Employer Compliance and TFWP Inspections: What Ontario Employers Must Know

Receiving a positive LMIA is not the end of an employer's obligations under the Temporary Foreign Worker Program (TFWP) — it is the beginning of a compliance relationship with Employment and Social Development Canada (ESDC). Employers who hire under the TFWP are subject to ongoing legal obligations, record-keeping requirements, and the possibility of a formal compliance inspection at any time during the work permit period or for several years after.

Failing an inspection can result in penalties ranging from a warning to a permanent ban from the program. Understanding what inspectors look for — and building compliance into your day-to-day operations — is the only way to manage that risk.

Who can be inspected and when

ESDC has the authority to inspect any employer who has hired a temporary foreign worker under the TFWP. Inspections can be:

• Random — selected without any triggering complaint
• Tip-based — initiated after a complaint from a worker, a union, an advocacy organization, or another source
• Follow-up — triggered by a prior non-compliant finding or by a pending renewal LMIA application

As of writing, employers can be inspected during the work permit period and for a period of years after the work permit expires — confirm the current inspection window on Canada.ca. This means even former TFWP employers are not entirely clear of risk.

What inspectors assess

The compliance framework focuses on whether the employer honoured the commitments made in the LMIA application and the Immigration and Refugee Protection Act (IRPA) regulations. Inspectors will typically examine:

Wages

Did the employer pay the foreign worker exactly what was stated in the LMIA and job offer? Paying less — even informally, by charging fees that reduce effective pay — is a violation. Voluntary deductions must comply with Ontario's Employment Standards Act and the terms agreed to.

Working conditions

Were the working conditions (hours, overtime, scheduling, rest periods) consistent with the LMIA? Did the employer follow Ontario employment standards? The TFWP framework requires that temporary foreign workers receive the same protections as Canadian workers.

Occupation

Did the worker actually perform the duties described in the LMIA? Using a worker in a substantially different role — even if well-intentioned — is non-compliant.

Employer-specific obligations (low-wage stream)

If the LMIA was under the low-wage stream, inspectors will verify:

• Whether return transportation was arranged or paid
• Whether the worker had access to suitable housing
• Whether the employer maintained proper WSIB (workplace safety insurance) enrollment

Transition plan (high-wage stream)

For high-wage LMIA positions, inspectors may assess whether the employer took the steps outlined in their transition plan — recruiting Canadians, providing training, meeting the commitments made to ESDC.

Record-keeping

Employers must retain specific records for the duration of the inspection window. These include:

• Payroll records showing wages paid to the foreign worker
• Hours worked and overtime records
• Copies of the LMIA, job offer, and work permit
• Any written agreements or amendments to employment terms
• Documentation of any housing arrangements or transportation payments

A missing or disorganized record is not just an administrative issue — it is evidence of non-compliance in itself.

Inspection methods: desk review vs on-site

ESDC may conduct compliance reviews by:

• Document request (desk review): ESDC sends a written request asking the employer to submit records within a specified timeframe. Most inspections start this way.
• On-site inspection: ESDC inspectors can visit the workplace, speak with workers and management, and review records in person.
• Worker interviews: Inspectors may interview the foreign worker directly — separately from management — to assess whether the worker's account matches the employer's records.

Employers should not coach workers on what to say to inspectors and should not prevent workers from speaking with ESDC representatives. Doing so is itself a compliance violation.

Consequences of non-compliance

ESDC classifies violations as either:

• Directly or indirectly causing harm to a worker (the most serious category)
• Failing to comply with a condition of the LMIA

Consequences range in severity:

The publication of an employer's name on ESDC's publicly accessible non-compliant list is a significant reputational consequence, particularly for businesses that rely on client trust or must hire skilled workers regularly.

How to prepare for a possible inspection

Even if you have never been inspected, treat compliance as an ongoing practice, not a one-time event:

1. Keep all TFWP-related records in an organized file for each worker — wages, hours, correspondence, housing and transportation records
2. Review payroll regularly to confirm the worker is being paid what the LMIA says
3. Do not change the worker's role or location without understanding whether an amended LMIA is required
4. Train HR staff on TFWP obligations and what to do if ESDC contacts them
5. Respond promptly to any ESDC communication — missing a deadline during a compliance review will worsen your outcome

Frequently asked questions