Advertisement

The values and vulnerabilities of Canada’s temporary foreign workers program

The federal government imposed a moratorium on the use of temporary foreign workers in the fast-food industry.

Canada's temporary foreign workers program continued to rack up criticism this week with fresh allegations that companies were abusing the system in a variety of spectacular manners.

The program has been maligned by labour unions but defended by business associations. And in the middle has been the federal government, promising to get the program in order and put an end to the perceived abuses.

The issue has been highlighted by a series of high-profile reports linking several notable companies to allegations of impropriety.

Most recently, MacDonald's locations in British Columbia and Alberta have been accused of various indiscretions, including forcing temporary foreign workers to live together in a shared apartment and pay rent directly to the company.

But even before the Big Mac attack, there were allegations that Canada's temporary foreign workers program was being used improperly.

Last month, the Alberta Federation of Labour claimed 65 oil-sand contractors were laid of and replaced by low-paid workers from Croatia.

Previous complaints surround Chinese workers brought in by a B.C. coal mine, Royal Bank tech staffers laid off in an apparent outsourcing movement and more than one fast food restaurant accused of replacing staff with lower-paid foreign workers.

Even a Tim Hortons franchise has been accused of mistreating foreign workers. In December, two Filipino workers alleged a Fernie, B.C., store owner cheated them out of overtime pay by driving them to the bank to cash their paycheques and then taking a cut.

The issue has become high debated, highly divisive and highly confusing. Here is an explainer about the value and vulnerability of Canada's Temporary Foreign Workers Program.

What is the Temporary Foreign Workers Program (TFWP) and why does it exist?

As its name suggests, the Temporary Foreign Workers Program helps Canadian companies hire non-Canadians to fill job vacancies. The program is intended to address legitimate labour shortages, and was originally established so companies could hire skilled workers when no appropriate Canadian applicants were available. One example often cited is booming Saskatchewan, where last year some 3,000 companies reportedly sought permission to hire temporary foreign workers to fill labour shortages.

The federal government is adamant that the program only be used as a stopgap measure and that hiring Canadian applicants remain a top priority. Yet the numerous complaints suggest the program has been misused.

How is the program being allegedly misused?

Companies have been accused of hiring temporary foreign workers over skilled Canadians, in some cases to avoid paying a higher salary, or even replacing Canadian employees with foreign workers. In some cases, companies have been accused of using the program to fill positions that don't need a specialized skill set and even withholding money from foreign workers.

Some Belize temporary foreign workers (TFWs) hired to work at McDonald's locations in Edmonton have alleged their employer forced them to live together in a shared apartment and were overcharged for the cost of rent, which was taken directly out of their paychecks. Some full-time workers were said to bring home less than $800 per month. One fired worker told CBC News that the situation was tantamount to "modern day slavery."

Where are these temporary foreign workers going?

In short, everywhere. But Western Canada has seen the largest influx. Statistics from Employment and Social Development Canada suggests 202,000 temporary foreign workers entered Canada in 2012. British Columbia had 28,000 TFWs in 2012 with half of those living in Vancouver, doing everything from flipping burgers to performing manual labour.

Alberta had more than 84,000 in the same year. Ontario was also a frequent destination, with nearly 50,000 TFWs in the province in 2012.

According to The Province, there are currently more than 70,000 TFWs in British Columbia right now. Columnist Michael Smyth points out that B.C. is home to about one-quarter of the national total of TFWs, despite being home to only 13 per cent of the country's population.

What effect has this had on Canadian workers?

The program was intended to have little to no impact on Canadian workers, but that does not appear to be the case.

A Parliamentary Budget Office report released in March suggests the temporary foreign worker program could be partially responsible for job shortages in Canada. The report, released March 25, suggests the impact of the TFWP is uncertain, but could be substantial.

"[A] higher portion of temporary foreign workers (TFWs) in the private sector could also be putting downward pressure on the private-sector job vacancy rate, as the presence of the Temporary Foreign Worker Program (TFWP) leaves labour demand broadly unaffected while reducing the number of job vacancies, thereby reducing the job vacancy rate," reads the report.

Statistics Canada numbers suggests job vacancies are rare, with an average of 219,000 vacancies in 2013 - some 33,000 fewer than the previous year. However, competition for those jobs is also tougher - with 6.2 unemployed people per job, compared to 5.4 people in 2012.

Are we cracking down on TFWP misuse?

The federal government appears to be. They announced last spring that they were reviewing the program and making changes to ensure companies can't, or at least won't, abuse the system. Those caught abusing the system could be added to a blacklist, which bars them from hiring temporary foreign workers in the future. Currently, the list of companies that have had their access revoked includes one restaurant in Fenelon Falls, Ont.

A Labrador pizza restaurant and three British Columbia McDonald's locations currently have their access to the program suspended.

Employment Minister Jason Kenny announced in March that hefty fines would be leveraged against offending companies starting in 2015. It is not clear how much that threat is actually worth. The Alberta Federation of Labour has called the promise a "smokescreen" considering current punishments are rarely used.

“The only way that abuse of the Temporary Foreign Worker program ever comes to light is through individual workers coming forward and going to the media, or through the research of journalists, activists and non-governmental organizations,” President Gil McGowan said in March. “And it seems the only punishment for abusing the system is doled out by news organizations acting in the best interest of Canadians.”

As spectacular allegations continue to come forward, and as questions about the impact such outsourcing has on Canadian workers continue to circle, we will hear more about the temporary foreign workers program.

Who knows, maybe the problems will all be sorted out before every job in the country is outsourced. That would be nice.