Thank you, Mr. Chairman.
The labour shortage is the number one issue facing Canada's $58 billion, one-million-employee food service industry, so I very much appreciate the opportunity to speak to you today about the temporary foreign worker program. Canada's labour shortage is a long-term demographic trend that is challenging all developed countries and industries. The outlook for the food service industry is particularly serious. Over the next 10 years, Canada's food service industry will need to add 190,000 new workers. Youth between the ages of 15 and 24 account for 44% of all food service workers in Canada today, yet between now and 2025, the number of youth in Canada will decrease by 345,000.
There are restaurant operators in western Canada, where the labour shortage is already a crisis, who would have been forced to close their doors if not for the temporary foreign worker program.
I want to say that improvements to the temporary foreign worker program over the last couple of years have been very welcome, but challenges remain.
Prevailing wage rates--and the methodology used to set them--is a pressing issue for my industry. Our members are frustrated by their inability to access the temporary foreign worker program due to artificially high wage rate demands. Service Canada officials dismiss the Statistics Canada wage rate data and other comprehensive third party compensation surveys, and in each region within each province, different and arbitrary methodologies are used to determine prevailing wage rates.
Prevailing wage rates are often significantly higher than the wages food service employers pay to their experienced domestic employees. There have been ongoing meetings between CRFA, HRDSC, and Service Canada officials about inaccurate data sources, lack of transparency, and lack of consistency in the prevailing wage-setting process. HRDSC officials acknowledge that there are problems and are currently undertaking a comprehensive review.
Our recommendations to this committee are, first, to accelerate the process of developing new methodology and criteria for determining prevailing wage rates that better reflect actual industry wages and, second, to ensure that the underlying policy on determining prevailing wage rates is market rate neutral and does not have the effect of putting upward pressure on wage rates.
I next want to touch on the importance on ensuring the long-term integrity of the temporary foreign worker program.
CRFA supports increased monitoring and compliance mechanisms for this program, and better communications between provincial governments and the federal government in this regard. We support the recommendation in the Federal Labour Standards Review Commission report to deny access to the temporary foreign worker program to employers who repeatedly or systematically violate provincial labour standards or the terms of their employment agreement. There has to be due process, of course, but the program is too important to let a few bad employers unfairly tarnish it.
CRFA also supports recent actions by provincial governments to regulate immigration representatives or consultants or recruiters to prevent the exploitation of workers. We would welcome more federal government involvement in this area as well.
I want to refute the notion that temporary foreign workers are not free to find work, and I also want to express concerns about the ease with which employers can hire temporary foreign workers brought to Canada by other employers without having to share in the significant recruitment and return airfare costs. Employers bringing in lower-skilled workers to Canada--i.e., NOC codes C and D--are required to pay for return airfare. In addition, they pay recruitment fees in the range of $2,000 to $3,000 per employee. They provide training, orientation to Canada, on-ground transportation, accommodation, and in many cases home furnishings, TV sets, boots, winter clothing, and so on.
A second employer can get a temporary foreign worker permit for the same worker and avoid the recruitment and start-up costs. There's no way to ensure the responsibility for return airfare and recruitment costs is transferred to the second employer if the worker leaves before the end of the contracted period.
As a result, CRFA's recommendations are to continue efforts to educate employers and temporary foreign workers about their rights and responsibilities under the temporary foreign worker program, to invest in additional monitoring and enforcement mechanisms to protect workers and the integrity of the program, and to ensure that the cost of initial airfare and recruitment for lower-skilled temporary foreign workers is transferred to the second employer and the third employer and the fourth employer on a pro-rated basis if a temporary foreign worker moves from one employer to another during his or her permit period in Canada.
Our operators are also concerned about the high percentage of application rejections for LMOs in some regions compared to others, inconsistencies in how the program is administered, and anomalies in how the occupations-under-pressure lists are developed--in particular the omission of cooks, since this is the most in-demand food service occupation.
CRFA recommends that government provide appropriate training, transparent guidelines, and incentives to foreign worker staff to reflect modernized objectives and to ensure consistent application of regulations; in conjunction with industry, re-evaluate the methodology and criteria used to establish occupation-under-pressure lists and E-LMO eligibility lists, particularly with regard to cooks; and allocate the necessary resources to regional Service Canada offices for the efficient processing of labour market opinions and temporary foreign worker applications.
I'd also like to speak about Canada's immigration system in relation to the temporary foreign worker program. We believe the immigration system needs to be overhauled and that the philosophy and culture of immigration policy has to change. The competition among developed countries for workers has already begun, and Canada needs to better establish itself as a country of choice.
Our immigration laws were established when labour market conditions were very different, and these laws need to be updated to reflect the new reality of labour shortage both in Canada and globally. Our current system is biased against low-skilled and semi-skilled workers, and there is no bridge between temporary foreign workers and permanent residency for low-skilled workers.
We were pleased to see a new immigration class established for temporary foreign workers who want to apply for permanent residence status without having to leave Canada. However, this new immigration stream is available only to workers in NOC codes A, B and O, and therefore not applicable to the majority of foreign workers in the food service industry.
Our recommendations are to revise the point system to better match labour market needs and to expand the Canadian-experience class of immigration to include NOC codes C and D so that Canadian job experience acquired by lower-skilled temporary foreign workers is recognized and will be weighted in their application for permanent residency.
To conclude, I want to emphasize that the labour shortage is the greatest single issue facing operators in the food service industry. It is not unique to our industry or country. It is not simply a skill shortage, it's a people shortage that is crippling our efforts to attract skilled, semi-skilled, and low-skilled workers. We need a long-term vision in Canada for attracting workers.
Thank you.