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Hiring Foreign Workers: 5 Key Construction Sector Considerations

Published:

July 26, 2024

Author(s):

• Meghan Felt
• Amanda Nash

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The nature of the construction industry, especially when it comes to seasonal work and where the labour needs and costs must be estimated in advance of submitting bids and negotiating contracts, mandates unique foreign workforce planning considerations. Here are five.

1. Prepare to Pay Prevailing Wages

Immigration isn’t a way to have work performed at a lower wage rate. In fact, to do so in most cases is a violation of employers’ compliance obligations. It’s important to be aware of the prevailing wage rates for specific occupations in your geographical area. Some immigration programs require you to pay foreign workers the within the prevailing wage range, and some require you to pay at or above the median prevailing wage. While some employers have been forced to increase wages to compete for skilled labour, others lag behind the Canada job bank prevailing wage for the work actually being performed. When advertising for the position is required, you must include the prevailing wage rates applicable to the position in the job advertisement and program which can have a ripple effect across the ranks of current employees. Furthermore, the obligation to pay prevailing rates has resulted in the requirement under some programs that employers conduct an annual review of any changes to the posted prevailing wage rates and increase the foreign workers’ rates as necessary. Be sure you’re prepared for these requirements.

2. Anticipate Additional Associated Costs

There can be significant additional costs associated with recruiting and employing foreign workers the employer must bear and is prohibited from recovering (directly or indirectly) from the foreign worker. These costs can include an international recruiter to find skilled foreign workers, and in some cases can include settlement assistance such as transportation from the foreign worker’s place of residence and medical coverage until they qualify for public coverage. There are also various government processing fees the employer must pay (for example, the fee for a Labour Market Impact Assessment or “LMIA” is currently CAD$1,000 per foreign worker). These are on top of any legal fees you incur for strategic immigration advice and assistance preparing the relevant applications. Make sure you budget for these additional expenses.

3. Take Timing Into Account

Many employers, particularly in the construction industry, are often precluded from the benefits of foreign labour because their workforce planning hasn’t accounted for the time it takes to process an application and obtain the necessary work permits or exemptions for a foreign worker. The processing times for various immigration pathways can vary greatly based on the program as well as the location where the application will be processed (which is determined by the foreign worker’s citizenship or residency). While processing times are subject to change and can’t be guaranteed, these tactics could reduce the time to get a foreign worker into Canada and onsite in mind:

• Focus on Visa Exempt Countries. If you’re looking to fill vacancies quickly, focus your recruitment efforts on countries that are visa-exempt. Foreign nationals from certain countries require a visa in addition to a work permit to enter Canada. They must apply for their visa from outside Canada and can’t travel to Canada until the visa is processed. However, foreign nationals from other countries that are visa-exempt can travel to Canada at any time and can therefore apply for their work permit at the Canadian border and, in most instances, have it issued upon entry.
• Figure in Flag-Poling. This is a process where a foreign national in Canada with a valid temporary resident visa leaves the country temporarily so they can ‘turn around the flagpole’ and return to Canada, allowing them to apply for a work permit at the Canadian border. Although not without risk, it’s a legitimate practice that typically occurs at the Canada-U.S. border but is also possible in Newfoundland and Labrador by going to St. Pierre and Miquelon (a French state). Flagpoling is a very quick option when you’ve identified a candidate already in the country that holds a valid temporary resident visa but needs a new work permit.

4. Compliance Counts

Unlike with general labour and employment standards, where there are statutory exemptions recognizing the seasonal and often unpredictable nature of the construction industry, there are no such special provisions when it comes to an employer’s immigration law compliance obligations. Therefore, if you’re new to immigration or don’t have a dedicated human resource team tasked with ensuring immigration law compliance, it’s crucial to designate a person to be responsible to understand your immigration law obligations, monitor compliance and maintain the necessary records in the event of an audit. While there might be some leeway for a minor first instance of non-compliance, violations can carry significant fines and can even result in jail time for the most serious offences.

5. Concentrate on Key Construction Sector Immigration Pathways

There are many immigration pathways available. Concentrate your efforts on these five that are particularly appropriate for the construction sector:

International Students. Enrollment of international students in post-secondary schools in some provinces, like Newfoundland and Labrador, is actually on the rise despite recently announced study permit caps, and is a generally untapped labour market. Historically, an international student could work up to 20 hours a week during study periods and full-time hours during regular study breaks, such as in the summer semester, and may be an ideal solution for employers looking to hire for seasonal work in the construction industry. While the 20-hour cap was temporarily suspended during the COVID-19 pandemic, allowing many employers to tap into the international student workforce as a solution to their labour needs, the 20-hour cap was reinstated on April 30, 2024. However, the cap will be increased to 24 hours per week in September 2024. Work in excess of the cap is considered illegal work and could have negative consequences for both the employee and the employer. If you avail of this path, confirm the current cap and take measures to ensure the employee doesn’t exceed it. The benefit of hiring an international student is that the only requirement of the employer is to ensure the cap isn’t exceeded and that the permit is valid with no other restrictions. In every other way, hiring an international student is the same as hiring a Canadian or permanent resident for the same job.

