The change allows some employers to exceed the usual 10% or 20% cap on low-wage temporary foreign workers. The 20% limit applies to employers in the in-demand sectors of health care, construction and food production.
How the new rule works
Under the revised calculation, employers with fewer than 10 employees at a particular work location can hire up to one low-wage temporary foreign worker. Employers in the in-demand sectors can hire up to two.
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Previously, this alternative calculation was available only to employers with fewer than 10 employees across their entire workforce.
The change applies where the standard 10% or 20% calculation would otherwise allow an employer to hire less than one or two workers.
Low-wage worker rules
A position is considered low-wage if its pay is below 120% of the regional median wage listed on the federal government’s Job Bank.
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Jobs that meet or exceed the wage threshold can be filled through the high-wage stream, which is not subject to the workforce cap. In Ontario, the threshold is $36.92 an hour.
Employers hiring through the low-wage stream must also meet requirements including paying the worker’s transportation to and from Canada, providing access to suitable housing costing less than 30% of the worker’s pre-tax income and buying private health insurance where provincial or territorial coverage is not available.
LMIA rules
Employers generally need a positive or neutral Labour Market Impact Assessment (LMIA) from ESDC to hire or retain foreign workers through the Temporary Foreign Worker Program (TFWP). The assessment is intended to show that no qualified Canadian citizen or permanent resident is available for the job.
ESDC counts full-time and part-time employees, approved temporary foreign workers who have not yet started work and vacant positions included in an employer’s LMIA application. Part-time employees who work an average of less than 30 hours a week count as half an employee.
Since March 13, 2026, provinces have also been allowed to raise the low-wage workforce cap to 15% for employers in rural areas.
The government has maintained a moratorium on LMIA applications for low-wage jobs in urban areas where unemployment is above 6%. The restriction has been in place since September 2024.
Most Canadian work permits are issued through the International Mobility Program (IMP), which does not require an LMIA.
Under Canada’s 2026 immigration levels plan, the federal government expects to admit 60,000 foreign workers through the TFWP and 170,000 through the IMP.