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  • Writer's pictureC&A Insights Team

Labour Market Impact Assessment (LMIA): Everything You Need to Know

Updated: May 13

Labour Market Impact Assessment (LMIA) allows Canadian employers to hire foreign workers in Canada to fill job positions unable to be filled by citizens or permanent residents.


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Labour Market Impact Assessment (LMIA): Everything You Need to Know

Canada's labour market is marked by diversity, inclusivity, and ample opportunities, making it a beacon for foreign workers worldwide. This vibrant labour market, combined with the quality of life and social security benefits the country offers, has resulted in Canada becoming one of the most sought-after destinations for foreign workers. 


This article will delve into the intricacies of the Labour Market Impact Assessment (LMIA), a critical element of the process that foreign workers and employers need to navigate in their journey to Canada's labour market.


What is a Labour Market Impact Assessment (LMIA)?


Labour Market Impact Assessment (LMIA) is a process that allows Canadian employers to hire foreign workers in order to fill job positions that they have been unable to fill with Canadian citizens or permanent residents. A positive LMIA means that there is a need for foreign workers and that hiring them will not have a negative impact on the Canadian labour market.


How long is the validity of the Labour Market Impact Assessment (LMIA)?


Starting from the 31st of October, 2023, and continuing until further instructions, a Labour Market Impact Assessment (LMIA) will have a validity period of 12 months. 


This validity period is intended to support the application process for a Temporary Foreign Worker's (TFW) work permit to Immigration, Refugees and Citizenship Canada (IRCC)


The expiry date on the LMIA specifies the duration within which the following must happen:

  • Employers must inform the TFW about the LMIA's approval.

  • Employers must dispatch the positive LMIA letter to the TFW.

  • TFWs must file their work permit application at IRCC.

  • In scenarios where the employers did not include the names of the TFWs in the LMIA application, they are required to persist in their recruitment efforts to hire Canadians and permanent residents until they choose a TFW.


If the above actions are not taken within the specified timeframe (before the expiry date), the LMIA loses its validity. In such a case, if the employer still intends to hire a TFW, they are required to submit a new LMIA application.


Who can be hired through the Labour Market Impact Assessment (LMIA)?


The LMIA process is used to hire foreign workers for various wage levels and specific programs.


High-Wage Workers


High-wage positions are at or above the provincial median hourly wage. Canadian employers must demonstrate that they have made significant efforts to hire Canadian citizens or permanent residents before they can apply for an LMIA. They must also submit a transition plan outlining their efforts to reduce their reliance on foreign workers over time.


Types of High-Wage Positions


High-wage positions encompass a variety of job roles across different streams. These include:


The Global Talent Stream

This stream is designed to enable Canadian employers to access highly skilled global talent to drive innovation and foster economic growth. The Global Talent Stream provides expedited processing for qualified foreign workers in specific occupations, such as those in the technology sector.


The High-Wage Stream

This covers a wide array of occupations that offer a wage at or above the provincial median hourly wage.


Currently, as of December 2023, ESDC has provided the following information regarding the median hourly wage for the provinces and territories.


The Agricultural Stream

This stream is specifically for agricultural workers. It covers positions related to on-farm primary agriculture such as general farm workers, nursery and greenhouse workers, and harvesting labourers.


Applications to Support Permanent Residency

In some cases, employers can use the LMIA process to support a foreign worker's application for permanent residency. This is typically applicable for high-wage positions that are full-time and permanent. The employer must offer a full-time permanent job to a skilled worker for them to be eligible for this category.


Low-Wage Workers


When it comes to low-wage positions, those that offer a wage below the provincial median hourly wage, employers are given a cap on the number of foreign workers they can hire. They must prove that they made efforts to hire Canadians and permanent residents first, and are required to provide affordable housing for their foreign workers.


Median Hourly Wages of the Provinces or Territories of Canada


This is the list of the updated median hourly wages of the provinces or territories of Canada as of May 31, 2023. 


With that, Service Canada implemented a new wage determination strategy for Labour Market Impact Assessment (LMIA) applications submitted on or following May 31, 2023. The new practice will distinguish between high-wage and low-wage applications based on the updated median wages. 


To accommodate potential delays, a special 90-day transition period has been initiated from May 31 to August 29, 2023. During this phase, Service Canada will assist employers whose application streams have been altered (either from high-wage to low-wage or the reverse) due to the new wage standards to correctly fill out the application form. The agency will also consider recruitment efforts that align with the initial submission's prerequisites as fitting the new stream's requirements.


