Canada expands access to low-wage foreign workers for multi-site employers

Employers with several small work locations can now hire more temporary foreign workers, under new rules introduced by the Canadian federal government.

Through an update to the government webpage on August 18, 2026, Employment and Social Development Canada (ESDC) has allowed affected employers to employ more than the usual 10% or 20% of their workforce as low-wage temporary foreign workers.

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Typically, an employer may hire no more than 10% of their total workforce through the low-wage stream of the Temporary Foreign Worker Program (TFWP), or 20% for the in-demand sectors of health care, construction, and food production.

ESDC now allows employers to employ either one or two low-wage temporary foreign workers per work location with fewer than 10 employees, with the two-worker limit being applicable to employers in-demand sectors.

The increase has been permitted through a shift to using the number of employees at each individual work location for the alternative calculation of the workforce cap, which applies to workforce sizes under 10, where an employer would otherwise qualify for less than one low-wage permit, if subject to the 10% limit, or for fewer than two permits, if subject to the 20% limit.

Prior to the change, this alternative cap calculation was used only for employers with fewer than 10 employees nationwide.

ESDC describes the new calculation in the "Variation: Employers with fewer than 10 employees at a given work location" section of its "Program requirements for low-wage positions."

Under the TFWP, a position is considered low-wage if it pays less than 120% of the regional median wage according to the federal government’s Job Bank.

For jobs paying at or above the wage threshold, an employer can hire through the high-wage stream of the TFWP, which is not subject to the workforce cap.

In Ontario, the threshold is $36.92 per hour, as of the time of writing.

ESDC enforces the limit on low-wage work permits as part of the approval process required for employers to hire and/or retain workers through the TFWP.

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For a foreign worker to be issued or to renew a work permit through the TFWP, the employer must apply for and be issued a positive or neutral Labour Market Impact Assessment (LMIA) by ESDC, showing that no qualified Canadian citizen or permanent resident is available to fill the position.

The calculation of an employer’s workforce size at a given location includes all

• full-time and part-time employees;
• temporary foreign workers with approved LMIAs who have not yet begun working; and
• vacant positions for which the employer is requesting hires on their LMIA application(s).

Part-time employees, defined as those who work an average of less than 30 hours per week, count toward the cap as 0.5 of an employee.

Since March 13, 2026, the federal government has empowered provinces to boost the low-wage workforce cap to 15% for employers in rural areas.

When hiring a foreign worker through the low-wage stream, an employer is subject to additional requirements, such as

• paying for the worker’s transportation to and from Canada;
• ensuring that the worker has access to suitable housing costing less than 30% of the worker’s pre-tax income; and
• purchasing private health insurance for workers not covered by their province or territory’s publicly funded health insurance plan.

Since September 2024, employers have been barred from hiring or renewing low-wage permits through the TFWP in urban areas with greater than 6% unemployment, on account of a moratorium on LMIAs in these regions.

The majority of work permits in Canada are issued not through the TFWP, but rather through the International Mobility Program (IMP), which is not subject to the LMIA process.

This year, the federal government plans to admit 60,000 foreign workers through the TFWP and 170,000 through the IMP, according to the government’s annual immigration levels plan.

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