Playing with Fire: Penalties for failure to comply with applicable laws when hiring foreign workers

Temporary Social Insurance Numbers have expiry dates which coincide directly to the expiration date of an employee’s work visa.  Once these documents have expired, a foreign worker is no longer eligible to work in Canada and may be required to leave the country depending on the terms and conditions of his/her work visa.

There are numerous penalties, fines, and possible criminal charges related to illegal employment of foreign workers. Some examples of these are:

A negative Labour Market Opinion (LMO) – HRSDC/Service Canada may issue a negative LMO and revoke all positions on confirmed LMOs for which work permits have not yet been issued by Citizenship and Immigration Canada (CIC).

Ineligible to hire Temporary Foreign Workers – CIC may deem the employer ineligible to hire Temporary Foreign Workers for two years. The employer’s name, address and period of ineligibility may also be published on a list of ineligible employers posted on CIC Web site.

Fines and Imprisonment

  • Under the Income Tax Act, employers who permit misuse of Social Insurance Numbers are liable to fines of $5,000 and 12 months imprisonment for each misuse.
  • Under the Immigration Act, employers who hire employees who are not authorized to work in Canada are subject to fines not exceeding $5,000 and/or two years imprisonment.
  • Employers who do not make reasonable efforts to obtain an employee’s SIN may be subject to a penalty of $100 for each failure.
  • An employee who refuses to give his or her SIN may also be subject to a penalty of $100 for each failure.

Under the Canada Pension Plan Regulations, employers are required to tell their employees who don’t have a SIN card how to obtain one. Employers should refer them a Service Canada Centre within three days of the employee’s start date and ask for proof of application as well as their SIN card once they receive it.

Immigration fraud is a criminal offence in Canada.

Please contact your PEO Canada Human Resources Specialist if you have any questions or concerns regarding compliance with Canada’s Temporary Foreign Worker Program.

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Written By: Leanne Suitor

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