Mexico - Canada: Recruiter licensing

The Regulation of Worker Placement Agencies (RACT) provides Mexico’s framework for the licensing of recruitment agents. All for-profit employment agencies must register with the STPS (the labour ministry) and obtain authorisation before providing domestic or international recruitment services, with additional requirements for recruiters placing migrant workers overseas. Recruitment agencies are banned from charging jobseekers any kind of fees; agreeing with employers to deduct any fees from workers’ salaries; offering illegal or non-existent employment; and/or misleading applicants. Recruiting for jobs overseas without a licence is prohibited, punishable by fines ranging between 50 to 5000 times the minimum wage, or the equivalent of between US$340 to US$34,000. However, in practice, the registered agencies are vastly outnumbered by the informal, unregistered recruiters who carry out the bulk of recruitment in Mexico. The agency licensing regime does not currently play a meaningful role in promoting or ensuring fair recruitment. As of August 2020 there were only nine registered agencies licensed to recruit Mexican workers for jobs overseas, despite the fact that hundreds of thousands of workers are recruited every year for work in North America, reflecting what one NGO calls “a highly decentralized and unregulated system.” The government maintains a public register of agencies but this contains only basic information - it does not for example provide any detail about any recruitment agencies that may have been penalized and/or had their licenses revoked. There is no data about inspections and their outcomes. At present, there are few disincentives for unethical or unlicensed recruiters. The failure to curb the activities of unlicensed recruiters is an important factor in explaining why so few recruiters opt to formally register.

Canada’s federal government has jurisdiction over the licensing of immigration consultants, who are authorized to provide assistance with immigration applications, including work permits. There is a national registry of licensed immigration consultants, and the outcomes of disciplinary proceedings, including in relation to fraudulent recruitment and fee charging, are posted online by the regulator. However, the federal government established a new regulator in 2021 in response to repeated concerns about the weakness of the two previous self-regulatory regimes set up in 2004 and 2011 respectively. The inability of regulators and the federal government to deal effectively with unregulated representatives or “ghost consultants” was particularly highlighted in a 2017 parliamentary review. Provincial governments have jurisdiction over the licensing of labour recruiters. Provincial practices vary, with the first comprehensive legal framework for the regulation of labour recruitment of migrant workers introduced by the province of Manitoba in 2009. Six provinces - most of those that host large numbers of migrant workers - require labour recruiters to be licensed in order to operate, with some also requiring employers to register in order to hire migrant workers. Quebec and Saskatchewan have taken the additional step of requiring immigration consultants to be registered both federally and provincially in order to operate. However, the province which hosts the most migrant workers, Ontario (along with six other provinces and territories) does not require labour recruiters to register in order to operate, a policy that unions and recruitment agencies have called to be reversed. Experts argue that this discrepancy between provinces allows unscrupulous labour recruiters to focus their activities in provinces where regulations and monitoring are weakest. The oversight of recruitment activities outside Canada also remains a significant challenge, and some provinces, including British Columbia and Saskatchewan, require licensed recruiters to provide information on their international partners. British Columbia has taken the additional step of making licensed recruiters liable for the actions of their overseas partners.

Recommendations to the Mexican government:

• Consider changes to the Federal Labour Law and the RACT to license individuals, instead of, or in addition to the current system that provides licenses to agencies that can re-incorporate in order to avoid sanctions.
• Revise the Federal Labour Law and the RACT to clarify the penalties against unlicensed labour recruiters and intermediaries offering services to migrant workers and job seekers; to make licensed labour recruiters liable for actions of any unlicensed partners and intermediaries; and to authorize and fund the STPS to implement and enforce penalties for unlicensed labour recruiters and intermediaries both as companies and as natural persons.
• Institute an ethical recruitment framework into licensing and regulatory machinery such that prospective or existing recruitment agencies need to demonstrate compliance with ethical recruitment principles, and for this compliance to be verified and audited by an independent third-party; consider the introduction of incentives for agencies who can genuinely demonstrate due diligence, commitment to zero-fee recruitment and a duty of care for migrant workers.
• Publish information on labour recruitment agencies that are inspected and penalized to allow migrant workers and job seekers to avoid these agencies.

Recommendations to Canada’s federal government

• Require licensed immigration consultants to provide information on all their Canadian and overseas partners and make them liable for the actions of their overseas partners, similar to recent changes introduced by the province of British Columbia for licensed recruiters and their partners.
• Promote the importance of licensing labour recruiters with provinces and territories that do not currently have licensing regimes, and allow provinces to share best practices on labour recruitment.
• Communicate proactively to employers about relevant legislation that requires them to use licensed labour recruiters and immigration consultants in Canada.

Recommendations to Canada’s provinces and territories:

• Implement licensing systems for any individual engaged in the recruitment of migrant workers, where these are not already in place;
• Institute an ethical recruitment framework into provincial licensing and regulatory machinery such that prospective or existing recruitment agencies need to demonstrate compliance with ethical recruitment principles, and for this compliance to be verified and audited by an independent third-party; require employers to register with the province in order to be involved in the hiring of migrant workers, in line with regulations adopted by BC, Saskatchewan, Manitoba, Quebec, New Brunswick, and Nova Scotia;
• Amend legislation to hold employers and recruiters liable for the actions by any Canadian and overseas partners in the recruitment process, similar to recent changes introduced by the province of British Columbia;
• Provide increased transparency about licensed recruiters, indicating on provincial public registers where recruiters have been inspected and the key outcomes of these inspections.