Since Sept 18, 2026, ESDC's LMIA pages define the employer: staffing agencies can't place foreign workers and workers can't be treated as contractors.
Since September 18, 2026, Employment and Social Development Canada (ESDC) has stated in its Temporary Foreign Worker (TFW) Program requirements exactly who counts as an employer for a Labour Market Impact Assessment (LMIA). In short: the employer is the business that hires the worker, sets their working conditions and pays them directly. Staffing agencies that place workers with other businesses are not employers under the program, and foreign workers cannot be classified as independent contractors.
This is published program guidance on canada.ca, marked "New: September 18, 2026" on both the low-wage stream page and the page for LMIAs supporting permanent residence. It is not a new regulation or fee, and it does not change wage thresholds, caps or processing.
What the new guidance says
ESDC's wording, summarised point by point:
- Who the employer is: the entity that hires the temporary foreign worker, sets their working conditions and directly pays them. Service Canada looks at who employs the worker, determines job duties, defines job expectations and monitors performance.
- Employer-employee relationship: it exists when an employer hires a worker, directs their duties and pays them for their work. An LMIA will not be approved where that relationship does not exist.
- Staffing and employment agencies: agencies that recruit workers for other businesses are not considered employers and cannot be approved to hire a temporary foreign worker for those businesses.
- Independent contractors: employers cannot classify temporary foreign workers as independent contractors; misclassification is non-compliant.
- Consequences: non-compliant employers can face administrative monetary penalties and bans from the TFW Program, and could be listed on federal or provincial government websites.
Who is affected
Employers who use, or planned to use, an intermediary to hold the LMIA; businesses that pay workers through a separate company or treat them as contractors; and workers whose job offer comes from an agency rather than the business where they will actually work. The guidance appears on the low-wage stream page and the permanent-residence LMIA page, so it matters both for temporary hiring and for job offers used in permanent residence applications.
What it does not change
Ordinary direct employers who hire, supervise and pay their own staff are not affected beyond confirming their paperwork matches that reality.
This guidance is about who can be the employer on an LMIA. It does not change LMIA wage levels, the low-wage refusal-to-process list, or the earlier 2026 changes covered in our post on the August LMIA rule changes.
What to do next
Check that the business named on the LMIA is the one that hires, directs and pays the worker, and that the signed employment agreement reflects that. Workers should make sure the employer on their job offer is the business they will actually work for. Related reading: 2 LMIA rule changes from August 2026 and our work permit options. If your hiring structure involves an agency, contractor or related company, book a consultation before filing.
Sources: ESDC program requirements pages (low-wage stream; LMIAs supporting permanent residence), read October 24, 2026; the low-wage page was last updated September 22, 2026. Processing times are estimates and no LMIA or work permit outcome is assured. This is general information, not legal advice.
Not sure how this applies to your situation? A licensed immigration consultant (RCIC) can review your profile with you.
