Last Updated On 19 January 2025, 8:16 AM EST (Toronto Time)

Exploitation of international students in Canada has been long discussed since the beginning of the first cohort in the 1990s.

With time, Canada became a popular destination for international students from developing countries to study with the hope of eventually getting permanent residency (PR) through various programs.

Furthermore, Canadian employers, educational institutions, landlords, and businesses saw value in international students arriving from around the globe.

New educational institutions opened, attracting more international students and selling it as a pathway to becoming a permanent resident and eventually becoming a Canadian citizen.

Canadian governments, from time to time, encouraged the entry of international students since they were cheap labour as well as paying higher fees to study here as compared to domestic students.

Additionally, federal and provincial governments also opened various permanent residency streams through which students could transition from temporary residency to permanent residency.

However, international students are now at risk more than ever with recent changes in permanent residency pathways from the government targeting candidates with experience in only certain occupations or prioritizing profiles with fluency in French.

Furthermore, the Canadian government is now becoming more strict with plans to trim down the number of temporary residents inside Canada.

Currently, Canada is only offering permanent residency to international students who are right now working in priority occupations such as healthcare, construction, etc., and that too has limited spots.

As of 2023, the Canadian government was seeing international students as contributing more than $4.8 billion annually directly to the economy.

While it is easier to say that students came to study and not to stay here, eventually a youth does need a fair chance to integrate after getting a Canadian education and working here.

Students were being sold the dream of settling in Canada permanently after completing their studies via various immigration streams or pathways.

And this is not new; the Canadian government has always been aware of this situation and has continued to attract students from all around the globe.

LMIAs and Fake Payrolls

Most of the local employers started seeing international students as cheap labour by offering work on ‘cash’ illegally because of students’ limitations to work no more than 24 hours per week.

Local businesses would often see labour market impact assessments (LMIAs) as a way of earning a significant amount and sometimes even more than their usual profit after margins.

Such employers would usually target international students who are still uncertain about their status in Canada because of unpredictable, ever-changing immigration policies.

This has always been the normal unethical system that most international students have to undergo and continues to thrive, being the most vulnerable group of temporary residents.

International students account for the majority of temporary residents in Canada.

Out of these, international students who are facing the expiration of their legal status in Canada and are not able to transition to permanent residency are the most affected.

The system is forcing these students to purchase LMIAs in order to extend their stay by requesting work permits and increasing their points for a better chance at permanent residency.

In 2023, Canada issued a record number of LMIAs to employers.

Quarter	Approved LMIAs	Number of Positions
Q1 (Jan – Mar)	21,124	59,749
Q2 (Apr – Jun)	19,295	41,900
Q3 (Jul – Sep)	22,205	47,284
Q4 (Oct – Dec)	25,765	78,718
2023 Total	88,389	227,651

Positive Labour Market Impact Assessment (LMIA) 2023

There are currently many LMIA-approved jobs that are actively hiring via the official job bank of Canada.

The black market of LMIAs has now flourished more than ever, even after the government announced significant measures to curb it, with employers selling LMIAs anywhere from $20,000 up to $40,000.

Apart from LMIAs, employers are running fake payrolls and charging hefty fees to make experience in one of the in-demand occupations.

Fake payrolls involve creating fraudulent records of employment and wage payments to a work permit holder.

These are often used to meet immigration requirements or to qualify for a particular immigration program to transition to permanent residency.

Solutions For International Students

International students on post-graduation work permits (PGWPs) in Canada have limited time to transition to permanent residency (PR) given the increasing cutoff scores and competition.

Students have been seeking an extension to their PGWPs to just enough time work their way on increasing the odds of getting PR.

IRCC was extending PGWPs during the pandemic to fill in the labour shortages. Similarly, Canada can extend the work permits of students with soon-to-be expiring PGWPs.

With the recent trend, Canada can make a permanent policy change to the international student program by increasing the duration of PGWPs and extending its scope for current PGWP holders, as mentioned in the new petition e4454.

Petition e4454 advocates for increasing the duration of PGWP to 2 years for students enrolled in up to a 12-month study program and 5 years for students in more than a 2-year study program.

Click here for full details on petition e4454.

Students should also join hands and come forward to put their perspective to local MPs and provincial immigration ministers since Minister Miller, in a recent meeting, assured all his counterparts that the IRCC will be accommodating for provincial requests, given that they provide data.

Potential Solutions to Combat the Black Market for LMIAs and Fake Payrolls

Enhanced Verification: Use of cross-referencing and sophisticated data analytics to confirm the legitimacy of payroll records and LMIA applications.

To find these discrepancies, this can entail combining data from various government entities.

Whistleblower Protections: Put in place robust whistleblower safeguards to enable employees and others to expose fraudulent activity without worrying about facing consequences.

Make sure that reporting can occur through secure, private methods.

Regular Audits: To guarantee compliance with labour laws and immigration restrictions, conduct audits on a regular basis of employers who hire foreign workers.

Random audits have the potential to discourage dishonest business practices.

Severe Penalties: Apply harsher sanctions to people and entities found responsible for LMIA fraud and phony payroll schemes.

This entails heavy fines, the cancellation of company permits, and criminal prosecutions.

Public Awareness efforts: Start efforts to inform employees and employers about the dangers and sanctions related to LMIA fraud and fictitious payrolls.

Brochures with information can be used in these efforts, as well as workshops and internet resources.

Open and Honest Application Procedures: simplify and increase transparency in the LMIA application process to lessen the likelihood of fraud and corruption.

Employers should receive support and clear guidance to help prevent inadvertent infractions.

Information Sharing: Set up procedures for law enforcement, labour departments, immigration authorities, and tax agencies to share information.

This can facilitate more efficient detection and investigation of fraudulent activity.

Collaborative Committees: Form collaborative task groups with members drawn from several government departments with the goal of identifying and combating payroll and LMIA fraud.

Legal Support: Provide support services and legal aid to employees who have fallen prey to fraudulent payroll schemes or LMIA fraud.

This involves guiding them through the legal system and assisting them in understanding their rights.

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Kamal Deep Singh, RCIC

Kamal Deep Singh, RCIC (Regulated Canadian Immigration Consultant) licensed by CICC (formerly known as ICCRC) with member number R708618. He brings extensive knowledge of immigration law and new changes to rapidly evolving IRCC.