Canadian Employee Relocation Council 180 DundasSt. W., Suite 1506 CE,RC Toronto,ON M5G 1ZB Tel:416-593-9812 Fax:416-593-1139 Lcnd arsltip fo r Workforce Mob i I i ty Toll-free: 1-866-357-CERC(237 2) E-maii: [email protected] TheHonourable Diane Finley, PC,, M.P. Ministerof HumanResources and Skills Development Canada 140,Promenade du Portage Gatineau,QC KIA OJ9 May27'h 2ol3 Dear Minister Finley, TheCanadian Employee Relocation Council (CERC) welcomes this opportunity to providecomments regardingthe recent changes to Canada'sTemporary Foreign Worker Program (TFWP). CERCrepresents the interesisof employersacross Canada involved in themovement of employees,our membershipis representativeof Canada'sdiverse economy, and includes many of Canada'slargest employersand corporations. Each year Canadian employers relocate over 100,000workers - themajority of thoseare skilled and professional employees, and many of themare immigrants. Canadian businesses requireaccess to an adequatesupply of well skilled,well trainedworkers to helptheir businesses grow and prosper.Canada's immigration programs must be effective in assistingthem to meetthese objectives. As notedin thevast amount of researchundertaken in demographicand labour force planning, immigration is expectedto accountfor the majorityof growthin Canada'slabour force over the next decade. While immigrationalone cannot be expectedto solvethe loomingshortage of skilledworkers in Canada,it is neverthelessan importantpart of a multifacetedsolution. The TFWP plays an importantrole in addressing skillsshortages in manyindustries across Canada. Sincethe changes were announced CERC has been canvassing its membersto gaina deeperunderstanding of howthey will impactbusiness operations. Our members have expressed significant concerns with several of theannounced changes, which are summarized below: l. Suspensionof theAccelerated Labour Market Opinion (ALMO) program 2. Paymentof the prevailingwage and removal of wageflexibility 3. Requiringemployers to havea planto transitionto a Canadianworkforce Whenaddressing the WorldEconomic Forum in DavosSwitzerland, on January26,2012, Canadian Prime MinisterStephen Harper said, "We will ensurethat we makeour economicand labour force needs the central goalof our immigrationefforts in thefuture," Theserecent announcements run counter to this statedvision for Canada'simmigration programs. We urge you undertakea formalconsultation process to ensureall aspectsofthese changes are fully exploredand the consequencesare understood. Ourmembers have expressed deep concerns about suspension of theALMO program,a decisionwhich we believewas centred on the inappropriateuse of theprogram by only a handfulof employers.In ourview thereare sufficient provisions in the ImmigrationRefugee Protection Act (IRPA)to enforcesanctions againstthose employers who areabusing the program. Theabrupt suspension of theALMO hasmade it verydifficult for companiesto plan.All companiesare nowbeing punished for theactions of a few asthey will not beable to expediteskills that are desperately needed.Many companies have told usthat job offersand aranged transfers into Canadahave been rescindedgiven the uncertainfuture of theTFWP. This has resulted in additionalcosts to employers throughpostponed business plans and cancelled projects. Sinceits introduction,the ALMO programhas delivered significant benefits to Canada'seconomy. It has createdthousands of goodjobs andassisted employers who legitimatelyrely on foreignexperienced skilled workersto competeat a globallevel. Suspendingthe ALMO is a regressivechange and punitive to those compliantemployers. These changes have the potential to jeopardizemajor projects and make it harderfor Canadiancompanies to competein globalmarkets. In additionto theseconcerns, and given that resources within HRSDCand CIC havebeen reduced over the pastseveral months, the changes will resultin extensiveprocessing delays. Prior to introductionof the ALMO, employerswere experiencing delays upwards of l2 weeksin processinga LMO application. Returnto thoselevels of servicewill imposesignificant and unnecessary hardship on employersand have negativeconsequences for Canada'sfragile economic condition. In today'sglobally competitive business climatethe Canadian government must find waysto enhanceeconomic activity and growth. This announcementwill havethe opposite effect. We aredeeply concerned these changes will impactlegitimate business travellers seeking to enterCanada, andmore importantly intra-company transfers. Information from our membersindicates that entry is now beingdenied based on erroneousinterpretations of theannounced changes. We askfor clarityfrom your departmentthat these categories of temporaryentry and intra-company transfers are outside the scopeof