Government officers told to skip fraud prevention steps when vetting temporary foreign worker applications, Star investigation finds

According to internal ESDC documents obtained by the Star and interviews with a current ESDC employee, routine checks meant to ensure the system is not abused by unscrupulous employers have been suspended in an effort to process applications faster.

Those checks include contacting employers to confirm they actually applied to hire a worker, verifying that lawyers and consultants applying on behalf of employers are in good standing with their regulator, and clarifying the overtime, vacation and benefits promised to the worker.

“This really shows a complete contradiction between the public-facing government policies and how the program is actually run,” said Catherine Connelly, a professor at McMaster University’s DeGroote School of Business who has been studying the temporary foreign workers program for more than a decade who examined the internal ESDC documents.

“On one hand, we’re told the government will crack down on everything, and then on the other hand, we see from the documents that this is clearly a rubber stamp,” she said. “If the government is not going to do even basic checks, how can the public have any confidence in anything?”

On Monday, Prime Minister Justin Trudeau announced changes to the temporary foreign worker program he said were designed to reduce the number of low-wage foreign workers business can hire and prompt companies to hire more Canadian residents.

Applications for low-wage workers in regions with high unemployment will be refused for many sectors, employers will be limited to hiring a maximum of 10 per cent of their workforce through the program, and the low-wage worker employment period drops from two years to one. Workers in the agriculture, health care, construction and food security sectors — the sectors hiring the most migrant workers — will be exempt from the changes. 

In an email to the Star, ESDC said the government understands that the process for approving labour market impact assessments — the applications Canadian employers submit to hire a foreign worker — “needs to be improved.”

The government is “taking concrete steps to restrict access to the TFW Program to only employers that can demonstrate a genuine labour market need,” ESDC said in response to inquiries about the streamlining instructions.

“The changes announced today are expected to reduce reliance on temporary foreign workers,” ESDC said, adding that the government is exploring further measures, including raising application fees and implementing “future regulatory changes regarding employer eligibility.”

Neither the government announcement nor the ESDC’s response to the Star said whether it would abandon the expedited process and return to the checks and safeguards that were once in place. 

A long-time ESDC employee on the front line of labour market impact assessment (LMIA) processing told the Star that as the TFW program ballooned and businesses were allowed to hire more and more workers, checks that curbed fraud in the program have been eroded, prioritizing speed over scrutiny. (The Star granted the employee anonymity due to concerns they could lose their job for speaking out.)

“The checks and balances have been reduced so much that there’s very little we can do,” the employee said. “People have complained to management, but nothing has been done.”

The employee said that since the directive to speed up application reviews came down from national headquarters, staff have scaled back on approximately “50 per cent of what we’re supposed to read on the application” and that while potential fraud is reported, “nothing” happens.

One of the most alarming revelations in the streamlining documents, the ESDC employee said, is the department’s awareness of the risks associated with overlooking information while skipping steps. 

There’s a Q&A section at the bottom of several directives to address potential staff concerns. One of the questions reads: “I’m concerned that I’ll miss some important information if I follow the streamlined assessment steps. What will happen if I make a mistake?”

The answer says that the assessment process is a “risk-based approach” balancing “the needs of the Canadian labour market with the integrity of the program.”

“The department has considered and accepted the risk of an important piece of information being overlooked during the assessment of an LMIA application,” the document states.

While the documents note that staff are able to exercise judgment, immigration consultant Kanwar Sierah said that “officers are not given enough time to use their discretion.”

Sierah, who also represents migrant workers who are scammed out of tens of thousands of dollars, likened the ESDC’s instructions to “an exit door” which would allow it to “later pass on the blame to the officers if something is overlooked.”

In its email to the Star, the ESDC said “due to the temporary nature of the pandemic measures, over the past two years, the program has taken a risk-based approach to reduce administrative burden, which has subsequently allowed the program to prioritize enhanced assessments of applications from employers identified as high risk for LMIA fraud, while allowing the program to keep up with unprecedented employer demand.”

But while it’s easy to flag applications with “huge red flags,” the ESDC employee said most scams fly under the radar because the perpetrators know how to “keep a low profile” and “know what to write” to avoid getting caught.

The expedition orders came at a time when demand for workers in Canada was surging, with employers given the green light to hire almost 240,000 temporary foreign workers in 2023, according to data from ESDC — more than double the number in 2018.

As the program has expanded, so have the number of allegations of abuse and fraud, to the point where earlier this month, Canadian Employment Minister Randy Boissonnault declared that the “abuse and misuse of the TFW program must end,” and promised more stringent oversight to keep “bad actors” in check.

To hire a temporary foreign worker, an employer must first submit an LMIA to ESDC for approval, demonstrating there is a need for a foreign worker to fill a position for which no Canadian citizen or permanent resident is available. The cost of the application is $1,000 and must be borne by the employer. It is illegal to charge workers for an LMIA.

