New LMO Standards - Have they gone to far?

With lay-offs and unemployment on the rise, businesses closing down and more and more Canadians struggling to get by, immigration policies regarding foreign workers wanting to enter the labour market have become more restrictive.

Over the recent years of unprecedented economic growth, immigration policies embodied a “get a job, get a visa” mentality. As of January 2009 those policies have shifted, taking cover from the economic storm overhead and offering shelter to Canadian job seekers.

In most cases, companies in Canada wishing to hire a foreign worker must apply to Service Canada for a Labour Market Opinion (LMO), which would ordinarily confirm whether or not the hiring of a foreign worker to fill a position would cause a positive or neutral effect on the Canadian labour market. If hiring a foreign worker would, in Service Canada’s opinion, cause a negative effect on the Canadian labour market, the application must be refused.

LMO applications incorporate a number of components designed to ensure, among other priorities, that the Canadian employer had first scoured the Canadian labour market for eligible candidates and that the wage offered to a foreign worker was reflective of local prevailing wage for the position.

When jobs were plentiful and Canadian companies were starving for qualified labour and skills, Service Canada relaxed their standards as they assessed LMO applications and even went so far as to compile lists of occupations in high demand where the minimum LMO applications assessment standards were all but dropped. These lists were known as “regional occupations under pressure” lists and were an employer’s ticket to successful overseas recruiting. Recruiting efforts were minimal and LMO approvals from Service Canada were fast and free flowing.

Now the lists are gone and have been replaced by a set of stringent new rules.

Under the new LMO application guidelines, employers must try even harder to find local candidates before recruiting overseas, no matter what the position or how scarce local talent may be.

As a general rule, the lower the skill level required to fill a position the greater onus there will be on an employer to recruit locally. For example, employers recruiting “low-skilled” workers must, at a minimum, advertise for 14 days on the national Job Bank, conform to industry practices (whatever they may be) and a invest in a combination of advertisements in journals, national or local newspapers, community bulletins and stores, churches, employment centres, and other recognized job websites. Moreover, these efforts must be ongoing and ought to target ‘disadvantaged groups’ that face barriers to employment.

All higher skilled positions now require a minimum 14 days on the national Job Bank and depending on the position, an employer may satisfy the recruitment requirements by simply conforming to recruitment activities consistent within the given occupation.

At any level, recruitment advertisements must include the name of the business, the business address and the wages being offered.

While Service Canada’s requirements may not, on their face, appear too onerous, they can be costly to an employer already short on qualified workers. They can also expose a company’s competitive position by forcing a company to publicly disclose wages and they could disrupt business by publicizing recruitment efforts within the view of existing employees. Most concerning, under the new policies, Service Canada reserves the right, at their discretion, to require alternative or additional advertising from an employer after efforts which seem to conform to their own stated rules have been met.

Some argue that these new rules amount to overbearing protectionism and they are out of touch with the economic realities facing Canadian business. Others argue that a Canadians first and foremost policy should remain a priority. Either way the message is clear, our labour market is not what it used to be and Canadian employers have to adapt.