LMO and LMIA: The 4 Biggest Changes to Canada’s Market Test

July 8, 2015 Patty Johnson-Vazquez

 

If you’re a Canadian employer who regularly hires foreign talent, you’ve probably had to complete the Labour Market Opinion (LMO) in the past to ensure your recruitment of foreign workers doesn’t displace a Canadian citizen from the local workforce. However, the government has made changes to the market test to add more regulations and rigorous compliance aspects to the system and, as a result, renamed the process the Labour Market Impact Assessment (LMIA). To help you understand how the changes could affect your company, we’ve broken down the top four differences between the LMO and LMIA.

LMO and LMIA differences

1. LMIA Wage-Based Classifications

The old LMO used the National Occupation Classification, a categorized system based on skill level, to distinguish different jobs.  However, one major difference between LMO and LMIA is that LMIA makes determinations based on whether the rate of pay falls above (high) or below (low) the median hour wage. It’s important to note that whether a job is high or low wage may vary between provinces, because median hourly wages can vary greatly in certain regions.

2. Cap for Low Wage Workers

The regulations each employer is subject to depends whether it’s a low or high wage worker. For example: Low wage workers are subject to the cap on the quantity of workers they can employ because only 10% of their workforce may consist of temporary foreign employees. High wage workers aren’t subject to the cap, however, the employer must submit a detailed plan of how the employee is making steps toward becoming a Canadian permanent resident.

3. LMIA Application Fee Hike

There’s also a difference in fees between LMO and LMIA. The LMO application fee was $275, however, the LMIA government fee is $1,000 per worker.

4. Transition Plan for High-Wage Positions

Employers who wish to hire temporary foreign workers in high-wage occupations are now required to submit transition plans with their LMIA applications to ensure that they are taking steps to reduce their reliance on temporary foreign workers over time. This underscores the purpose of the program, which is to operate as the very last and limited resort to address immediate labour needs on a temporary basis when qualified Canadians are not available.

Conclusion: LMIA is Complex

The LMIA process has become increasingly complex and it requires careful strategizing of future needs when hiring foreign nationals in Canada. If you need assistance reviewing:

  • the position offered in Canada
  • the salary offered to the foreign national
  • business needs for the services, as well as, location of employment
  • future business prospects for the Canadian employer

Contact Envoy and our team of global immigration specialists can help you complete the LMIA.

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The post LMO and LMIA: The 4 Biggest Changes to Canada’s Market Test appeared first on Envoy.

Content in this publication is not intended as legal advice, nor should it be relied on as such. For additional information on the issues discussed, consult an Envoy-retained attorney or another qualified professional.

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