Agencies and recruiters who exploit workers will face the toughest penalties in Canada

The Ontario government is protecting vulnerable and temporary foreign workers by requiring temporary help agencies (THAs) and recruiters to have a licence to operate in the province as of January 1, 2024. Inspections by Ministry of Labour, Immigration, Training and Skills Development officers have shown that multiple temporary help agencies in Ontario are illegally paying people below the minimum wage and denying other basic employment rights to gain an unfair competitive advantage over law-abiding agencies by undercutting rates.

“While temporary help agencies are vital to Ontario’s businesses and jobseekers looking to get their foot in the door, for too long they have operated in a grey zone that allows criminals to prey on vulnerable workers,” said Monte McNaughton, Minister of Labour, Immigration, Training and Skills Development. “Our government’s licensing system will ensure law-abiding businesses can have confidence in the THAs and recruiters they work with and that those who abuse workers face the harshest fines in Canada and are banned from operating in our province.”

Many businesses and jobseekers in Ontario are often unaware if an agency or recruiter they are working with is meeting their employment standards obligations or has a history of violations. They will now be able to check the ministry’s online database before working with one, to see if they have met the province’s stringent licensing requirements. It will be against the law for companies to knowingly use unlicensed businesses for staffing, and those who hire deceitful recruiters will be required to repay workers for any illegal fees charged to them.

To operate their businesses, THAs and recruiters will need to provide $25,000 in the form of an irrevocable letter of credit that can be used to repay owed wages to employees. Offenders could face up to a $50,000 penalty based on repeat violations – the highest amount in Canada.

In 2022, the government launched a task force to work with law enforcement agencies and community partners to detect and address illegal practices and recover unpaid wages for exploited employees. Their work has resulted in multiple investigations helping remove hundreds of vulnerable and migrant workers from hazardous working situations. Ontario also recently introduced legislation to strengthen penalties for withholding worker passports.