Canada has updated the low-wage stream of the Temporary Foreign Worker Program, giving some multi-site employers more room to hire at smaller locations. The change affects how the workforce cap is calculated for worksites with fewer than 10 employees, and it may help businesses in sectors facing ongoing labour shortages while still keeping LMIA rules and worker protections in place.
Canada changes low-wage TFWP rules for employers with small worksites
Canada’s federal government has introduced an important adjustment to the low-wage stream of the Temporary Foreign Worker Program (TFWP). The update is aimed at employers that operate more than one location, especially businesses with several small worksites spread across a city, region, or province.
Under the revised approach, Employment and Social Development Canada (ESDC) now allows eligible employers to use a location-by-location calculation when applying the low-wage workforce cap for worksites with fewer than 10 employees. In practical terms, this means some employers may now be able to hire at least one low-wage temporary foreign worker at a small site, or up to two in certain in-demand sectors, even when the usual percentage cap would have produced a lower number.
This is a notable development for employers and foreign nationals following Temporary Foreign Worker Program rules in Canada. It may create more job opportunities for workers seeking employer-supported permits, while also giving smaller workplaces a more realistic way to meet staffing needs.
What the old cap looked like
Normally, employers hiring through the low-wage stream are limited to a set share of their workforce. In most cases, that cap is 10% of the total workforce. For certain sectors that continue to face stronger labour demand, the cap can be 20%.
Those higher-cap sectors include health care, construction, and food production. Before this update, the special alternative calculation for employers with fewer than 10 employees generally applied only at the national business level. That made it harder for a company with many small branches to access the rule if its total workforce across Canada was larger.
What has changed now
ESDC has shifted the focus to the individual work location. If a specific location has fewer than 10 employees, the employer may now use the alternative cap at that site instead of relying only on the company’s total national headcount.
As a result, a qualifying employer may be able to hire:
- one low-wage temporary foreign worker at a small work location in most sectors; or
- two low-wage temporary foreign workers at a small work location in in-demand sectors covered by the 20% cap.
This change will likely matter most to restaurants, care providers, contractors, and other businesses with multiple modest-sized operations.
Why this matters for foreign workers and Canadian employers
For employers, the update offers more flexibility in places where local recruitment remains difficult. A business may have enough staff overall across Canada to lose access to the old alternative rule, yet still struggle to fill jobs at a single small branch. The new method is meant to address that gap.
For foreign workers, the change could lead to more LMIA-supported job offers in communities and neighbourhoods where small employers previously had limited access to the programme. Anyone exploring a move through a Canadian work permit pathway should pay close attention to these employer-side changes, because they can directly affect hiring opportunities.
Low-wage versus high-wage positions
In the TFWP, a job is treated as low-wage if the pay is below 120% of the regional median wage listed by the federal Job Bank. Jobs at or above that threshold fall into the high-wage stream. That distinction matters because the high-wage stream is not subject to the same workforce cap.
For example, in Ontario, the wage threshold mentioned at the time of the source update was $36.92 per hour. Thresholds vary by region, so employers and applicants should always check the latest figures before relying on them.
People comparing their longer-term options should also remember that temporary work can sometimes support future permanent residence plans. Depending on the job, province, and skill level, Canadian work experience may later help with Express Entry immigration to Canada, including the Canadian Experience Class, or with a Provincial Nominee Program.
LMIA approval still remains central
The new cap calculation does not remove the need for a Labour Market Impact Assessment. In most low-wage TFWP cases, the employer must still obtain a positive or neutral LMIA from ESDC before the foreign worker can receive or renew a permit. The LMIA process is designed to show that no suitable Canadian citizen or permanent resident is available for the role.
If you are new to this area, you can review the basics of the LMIA process for Canadian employers and workers. Employers must also follow recruitment and compliance rules, and foreign nationals should make sure the job offer is genuine and properly documented.
How the workforce cap is counted at a work location
One of the most important parts of this update is how ESDC counts the workforce at a specific location. The number is not limited to people currently on the schedule. The calculation can include existing staff, certain approved foreign workers, and even some vacant positions tied to the LMIA request.
At a given work location, the workforce count includes:
- full-time employees;
- part-time employees;
- temporary foreign workers with approved LMIAs who have not started work yet; and
- vacant positions the employer is seeking to fill through the LMIA application.
Part-time workers count differently. If an employee works less than 30 hours per week on average, that person counts as 0.5 of an employee for cap purposes. This can make a real difference for businesses with mixed staffing models.
Worker protections still apply
Even with the expanded access, employers using the low-wage stream must continue to meet extra obligations. These rules are meant to protect temporary foreign workers and reduce the risk of exploitation.
Among other things, employers may need to cover transportation to and from Canada, help ensure access to suitable housing at an affordable cost, and provide private health insurance when provincial or territorial public coverage is not yet available. These obligations remain an important part of the low-wage stream and should not be overlooked by either employers or workers.
Foreign nationals considering work in Canada should also think beyond the initial permit. In some cases, a temporary job can become part of a broader path to permanent residence in Canada. Depending on the occupation, language level, and province, workers may later benefit from programmes tied to regional labour needs, such as the Atlantic Immigration Program or rural community pathways.
Broader immigration context: what applicants should keep in mind
This policy update sits within a wider Canadian immigration system that separates temporary work from permanent immigration, even though the two can sometimes connect. Work permits under the TFWP are different from permits issued under the International Mobility Program, which often do not require an LMIA.
Canada continues to issue many work permits outside the TFWP as well, including open and LMIA-exempt permits. Still, LMIA-based hiring remains highly relevant in sectors where employers need direct access to international labour.
Restrictions still exist in some urban areas
Readers should also remember that low-wage LMIA processing has faced restrictions in some urban regions with unemployment above the federal threshold. That means expanded cap access does not automatically mean every employer in every city can hire under the low-wage stream. Local labour market conditions still matter.
For applicants planning a full immigration strategy, temporary work is only one piece of the puzzle. Language test results such as IELTS, CELPIP, TEF, or TCF, educational credential assessments, and skilled work history can all shape future eligibility for economic programmes. If your long-term goal is settlement, it may help to explore your Canadian immigration options early rather than waiting until a work permit is close to expiry.
A practical next step for workers and employers
Because this update affects employer calculations, many foreign workers may not immediately know whether it improves their situation. The best approach is to review the job location, wage level, sector, and LMIA requirements carefully. Employers should confirm whether a specific worksite qualifies under the revised rule, and workers should ask whether the position falls under the low-wage or high-wage stream.
If you are unsure how a temporary job could fit into your broader immigration to Canada process, it may be helpful to get a professional immigration evaluation. A careful review can identify whether a work permit, provincial nomination, or Express Entry profile may be the better route for your goals.
Immigration rules and programme requirements can change quickly, so readers should always confirm current information with IRCC, ESDC, or a licensed immigration consultant before making decisions. EverNorth Immigration is here to help with experienced, professional support at every stage of your journey toward a new life in Canada, and you are welcome to book your free immigration assessment to better understand your options.