Open Work Permit Holders. Open work permits are the most flexible work permits because they allow a foreign worker to work for any employer. And like the international foreign student regime, employers aren’t under any specific compliance obligations beyond that applicable to their existing domestic workforce. There’s a great chance there are open-work permit holders already in your community looking for work – you just might need to seek them out. Under the post-graduate work permit program, open work permits are granted to international students upon graduation to retain skilled foreign nationals and facilitate their entry into the local labour market. Open work permits are also granted in accordance with various immigration policies, the majority of which are aimed to allow foreign spouses of Canadian citizens and permanent residents as well as spouses of authorized temporary residents (spousal open work permits) the option to live together as a family and work in Canada.  Many open work permit holders looking for work will be entering the local labour market for the first time, which can be intimidating to a newcomer. In most cases, newcomers will see help wanted ads in windows of retail outlets or be connected through various community support organizations. So, if you’re looking for open work permit holders in the construction industry, where ‘storefronts’ are uncommon, consider connecting with newcomer support agencies or attending job fairs hosted for newcomers.

Temporary Foreign Worker Program (TFWP). The TFWP is the pathway employers must use to hire a foreign candidate unless the candidate qualifies for a work permit via another program. The TFWP is a two-step program. First, the employer must obtain a Labour Market Impact Assessment (LMIA) by showing they have attempted to recruit for the position offering the prevailing wage and there are no qualified Canadian citizens or permanent residents. Second, the foreign candidate must apply for a LMIA-supported work permit. To apply, the candidate must provide the job offer, the LMIA, and demonstrate they qualify for the job being offered and are otherwise admissible to Canada. While this is the default program, it’s not the most seamless for employers. In general, the LMIA process mandates very specific advertising requirements, there may be limits on the number of workers you can hire based on whether the job is considered high or low wage, and the processing can be longer and more costly than many employers anticipate. However, depending on the position you need to fill, there are exceptions to the general LMIA requirements under the TFWP that, if applicable, can significantly shorten the process, including:

• Global Talent Stream. This program offers a simplified LMIA process for specialized, high-skilled and in-demand positions, with no mandatory advertising requirements and expedited processing.
• International Treaties. No LMIA is required if the candidate is from a country that is party to an international treaty and the work they will perform is covered by that treaty. This exemption typically applies to professional occupations such as engineers and engineer technicians/technologists The most commonly use treaties are USMCA, CETA, Canada-UK TCA, Canada-Peru CTA and Canada-Chile FTA.
• Significant Benefits. No LMIA is required for specific carved out scenarios where the federal government has determined the benefits to Canadians outweighs the need to canvass the Canadian labour market. Examples include the Francophone Mobility Work Permit, repair personnel for out-of-warranty equipment and emergency repair personnel.

Provincial & Regional Programs. The focus of the various provincial and regional programs is permanent residency in the specific regions. To facilitate the settlement of permanent residents, these pathways offer work permits to foreign workers to allow work and settlement to begin or continue while their residency applications are in process. Each province has a Provincial Nominee Program; they vary by province but all have pathways to nominate skilled workers who demonstrate a legitimate intention to settle and work in a specific region. In addition, the Atlantic Immigration Program can be a quicker path to permanent residency for the foreign worker, though as an employer-driven program the onus is on the employer to become designated and commit to assist with settlement before recruiting foreign workers.

Special Measures Programs. In response to a particular demand, event or in support of a specific immigration policy, from time to time federal and provincial governments announce special immigration programs targeting in-demand occupations and offering expedited processing that can be beneficial to the construction sector. One such example is the Canadian-Ukraine Authorization for Emergency Travel (CUAET) measures that saw large numbers of Ukrainian nationals settle in Canada and who were granted open work permits. There are undoubtedly still many Ukrainian nationals living in Canada with time left on their open work permit or in the process of applying for permanent residency and looking for work. Other policies are designed to attract French-speaking foreign workers to communities outside of Quebec to grow the francophone population in other areas of the country. One such program, the Francophone Mobility Program does not require that the work to be performed by the individual to be conducted in French; it only requires that the individual be proficient in French at an intermediate level.  Another program, the Francophone Community Immigration Pilot Program, is anticipated to commence in Fall 2024 and will identify designated communities where the francophone recruitment efforts will be focused with various community initiatives to facilitate settlement of the French newcomers.  However, because these programs are usually introduced and cancelled with little notice, it’s important for someone in your organization to monitor Immigration, Refugees and Citizenship Canada (IRCC, the federal government department responsible for Immigration in Canada) announcements.

Please contact your McInnes Cooper lawyer or any member of our Immigration Law Team @ McInnes Cooper to discuss hiring foreign workers to fill your labour and skills gaps.

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