on some of the administrative burden.

Improving communication

The SCSAST told the Senate that poor communication has proven to be a key failing in the program. Currently, there are multiple departments involved in the TFWP and communication between them has not been consistent.

For example, employees are not always informed of their rights, some employers are subject to duplicate workplace inspections (which are generally announced in advance, making it less difficult for non-compliant employers to temporarily improve work conditions) and there is a lack of data organization that makes it difficult to measure program outcomes.

In response, the SCSAST report says that is critical that Canada’s government establish a Migrant Work Commission. This commission would include a Commissioner for Migrant Workers, a Commissioner for Employers and representation from the Government of Canada, through Employment and Social Development Canada and IRCC.

The Commission would serve as a single point of contact for reports of abuse and mistreatment for TFWs and advocate for their rights. It would also hold annual consultations with relevant stakeholders and work to “establish a research agenda to collect, analyze and disseminate data about the experiences of migrant workers in Canada and their role in the labour market."

Both reports featured many other recommendations including better pre-arrival information for TFWs, more unannounced workplace inspections and expanding the Provincial Nominee Program to allow more temporary and migrant workers to become permanent residents.

According to legislation outlined by the Senate, once a standing committee presents a report, the government has 150 calendar days to either respond or explain why the response has not been offered.

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