Canada’s TFWP Changes: What Employers and Migrants Should Know

(CANADA) Canada’s Temporary Foreign Worker Program is entering its hardest reset in a decade, as Ottawa imposes tighter controls on employer access, higher wage floors, and regional limits while it throttles 2025 admissions. As of September 12, 2025, the government is holding to a target of 82,000 net new entries next year, after a steep 50% drop in arrivals from January through June compared with 2024. Officials say the push will steer hiring to real shortages and reduce temporary residents to 5% of Canada’s population by late 2026.

Key policy changes and mechanics

At the center of the shift is the Labour Market Impact Assessment (LMIA), the gatekeeping test employers must pass before hiring a non‑citizen.

• The LMIA validity window was cut to 6 months in 2024 (down from 12 months), forcing quicker recruitment or repeat filings.
• Service Canada paused low‑wage LMIA processing in any census metropolitan area with 6% or higher unemployment, closing many regions to entry‑level hires.
• Caps now limit low‑wage temporary foreign workers to 10% of a company’s workforce, with an overall 20% ceiling in most sectors.
• Certain sectors — agriculture, caregiving, short‑term, and seasonal roles — retain specific exemptions.

Rising costs and wage floors

Costs for employers are increasing markedly:

• Since November 8, 2024, employers using the High‑Wage stream must offer pay 20% above the provincial or territorial median wage.
• In Ontario, the high‑wage threshold rose from $28.39 to $34.07 per hour.
• Across streams, employers must meet or exceed the prevailing wage for the job and location. These figures are refreshed annually using Job Bank data (as of January 1, 2024).
• The higher floors price many positions out of the program and push small firms to reconsider program participation.

Intake targets and national objectives

• Ottawa’s 2025 admissions target: 82,000 net new TFWP entries.
• Policy aim: reduce temporary resident share to 5% by end‑2026.
• Impact to date: 125,903 fewer foreign worker arrivals between January and June 2025 versus the same period in 2024 — a 50% decline.
• Analysis (VisaVerge.com): shift toward permanent, skills‑focused pathways and narrower short‑term labour use outside priority sectors like construction and healthcare.

Family, duration, and spousal permit changes

Families face tighter rules:

• Since January 2025, spousal open work permits (SOWPs) are mainly limited to spouses of workers in TEER 0 or 1 roles (management and professional), or a short list of in‑demand TEER 2 or 3 occupations.
• The principal worker typically needs at least 16 months remaining on their work permit at the time of application to enable a SOWP.
• The maximum stay for low‑wage jobs under TFWP fell from two years to one year, reducing stability for entry‑level workers and their families.

Important: Without 16 months left on the principal worker’s permit, spousal open work permit approval is unlikely under current rules.

Strategic sector and regional targeting

Officials are steering the program toward sectors and regions with proven shortages:

• Commonly cited priority areas: construction and healthcare.
• In March 2025, IRCC introduced measures to support construction apprenticeships without study permits and convened an advisory council to examine work‑permit options, including for some undocumented workers already on job sites.
• Regional targeting uses unemployment rates as a lever: a 6% city/unemployment threshold can halt low‑wage processing entirely.

Practical implications for employers

Major operational impacts:

• Shorter LMIA validity forces faster recruiting or re‑filing costs.
• Wage hikes push payroll up across crews because of equal pay and morale pressures.
• 10% low‑wage and 20% overall caps constrain staffing plans for peak seasons.
• Moratoriums in metros with ≥6% unemployment may compel training locals or shifting operations.

Practical steps for employers (numbered):
1. Map your recruitment timeline backward from the 6‑month LMIA expiry, allowing buffers for ads, interviews, and notice periods.
2. Check the local unemployment rate monthly; a 6% rate can pause low‑wage LMIA processing.
3. Price offers against Job Bank’s prevailing wage and include the 20% high‑wage premium where applicable.
4. Track workforce ratios to remain within the 10% low‑wage and 20% overall caps.

Practical guidance for workers and families

Workers should plan around shorter terms and tighter family rules:

• Confirm whether the city’s unemployment rate crosses 6%, which can halt low‑wage processing.
• For spouses seeking SOWPs, gather evidence of the principal worker’s TEER level and remaining permit time (minimum 16 months usually required).
• High‑wage applicants must ensure pay letters reflect the 20% premium and local prevailing wage.
• Keep copies of contracts, pay stubs, and schedules for compliance checks.

Forms and official guidance (use official versions)

Start with government guidance and use the official application forms:

• Federal overview of TFWP: Temporary Foreign Worker Program – Government of Canada.
• LMIA application bundle and instructions: LMIA application – Temporary Foreign Worker Program.
• Work permit application (outside Canada): Application for Work Permit Made Outside Canada (IMM 1295).
• Changing conditions or extending stay (inside Canada): Application to Change Conditions or Extend Your Stay in Canada – Worker (IMM 5710).

Compliance, documentation, and enforcement

Compliance pressure is increasing:

• Expect more audits, site visits, and document requests focused on wages, job duties, schedules, housing, and safety.
• Keep organized records: advertising proofs, interview notes, payroll records, and proof of Canadian recruitment.
• Since October 28, 2024, accountant or lawyer attestations no longer prove business legitimacy for LMIAs. Company registrations, tax filings, bank letters, and leases now carry greater weight.

Warning: Weak documentation amid heavier enforcement can lead to delays or penalties. Organized files are essential.

Sector examples and scenarios

• Food processor case study: A mid‑sized processor in a metro near 6% unemployment could be blocked from filling a dozen low‑wage packaging roles. Options: pivot to higher‑paid operator roles meeting wage floors, invest in local training, or use a small number of foreign hires strategically.
• Caregiver scenario: With a one‑year maximum for low‑wage LMIAs and restricted SOWPs, caregivers should save early, build employer ties, and explore community supports or provincial programs if a second income won’t materialize.

Construction sector nuance

Construction is a partial exception:

• March 2025 IRCC changes aim to let apprentices train on sites without study permits and explore work‑permit routes for some undocumented workers with consistent records.
• Clear eligibility and union coaching can shorten hiring when LMIA routes and wage floors are met.

Broader context and outlook

• Historically the TFWP filled gaps when Canadian recruitment lagged. Over the past two years, the program has been refitted to curb misuse and align with labour data.
• The 2025–2027 immigration plan shifts volume toward permanent streams and reduces temporary resident growth.
• Expect continued tuning: use of wage data, caps, and regional jobless rates to target needs and prevent fraud. The advisory council in construction may create special routes for public builds and housing projects.

Final takeaway

The Temporary Foreign Worker Program remains available but is now smaller, slower, and more selective. Success requires:

• Planning carefully around timing (6‑month LMIA), documentation, and local labour indicators (6% unemployment threshold).
• Meeting the higher wage floors and complying with 10%/20% staffing caps.
• Keeping meticulous records and using official forms and guidance linked above.

Employers who adapt processes and budgets, and workers who align to high‑priority roles and maintain complete documentation, are most likely to succeed under the new settings.