‘Unscrupulous Employers’ Misusing Temporary Foreign Worker Program: Federal Memo

An assessment used to determine if employers genuinely need to hire temporary foreign workers due to a shortage of qualified Canadians has been misused by “unscrupulous employers,” posing serious challenges for Canada, says a briefing note from the federal labour department.

Employment and Social Development Canada (ESDC) says the “illicit misuse” of the Labour Market Impact Assessment (LMIA) has become a “serious issue.” There is “evidence that these types of illicit activities are being undertaken by a range of players, both domestically and internationally,” according to the department’s June 18 briefing note, though no specific figures were provided.

“LMIA misuse includes both the buying and selling of LMIAs, as well as the unethical recruitment and exploitation of vulnerable foreign nationals for personal and financial gain,” the briefing note added, as first covered by Blacklock’s Reporter.

The labour department said that in 2024, tightening measures were implemented to improve the integrity of the Temporary Foreign Worker (TFW) Program “by reducing the number of available positions, and the length of time that LMIAs remain valid,“ thus “limiting opportunities for unscrupulous employers to misuse the Program.”

On Aug. 6, 2024, ESDC announced that then-Employment Minister Randy Boissonnault met with representatives of Canada’s largest business associations to convey that the TFW program cannot be used to avoid hiring qualified Canadian workers.

“I’ve been clear over the last year; abuse and misuse of the TFW program must end,” said Boissonnault in a statement at the time. “Bad actors are taking advantage of people and compromising the program for legitimate businesses.”

‘Significant Consequences’

In an earlier briefing note, published on May 24, 2025, ESDC acknowledged growing tension from the public toward the TFW program.

“There is a public perception that the TFW Program is putting increased burden on Canada’s housing market, downward pressure on wages, and stressing Canada’s social support systems including health care,” it said.

The department defended its stance, saying migrant workers play a critical role in key sectors facing labour shortages, such as agriculture, food processing, construction and tourism. “We are closely monitoring labour market conditions and will consider further TFW Program adjustments as appropriate,” it said.

EDSC added that as many as half of employers could face an “enhanced” assessment.

“Between 30-50% of all LMIAs are selected to undergo an Enhanced Assessment (EA) process; which is a more rigorous assessment on specific elements of the LMIA process,” the memo said. “If officers identify any issues or concerns with an application, they can complete an EA, thereby increasing the rigour of the assessment.”

The department’s June 18 memo states that any employer found to be non-compliant with the requirements will be subject to “significant consequences,” including fines of up to $1 million and a ban from the TFW program.

Other measures taken by Ottawa to curb the use of temporary foreign workers included reducing the validity period of new LMIAs from 12 months to six, effective May 1, 2024; and setting a 10 percent cap on workers under the low-wage stream of the TFW program, effective Sept. 26, 2024—with an exception for the construction, health-care, and food processing sectors, which were allowed to keep a 20 percent cap.

New Arrivals

Immigration, Refugees and Citizenship Canada (IRCC) recently released data indicating that the number of new foreign workers arriving in Canada dropped more than 50 percent between January and June 2025, compared to the same period in 2024.

The first six months of this year saw 119, 234 foreign workers enter the country, compared to 245,137 during the same period last year, according to an IRCC webpage last updated Aug. 25.

The figures from the first half of this year, nevertheless, surpassed IRCC’s target for new temporary foreign workers, set last October, which aimed for a maximum of 82,000 in 2025 and each of the following two years.

On the Aug. 25 IRCC webpage, the immigration department also noted that the latest numbers do not include asylum claimants, permit extensions, seasonal agricultural workers, and workers under the TFW program who are in Canada for fewer than 270 days in the same calendar year.

In addition, the data, which also includes new international student arrivals to Canada, accounts for cases whereby students hold two permits.

“We count arrivals based on the number of people issued study or work permits in that month,” the IRCC said. “If someone was issued both a study and a work permit in the same month, they will be counted under the study permit group.”

A total of 36,417 student permits were issued from January to June 2025, whereas 125,034 were issued during the same period in 2024.