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The Conservative Temporary Foreign Labour Program Fiasco

This story just gets weirder, and more troubling every day.

Check out this list of employers the Conservative government approved to permit Canadian employers to bring in foreign workers.  Link to it on the Alberta Federation of Labour website here; it is so long my blog had trouble downloading it!  It includes about 4000 employers approved to use temporary foreign workers inside Canada because of an absence of Canadian workers.

The Conservative’s Accelerated Temporary Foreign Worker Program

To qualify, the employer is supposed to demonstrate that there are no Canadians available to do the work, despite exhaustive recruitment and advertising efforts. It’s the government’s job to make sure this is the case. In this task, the Conservatives appear to have failed in a spectacular way.

To file an application for the workers under the Accelerated Temporary Foreign Worker program developed by the Tories, employers need only pledge a bunch of things in an online form (Here is the form employers must submit), such as:

TFWP–  there has been no layoffs in the positions involved for the previous 12 months

–  reasonable efforts have been made to hire and train Canadian citizens, and these efforts have failed.

–  extensive job ads were placed to attract workers for the job, but there weren’t sufficient takers

– an explanation of how hiring the foreign workers will benefit Canada (hilarious)

These are supposed to be extraordinary permits available to fill an immediate need for skilled workers when there just aren’t any Canadians available.  However, a quick look at the list demonstrates that most of the jobs are in the fast food and service sector.  According to the Conservatives, Canada has a chronic shortness of short order cooks, pizza makers, and retail and bank workers. All the major banks are on the list, along with most of the big retailers like Walmart, Sears, and Gap.  Almost every university in Canada is on the list too, for some reason.  Is the program used to bring in foreign academics?  Not sure.  The National Post is there, as is many divisions of Rogers’ Communications.  Think of a company that operates in Canada, and there’s a good chance they have used foreign workers under the Tory scheme.

The Conservatives allow employers to pay the foreign workers 15% less than the average market rate. This incentivizes the use of foreign workers over Canadian workers.  I can offer no explanation as to why our government thinks that is good economic policy.

The Conservative’s Explanation for the Hundreds of Low Skills Jobs on the List

The Tories are scrambling to explain the list.  One argument is that Canadians don’t want to do some of these low level, low paying jobs.  But wait a minute.  That can’t make any sense to a Conservative, because the market provides the response.  If you can’t get people to work for minimum wage, then you need to keep raising the offering wage rate until you begin to attract applicants.  You don’t get to go to big government and demand the right to bring in vulnerable foreign workers with fewer legal rights to work for less than market rate.  The TFWP is as anti-free market a program as there is.

My favorite line came from the poor spokesperson, Kelly Leitch, the Tories dragged onto Power and Politics last night.  In one small sentence, she encaptulated the Conservative Party’s view on the regulation of business:

Conservative Spokesperson, Kelly Leitch:  “We expect firms to follow the rules.”

If you begin with the assumption that business will simply comply with a rule on good faith, then you will convince yourself that there is no need to invest much resources in actually investigating and enforcing those rules.  That is why the Tories set up the ‘accelerated’ foreign worker scheme, which rubber stamps on-line employer applications for the workers without any investigation at all.  The Tories just assume that no employer would abuse the system.  Employers’ claims are taken on faith.

We see now how that has worked.  My earlier post argued that the approvals for the use of Foreign Temporary Worker Program should be transparent, accompanied by a written decision explaining why the applicable meets the many supposedly strict guidelines in place to protect domestic workers.  Now you see why this is necessary.

Another response from the Conservatives was that there are just a few “rogue” employers abusing the system, but overall, the program works fine.  The question then is, which of the thousands of companies on the list are the “rogues”.  Below are some contenders.  Which do you think needed foreign workers because no Canadians have the skills to work for them?  Do you expect the Conservative Party to investigate and publicly report on which of the companies has abused the system?  Maybe the rogue employers will just come forward and apologize.

A Small Sample of Conservative’s Potential List of Bad, Rogue Employers

Tim Hortons, Second Cup, A & W, Boston Pizza, Burger King, Kids R Us, Canadian Tire, 7-Eleven, Petro Canada, Montana’s Cookhouse, National Car Rental, Safeway, Shaw Cable, Swiss Chalet, University of Calgary, University of Lethbridge, University of Alberta, McDonald’s, Westjet, Dominos Pizza, Pizza Hut, Subway, Michelin, Mac’s Convenience, Mountain Equipment Co-op, University of Victoria, University of Manitoba, Memorial University, Bank of Canada, Cadillac Fairview, Cara (Milestones), Caterpillar, Citibank, Computech, Dairy Queen, Ellis Donn, Four Seasons Hotel, Gap Canada, General Electric, General Mills, Google Canada, HP, Ikea, ING Direct, JP Morgan, Loblaws, Linamar Corp, Maple Leaf Foods, McCain Foods, Merrill Lynch, McMaster U., Ontario Ministry of Attorney General, Molson Coors, National Post, Porter Airlines, Queens U., Ralph Lauren, Ryerson U., Rogers Communications, Sears, Scotia Bank, Sun Life Assurance, Bank of Montreal, TD Bank, Ritz-Carelton, Drake Hotel, ROM, The Shopping Channel, UWO, Trent U., Trump Tower, (ok, every university in Canada, as far as I can tell), Walmart.

