Canada’s New Immigration Targets: A Shifting Landscape for Employers
The Canadian federal government has recently proposed a significant change in its immigration strategy, particularly affecting temporary residents and foreign workers. With a target to limit the number of work permits available for first-time applicants to 367,750 by 2025, Prime Minister Carney’s approach is a shift from previous immigration levels aimed at welcoming 500,000 newcomers a year for both 2025 and 2026. This pivot underscores a commitment to returning immigration to what the government deems “sustainable levels,” a policy particularly aimed at reducing the number of individuals holding work and study permits to less than five percent of Canada’s population by 2027.
Impact on Canadian Employers
This policy change directly affects employers across various sectors, especially those reliant on international students with work authorizations. Many businesses have benefitted from the flexibility of employing students without needing to navigate employer-specific work permit programs. The new restrictions will create additional complexities and challenges, particularly for those familiar with the closed work permit schemes. Employers must, therefore, begin planning for their evolving workforce needs without the historically robust access to temporary foreign workers.
Importance of Early Work Permit Renewals
For those currently holding work permits in Canada, immediate action is critical. Immigration, Refugees and Citizenship Canada (IRCC) mandates that work permit holders must apply online for renewals rather than at the border, a policy intended to streamline processes for border officers. However, processing times have intensified, with an estimated 196 days for work permit extensions as of June 2025. This backlog means that foreign workers must apply for renewals in advance of their permit expirations to maintain their status and work eligibility. Should they fail to do so and leave Canada during processing, they could lose their work status, leading to severe disruptions both personally and for employers.
The Challenge of PGWP Expiry
Employers have increasingly relied on post-graduate work permit (PGWP) holders, particularly during the pandemic. However, these permits are not renewable unless further eligibility time remains. As these permits begin to expire, companies will face urgency in either securing new work authorizations through processes like Labour Market Impact Assessments (LMIAs) or aggressively seeking replacements. It’s crucial for employers to conduct audits of current staff to identify those with expiring permits and strategize accordingly.
Increased Application Complexities
The integrity of the application process has also come under scrutiny. Reports have indicated an increase in arbitrary denials from the IRCC’s Case Processing Centre in Edmonton. Applicants—often meeting all criteria—have found their applications denied without clear reasons, causing immediate employment disruptions. Additionally, even approved applications can include administrative errors, leading to further delays and uncertainty. For employers in rural or hard-to-fill positions, these developments pose a daunting challenge.
Compliance Risks for Employers
Compliance will be more critical than ever for employers navigating these changing immigration rules. Adhering to the conditions of foreign worker programs is essential to avoid severe penalties, such as bans from future programs and severe financial repercussions for violations. Recent changes have even doubled the penalties under the Temporary Foreign Worker Program, highlighting the need for employers to be proactive in compliance training and internal audits to prepare for inspections.
The Influence of Bill C-2 – Strong Borders Act
Recently introduced, Bill C-2, also known as the Strong Borders Act, would significantly enhance the federal government’s control over immigration processes. If enacted, this legislation could enable the federal government to pause or terminate applications for various types of visas and permits, further complicating hiring for employers and straining their operational capacities.
Proactive Planning for Employers
With an increasingly complex immigration landscape, it is essential for employers to begin proactive planning. Conducting audits to understand the status of temporary foreign workers in their workforce is a crucial first step. This involves checking the specific types of work permits each employee holds and strategizing on renewal options or replacements well in advance.
At McMillan, our immigration team stands ready to assist employers in navigating these challenges, offering support ranging from compliance to immigration applications. Engaging in proactive planning and compliance training is vital for adapting to these changes, ensuring both businesses and foreign workers can move forward effectively.
