Canada expands temporary foreign worker rules to address labour shortages

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Canada expands foreign worker rules

Highlights

Canada will allow Labour Market Impact Assessment approvals under the Temporary Foreign Worker Program’s Low-wage Stream to extend up to two years from November 6, 2026, doubling the previous limit.
Budget 2026 allocates $151.5 million over five years to improve Temporary Foreign Worker Program service delivery and $82 million over four years to support the Migrant Worker Support Program.
From March 2027, opting-in provinces can raise the cap on temporary foreign workers in the Low-Wage Stream from 10% to 15% of workforce, with rural and priority sectors receiving targeted or full access.

Program changes and implementation timeline

As reported by Canada.ca, citing Employment and Social Development Canada, the federal government is immediately changing the Low-wage Stream of the Temporary Foreign Worker Program to give employers longer approval periods and expand exemptions in certain high-unemployment urban areas. Labour Market Impact Assessment applications submitted on or after November 6, 2026 can now run for up to two years, versus one year previously, and early childhood educators are being added to the list of sectors exempt from processing restrictions in Census Metropolitan Areas with unemployment rates of 6% or higher.

The government said the program remains focused on filling labour shortages in critical sectors where qualified Canadian workers are not available. It framed the reforms as part of a wider effort to restore predictability for businesses, support local economies and keep essential services operating in communities facing persistent workforce gaps.

Budget 2026 also allocates $151.5 million over five years to support and improve service delivery under the program. Separate changes proposed for March 1, 2027 remain contingent on provinces and territories opting in, with the federal government planning to tailor access rules by unemployment rate, community size and occupation lists under the Canadian Occupational Projection System.

Regional labour flexibility and immigration pathways

Under the proposed March 2027 framework, employers in large metropolitan areas with unemployment below 6% would get targeted access for occupations listed in COPS and any additional jobs identified by provinces and territories. In rural parts of large CMAs and in smaller CMAs with populations between 100,000 and 250,000, employers would also receive targeted access, while rural communities would continue to have full access to all occupations in the Low-Wage Stream.

Provinces and territories would also be able to request added flexibility for eligible employers in designated communities. If they opt in, the federal government would allow employers to hire temporary foreign workers for up to 15% of their workforce under the Low-Wage Stream, up from the current 10% cap, while priority sectors would keep the existing 20% limit.

Minister Patty Hajdu is set to meet provincial and territorial counterparts in the coming weeks to discuss how the program can better respond to labour shortages, particularly in rural communities, while keeping Canadians first in line for available jobs. The federal government also said Budget 2026 includes a time-limited measure offering provinces and territories additional Provincial Nominee Program spaces and access to existing federal economic immigration programs to help retain workers already in Canada.

Budget 2026 further sets aside $82 million over four years for the Migrant Worker Support Program, which helps temporary foreign workers understand and exercise their rights while living and working in Canada. Ottawa said it will continue monitoring labour market conditions with provinces, industry groups and labour organizations as it seeks to protect the integrity of the program.

Our earlier article on Malaysia’s MyIMMs maintenance contract extension explained how the government is keeping its legacy immigration platform running while it transitions to the National Integrated Immigration System (NIISe). We detailed the new two-year extension through February 2029, why parallel operations are needed to avoid service disruptions, and how the rollout timeline affects the contractor, HeiTech Padu.

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