the announcedchanges to theTFWP. We recommendthat your decision to suspendthis importantprogram be reversedand the following approachbe considered. r Reinstitutethe ALMO programfor employersthat meet prescribed requirements of HRSDC. o Providea processto developa 'TrustedEmployer Program' in key industrysectors that have provenskilled worker shortages. (CERC has proposed such a modelto yourgovernment under theBeyond The Border Action Plan consultations) o Trustedemployers should receive LMO approvalsfor four yearsduration. On theissue of theprevailing wage, requiring employers to paytemporary foreign workers at theprevailing wageby removingthe existingwage flexibility is problematicfor severalreasons. Labour markets across Canadaare complex. They are driven by localconditions, demand and supply, and levels of experienceand skill.Our members have told usthat prevailing wage information contained in the"Working in Canada" resourcedata base does not accuratelyreflect those market conditions, or salarymarket surveys. For instance,the prevailing wage change fails to considerhow various roles in differentindustries are remunerated,in additionit makesno distinctionbetween entry positions and those positions requiring severalyears of experience.This changewill resultin equityissues in manycompanies as foreign workers maynow be paidmore than Canadian workers that have the same level of experienceand skill in many industries. 2lPage We stronglyrecommend that the current program be maintained. As a solutionto concemsabout wage parity,HRSDC could require employers to validatethe payroll where it is lessthan the prevailing wage, subjectto auditby governmentofficials We arein agreementthat if the entryof a temporaryforeign worker is foundto havea negativeimpact on thelabour market or if it is determinedthat the LMO or work permitwas fraudulently obtained, they should be suspendedand revoked. We agreein principalwith theaddition of newquestions on theLMO applicationverifying that Canadian employees are not beingreplaced by foreignworkers however, the recentlyintroduced "Offshoring Questionnaire" as curently draftedwill not elicitthe informationrequired andis provingdifficult for employersto complete.Employers are concerned about the impactof answering positivelyto theoffshoring questions. Many of thequestions are in regardto contractualagreements and thereforesubject to confidentiality.Further consultations are required with employersto improvethis questionnaire. In principleemployers have no concernwith theGovernment of Canada'sannouncement that it would introducefees for employersapplying for temporaryforeign workers through the LMO process,providing thosefees are reasonable. However, such fees should also be contingenton improvedlevels of servicefrom HRSDCin the processingof work permitsand labour market opinions, such as the timelines being achieved with theALMO process. With regardto therequirement on employersto developand implement a planto transitionto a Canadian workforce,while the fundamental principles and objectives of thischange are aligned with thoseof employersto hireCanadian workers first, we haveseveral concerns as to howthis mayoperate in practice. HiringCanadians is thepreferred route before resorting to thecostly and cumbersome process of hiring temporaryforeign workers. Reality is thatskilled workers are in shortsupply within the domestic labour force.Canada's workforce, not unlikemany other developed nations, is aging. At thesame time our economyis undergoinga transformation,similar to the industrialrevolution of the early1900's. Canada, along with all otherdeveloped nations, is rapidlyshifting to a knowledgebased economy.This shiftis resultingin the sheddingof low skilledjobs andcreation ofjobs requiringmore educationand skill. Canadianemployers created 280,000 net new jobs in two recessionaryyears leading up to September,2010,that needed a universitydegree, according to theAssociation of Universitiesand Collegesof Canada.Meanwhile, the country shed 260,000 jobs that didn't needone. Yet, just overone- quarterof working-ageCanadians have a universitydegree today. Thismirrors the transformation taking place in theEuropean Union, where despite record levels of unemployment,some six million positionscannot be filled becauseof a lackof skills. Accordingto researchconducted by McKinseyand Company, by 2020employers will befaced with a globalshortage of 41 millionhighly skilled workers, 45 millionmedium skilled workers and a surplusof 58million low skilledworkers; Canada will not be immunefrom this global phenomenon. Employers are competing on a globallevel for valuableand scarce human talent. Our immigrationprograms, including the Temporary ForeignWorker Program, are vitally importantin meetingthose needs.