New compliance rules to take effect for employers

10 Feb 15

CANADA

IMPACT – HIGH

What is the change? New compliance rules are imminent for companies hiring foreign nationals in jobs that are exempt from Canada’s Labor Market Impact Assessment procedures.

What does the change mean? The rules require that employers submit information about their business, complete an Offer of Employment form and pay a government compliance fee of 230 Canadian dollars for each work permit. The employer must submit the information and pay the compliance fee online before foreign nationals can apply for LMIA-exempt employer-specific work permits.

  • Implementation timeframe: The new rules take effect Feb. 21.
  • Visas/permits affected: Work permits for LMIA-exempt jobs under the International Mobility Program.
  • Who is affected: Employers hiring foreign nationals in jobs that do not require an LMIA.
  • Impact on processing times: Failure to complete the new compliance steps will delay processing.
  • Business impact: Employersface greater monitoring of their hiring of foreign employees and will have to factor the increased government fees into their budgets.
  • Next steps: Companies should work with their BAL attorney to complete the new steps that are required for hiring under the International Mobility Program.

Background: Citizenship and Immigration Canada revamped its immigration system last year under the slogan “Putting Canadians first” and is rolling out the new rules in stages. Stricter criteria for labor market testing have already taken effect. Starting Feb. 21, employers hiring foreign employees who are LMIA-exempt will also face greater scrutiny and must complete a number of steps before they can file a work permit application. One of the steps requires payment of a CA$230 government fee that will fund stronger compliance programs, including inspections of thousands of employers. CIC has not yet provided details about the process that employers must follow to submit the required information and processing fee prior to foreign nationals’ applications, aside from indicating that payment will need to be submitted online. We will provide further information as it becomes available.

Employers do not have to pay this fee if they are hiring foreign workers holding open work permits that allow them to work for any employer in Canada. However, also beginning Feb. 21, open work permit holders will have to pay a new government fee of CA$100 in addition to the CA$155 government processing fee that is required for all work permits. The new fees will fund initiatives to collect data on open work permits.

BAL Analysis: Employers should be aware of the increased compliance environment in Canada. Employers who are out of compliance face monetary penalties, bans on hiring foreign workers and possible criminal investigation in serious cases.

This alert has been provided by the BAL Global Practice group and our network provider located in Canada. For additional information, please contact your BAL attorney.

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