Ok, I’m only about 10 pages in, and I’m bored and tired.  You get the idea.   Apparently there are no Canadians skilled enough or willing to work for these companies and public sector employers, despite exhaustive advertising and recruitment efforts.  The Conservative Party ensures us that is the case, because employers obey rules.

Issues for Discussion

“Can you make an argument that justified the Temporary Foreign Worker Program applying a neoclassical economic theory, that argues the optimal wage rate is that at which the wage rate offered attracts the amount of labour needed?

How would you fix the TFWP?  Or would you abolish it altogether?


9 Responses to The Conservative Temporary Foreign Labour Program Fiasco

  1. Fernando Reis Reply

    April 10, 2013 at 4:20 pm

    From a neoclassical perspective, the TFWP is entirely justifiable. There are employers who want to buy labour and there are those who wish to sell labour. At some point, an equilibrium price for the labour commodity will be reached. With the TFWP, the effect is to increase the supply of labour which will bid down wages. Of course, labour is not like other commodities. The price of gold is what it is whereever you go. This is the problem with neoclassical theory – people are not a heap of stuff.

    • admin Reply

      April 10, 2013 at 8:07 pm

      Thanks Fernando. The program introduces an external, legally create subclass of actor into the market, a class of worker that is disenfranchised and lacking in the rights afforded other market participants. The law is used to create two classes of workers in order to drive down market forces. That is not neoclassical. To fit the Program into the Neoclassical model, there would need to be complete mobility of labour, regardless of citizenship rules, similar to the case in Europe. Open up Canada’s borders to create a truly open labour market, and allow employers to offer whatever wage they like. No political party in Canada is advocating for that.

  2. Chris George Reply

    April 11, 2013 at 1:16 am

    The simple solution would be to require that the employer sponsor the TFW for citizenship. The employer, as sponsor, would be responsible for the financial well being of the applicant, including paying for all of the health care and housing costs incurred until the process is complete.

    Suddenly there would be a whole bunch of Canadians available for those jobs, I think.

    • sp Reply

      April 11, 2013 at 6:15 pm

      And another solution would be to require these employers to pay 10% – 15% more (not less) than they would pay a Canadian worker. Suddenly there would be plenty of work for all of us.

  3. Larry Hubich Reply

    April 11, 2013 at 6:33 pm

    What we are witnessing in Canada is this:

    We are seeing absolute disgust with a systemic government sponsored program that abuses and exploits vulnerable temporary foreign workers, encourages fraud by employers and corporate giants, and fires Canadian workers.

    All the while senior executives and the big bosses stuff their pockets with taxpayer subsidized golden compensation and benefit packages that they hide in tax havens in the Cayman Islands.

    We don’t need convenient apologies so that people like Nixon RBC CEO) can continue to live like royalty while the people that work for him are struggling to make ends meet. We need fundamental change in the system that perpetuates this gross inequality and abuse of citizens.

    • Fernando Reis Reply

      April 11, 2013 at 9:10 pm

      Well said, Larry.

  4. Dan McGarry Reply

    April 12, 2013 at 1:15 pm

    As David says this introduces “an external, legally create (sic) subclass of actor into the market”.

    With the coal miners from China (approximately 200?) now working in B.C. for a Chinese (meaning Chinese government owned) mining company what are the chances that they know their legal rights regarding occupational health & safety, training and working conditions legislated by the province of B.C.? What might happen to any of these workers who makes a complaint or who tries to have their rights enforced?

    Not only does this create an imbalance in the labour market, it hurts ‘good’ employers in Canada who are willing to pay the wages required to hire Canadian workers.

  5. James Muir Reply

    April 12, 2013 at 3:52 pm

    Re: Universities: In his work on the TFW programme, Jason Foster (e.g. in Just Labour vol. 19) has argued that in its original incarnation its purpose was to cover people like short term guest lecturers or researchers at universities (among other highly skilled people). This speaks to some of the original labour and employment law exclusions too: there was little fear that someone coming in from Oxford to lecture at Osgoode for a few weeks or months couldn’t negotiate fair compensation, while they were also likely to have continuing employment in their home country.

  6. Pingback: Is wage theft Gordon Nixon’s new initiative aimed at “helping” young people? | The Racist and Unoriginal Anglo-American Entertainment Industry

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