What is Labour Market Impact Assessment (LMIA)?

What is Labour Market Impact Assessment (LMIA)?

An employer in Canada must complete a Labour Market Impact Assessment (LMIA) before hiring a foreign temporary employee (formerly called a Labour Market Opinion, LMO).

A Labour Market Impact Assessment protects the Canadian job market and protects foreign workers temporarily employed in Canada by protecting the domestic job market. LMIA-exempt work permits can only be obtained under certain circumstances.

Assessing the Merits of an LMIA Application

It generally takes two steps to obtain a Canadian work permit. Employment and Social Development Canada (ESDC) must receive the qualifying LMIA application from the Canadian employer. Canadian employers must let applicants know why they were not hired as well as how many Canadians applied. If a work permit is issued, employers may be inspected for compliance.

ESDC will consider the following factors when assessing the applicant's merits:

• Are there any Canadians who would be willing to fill this job?

• Has the employer made enough effort to hire a Canadian for the position?

• Is it possible to create jobs in Canada by hiring a foreign national?

• Are the wages and salaries offered by the employer in line with the regional average?

• According to Canadian Labour standards, are the working conditions acceptable?

• Is the employer or industry where the job is located involved in ongoing labour disputes?

ESDC will issue a positive LMIA if it is satisfied that a region and industry can sustain foreign labor.

They are appropriate for employers, for the positions being offered, and for the regions in which they are located. A positive LMIA does not allow you to change jobs or employers after getting a work permit or move to a different region of Canada. Under any of these circumstances, you will need to find a new LMIA.

Employees are classified as "high wage" or "low wage" in the LMIA process. In this context, low-wage foreign workers are defined as those whose remuneration is lower than provincial/territorial median wages. High-wage temporary foreign workers are those whose wages are equal to or more than the average.

Median Hourly Wages by Province/Territory

Province/Territory Wage ($/hr)

Newfoundland and Labrador

$21.12

Prince Edward Island

$17.49

Nova Scotia

$18.85

New Brunswick

$18.00

Quebec

$20.00

Ontario

$21.15

Manitoba

$19.50

Saskatchewan

$22.00

Alberta

$25.00

British Columbia

$22.00

Yukon

$27.50

Northwest Territories

$30.00

Nunavut

$29.00

High-Wage Workers

The submission of a transition plan is an essential requirement for all Canadian employers who are looking to hire a temporary foreign worker(s) at a wage equal to or higher than the provincial/territorial median hourly wage. In the interest of Canadians, employers are required to develop a plan to reduce their reliance on temporary foreign workers.

Low-Wage Workers

The process of completing a Labour Market Impact Analysis (LMIA) does not require employers to submit a transition plan for hiring low-wage workers. Contrary to high-wage workers, low-wage temporary foreign workers are subject to a limit that restricts the number that can be employed by a particular company. There will be a 10% cap on low-wage temporary foreign workers for Canadian employers with more than 10 employees.

To give Canadian employers time to transition to a Canadian workforce, this cap will be phased in over the next two years.

LMIA Processing Times

Processing times for LMIAs can vary from a few weeks to a few months. A LMIA application will be processed by Employment and Social Development Canada (ESDC) within 10 business days. There is now a standard 10-business-day turnaround time for the following categories:

• Applications for all LMIA jobs that are in high demand (trades), or

• Top-paying occupations (top 10%)

• (120 days or less) Working periods with short durations.

LMIA Fees and Additional Employer Requirements

• Application fees for Labour Market Impact Assessments are CDN $1,000 for each application (except for those intended to support permanent residency). A Privilege Fee of CDN $100 also applies.

• Canadian employers are required to advertise (Canada Job Bank) for a minimum of four weeks prior to applying for LMIA. Additionally, employers must identify at least two other recruitment methods, other than the Canada Job Bank website, to target potential hires. The ESDC will also be looking for proof that underrepresented groups of Canadians have been considered (e.g. disabled people, aboriginal people, youth).

• To qualify as a requisite for the LMIA, only two languages are acceptable: English and French. A large majority of ESDC agents are reluctant to approve an LMIA application if another language has been used as a determinant other than English or French.

• If their company hires temporary foreign workers, Canadian employers must certify that they may not lay off, or reduce the hours, of Canadians.

Contact our experts today to learn more about Labour Market Impact Assessment.

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