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June 2013

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Union Members Decry Abuse of
Temporary Foreign Worker Program

Early this spring, Canada's largest bank came under fire when it was revealed that it had replaced 50 of its IT workers with temporary foreign workers from India. The new workers are employed by a multinational contracting firm.

"It's horrible to be in this situation," one former Royal Bank of Canada employee told the CBC. "The bank is doing this while making billions of dollars in record profits and they don't think about the impact on us."

In response, labour leaders across the country threatened to pull millions of dollars out of the bank, including Victoria, British Columbia, Local 230, which has banked with RBC for more than half a century.

"RBC is enjoying record profits and this blatant abuse of the temporary worker program is a slap in the face to all working Canadians," says Local 230 Business Manager Phil Venoit.

Unfortunately RBC's behavior is only the latest example of employers abusing the temporary foreign workers program to boost profits at the expense of Canadian workers, say union leaders.

Established to allow employers to bring in small groups of in-demand workers on a temporary basis, the program has since grown to the point that the number of temporary workers in Canada — more than 330,000 — nearly equals the total population of New Brunswick. And the numbers keep growing.

Originally for highly-skilled workers, the program has expanded under Prime Minster Stephen Harper's Conservative government to affect nearly every sector of the economy — from construction to the service industry.

For Canadian workers, the expansion has meant increased downward pressure on wages, and stagnant employment numbers, particularly for those under age 35.

"You got fast food companies, hotels, all using foreign workers," Venoit said. "These are jobs our young people count on, and now it's hard for them to find work."

A study from the Alberta Federation of Labour found that employers brought in thousands more temporary workers into the province than jobs created, forcing Canadians onto the unemployment rolls or into low-wage part-time work.

In many parts of the booming oil sands region, there is a temporary worker for anywhere from four to nine of every 10 new jobs created.

For example, the AFL reports that more than one in six new jobs in Calgary went to a temporary foreign worker.

In one of the most infamous incidents, HD Mining International Ltd. brought in more than 200 Chinese miners to work at its Murray River coal mine in British Columbia. The company even went as far as to require Mandarin Chinese language skills as a condition of employment.

The program also allows employers to pay 15 percent less to foreign workers, driving down wages across the board.

Despite the economic recovery since 2008, the number of Canadians making $13 an hour or less has remained steady, reports the labour federation, a statistic it blames on the use of underpaid foreign workers.

The system also makes foreign workers ripe for abuse.

"It's essentially indentured servitude," Venoit said. Workers are wholly dependent on their employer for residency and can be sent home at any time. Some are even dependent on the company for room and board. And they don't qualify for workers' compensation or pay into the Canada Pension Plan.

"They have no rights whatsoever," he says. For example, the British Columbia building trades found a group of Costa Ricans working on parts of Vancouver's rapid transit system for $3.67 an hour.

Even government supporters, like right-wing economist Herb Gruel, who is associated with the Fraser Institute, are critical.

"The temporary foreign worker program is effectively a business subsidy that lets frequent users avoid increasing wages to attract workers, invest in training, or automate production to boost productivity," Gruel told the Vancouver Sun.

In April, public pressure pushed the federal government to announce changes to the system to address critics' complaints. Among the reforms are requiring employers make more of an effort to hire Canadians before bringing in foreign workers and pay a fee before applying for a foreign worker permit. The government will also eliminate the 15-percent wage differential between foreign and domestic workers.

Workers' rights advocates are skeptical, however. "This is more slippery politics from the Harper government," Alberta Federation President Gil McGowan told the Globe and Mail. "They're trying to give the impression that something big is being done to address public concerns, when in reality the foundations of the program remain unchanged."

First District Vice President Phil Flemming says union members and all Canadians concerned with good jobs need to keep the pressure on the Conservatives to eliminate abuse of the temporary foreign workers program.

"It's up to the federal government to fully reform or scrap the program that is hurting both Canadians and foreign workers," Flemming said.


Victoria, British Columbia, Local 230 is threatening to withdraw millions in funds from the Royal Bank of Canada to protest its role in outsourcing Canadian jobs. Photo used under a

Creative Commons License from Flickr user physis3141