The Federal Court has overturned a $7,000 penalty against a Victoria construction company that paid a temporary foreign worker less than the posted wage, ruling the employer acted in good faith.
However, Justice Russel Zinn emphasized the decision was based on the specific facts of the case and should not be seen as weakening worker protections.
“The carve-out within the regulations is heavily circumscribed,” wrote Zinn. “Nothing in this decision should be interpreted as undermining strong worker protections.”
Blacklock's Reporter says Northern Tropic Homes Ltd. had hired a carpenter under the Temporary Foreign Worker Program at a posted rate of $30 per hour for a 40-hour week, with overtime at $45 and 4% vacation pay.
The company later reduced his wage to $24 after discovering he had misrepresented his credentials and lacked substantial experience.
Court records showed the company covered the worker’s six-month training costs, provided a biweekly $150 gas allowance, and assisted with rent.
Once the worker was fully trained, his wage was restored to $30. Zinn ruled that Northern Tropic had acted appropriately and rejected the government’s demand for compensation.
“It is illogical to require that an employer who deliberately reduces wages based on what it believes to be legitimate reasons and who actively attempts to seek approval from the relevant authorities to then voluntarily repay the reduction it seeks to justify in the first place,” he wrote.
The Department of Employment has maintained that the Temporary Foreign Worker Program must not be used to drive down wages or replace Canadian workers.
Last August, cabinet reinstated a cap limiting temporary foreign workers to 10% of a workplace’s staff.
“There are Canadians in your city who need a job,” then-Finance Minister Chrystia Freeland said at the time. “Look to them and offer those jobs to them.”
A 2014 in-house study by the employment department found that 68% of Canadians believed businesses were abusing the program by failing to recruit local workers.
