Restaurants Canada Warns of Major Impact from Changes to Foreign Workers Policy

The federal government’s latest changes to the Temporary Foreign Worker (TFW) Program take effect this Thursday, aiming to reduce Canadian employers’ reliance on foreign labor to fill vacancies. However, Restaurants Canada is warning of significant repercussions for the industry.

Currently, there are 73,000 job openings in the restaurant sector, with rural, remote, and tourist regions facing the greatest challenges in hiring. The updated TFW Program will now limit foreign workers to one-year contracts, down from two years, and will cap the number of foreign workers at 10% of a business’s workforce, reduced from the previous 20%.

Mark von Schellwitz, vice-president of Restaurants Canada’s western branch, explains that employers invest considerable time and money in recruiting and training foreign workers, which may no longer be worthwhile for just a one-year contract.

“By the time the workers are fully integrated into the business, they’ll only have a year left to work, instead of the two years we had before. It just doesn’t make sense,” said von Schellwitz.

Rather than tweaking the TFW system, von Schellwitz believes a more sustainable solution is to transition foreign workers into permanent residents.

“Our goal should be to bring immigrants in and help them become permanent residents, instead of this temporary solution where workers stay for a year, then have to leave, and we have to start over with new hires,” he said. “We also need a program to match the roughly one million refugees and immigrant family members who aren’t currently working with available jobs.”

The TFW Program has faced frequent changes and controversies over the years, particularly regarding whether Canadian employers make sufficient efforts to hire local candidates before turning to foreign workers. Employers must now provide a labor market impact assessment to demonstrate the need for hiring foreign labor.

Worker advocates have raised concerns over tying TFW contracts to a single employer, arguing it can lead to exploitation and limit workers’ ability to seek better opportunities. While most workers are expected to leave Canada at the end of their contract, some may apply through other immigration streams to remain as permanent residents.

Von Schellwitz notes that the best outcomes arise when foreign workers are allowed to stay in Canada long-term, adding that while only 3% of workers in the Canadian restaurant industry come from the TFW Program, the changes will severely impact smaller towns, where restaurants may be forced to cut hours or close down due to staffing shortages.