The Trials of International Hires for Senior Executive Positions

Over the years I have worked with many companies across a variety of industry sectors to bring senior executives into Canada. Let’s face it, as wonderful as this country is, it is often hard to domestically find the required executive experience that can grow and drive industry. Our smaller population means a smaller pool of available talent, specifically where the company in question is the only one in Canada that provides service in a particular industry.

Unless the executive is being transferred to Canada from a related office in another country, often the only work permit option is a positive Labour Market Impact Assessment (LMIA). This in itself creates many challenges.

    • Unless the executive is being transferred to Canada from a related office in another country, often the only work permit option is a positive Labour Market Impact Assessment (LMIA). This in itself creates many challenges.
    • LMIAs require that the position and the salary for the position be posted publicly. This can wreak havoc with a publicly traded company’s stock price and can tip off competitors to its salary structure.
    • The details of the posting can limit / restrict what can be offered to a senior executive during salary and benefits negotiations both before and during the term of employment making the company less able to attract and retain senior executives.
    • The practice of paying senior executives in US dollars or the equivalent US dollar amounts can cause immigration compliance issues if the salary and associated benefits are not reported effectively when submitting the application.

To illustrate some of the above, imagine a situation where after four months of waiting for the positive LMIA to be issued, and a significant reduction in operations, the new COO finally arrives in Canada just in time to participate in a senior executive salary review in which all executive salaries are reviewed. Some, including the new COO, receive significant increases in order to bring their salaries up to market rates.

If the company follows the appropriate protocol in this situation they would notified their immigration service provider of the change. The immigration service provider would have advised that the change needed to be reported to Service Canada. Because of the newness of the LMIA and the percentage of the increase, Service Canada requests that the position be reposted and the labour market retested even though the company was one of the only ones in Canada who provide the service that they do

If the company does not appreciate their obligation to report the salary change, when the applicable LMIA is called for a compliance review, there is a lot of explaining that is required and a significant risk of non-compliance.

At this point, I usually have a Director of Human Resources saying to me, will this never end?? At this point my response is generally to advise that the applicant to apply for permanent residence as soon as possible.

All the above is to show that for good reasons many companies opt to avoid LMIA applications in this scenario as much as possible. Even if an LMIA is your only option, many of the above issues can be

 

To book a free 15 minute consultation with Sarah, click here or call us at 1 844 4CEOLAW or #CEO on your cell.

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