In order to conduct business and compete successfully, many Canadian companies will find it necessary to recruit foreign employees or transfer employees from foreign jurisdictions to Canada. Whether your business strategy requires that temporary or permanent positions be filled, there are a number of rules and procedures involved in order for these workers to work lawfully in Canada.
Pursuant to the Immigration and Refugee Protection Act (“IRPA”), foreign nationals (non-Canadian citizens and non-permanent residents) can only work in Canada if they are authorized to do so, even if they do not otherwise need a visa to enter Canada. As a general rule, and subject to certain exemptions, all individuals wishing to “work” in Canada require a work permit. The definition of “work” under Canada’s immigration regulations is quite broad and could cover even unpaid activities if they compete directly with activities of Canadian citizens or permanent residents in the Canadian labour market. As such, proper and early advice should be sought if the employment or transfer of foreign workers into Canada is being contemplated. While a thorough discussion of the exemptions and work permit requirements is outside the scope of this article, a number of common scenarios are discussed below.
Hiring Temporary Foreign Workers and Employees Who May be Required Permanently
The first question that is relevant is whether the foreign workers are intended to fill temporary skills shortages, or permanent positions. The Temporary Foreign Worker Program enables Canadian employers to hire eligible foreign nationals to work for them in Canada for a specified duration, provided they can demonstrate that the employers cannot find a suitable Canadian/permanent resident to do the job and that the entry of the said foreign national will not have a negative impact on the Canadian labour market.
Unless the occupation is exempt, as a first step employers will be required to obtain a favourable Labour Market Opinion (an “LMO”) before the foreign national can apply for a work permit. An LMO is Service Canada’s opinion and assessment of what impact the hiring of the foreign worker would have on Canada’s labour market. Typically, employers have to show that despite efforts to advertise for and recruit Canadian workers, the employer has not been able to find the required quantity or skills. The information and documents the Canadian employer must submit as part of the application, include the following:
- details of the occupation for which the foreign national is required;
- a copy of the employment contract (required in some cases);
- details of the job offer including wages and working conditions that will apply to the foreign worker;
- advertising and recruitment efforts on the employer’s part to hire a Canadian or permanent resident to fill the position (the requirements depend on the skill level of the occupation for which the LMO is being sought, having regard to the National Occupational Classification Skill Levels and the specific requirements vary depending on the occupation at issue and should be carefully considered in each individual case);
- the benefits that the foreign worker’s employment may have to the Canadian labour market;
- the number of Canadians/permanent residents currently employed in the organization;
- whether any Canadians/permanent residents were laid off in the 12 months preceding the application; and
- education, experience and skills (including language skills) required for the position.
It should be noted that on April 1, 2011 significant changes to Canada’s Temporary Foreign Worker Program went into effect. These changes include:
- a more rigorous assessment of the genuineness of the employer’s job offer(s);
- a two-year prohibition from hiring temporary foreign workers for employers who have failed to meet their commitments to workers with respect to wages, working conditions and occupation; and
- a limit on the length of time a temporary foreign worker may work in Canada before returning home.
The avenues available to an employer to support a foreign employee’s permanent immigration depend on the circumstances at hand and a discussion of these are outside the scope of this article. However, a qualified lawyer or immigration practitioner can offer assistance on the possibility of transferring employees into Canada on a permanent basis.
Business Visitors to Canada
Frequently a Canadian company wishes to bring in an employee from one of its foreign operations temporarily to explore business opportunities or to advance existing business relationships, such individuals may qualify to enter Canada as business visitors without the need to obtain a work permit (although a visa will still be required if the foreign national is not from a visa exempt country).
To qualify, the foreign national must be entering Canada to engage in international business activities without directly entering into the Canadian labour market. Examples of permitted activities include:
- attendance at conferences, conventions, meetings or trade fairs;
- providing training to employees of a Canadian subsidiary of a foreign company;
- receiving training within a Canadian parent or subsidiary of the corporation that employs them outside Canada (provided any production of goods or services that results from the training is incidental);
- representing a foreign business for the purpose of selling goods for that business (if the foreign national is not engaged in making sales to the general public in Canada); and
- purchasing Canadian goods or services for a foreign business or receiving training or familiarization in respect of such goods or services.
