Temporary foreign workers program gets a facelift

Ottawa is expected to announce changes to the controversial and widespread temporary foreign workers program that would make it more difficult for companies to abuse the system.

According to media reports, new legislation to be announced as early as Monday will force companies to ensure they couldn’t find someone within Canada to do the job before outsourcing.

Companies will have to demonstrate plans to eventually hire a Canadian to fill the role, before being granted permission to hire a temporary foreign worker, the reports say.

The changes come weeks after Royal Bank of Canada was criticized for outsourcing information technology jobs in Ontario. That created a public backlash against the bank that led its CEO Gord Nixon to issue an apology days later and announce the company would review its supplier arrangements.

The hiring of temporary foreign workers was also an issue in B.C.’s mining sector last year when HD Mining hired workers from China to work at its underground mine project. Earlier this month, an internal federal review of the decision found the company met its requirements.

Last week, outgoing Bank of Canada Governor Mark Carney warned against an “overreliance” on temporary foreign workers in an appearance before the House of Commons finance committee.

The program allows companies to hire workers from abroad on a temporary basis to fill immediate skills and labour shortages. Human Resources and Skills Development Canada (HRSDC) is responsible for the program, and issues what’s known as a labour market opinion (LMO) on the impact these workers would have on the job market.

Changes were made to the program in 2011 that added new criteria to the “genuineness assessment” of a job offer and imposed a cap of four years of cumulative work for most foreign workers.

More than 192,000 temporary foreign workers entered Canada in 2011, according to HRSDC. That includes jobs such as agricultural workers and caregivers as well as other higher-skilled jobs including academics and executives. That total is said to include 70,000 foreign workers whose employer required an LMO and about 120,000 who did not. In 2011, more than 29,000 temporary foreign workers made the transition to permanent status.

HRSDC stats show the number of LMO increased by 53 per cent to 202,510 in 2012 from 131,645 in 2009, according to HRSDC data.

While the hiring of temporary foreign workers is a labour issue in Canada, it doesn’t have a huge economic impact on the labour market, said Benjamin Tal, deputy chief economist at CIBC World Markets.

“It’s not a big enough number on a macro economic level to change the projection of the labour market in any meaningful way,” Tal said.