LMIA, Who Needs One?

What is an LMIA?

Labour Market Impact Assessment (LMIA) is required from most Canadian employers before hiring a foreign worker and if the job is not exempt from LMIA.

LMIA is applied for by the employers and the type of program affects the process application for LMIA. The types can be as follows:

• High-Wage Workers;
• Low-Wage Workers;
• Seasonal Agricultural Worker Program; or
• Agricultural Stream

The employee then can get a work permit and to do so they need to have an employment contract, a copy of the LMIA, the LMIA number and a job offer from the employer.

The job offer should include the amount of payment and deductions from it, responsibilities of the job and any conditions such as work hours, etc.

A positive LMIA, A.K.A confirmation letter, means that your employer can go on with hiring you as a foreign worker. You can also apply for a work permit with it too. A negative LMIA means that you were denied because there were in-land Canadians for the position already. Labour Market Impact Assessment is a part of TFWP. This program is designed to take care of short-term labor shortages. It plays a significant role in supporting sectors that have skilled labour shortages.

What is the LMIA Application?

LMIA application is a process in which your employer asks for permission for you be a foreign worker. This application should be submitted to ESDC and they will review it to determine if hiring the foreign worker has a positive or a negative impact on the labour market. Your LMIA application must have the following information:

• The job description and requirements
• Wage and working conditions
• Recruitment efforts to hire Canadians or permanent residents
• Justification for the need for a foreign worker
• Information on the foreign worker, if applicable.

Your employer must show, through this application, that they have made plenty of reasonable efforts to hire Canadians and has not succeeded.  This could be shown in the form of advertising for the position 4 weeks in advance on platforms approved by the Canadian government.

Who Can Apply for an LMIA in Canada?

Canadian employers who want to hire a temporary foreign worker must apply for an LMIA and make sure they meet the requirements. Common scenarios where employers want to apply for an LMIA are:

• High-Wage Jobs: Positions that offer wages above the median hourly wage in the province or territory where the job is located.
• Low-Wage Jobs: Positions offering wages below the median hourly wage. These typically include roles in sectors with labor shortages, such as hospitality and retail.
• Agricultural Workers: Employers in agriculture who need seasonal or year-round workers for activities directly related to farming, such as planting or harvesting​.
• Caregiver Positions: Employers looking to hire caregivers for children, seniors, or persons with medical needs.

To qualify for applying for an LMIA, employers must own a legitimate business that can showcase their financial ability to hire foreign workers

High and Low Wage Positions in Canada

The distinction between these two positions is super important in the LMIA process. Put in simple terms, high wage refers to an above-median salary and low wage to a below-median salary.

High-Wage Positions

For these positions, the applicant must provide a transition plan. The plan must outline how the employer is going to lower the reliance on foreign workers over a set period of time. To do this, the employer must try and hire/train Canadians, improve the working conditions and hire local talent in the future.

Low-Wage Positions

The lower-wage positions are more strict. The Canadian government sets a cap on how many foreign worker a company can hire. In most sectors, the cap is 10%. This means the company cannot hire more than 10% of its workforce from TFWs. The maximum time that you can remained hired in a low-wage position is only 1 year but in construction and health, this limit is reduced.

LMIA Employer Requirement Checklist

There are several boxes each employer must check before successfully getting an LMIA. If they fail to comply with these requirements, they could face a negative LMIA decision. Let’s have a look at the checklist:

• Recruitment Efforts: Employers must provide evidence that they have attempted to recruit Canadian citizens or permanent residents before turning to foreign workers.
• Wage and Working Conditions: The wages offered to the foreign worker must be equal to or higher than the prevailing wage for the job in the same geographical region.
• No Impact on Labor Disputes: Employers cannot use foreign workers to replace workers involved in a labor dispute, and hiring a TFW must not negatively affect the settlement of labor disputes.
• Compliance with Labor Laws: Employers must adhere to provincial and federal labor laws, ensuring that the foreign worker receives the same benefits, rights, and protections as their Canadian counterparts.
• Job Offer: Employers must provide a valid job offer that clearly outlines the roles, responsibilities, wage, and working conditions of the position​.

LMIA Exemptions Simplified

LMIA exemptions let certain foreign workers skip the standard requirement for employers to prove no Canadian can fill a job. These exemptions are under the International Mobility Program (IMP), which supports Canadian interests or international agreements. Common exemptions include those covered by trade deals like CUSMA or workers in intra-company transfers. Other exemptions include the Francophone Mobility Program, encouraging French-speaking workers outside Quebec, and roles that bring significant benefits to Canada. This could include self-employed individuals in cultural fields or academics like researchers. Charitable and religious workers may also qualify. Even with an LMIA exemption, workers still need a work permit, ensuring compliance with Canadian labor standards. These exemptions simplify hiring for employers, helping attract specialized talent and promoting cultural diversity in Canada.

LMIA Process Steps

The LMIA process allows Canadian employers to hire temporary foreign workers through the TFWP. It starts with submitting an application to Employment and Social Development Canada (ESDC). The employer must include job ads to prove recruitment efforts for Canadian workers, alongside job details like wages. After submission, ESDC assesses whether hiring a foreign worker will negatively impact the labor market. They evaluate factors like local worker availability and wage compliance. Employers might need to adjust wages to meet the prevailing rates. If approved, the employer receives a positive LMIA, allowing the foreign worker to apply for a work permit. The process varies in length, with some cases taking weeks and others months, depending on job type and location.

LMIA Application Processing Time

LMIA processing times can range from weeks to months, depending on factors like job type. High-demand roles or those under the Global Talent Stream may be processed within two weeks. Lower-priority applications often take longer due to more detailed assessments. Processing times also depend on application completeness and ESDC’s workload. Employers should ensure applications meet all requirements to avoid delays. Recent changes in 2024 set LMIA validity back to six months, meaning employers need to act promptly. This adjustment requires employers to secure a work permit for their worker within a limited time. Planning and staying updated on ESDC guidelines can help ensure a smooth process.

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