Skip to main content

Workers picking green peppers.Thinkstock

"Small businesses will pay the price" of recent changes to Canada's Temporary Foreign Workers Program, says the president of the Canadian Federation of Independent Business (CFIB).

The updates, which went into effect on July 31, were intended to protect jobs and prevent the program from being used as an outsourcing tool by employers. But recent news that the changes led to higher costs for bars and restaurants featuring touring bands and other entertainers from outside the country highlights some new challenges introduced to the process.

"It's basically a statement on the whole program," Dan Kelly says. "It's less responsive to employer needs."

While the head of the CFIB acknowledges there had been abuses of the program, he is convinced the government's "blanket" response went too far. "The reason for the crackdown had little to do with the program itself."

He says the higher costs and greater hurdles will affect small businesses more than bigger firms because "big companies will find ways around it."

But Alexandra Fortier, press secretary for Employment and Social Development Minister Jason Kenney, says the changes were necessary to ensure that employers look to hire Canadians first, and to save taxpayers money. Among the changes is a new $275 fee for a Labour Market Opinion (LMO), a government study that looks at whether Canadians are available for a job.

"In the past, taxpayers were footing the entire bill for LMOs," Ms. Fortier says, adding that "in 2012, 60 per cent of LMOs requested by employers weren't even used."

Ms. Fortier says the government conducted extensive consultation with employers, including small businesses, before the changes were made. "It's good for Canadian jobs and it's good for taxpayers."

According to Mr. Kelly, it can cost as much as $6,000 for a company to bring a temporary foreign worker to Canada, and businesses faced an expensive, time consuming and confusing process even before the recent rule changes.

That's what Carole Tarlington, owner of a small acting studio in Vancouver called Tarlington Training, discovered when she tried to keep an Australian employee after his working holiday visa expired. "I thought it would be a simple thing. How wrong was I?" Ms. Tarlington asks. "It was the most stressful thing I've ever done."

Her application was rejected three times, and when it was finally approved she says the government told her she would have to pay her employee more than his Canadian colleagues: $70,000 a year. "I've never made $70,000 a year."

Under the Temporary Foreign Workers Program, employers are allowed to pay foreign workers up to 15-per-cent less than the average wage in their field. But because Ms. Tarlington's employee was expected to both teach acting and maintain her office's computer systems, she says the government included both the salaries of university theatre professors and IT professionals in the calculation.

Patrick Millard, owner of Laval, Que.-based Millobit Group, which specializes in developing software for trucking companies, also faced delays and high costs. He says his application took more than six months to process, and due to Quebec's high level of control over immigration to the province, it was often unclear what level of government he needed to deal with at different stages.

Mr. Millard says once his application was approved, the government ordered him to pay his foreign worker $22 an hour, more than the $19 an hour he normally starts his staff at.

Both Mr. Millard and Ms. Tarlington say that due to the costs of the program, and its complexity, they wouldn't consider hiring another temporary foreign worker, even if they couldn't find the right person for the job in Canada.

Bars and restaurants that feature entertainers from outside Canada might be thinking the same thing.

Among their costs now is the $275 fee for a LMO. A separate opinion is required for every member of a band and its crew. While festivals and dedicated venues are exempt from the requirements, bars and restaurants are not.

Citizenship and Immigration Canada spokesperson Sonia Lesage says the distinction dates back to 1978. "The intent was to distinguish between performances of significantly popular acts that were not considered to be competing directly with Canadian acts and that would normally play at a larger venue from acts at smaller venues such as bars or restaurants where the entertainment could be considered secondary to the primary commercial activity of the establishment, and where musicians might be competing directly with Canadians."

But Daniel Seligman, co-founder and creative director of the POP Montreal music festival, says it's not that simple. For some venues, he points out, even those that focus on showcasing original bands, it makes sense to opt for a bar licence. "The small bar owners are going to be hurt. They're not going to be able to afford it."

And Mr. Seligman says the changes will have the biggest impact on Canadian artists. "Generally when you have an American band on the bill, you have two or three Canadian bands opening for them."

The connections that bands build playing those shows can help their careers, says Mr. Seligman, and open doors to performances in other countries.

Even though POP Montreal is exempt from the rules around temporary foreign workers, it has hired a specialist to help ensure performers have the proper authorizations.

Follow us @GlobeSmallBiz and on Pinterest
Join our Small Business LinkedIn group
Add us to your circles
Sign up for our weekly newsletter

Interact with The Globe