Tories eye 'wage floor' and raising fees for foreign-worker program

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The Conservative government is putting employers on notice that it could force them to pay more for temporary foreign workers, a move that would likely make the program too costly for low-wage sectors like restaurants that have been accused of abusing it.

The government has been under intense pressure to announce reforms to the controversial temporary foreign worker program since April, when it put a moratorium on access for the restaurant sector because of complaints that Canadians were denied employment in favour of foreign workers.

(What is the Temporary Foreign Worker Program? Read The Globe's easy explanation)

During a closed-door meeting with employer groups on Thursday, Employment Minister Jason Kenney floated several major reforms, sources told The Globe and Mail. While the minister said no final decisions have been made, changes are imminent, sources said.

Currently, employers must pay temporary foreign workers at least the average hourly rate ‎paid to Canadians for the same occupation in the same geographic area. Imposing a minimum wage that is higher than the minimum wage for Canadians would be aimed at encouraging employers to offer higher pay for lower-skilled jobs before turning to the program. However, the idea could mean foreign workers are paid more than some Canadians. And some employers might accuse Ottawa of excessive interference in private-sector wage decisions.

One of the other reforms under consideration would make it easier for employers to access the program in regions with low unemployment while tightening the eligibility rules in areas of high unemployment. The Conservative government is also looking at a dramatic hike to the user fee for accessing the program, from the current $275 to something closer to the fee of up to $2,325 that is charged for a similar program in the United States.

Immigration Minister Chris Alexander also attended the meeting, and both ministers then met with four labour organizations: Canada's Building Trades Unions, the Canadian Labour Congress, the Christian Labour Association of Canada and Unifor.

Mr. Kenney's decision to suspend restaurants' access to the program was in response to allegations of abuse, including at three McDonald's franchises in Victoria.

At the time of that announcement, Mr. Kenney said he was sending a message not just to the restaurant sector, but to all employers that wages must go up.

"We expect Canadian employers to do better, to raise wages, to increase salaries and improve working conditions, to invest more in training, to increase labour force participation, particularly amongst groups of our population who are underrepresented," he said.

The restaurant sector has urged the government to lift the moratorium as soon as possible. Restaurant owners say they desperately need to fill positions such as cooks for specific ethnic foods.

Minimum wages in Canada are a provincial responsibility. The rates vary from a low of $9.95 in Alberta to a high of $11 in Nunavut and, as of June 1, in Ontario. The minister did not provide details on the proposed wage floor for foreign workers.

Jayson Myers, the president and CEO of the Canadian Manufacturers and Exporters, said he likes the idea of a wage "threshold," provided that it ensures foreign workers are paid the same as Canadians and is not used as a tool to increase wages in Canada.

"Personally speaking, I have concerns over a government putting in wage controls basically," he said. "If [the threshold] is higher, then you're setting up wage expectations and wage pressures."

Tightening access in geographic areas of high unemployment could also be problematic, he said, if it ignores the fact that specific skills could be in demand.

Joyce Reynolds, the executive vice-president of Restaurants Canada, left the meeting concerned that a wage floor could price restaurants out of the program.

"The idea that wages could be elevated to the degree that the minister seemed to be indicating is just not going to be workable for our industry," she said. "It would impact a lot of industries other than ours as well."

Dan Kelly, president of the Canadian Federation of Business, noted that Canada allowed only about 20,000 low-skilled temporary foreign workers in 2012, but it looks like Ottawa wants to reduce that dramatically.

"I'm not optimistic. I think the government is going to gut the program for a large number of employers and that's a really sad thing," he said. "This is being done entirely for political reasons."