As scandals about abuse of the Temporary Foreign Worker Program break with increasing regularity, the spotlight still overlooks the exploitation that workers face just to get jobs under that program.
A new report from the Metcalf Foundation reveals that migrant workers regularly pay thousands of dollars in recruiting fees — equal to as much as two to three years’ wages in their home currency — to work in minimum wage jobs in Ontario.
To pay the fees, workers must borrow from recruiters and informal money lenders. They sign over the deeds to their homes to secure the loans and pay oppressive compounding monthly interest rates. Their passports and work permits continue to be seized when they arrive in Canada, trapping them in abusive work relationships.
Profiting from the Precarious: How Recruitment Practices Exploit Migrant Workers reveals that these practices are routine — even normalized — for workers who have arrived, not through human smuggling, but through the legal channels that the Canadian government has created for temporary labour migration. Federal and provincial laws interact in ways that create space for the practices to continue.
Even though a 2009 Ontario law prohibits recruitment fees for live-in caregivers, two-thirds of caregivers have paid fees since the law took effect.
Migrant workers arriving under the federal Agricultural Stream and workers filling “lower skilled” jobs in areas such as food processing, restaurants, fast-food service, cleaning, hospitality, and warehouses are unprotected by Ontario law but are targeted by the same predatory recruitment practices.
Migrant workers typically pay recruitment fees of $4,000 to $10,000 for minimum wage jobs. Some are paying as much as $15,000. And the fees are rising.
By contrast, data from the Ontario Ministry of Labour acquired through a Freedom of Information request reveals that from 2010 to 2013 a mere $12,100 in illegal recruitment fees was recovered under that province’s Employment Protection for Foreign Nationals Act.
Yet the problem goes beyond illegal fees.
After paying fees, nearly 1 in 5 caregivers arrive to find that the job they were promised does not exist. The practice is so common both for caregivers and other migrant workers that it has its own name — “Release on Arrival”.
Federal work permits restrict workers to working for the employer named on the permit. Release on Arrival places these workers out of status. But they must immediately start repaying the money lenders. Recruiters exploit this to place workers into even more precarious jobs, with conditions and wages well below minimum standards.
Some federal programs require workers to live in housing provided by the employer. Recruiters sometimes manage this housing, extracting more profit through rents. It is not uncommon to find overcrowding — 8 to 10 workers crammed into a 2-bedroom home — with workers collectively paying well above market rent.
Workers remain silent in the face of these rights violations because they must repay their recruitment debt before they can send money home to support their families. Debt repayment can take up to two years.
When workers complain, they are typically fired and evicted from employer-provided housing.
Manitoba, Nova Scotia and Saskatchewan have passed laws following international best practices to target this abuse. They require mandatory licensing of all migrant worker recruiters along with irrevocable security deposits. Nova Scotia and Saskatchewan require disclosure of all agents in a recruiter’s supply chain in Canada or abroad, holding licensed recruiters liable for any misdeeds in the supply chain.
In these provinces employers must also register before applying for a federal LMO. The province can then ensure employers are complying with provincial laws before hiring precarious migrant workers. Registration also creates a database of where all migrant workers are employed so the province can proactively enforce employment standards.
These initiatives provide valuable protection for workers. But cleaning up the recruiter supply chain cannot be the end point of the discussion. Indecent profiteering is not restricted to “unscrupulous recruiters”.
Ultimately, the report poses the more fundamental question: Who profits from the precariousness that is created and sustained by temporary labour migration?
It is long past time for a serious public debate about the Temporary Foreign Worker Program. An economy built on the labour of a perpetually revolving working class of low-wage workers with no capacity to enforce their rights to decent work, no security of status and no right to participate democratically in shaping the laws that govern them is unsustainable and unjust.
Fay Faraday is a constitutional law, labour and human rights lawyer in Toronto and an Innovation Fellow at the Metcalf Foundation. She is the author of Profiting from the Precarious: How Recruitment Practices Exploit Migrant Workers which can be downloaded at www.metcalffoundation.com.