Canada LMIA Rules — August 2026: Per-Location Caps & 90-Day Concurrent Processing

Last updated: August 25, 2026 · Author: Dimple Verma, RCIC-IRB R708308, VG Immigration Services Inc.

Canada’s Labour Market Impact Assessment (LMIA) framework quietly changed twice in August 2026, and both updates matter for employers using the Temporary Foreign Worker Program (TFWP) and for in-Canada workers whose permits are close to expiry. Employment and Social Development Canada (ESDC) redefined how the low-wage TFW cap is calculated for small employers on August 18, 2026, and Immigration, Refugees and Citizenship Canada (IRCC) extended the concurrent-processing grace period from 60 days to 90 days on August 21, 2026. Together, they open a real path for multi-location small businesses and give in-Canada workers a wider safety net when their LMIA-linked extension is running against processing times.

This guide breaks down each change, walks through worked examples, and shows exactly what VG Immigration is doing to help clients act on both rules.

Change 1: ESDC low-wage TFW cap now calculated per work location (August 18, 2026)

The low-wage stream cap limits how many temporary foreign workers an employer can hire in low-wage positions. Historically, the cap was applied against an employer’s total national workforce. Effective August 18, 2026, ESDC’s Program Requirements for Low-Wage Positions page confirms that, for employers with fewer than 10 employees at a specific work location, the cap is now calculated per location.

How the small-employer variation works after August 18, 2026

• The cap variation applies where an employer has fewer than 10 employees at a given work location.
• ESDC uses a deemed workforce of 10 to calculate the cap at each qualifying location.
• Under the standard 10% cap: a maximum of 1 low-wage TFW per qualifying location.
• Under the 20% cap (construction, food manufacturing, hospitals, nursing and residential care facilities, specified in-home caregiver occupations): a maximum of 2 low-wage TFWs per qualifying location.
• Full-time employee: averages 30 or more hours per week. Part-time employee: averages fewer than 30 hours per week and counts as 0.5 of an employee for cap-calculation purposes.

Every location’s headcount is counted independently. That includes all full-time and part-time employees at the location, Canadians, permanent residents, TFWs already onboard, workers holding other work permits, employees on approved leave who are expected to return, and vacant positions being requested on the current LMIA.

Worked example: three-location cleaning company in Ontario

• 3 locations. Each has 7 full-time employees. National headcount: 21.
• Before August 18, 2026: the employer had 21 employees nationally, so it did not qualify for the small-employer variation. Its cap would have been calculated against the full 21-employee workforce.
• After August 18, 2026: each location is independently under 10 employees, so each qualifies. Under a 10% cap, the employer can request 1 low-wage TFW at each location — up to 3 low-wage positions company-wide. In a 20% cap sector, that becomes up to 6 low-wage positions company-wide.

Cap-exempt streams that this change does not touch

• On-farm primary agriculture positions.
• Certain caregiving positions.
• Short-duration positions of 120 days or less.
• Seasonal industry positions of up to 270 days.

Business-legitimacy evidence Service Canada is asking for

Employers that have not had a positive LMIA within the past two years must submit supporting documents to demonstrate business legitimacy alongside the LMIA. The primary document requested by ESDC is a valid municipal business licence or the applicable operating permit. Where a municipal licence is not required, acceptable alternatives include a T4 Summary of remuneration paid, T2 Schedule 100 or 125 for corporations, or a PD7A statement of account for current source deductions. Service Canada considers alternatives on a case-by-case basis and can request additional documentation at any time.

Because the cap is now counted per work location, expect Service Canada to test the reality of that location — payroll records, on-site verification, and evidence that the employer is genuinely operating and providing goods or services at each site.

Change 2: IRCC extends concurrent-processing grace period from 60 to 90 days (August 21, 2026)

Concurrent processing lets an in-Canada worker submit a work permit extension application while their employer’s LMIA is still pending with ESDC, provided a strict set of eligibility conditions are met. On August 21, 2026, IRCC issued a program delivery update extending the hold period from 60 days to 90 days. The underlying officer instructions on the Labour Market Impact Assessment Review page now reflect the 90-day window and a new client-flagging code.

All five eligibility conditions must be met at the moment of filing

1. The applicant’s current work permit expires in two weeks or less.
2. The employer has already submitted a complete LMIA application to ESDC.
3. The LMIA was submitted with sufficient lead time against published LMIA processing times — meaning ESDC could reasonably have made a decision by the time the work permit was filed.
4. No decision has yet been made on the LMIA.
5. The applicant is applying from inside Canada under IRPR R199.

How the 90-day hold works in practice

Once the officer confirms the file qualifies, the work permit application is promoted, the processing fee is allocated, and the application is held for 90 days from the date it is received. During that window the applicant can update the file with proof of a positive or neutral LMIA. If IRCC still has no LMIA on file after 90 days, the officer returns to the application and makes a decision on the documents available — which typically means refusal, because the LMIA is a mandatory document under paragraph R10(1)(c) of the Immigration and Refugee Protection Regulations. The 90-day period is a hold, not a guarantee of approval.

New client-flagging code: CPTS2026

Applicants who need concurrent processing are now instructed to enter CPTS2026 in the intended occupation field of IMM 5710. The code is for tracking purposes only and does not affect the officer’s decision. Quebec applicants must still provide a Quebec Acceptance Certificate (CAQ) where one is required.

