ESDC Reports Large Drops in Low-Wage Temporary Worker Applications & Record Compliance

The ESDC media release also reiterated that the program’s role is to recruit foreign workers only when Canadian workers are not available to fill roles. It goes on to say the temporary foreign worker program makes up just 1% of Canada’s workforce.  

Key Takeaways 

• 1,435 employer inspections were conducted during the 2024–2025 fiscal year. 
• 10% of inspected employers were found non-compliant with program rules. 
• Monetary penalties more than doubled year-over-year, reaching $4.88 million. 
• 36 employers were banned from the TFW Program — a threefold increase from 2023–2024. 
• The government continues to maintain that the program is a last resort for employers who cannot find qualified Canadians or permanent residents. 

What the Federal Government Is Saying 

The latest update comes from Employment and Social Development Canada (ESDC), which oversees the Labour Market Impact Assessment (LMIA) process — a necessary step for employers seeking to hire temporary foreign workers. 

According to ESDC, the TFWP is meant to be used only when Canadian citizens and permanent residents are unavailable for a position. Employers must show they made genuine efforts to recruit domestically, and those efforts must continue while their LMIA application is being assessed. 

Since September 2024, measures to reduce reliance on the program have led to a 50% drop in overall TFW applications, and a 70% decline in the low-wage stream. ESDC frames these changes as part of a larger effort to encourage sustainable employment practices that prioritize Canadian labour – particularly in a context where Canadian unemployment is historically high, especially among young workers.  

“The TFW Program is a last resort measure for businesses – it is no substitute for Canadian talent, and its misuse will never be permitted,” said Patty Hajdu, Minister of Jobs and Families. 

Employer Compliance and Inspections 

ESDC’s enforcement branch is responsible for ensuring employers uphold their obligations to temporary foreign workers, including providing safe workplaces, accurate job descriptions, and fair wages. The recent ESDC press release went into the recent enforcement activities in detail.  

In the 2024–2025 fiscal year, 1,435 compliance inspections were conducted, and 10% of employers were found non-compliant. The department issued $4.88 million in penalties and banned 36 employers from participating in the program — the highest number on record. 

Examples of Violations 

• Agriculture sector: An employer was fined $212,000 and banned for 2 years for poor working conditions and failing to provide documentation. 

• Residential construction: Fined $161,000 and banned for 5 years for unpaid wages and unsafe conditions. 

• Long-haul trucking: Fined $150,000 for not operating a genuine business and refusing to provide requested documentation. 

• Fish and seafood sector: Fined $1 million and banned for 10 years — the largest penalty in program history — for wage violations, unsafe conditions, and workplace abuse. 

Employers who fail to comply with TFW Program conditions are listed on a public registry managed by IRCC, ensuring transparency for workers and the public.  

Common Reasons for Employer Non-Compliance with LMIA Requirements

The most frequent cause of non-compliance in 2024–2025 was employers failing to provide the required documentation to inspectors. In our opinion, this may be more related to a lack of understanding of LMIA requirements than anything sinister on the employer’s behalf. Though, we’re sure some could be related to bad actors.  

Other common issues included: 

• Breaching federal or provincial labour and recruitment laws. 

• Failing to maintain a workplace free of physical, sexual, psychological, or financial abuse. 

• Not attending scheduled meetings or refusing to answer questions from inspectors. 

• Paying workers less than promised or providing conditions that differed from the offer of employment. 

• Failing to actively operate the business for which the worker was hired. 

Many of these are fairly significant breaches that could constitute abuse of the workers. As a result, we aren’t surprised to also find out that the number of people applying for an open work permit for vulnerable workers has significantly increased in 2025 compared to 2024 – to the tune of 847% in Ontario this year, for example. You can read more about this trend in the Toronto Star.  

Moving2Canada Commentary: The Program’s Principles vs. Practice 

While ESDC’s public statements emphasize that the TFW Program is designed to give Canadians and permanent residents first access to available jobs, the practical operation of the system tells a more complicated story. 

Under the current setup, employers advertising through the federal Job Bank platform — which integrates directly with LMIA requirements — are required to consider applications from all individuals in Canada who are legally authorized to work. This includes not only Canadian citizens and permanent residents, but also temporary workers holding open work permits. 

This means that in practice, when employers post jobs through Job Bank as part of their LMIA process, they are reviewing candidates who may already hold temporary status in Canada. As a result, the government’s stated goal of ensuring that Canadians are “always first in line” does not necessarily align with how the system functions on the ground. 

For employers, this can create confusion about who counts as a “qualified Canadian worker.” For temporary residents — including those on open work permits or seeking to transition to permanent residence — it can also blur the lines between eligibility and preference in recruitment. 

While ESDC’s compliance efforts are clearly intensifying, this gap between policy intent and program reality remains an ongoing tension within Canada’s labour market strategy. 

Reporting Abuse or Unsafe Conditions 

Workers and the public are encouraged to report suspected program misuse or unsafe conditions directly to the government. Reports can be made confidentially and anonymously — your name does not need to be shared, and your employer will never be informed of who made the report. 

Ways to report: 

• Confidential tip line: Available 24/7 

• Live agents: Available in 200 languages, Monday to Friday, 6:30 a.m. to 8:00 p.m. ET 

• Online tool: Allows anonymous reporting at any time 

Information shared through the tip line is protected under Canada’s privacy laws. ESDC works with IRCC, the Canada Border Services Agency (CBSA), and the Royal Canadian Mounted Police (RCMP) to investigate any suspected fraud or abuse identified through these reports.  

What This All Means for Newcomers 

For newcomers working in Canada or considering employment through the TFW Program, the message is clear: the program remains active but under tighter oversight. 

While these changes are aimed at protecting worker rights and strengthening accountability, they also highlight the complexity of how Canada balances domestic labour priorities with the realities of its temporary and transitional workforce.