Canada Eases Low-Wage Worker Caps for Multi-Site Employers

Canada has changed how it calculates limits on low-wage temporary foreign workers for employers that operate several small worksites, giving some businesses more room to hire through the Temporary Foreign Worker Program.

Employment and Social Development Canada (ESDC) updated its low-wage program rules on August 18, 2026. The change allows eligible employers to hire one low-wage temporary foreign worker at each work location with fewer than 10 employees. Employers in health care, construction and food production may hire up to two workers at each qualifying site.

How the New Calculation Works

Under the usual rules, employers may fill up to 10% of their workforce with low-wage temporary foreign workers. The limit rises to 20% for certain in-demand sectors, including health care, construction and food production.

The new approach changes how the cap is calculated for small worksites. Instead of looking only at an employer’s total workforce across Canada, ESDC can now apply the alternative calculation to each individual location with fewer than 10 employees.

Previously, this option was available only to employers with fewer than 10 employees nationwide. The updated rule can help multi-site businesses that would otherwise fall below the minimum needed to hire one worker under the 10% cap, or two workers under the 20% cap.

Wage Rules Still Apply

A job is considered low-wage under the Temporary Foreign Worker Program if it pays less than 120% of the regional median wage listed by the federal Job Bank.

Jobs paying at or above that threshold fall under the high-wage stream, which is not subject to the same workforce cap. In Ontario, the wage threshold was $36.92 an hour at the time of writing.

Employers must still receive a positive or neutral Labour Market Impact Assessment (LMIA) from ESDC before a worker can receive or renew a TFWP work permit. The assessment is meant to show that no qualified Canadian citizen or permanent resident is available for the job.

Who Counts Toward the Workforce Cap

When ESDC calculates the workforce at a location, it includes full-time and part-time employees, temporary foreign workers with approved LMIAs who have not yet started work, and vacant positions included in current LMIA applications.

Part-time employees who average fewer than 30 hours a week count as 0.5 of an employee.

Since March 13, 2026, provinces have also had authority to increase the low-wage cap to 15% for eligible employers in rural areas.

Other Restrictions Remain in Place

Employers using the low-wage stream must continue to meet additional requirements. These include paying transportation costs to and from Canada, ensuring access to suitable housing that costs less than 30% of the worker’s pre-tax income, and providing private health insurance when public provincial or territorial coverage is unavailable.

A separate restriction introduced in September 2024 also remains. Low-wage LMIA applications generally cannot be used to hire or renew workers in urban areas where unemployment is above 6%.

Most Canadian work permits are issued through the International Mobility Program (IMP), which does not require an LMIA. Canada’s 2026 immigration levels plan calls for 60,000 foreign workers through the TFWP and 170,000 through the IMP.