Worked example: BC food-service employer

• A restaurant in British Columbia files a complete LMIA in early May 2026 for a low-wage cook position.
• The employee’s current work permit expires September 5, 2026.
• ESDC has not yet issued a decision — high-wage and low-wage streams were averaging 88 days and 73 days respectively in July 2026, per ESDC’s monthly processing times.
• On August 25, 2026 the employee files an in-Canada work permit renewal, enters CPTS2026 in IMM 5710’s intended occupation field, and attaches proof that the current permit expires within two weeks, the LMIA was filed with sufficient lead time, and no LMIA decision has been made.
• IRCC holds the file for up to 90 days — to late November 2026. Under the old 60-day rule the deadline would have fallen in late October, giving the applicant roughly 30 fewer days to secure the LMIA.
• If ESDC issues a positive LMIA in October, the applicant uploads it to the file and the officer can finalize the work permit.

Last-minute LMIA filings and outside-Canada applicants

IRCC is explicit that employers should not submit an LMIA immediately before the work permit application and expect concurrent processing — those requests are assessed only on an exceptional basis. Concurrent processing also does not apply to applications filed from outside Canada; those applicants must have a positive or neutral LMIA in hand before they submit the work permit application. A positive LMIA is generally valid for six months from the date ESDC issues the decision letter, and the 90-day hold does not extend that validity.

How both August 2026 LMIA changes affect employers and workers

For small and multi-location employers

• Franchise, chain and multi-site operators — cleaning services, food service, retail, trades — that were previously locked out of the small-employer variation because national headcount exceeded 10 can now qualify at every location that stays under 10 employees. Plan hiring rounds site by site.
• Document each site as a genuine work location. Payroll ledgers, T4 summaries, PD7A statements, municipal licences, and photographs of the operating site should be organized by location before you submit the LMIA. Expect ESDC to test whether the location is real, staffed as claimed, and in genuine need of the position.
• Part-time weighting matters. If your location has 6 full-time employees and 6 part-time employees, that is 6 + (6 × 0.5) = 9 employees — still under 10 and still eligible for the small-employer variation.

For in-Canada TFW workers approaching permit expiry

• The 90-day hold buys real time. With low-wage LMIAs averaging 73 processing days and high-wage LMIAs averaging 88 days, the 60-day window frequently expired before ESDC issued the LMIA. The 90-day window now aligns more closely with published processing times.
• File early, not on the last day. The two-week expiry requirement is a floor, not a target. Filing 10-14 days before the permit expires still triggers implied status protection under R186(u) while the extension is under review.
• Enter CPTS2026 in the intended occupation field on IMM 5710. Without the code, IRCC may not identify your file for the concurrent-processing queue.
• Do not wait past the 90-day mark. If ESDC has not issued a positive LMIA by day 90, the officer will decide the file on what is available, and R10(1)(c) makes refusal the typical outcome.

How VG Immigration is helping clients under the new rules

Our team is already using both August 2026 changes to unlock hiring for employers and to protect worker status. When clients engage us on an LMIA file we do location-level workforce calculations before we even open LMIA Online, build the business-legitimacy evidence package (municipal licence, T4/T2/PD7A alternatives, site photos, floor plans), stress-test each work location against ESDC’s “genuine employer” test, and schedule the LMIA submission with enough lead time to trigger concurrent-processing eligibility if the worker is inside Canada. For in-Canada extension files we file the R199 work permit as early as day 14 before expiry, add CPTS2026 to IMM 5710, and stage the LMIA upload the moment ESDC issues its decision.

Book a consultation before your LMIA window closes

If you are an employer weighing a multi-location LMIA strategy under the new small-employer variation, or a worker whose permit is close to expiry with an LMIA still in processing, VG Immigration can map your options against these two August 2026 changes and file the paperwork with the correct evidence the first time. Book a consultation or reach us at immigration@vgis.ca or WhatsApp +1 (416) 578-9269.

Official sources

• ESDC — Program Requirements for Low-Wage Positions (variation updated August 18, 2026)
• IRCC Program Delivery Update — Labour Market Impact Assessment Review, Temporary Foreign Worker Program (August 21, 2026)
• IRCC — Labour Market Impact Assessment Review officer instructions
• ESDC — LMIA processing times
• Immigration and Refugee Protection Regulations — Section 199 (R199)
• Immigration and Refugee Protection Regulations — Section 10 (R10)

Frequently asked questions

What are the two new Canada LMIA rules effective in August 2026?

ESDC changed the low-wage TFW cap calculation for employers with fewer than 10 employees at a given work location, effective August 18, 2026, so that the cap is now applied per work location. IRCC extended the concurrent-processing grace period for in-Canada work permit extension applications from 60 to 90 days, effective August 21, 2026.

How many low-wage temporary foreign workers can a small employer hire under the new rules?

Under the standard 10% cap, up to 1 low-wage TFW per work location with fewer than 10 employees. Under the 20% cap that applies to construction, food manufacturing, hospitals, nursing and residential care facilities, and specified in-home caregiver occupations, up to 2 low-wage TFWs per qualifying location.

What is the tracking code for concurrent processing on IMM 5710?

Enter CPTS2026 in the intended occupation field of IMM 5710. The code is for IRCC tracking purposes only and does not affect the officer’s decision.

Does concurrent processing apply to work permit applications made from outside Canada?

No. Concurrent processing under R199 is only available to applicants inside Canada. Foreign nationals applying from outside Canada must have a positive or neutral LMIA in hand before they submit their work permit application.

What happens if the LMIA is not issued within the 90-day hold?

The officer returns to the application on day 90 and decides it on the documents on file. Because a positive or neutral LMIA is a mandatory document under paragraph R10(1)(c) of the Immigration and Refugee Protection Regulations, the application is typically refused if the LMIA is not provided during the hold period.

This article is general information about Canadian immigration policy as of August 25, 2026 and is not legal advice. For advice on your file, book a consultation with a Regulated Canadian Immigration Consultant. Dimple Verma, RCIC-IRB, R708308.