LMIA Applications (High-Wage / Low-Wage)

Labour Market Impact Assessments (LMIAs) are one of the most technical, procedure-heavy, and compliance-sensitive components of Canadian immigration law. Administered by Employment and Social Development Canada (ESDC), the LMIA process determines whether hiring a foreign worker will have a neutral or positive impact on Canada’s labour market. Employers must meet strict advertising requirements, offer prevailing wages, maintain business legitimacy, comply with employment laws, and prepare extensive documentation. Any error can result in refusal, delays, audits, or employer penalties.

Let's have a detailed, lawyer-level breakdown of LMIA applications—with a specific focus on the two major streams most employers rely on: the High-Wage Stream and the Low-Wage Stream. It examines eligibility rules, advertising obligations, wage requirements, transition plans, employer compliance, inspection risks, refusal grounds, red flags, and strategic best practices to ensure successful submissions.

Overview of LMIA Requirements

An LMIA is mandatory unless a clear exemption applies under the International Mobility Program (IMP). LMIAs are foundational to employer-specific work permits and require employers to show:

• a genuine need for the foreign worker,
• efforts to recruit Canadians/permanent residents,
• ability to pay wages,
• compliance with wage standards,
• valid business operations,
• clean employment-law compliance history.

High-Wage vs. Low-Wage Categories

ESDC determines the stream based on the job’s hourly wage in relation to the provincial/territorial median wage.

• High-Wage Positions: at or above the provincial median wage.
• Low-Wage Positions: below the provincial median wage.

Each stream carries different obligations and documentation.

1. High-Wage LMIA Applications

High-wage positions include NOC TEER 0–5 occupations where wages meet or exceed provincial median. Employers must submit:

• A comprehensive Transition Plan (mandatory),
• Proof of financial ability,
• Valid business documentation,
• Recruitment evidence,
• Job offer meeting prevailing wage.

Transition Plan Requirements

The Transition Plan demonstrates how the employer will reduce reliance on foreign workers and increase domestic hiring. It must outline:

• training for Canadians,
• internal promotions,
• long-term recruitment strategies,
• plans to transition the foreign worker to PR (if applicable),
• proof of prior commitments (in renewals).

Failure to meet Transition Plan commitments can lead to LMIA refusal, employer scrutiny, or compliance inspections.

Recruitment Requirements (High-Wage)

Employers must advertise:

• for at least 4 consecutive weeks,
• within the 3 months prior to LMIA submission,
• on Job Bank + 2 additional recruitment platforms,
• with detailed job descriptions aligned to the NOC.

Wage Requirements

High-wage LMIA wages must meet or exceed:

• the provincial median wage, and
• the prevailing wage for the NOC.

ESDC examines wage justification closely.

2. Low-Wage LMIA Applications

Low-wage positions include jobs paid below the median wage. This stream includes additional compliance requirements because of the vulnerability of workers and higher risk of exploitation.

Requirements Unique to Low-Wage Positions

• No Transition Plan required (unlike high-wage),
• Strict caps on number of foreign workers per worksite,
• Mandatory housing or housing assistance,
• Transportation requirements (to/from Canada),
• Signed employment contract,
• More frequent mandatory inspections.

Worksite Cap Rules

Businesses may only have a limited percentage of their workforce in low-wage positions under the Temporary Foreign Worker Program (TFWP). Exceeding caps leads to automatic refusal.

Recruitment Requirements (Low-Wage)

Similar to high-wage but with heightened scrutiny on:

• genuineness of the labour shortage,
• efforts to hire Canadians from underrepresented groups,
• job requirements not being overly restrictive.

Mandatory Recruitment Requirements for All LMIAs

1. Job Bank Posting (compulsory)

Must include:

• NOC-aligned duties,
• wages,
• location,
• requirements justified (not exaggerated),
• company details.

2. Two Additional Recruitment Methods

Examples:

• Indeed, LinkedIn, Glassdoor,
• sector-specific job boards,
• trade publications,
• local/ethnic newspapers,
• university career portals.

3. Diversity Recruitment

ESDC encourages outreach to:

• Indigenous communities,
• newcomer settlement agencies,
• youth unemployment programs.

Employer Proof of Business Legitimacy

Employers must show:

• valid CRA business number,
• financial capacity (T2s, NOAs, payroll summaries),
• active operations (invoices, licenses),
• genuine need for the role.

Wage Assessment and NOC Compliance

Wage must align with:

• median wage for region,
• prevailing wage for the NOC,
• any collective bargaining agreements.

Incorrect wage selection is a common ground for refusal.

Worker Eligibility Considerations

Although the LMIA focuses on employers, foreign workers must still:

• meet qualifications for the NOC,
• provide proof of experience,
• pass admissibility checks,
• demonstrate genuine intention to work for the employer.

High-Risk Red Flags for LMIA Refusals

• job duties inconsistent with NOC description,
• inflated job requirements,
• wages below median or prevailing rate,
• weak recruitment efforts,
• financial inability to pay wage,
• business legitimacy concerns,
• previous employer non-compliance history,
• unclear rationale for hiring a foreign worker.

Procedural Fairness Letters (PFLs)

ESDC may issue a PFL when:

• recruitment appears insufficient,
• wage levels are questionable,
• employer legitimacy is unclear,
• NOC categorization is incorrect,
• transition plan concerns exist (high-wage).

Failure to respond adequately often results in refusal and long-term compliance issues.

ESDC Employer Inspections

Employers are subject to inspections for up to 6 years after hiring a foreign worker. Inspectors may request:

• payroll records,
• contracts,
• timesheets,
• bank statements,
• evidence of working conditions,
• proof of employer obligations (transportation/housing for low-wage).

Penalties include:

• administrative fines,
• ban from TFWP/IMP,
• publication on the Employer Compliance Registry.

Judicial Review (Federal Court)

LMIA refusals may be challenged when officers:

• ignore key evidence,
• apply improper wage/NOC standards,
• misinterpret recruitment efforts,
• breach procedural fairness.

Strategies for LMIA Success

• Accurately match job duties with NOC descriptions.
• Use competitive and compliant wage levels.
• Document all recruitment activities meticulously.
• Prepare strong Transition Plans for high-wage positions.
• Address any past compliance issues proactively.
• Ensure business legitimacy documentation is complete.
• Provide clear rationale for hiring foreign workers.

Role of Skilled Counsel

The LMIA process is one of the most complex components of the TFWP. Skilled legal counsel:

• determines the correct NOC and stream,
• prepares compliant recruitment strategies,
• drafts accurate job descriptions and wage assessments,
• builds robust Transition Plans,
• prepares employers for inspections,
• handles PFL responses,
• pursues judicial review where necessary.

With proper legal preparation, employers can meet ESDC’s demanding standards, hire foreign talent efficiently, and ensure long-term compliance within Canada’s labour market framework.