The ESDC documents reveal that in an effort to “manage unprecedented employer demand,” staff were pressured to process a higher volume of applications at a faster pace.

As of April 2023, 70 per cent of applications for TFWs in the low-wage stream had “processing time objectives” of 44 business days. Three months later, in July, that target jumped to 80 per cent of applications completed within 35 business days.

At the same time, completion targets for applications in the agriculture stream — in which the vast majority of TFWs are employed — increased from 70 per cent in 24 days to 80 per cent in 15 days.

“There’s a lot of pressure to spin these applications out as quick as you can,” the ESDC employee said.

“We’re constantly given new files and if you don’t meet the targets you get asked about it,” they said, adding that some staff have been disciplined for not following the guidelines.

According to streamlining directives from April 2023 and July 2023, ESDC employees were also told to “reduce contact with employers,” with the guideline that third parties applying on behalf of employers would not need to be contacted in cases where an employer’s application to hire a TFW had not been rejected in the past two years. 

However, the guideline does say this measure “does not prevent the officer from using their judgment in the assessment.”

The guideline is still in effect today, according to the ESDC employee who spoke to the Star.

“We had to call every single person (applicant) prior to 2022 and talk to them through the application and about their business needs,” said the employee.

“Now, I would say probably 90 per cent of the people that are applying aren’t even getting a call. We’re not verifying anything.”

At the same time, the directives tell staff to “discontinue the practice of checking on the website of the law society or the CPA (Chartered Professional Accountant) association to validate that the lawyer or the CPA who provided the attestation is a member in good standing.”

Immigration lawyers and licensed consultants in good standing with the College of Immigration and Citizenship can apply for LMIAs on the behalf of employers wishing to hire a TFW. Chartered professional accountants can demonstrate the validity of the business and “its ability to fulfil terms of the job offer to the temporary foreign workers,” according to the ESDC website.

Both Sierah and Connelly said it was alarming that the ESDC would ask staff to gloss over such important information, especially as it takes very little time to confirm whether a third-party applicant is in good standing.

“This is one of the most worrying parts of these documents,” Sierah said. “This undermines the whole integrity of the temporary foreign worker program and the LMIA process,” and “undermines the whole existence of the regulatory authorities.”

These guidelines are particularly troubling because LMIA fraud is primarily driven by consultants and employers who have learned to manipulate the system and continue to hire migrant workers to make profit, Sierah and the ESDC employee said.

“It takes about five to 10 seconds,” to check whether the applicant is in good standing or “whether they even exist,” Sierah said.

Employers can create fake job openings or partner with consultants to get LMIAs approved, which are then sold to foreign workers for tens of thousands of dollars, often with the worker unaware that selling LMIAs is an illegal practice. Many migrant workers come to Canada only to find their job does not exist, Sierah said.

Some employers who actually need workers can also choose to only hire those willing to pay for the job, he added.

The costs of failing to assess the legitimacy and good standing of employers and consultants can be profound on those who end up being the victims of fraud.

Prem, 39, came to Canada from India through a consultant who charged him $40,000 for an LMIA to work as a bookkeeper in a marketing company. He had extensive experience working in the UAE as an accountant for 15 years.

Prem, who the Star has granted anonymity due to fear of losing his status in the country, had all the right documents and papers to enter and work in Canada legally. But when he arrived in September 2023, he was told that the job he was promised did not exist.

“I was in total shock — I didn’t know what to do,” said Prem. “I had no idea how immigration works here.”

He even went as far as going to the location listed on his employment offer only to find that the business was just a residential address.

Nearly a year later, Prem said he is working as an Uber driver while he tries to find work.

“I had high hopes. I heard there’s lots of opportunities in Canada to build your life and career,” Prem said. “But I feel like I’ve wasted months of my life for no reason.”

Sierah, who helped Prem apply for a vulnerable worker’s open work permit, said he has seen LMIA scams like these increase “exponentially” in recent years.

Having seen the ESDC’s streamlining instructions, he says he is not surprised at the surge.

“On the black market, LMIAs used to cost somewhere between $10,000 to $15,000,” Sierah said. “Now, these workers are paying $70,000 to $80,000 to consultants and employers for LMIAs — and when they come to Canada they realize the job doesn’t exist.”

Connelly said migrant workers whose permits are tied to a single employer will often put up with “terrible treatment” out of fear of retaliation by their employer which could cost them their job and therefore their status. 

The UN’s special rapporteur on contemporary forms of slavery doubled down on his comments that Canada’s temporary foreign worker program is ”a breeding ground for contemporary forms of slavery,” earlier this month, stressing that granting migrant workers permanent resident status is necessary to end ongoing exploitation.

Sierah said the UN report “hit the nail on the head.”

“The result of this oversight is already here and we can already see it,” he said. “It is a contemporary form of slavery — and it’s government sponsored.”