Refer to Service Canada's website for more details.

Province / Terrirotry

Median Hourly Wages as of May 31, 2023

Alberta

$28.25

British Columbia

$27.50

Manitoba

$23.94

New Brunswick

$23

Newfoundland and Labrador

$25

Northwest Territories

$38

Nova Scotia

$22.97

Nunavut

$35.90

Ontario

$27

Prince Edward Island

$22.50

Quebec

$26

Saskatchewan

$26.22

Yukon

$35


Seasonal Agricultural Worker Program (SAWP)


The LMIA is also used for hiring workers through the Seasonal Agricultural Worker Program (SAWP). 


The Seasonal Agricultural Worker Program (SAWP) permits employers to engage temporary foreign labour when the local workforce comprising Canadians and permanent residents is unavailable. 


This program allows for recruitment from predefined countries for a duration not exceeding eight months, within a year starting January 1 and ending December 15. This is conditional on the provision of a minimum of 240 work hours within a span of 6 weeks or less. 


Employers must meet the following criteria to hire a seasonal agricultural worker through LMIA:

  • The seasonal agricultural workers that they are hiring should be nationals of Mexico or participatory Caribbean nations.

  • The industry should fall under specified commodity sectors, and 

  • The work must pertain to primary agricultural activities performed on farms.


See IRCC's website for more information about the Seasonal Agricultural Worker Program (SAWP).


Agricultural Stream


Similarly, the Agricultural Stream allows employers to hire foreign workers for on-farm jobs. The position must be in a primary agricultural occupation, and the foreign worker must be from a specific list of eligible countries. Like the SAWP, employers must also prove that no Canadians or permanent residents are available to fill the position.


This stream comes with two essential prerequisites for employers: 

  • The business operation must be within the defined commodity sectors; and 

  • The work must involve primary agricultural tasks executed on farms.


Upon meeting these conditions, employers can proceed to submit an LMIA application under the Agricultural Stream, with the option of requesting an employment period lasting up to two years. 


However, as of April 4, 2022, a recent change has been introduced for high-wage positions under this stream. Employers applying for high-wage positions can now request an employment period of up to three years, extending the previous limit.


See IRCC's website for more information about the Agricultural Stream.


How to Apply for a Labour Market Impact Assessment (LMIA)?


For Canadian employers seeking to employ foreign talent through the Labour Market Impact Assessment (LMIA), here is the application process:


Step 1: Eligibility Confirmation

Initially, employers must ensure their business qualifies for the LMIA application. This involves verifying if the organization fits the criteria set by the Canadian government.


Step 2: Meeting Advertising and Salary Standards 

The second step necessitates compliance with specific norms related to advertising the job vacancy and setting a fair wage in line with prevailing regional rates. These demands are set to ensure transparency and fairness in the hiring process.


Step 3: Online Submission of LMIA Application 

Upon meeting the initial prerequisites, employers are to fill out and submit the LMIA application form digitally. 


Step 4: Evaluation by ESDC

Following the submission, the LMIA application and the job offer are assessed by Employment and Social Development Canada (ESDC). They scrutinize the application, ensuring it aligns with Canadian labour market needs and legislation.


Step 5: ESDC Interview

As part of the process, employers might be required to attend an interview with an ESDC officer. This is a measure to further validate the information provided in the application.


Step 6: Receiving ESDC Confirmation

The final step in the process is the issuance of a Confirmation Letter from ESDC, provided the application is successful. It signifies the approval of the LMIA, thus allowing employers to proceed with the hiring of foreign workers.


How to hire a skilled worker if employers are LMIA-exempt?


The International Mobility Program enables the recruitment of temporary overseas workers without the necessity of a Labour Market Impact Assessment (LMIA). Here is a list of the LMIA-exemption codes applicable through the International Mobility Program.


If the foreign worker is a citizen of a country participating in a Free Trade Agreement with Canada, they are excused from requiring an LMIA. 



If the foreign worker is a resident of the United States or Mexico, they would probably qualify for the LMIA exemption.



CETA allows certain professionals from European Union nations to work in Canada without needing LMIA approval.



This stream offers the opportunity to engage highly competent overseas professionals, which is another situation where foreign workers can be exempt from LMIA.



If an overseas company runs an office in Canada, they can, through the ICT program, relocate their foreign employees from international branches to Canada, bypassing the need for an LMIA.


Employer Requirements for Labour Market Impact Assessment (LMIA) Application