Special rules apply for nationals of the United States or Mexico wishing to enter Canada as business visitors as they may qualify to enter Canada under the North American Free Trade Agreement (“NAFTA”). A discussion of all the available options under NAFTA is outside the scope of this article but businesses should seek advice to explore their options.
In addition to the limitation on the nature of their activities while in Canada, the duration of time for which business visitors may remain in Canada is also limited. Typically, the stay in Canada is for a few days or a few weeks, although the circumstances of each case must be examined and generally, under this category, the intended stay in Canada must be for less than 6 months and it must be demonstrated that such business visitors do not plan to enter the Canadian labour market. In addition, the foreign employees must also meet Canada’s basic entry requirements in terms of carrying the necessary travel documents, having sufficient funds for their stay, plans to leave Canada following the end of their visit and the lack of criminal, security or health risks to Canadians.
Intra-Company Transferees – Executives, Senior Managers and Specialized Knowledge Workers
If a Canadian company wishes to hire one or more of its employees to Canada to work for a Canadian subsidiary, an entry option that may be available for such individuals is to obtain a work permit as an intra-company transferee. The key elements that must be present for qualify under this category are as follows:
- the requirement that the transfer of the employee be temporary in nature;
- the existence of the required “qualifying relationship” between the foreign entity sending the employee to Canada and the Canadian entity. [i.e. the entry must be to work in a parent, subsidiary, branch or affiliate of a multi-national company and the entry should be to undertake employment at a legitimate and continuing establishment of that company; and both the foreign entity and the Canadian entity must be doing business or be able to establish that the entity will be doing business];
- the transferee must be taking a position in an executive, senior managerial or “specialized knowledge” capacity;
- an employer-employee relationship must exist between the Canadian entity and the employee being transferred and evidence of this must be provided;
- the transferee must have been employed by the foreign entity in a similar full-time position for the requisite amount of time (subject to some exceptions, generally, one year in the three-year period immediately preceding the date of application); and
- the transferee must be able to transfer back to the foreign company at the end of the Canadian assignment.
There are special guidelines that apply in the case of “Start Up Companies” and companies that have been subject to a recent merger or acquisition who wish to temporarily bring into Canada an employee from a foreign entity. Also, the assessment of whether the foreign or Canadian entity are “doing business” or whether the intended transferee actually meets the criteria of being an executive, senior manager or specialized knowledge worker, involves the examination of a number of factors and documents which must be submitted as evidence of active involvement in business both in the foreign jurisdiction and in Canada.
Also, much like business visitors, the foreign employees must also meet Canada’s basic entry requirements in terms of carrying the necessary travel documents, having sufficient funds for their stay, plans to leave Canada following the end of their visit and the lack of criminal, security or health risks to Canadians.
The Importance of Getting Advice
The matters discussed above are general in nature, are guidelines only and even if all the factors described above are met, an application may be denied for any number of reasons. Each situation must be assessed independently and in light of all available information about the employers involved and the candidate (employee). Since the examination of whether an intended foreign employee who wishes to enter Canada for business is complicated, it is important to seek advice from qualified experts who can assess the proposed entry into Canada before plans are finalized and to avoid surprises such as being denied entry.
Qualified lawyers and immigration specialists can:
- navigate the application process with the Canadian authorities;
- draft and advise on employment agreements between the Canadian entity and the intended employee/transferee;
- if the transfer of an employee is to British Columbia and the employment is based in British Columbia, advise on the employment law obligations of the B.C. employer;
- if the transfer of an employee is to a federally regulated business in Canada, advise on the employment law obligations of the Canadian employer;
- assess whether an employee’s existing position in the foreign enterprise and the intended position in the Canadian enterprise would meet the criteria for the position the intended transferee must occupy in Canada;
- assist companies in identifying the supporting documents they will likely require if they intend to invite an employee into Canada;
- help you assess whether your key employee’s intended entry in Canada would likely qualify as a business visit; and
- advise on whether a “qualifying relationship” exists between a foreign entity and the Canadian entity if the temporary transfer of a foreign employee to Canada is being considered.
Whether due to shortage of Canadian workers or skills, the need to compete globally, or the desire to transfer skills and knowledge between a company’s international operations, the recruitment and transfer of employees to Canada will be an important strategy of many businesses. With planning and good advice, this strategy will also be a successful one.