Hiring temporary foreign workers can help address labour shortages and support business growth, but it also comes with important and ongoing employer compliance obligations. The employer compliance regime is designed to ensure that terms and conditions of employment promised to foreign workers are offered in reality, with the aim of preventing mistreatment of foreign workers in Canada. Whether an employer hires through the Temporary Foreign Worker Program (TFWP) or the International Mobility Program (IMP), compliance obligations extend beyond the initial hiring process and continue throughout the worker’s employment in Canada.

With government oversight increasing in recent years and penalties becoming more substantial, it is critical that employers understand their obligations to safeguard their business, support their workers, and maintain access to Canada’s foreign worker programs.

What Is Employer Compliance?

Employers are required to meet a number of conditions and obligations associated with hiring temporary foreign workers under Canadian immigration law.

Compliance is currently overseen by different government departments, depending on the program through which the foreign worker obtained their work permit:

• Employment and Social Development Canada (ESDC) administers compliance under the Temporary Foreign Worker Program (TFWP) and may inspect the conditions of work permits issued pursuant to a positive Labour Market Impact Assessment.
• Immigration, Refugees and Citizenship Canada (IRCC) oversees compliance under the International Mobility Program (IMP) and may inspect the conditions of work permits issued that are Labour Market Impact Assessment exempt.

Although specific requirements vary by program, employers are generally required to:

• Pay the wages promised to the worker and provide the agreed-upon working conditions,
• Ensure the employee performs the duties outlined in the approved job offer,
• Comply with applicable federal, provincial, and territorial employment laws,
• Take reasonable steps to maintain a workplace free from abuse,
• Retain records that demonstrate compliance, and
• Cooperate fully during inspections and provide requested documentation.

These obligations remain in effect throughout the worker’s employment and may be reviewed for up to six (6) years beginning on the first day of employment for which the work permit was issued.

When Can an Inspection Take Place?

Receiving notice of an inspection does not automatically indicate wrongdoing.

Employers may be selected for inspection for several reasons, including:

• Random selection,
• Suspected non-compliance,
• A history of previous non-compliance, or.
• Other circumstances identified under Canadian immigration law

Inspections can be conducted remotely or in person, and officers have the authority to request documents and interview employers and employees of the business to assess and verify compliance. Most inspections are initiated by random selection.

What Records Should Employers Maintain?

Strong recordkeeping practices are critical to prepare for a compliance inspection.

Employers should retain any documentation that can be used to demonstrate that the employment conditions outlined in the LMIA or work permit application were accurate and have been offered to the foreign worker in practice, such as:

• Payroll records,
• Employment contracts and agreements,
• Evidence of wages paid and benefits offered,
• Employee schedules and time records,
• Recruitment documentation, where required,
• Company policies related to health and safety and to prevent abuse in the workplace, and
• Any other documentation that demonstrates compliance with program requirements.

Maintaining organized and accessible records can significantly simplify the inspection process.

What Are the Consequences of Non-Compliance?

The penalties for non-compliance can be severe.

Depending on the nature and seriousness of the violation, employers may face:

• Warnings
• Administrative monetary penalties ranging from $500 to $100,000 per violation, up to a maximum cumulative penalty of $1 million in a one-year period
• Temporary or permanent prohibitions on hiring temporary foreign workers through the TFWP or IMP

Beyond administrative monetary penalties and prohibitions on hiring temporary foreign workers, a finding of non-compliance carries reputational risk for employers as they may be identified publicly online with the reasons for their non-compliance.

Recent Employer Compliance Outcomes

The federal government continues to expand its enforcement efforts.

Between April 1, 2025, and March 31, 2026, ESDC completed 1,488 employer compliance inspections, 12% of which resulted in a finding of non-compliance. More than $10.2 million in administrative monetary penalties were assessed, and 30 employers were prohibited from hiring foreign workers under the TFWP.

IRCC’s most recent publicly availably statistics cover 2024 to 2025, where 4,328 employer compliance inspections were conducted under the IMP, resulting in 55 penalties and $534,000 in administrative monetary penalties assessed.

These results reflect a notable increase in financial penalties compared to prior reporting periods and demonstrate the government’s ongoing commitment to worker protection and program integrity.

Practical Compliance Tips for Employers

Employer compliance should be treated as an ongoing operational priority rather than something addressed only when an inspection occurs.

Best practices include:

• Regularly reviewing employment terms and conditions,
• Confirming that wages, job duties, and working conditions remain consistent with approved LMIAs and work permits,
• Maintaining complete and accurate records throughout the employment period,
• Educating managers and supervisors on employer compliance obligations,
• Responding promptly to government requests for information, and
• Conducting periodic internal audits or compliance reviews.

Importantly, non-compliance may only be justified in very limited circumstances. Turnover in human resources personnel and/or a misunderstanding of compliance obligations will not serve as justification in the event of allegations of non-compliance.

Final Thoughts

Canada’s employer compliance regime is intended to protect temporary foreign workers while ensuring employers uphold their commitments made when accessing international talent.

Inspections have become a routine component of program oversight, and enforcement activities continue to increase. Employers who stay informed, keep thorough records, and regularly assess their compliance practices are better positioned to navigate inspections successfully.

Remaining compliant not only helps reduce legal and financial exposure but also supports continued access to Canada’s temporary foreign worker programs for future workforce needs.

If your business is subject to an employer compliance inspection or is interested in learning more about employer compliance obligations, please contact us to learn more.