In 2015, a number of changes were announced to the procedures at Canadian ports of entry. Unfortunately, there continues to be a lack of awareness about these changes on the part of many U.S. companies that occasionally assign employees to work in Canada. As a result, some companies have been caught off guard when their employees are refused entry at the Canadian border. We are writing this article to clarify the obligations of U.S. companies that send employees to perform work in Canada.
First, it is important to note that the substantive rules regarding the requirement for a work permit have not changed. It has been the case for many years that U.S. citizens who are going to provide services to a Canadian entity—even if they remain employees of their U.S. employer while they execute their assignment in Canada—will be considered to be entering the Canadian labor market.
Thus, they need a work permit. Typical examples are management consultants who come to Canada for just a few days and employees of a U.S. company coming to Canada to “lend a hand” by working for a short period of time on a specific project for the Canadian affiliate of the U.S. employer. Even if the employee’s stay will be short and even if the employee remains an employee of the U.S. company while in Canada, the employee will be “working” in Canada and therefore must obtain a work permit.
However, as of February 2015, new procedures came into force. Before that time, a citizen of the U.S. or of another visa-exempt country who presented him or herself to a port of entry and was able to provide enough information to the Canadian immigration officer for the latter to conclude that a Labour Market Impact Assessment (LMIA) was not needed because the situation fit one of the LMIA exemptions (notably intra-company transfers and work permits under NAFTA) could get away with not having put together a proper application. If the immigration officer was particularly helpful, the applicant would be invited to pay a fee of $155 and would walk out of the immigration office with a work permit in hand.
When the new rules came into effect in February 2015, an employer was required to submit an “offer of employment” to Immigration Canada and pay a $230 compliance fee (in addition to the $155 fee for work permit issuance). As we announced in May 2015, these changes were part of the new compliance regime aimed at ensuring that employers comply with the terms and conditions of offers of employment made to foreign employees. The $230 fee was introduced to fund an enforcement regime (through audits and inspections).
In October 2015, further changes were made. Employers of foreign employees are now required to submit the “employer offer” through an Employer Portal created at Immigration Canada’s website. These requirements have to be complied with BEFORE the applicant presents him or herself at the port of entry. While immigration officers were somewhat accommodating in the immediate months following the introduction of the February 2015 changes, they are no longer as accommodating because they believe that the changes have been in force long enough that companies should be aware of them.
Although many immigration officers prefer to see a Canadian company submit the “employment offer,” U.S. employers should know that a foreign entity can also do so. Since the information provided in the Employer Portal contains several pieces of information related to the employment conditions of the person being assigned to Canada (specific salary, other benefits, number of vacation days, etc.), it is preferable to have the actual employer (the foreign entity if the employee remains attached to his U.S. employer) create the Employer Portal.
All employers should be aware that the number of audits/inspections is relatively high and the information in the Employer Portal has to be entered carefully since this is the information that the auditor will use, if an audit takes place, to determine whether the employer has complied with the terms of the offer. We therefore recommend that the employment offer be submitted by the entity that has control of the employee’s employment conditions.
Finally, it is important for employers to remember that they are bound by the agreed-upon terms and conditions of employment for the full length of the employee’s stay in Canada. Changes to an employee’s terms and conditions of employment (including salary increases and payment of additional benefits) should not be made without communicating them to Immigration Canada.