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Foreign Work Permit Regulations in Canada to Become More Stringent Following iGate Scandal

August 27, 2013

Human Resources and Skills Development Canada (HRSDC), an administrative office of the Canadian Government, announced that it will be releasing modified and more stringent regulations governing the issuance of Labor Market Opinions (LMO’s) in Canada.  LMO’s are issued by Citizenship and Immigration Canada (CIC), another administrative office of the Canadian Government, before a Canadian employer can begin recruiting temporary foreign workers (TFW’s) for certain positions within their organization.  In deciding whether to certify the LMO or not, the CIC must determine the impact that the TFW will have on the Canadian labor market.  If the LMO is certified, the employer can recruit foreign workers for that position and when a foreign worker has been found, that worker can then apply for a Canadian work permit.   An LMO will not be certified if there are Canadian workers who are able and willing to take those positions.  Foreign workers hired through this program can be compensated at a rate 15% less than the Canadian prevailing wage rate.

The change in regulations comes as a result of a recent scandal involving the Royal Bank of Canada (RBC).  RBC hired dozens of TFW’s through iGate, a United States-based outsourcing firm with an office in India.  Many of the TFW’s were from India and were hired to fill information technology positions within RBC’s infrastructure.  It is claimed that these information technology positions were previously held by Canadian employees, and the employees claim that they were displaced from their positions in a manner that is not compliant with Canadian immigration laws.  Further, the displaced employees and others still within the RBC infrastructure, claim that the hired foreign workers do not have the same skill set as the displaced Canadian workers.

As Canadian immigration laws affect many of our clients, we’ll update you again if/when LMO laws change.