Do you want to save $35,000 a year per employee in payroll costs? Good immigration advice doesn’t have to cost you money. In fact, time and again I find ways to save small and medium sized businesses huge sums of money.
Take the following case as an example, where my advice saved a small business over $35,000 annually in payroll costs.
Gone Fishin’…
An employee of a small tech company asked his employer to sponsor his LMIA to support his permanent residency application. The employee said that the LMIA would give him the Express Entry points he needed to apply for permanent residency. Without it, he wouldn’t have the points, and would have to leave Canada when his work permit expires.
This isn’t an unusual request. Employers who recruit graduates from Canada’s schools often receive job applications from international students who have post-graduation work permits that are valid for up to 3 years and allow them to work for any employer.
Maybe you are an employer who has heard this before. Know that if you have, you might be swimming in unfriendly waters.
The Hook
The employee took the trouble of already hiring an immigration consultant to take care of the entire process and the employee was going to pay the consultant’s fees.
The company really valued the employee. They didn’t want to lose him when his open work permit would expire, they knew how competitive the labour market was for employees with his skills, they wanted to show their appreciation to the employee and the employee was going to pay the consultant’s fees.
So what did the employer have to lose?
The Catch
To qualify for the LMIA, the company was told that they would have had to double the wage they were paying the employee, up to the prevailing wage from the entry level wage they were presently paying him. This information was correct. But it wasn’t the whole story.
Murky Waters
A LMIA is often not the only way an employee can increase their points to qualify for permanent residency. In fact, the immigration system and programs are often so complex that it can be easy for a layperson to overlook other options. It may be more likely that you get it wrong without professional advice than you get it right.
In this case, the employer contacted me for legal advice.
I evaluated the employee’s immigration situation and found that the employee could obtain the points he needed for his permanent residency in other ways that did not require a LMIA. Since the LMIA was not required, the company did not have to shell out an additional $35,000 per year in perpetuity to this employee.
Shark Bait
Why hadn’t the employee’s immigration consultant recommended that his client pursue these other options first?
The simple and obvious answer is that it wasn’t in the employee’s best interest to pursue other options first.
It is important to remember that when your employee hires a professional to research their immigration options and plan an immigration strategy for them, the advice may be to the maximum advantage of the employee, not the employer.
The employee was not incentivized to pursue other options first. These other options would take the employee time and effort, and why bother pursuing them at all if the employee can pass the work to the employer, still get his points AND score a huge payday?
I have represented clients on both sides of an employee-employer relationship in the immigration context. Lawyers are obligated to act in their client’s best interests. I have advised employees of all the ways they can increase their points, and have evaluated which require the greatest investment of time, effort and money for the employer and the employee, and in some cases, which can result in a huge pay-day for the employee.
If you were the employee, working for a good employer for a fair wage, but saw an opportunity to double your earnings and exert less of your own time and effort to obtain this, wouldn’t you want to try that first?
The Whale
If you are a small or medium sized tech company, chances are you have hired or thought about hiring someone who is not a Canadian citizen or permanent resident. If so, remember that an employee who has hired professional advice has a significant advantage over an employer who has not.
You can rebalance the playing field by hiring a good immigration lawyer and obtaining professional advice. Hiring an immigration lawyer shouldn’t cost you more money than proceeding unrepresented. If you hire the right lawyer, you can get professional, strategic and quality advice that saves you money.
Do you want to be a fish out of water or a killer whale in a shark tank?
You might now be thinking, if I just hire Canadians, I can avoid the costs and complications of hiring a foreign national altogether? If you thought this, you would be mistaken.
Growing tech companies can thrive in this labour market by securing foreign talent. Failing to do so means you are losing to larger, established companies that have hired Bay Street firms to figure out the secret: if you are hiring talent from abroad, you can realize productivity gains, save payroll costs and outcompete other businesses.
If you are a growing tech company, there are many reasons why hiring a foreign national can make you better off!
- Canada and the US are experiencing a massive labour shortage of highly skilled technology workers. To grow your business and compete with larger companies for the best talent, you must recruit globally. Your competition is large multinational tech giants who are already doing this.
- By searching globally, you get to choose from a larger pool of talent, meaning you recruit more productive workers and gain a competitive advantage over other businesses with a purely local mindset.
- With quality advice and strategic planning, your workforce with foreign workers can actually reduce your payroll costs. Top foreign talent may be willing to relocate to Canada for wages that are lower than you might pay a Canadian for the chance at a better life in Canada and a pathway to Canadian citizenship. Understanding how to leverage Canada’s immigration programs to find, attract and retain highly affordable foreign talent is a valuable strategic tool.
- Hiring foreign workers means that you buy long-term workforce stability and security. While the employee is working with you on an employer specific work permit, they are incentivized to remain with you throughout the immigration process. While working for you, it isn’t always easy for foreign workers to find and secure new jobs with other Canadian employers. Their work permits are restricted to your company, and many other Canadian companies have the same hesitations you had before you were enlightened by this article about hiring foreign talent. Moreover, we can pinpoint for you precisely the right time to transition this employee to permanent residency, so that your employee doesn’t develop resentment toward you and look elsewhere for other options. By taking care of your foreign employees in helping them obtain Canadian citizenship, you may be further rewarded with their long-term loyalty.
How does it look outside the fishbowl?
If all of this is true, wouldn’t the best and brightest foreign talent already be working for the biggest companies in Canada or, more likely, the US?
In the US, the US immigration system is skewed to favour large companies. However, there is an overall cap of 85,000 on the number of workers who can obtain “H1B” lottery work visas in the US in any year. At the same time, there is presently an estimated half a million unfilled positions in technology in the US. H1B work visas are awarded through a lottery system that disproportionately awards more chances at winning the lottery to larger companies. Since the total supply is a fraction of the demand and since the lottery rules favour large companies, large firms cannot hire anywhere near enough to meet their needs and small or medium sized businesses struggle to grow.
Canada’s immigration programs for recruiting top foreign talent, by contrast, disproportionately favour small and medium sized technology companies who want to grow. That is because, in Canada, a company’s potential to secure work visas through the “Global Talent Stream” work visa process is proportionate to their commitment to growth, and there is no annual quota. This means that existing, established and large Canadian companies with relatively stable workforce recruitment rates max out their immigration potential relative to their commitment to growth sooner than growing small and medium sized firms. Furthermore, larger multinational companies, who are often headquartered in the US, first bring their top foreign talent to the US. This means that their workforce outside of the US may not be receiving the same level of priority as their workforce in the US. Quite simply, companies in the US may be preoccupied with their US immigration cases.
As such, growing start-ups, small and medium sized tech businesses can be at an advantage when recruiting top foreign talent.
Contact Mandelbaum Immigration Lawyers to help you grow your business and save you money.
