Guidance for Officers on Assessing “Reciprocal Employment” and Entries via “Wet Lease”

Operational Bulletin 562 – December 20, 2013

Objective

This Operational Bulletin provides additional guidance to officers assessing requests that might qualify as:

• Labour Market Opinion (LMO) exempt (in accordance with R205(b) or,
• Work permit exempt (according to R186(s) of the Immigration and Refugee Protection Regulations (IRPR))

It also helps officers distinguish between:

• LMO exempt “Reciprocal Employment” situations and,
• Work permit exempt foreign crew situations (also known as approved “wet leased” conveyances)

Background

According to R186(s) of IRPR, foreign crews are eligible to work without a work permit as long as they:

• Work on a foreign-owned and foreign-registered conveyance and,
• Work mainly on international transportation assignments

“Wet Leasing” is a common term used in the aviation industry. It denotes an arrangement whereby a foreign company leases an aircraft and crew (along with maintenance and insurance) to a Canadian airline for a specified duration. In return, the Canadian airline pays:

• Charges based on the number of hours it operated the aircraft (to the foreign company)
• Fuel costs
• Airport fees, duties, taxes and other expenses

Wet leases help the host country (i.e. Canada) address shortfalls in aircraft availability. Various technical or mechanical reasons could result in such shortfalls. Wet leases come in handy on occasions like peak traffic seasons.

Under this arrangement, the foreign crewmembers on approved “wet lease” aircraft receive work permit exemption if they work on:

• Direct flights from Canada to a destination abroad or,
• Direct flights from a destination abroad to Canada

The Canadian Transportation Agency (CTA) has the sole prerogative of approving “wet lease” applications. However, this work permit exemption does not apply to crewmembers on flights involving stops within Canada.

On several occasions, Canadian airlines could also “dry lease” conveyances. “Dry Leasing” refers to the arrangement where the Canadian airline leases the aircraft, without leasing the crew. In this scenario, Citizenship and Immigration Canada (CIC) treat foreign crewmembers at par with foreign crew flying a Canadian airline’s regular fleet. Therefore, foreign crewmembers on a dry lease arrangement would need:

• A Labour Market Opinion (LMO) from Employment and Social Development Canada (ESDC) and,
• A work permit

Note:

• Approved “wet lease” arrangements between two airlines must not be regarded as “reciprocal employment” arrangements
• A Reciprocal Employment arrangement enables a foreign national to work in Canada with a work permit
• If evidence shows that a Canadian citizen has been provided a similar ‘reciprocal’ arrangement to work abroad, the foreign national working in Canada is given LMO exemption

Assessing Crew Work Permit Exemption (Wet Leases)

This Operational Bulletin guides officers to ways to check the Work Permit Exemption for foreign crewmembers in wet leases. Officers check to confirm that:

• The employer is the foreign airline
• The Work Permit Exemption application contains:
• The wet lease agreement with:
• The name of the Canadian airline
• The date and signatures
• The duration of the agreement or lease
• The Occupation NOC
• The year
• The number of aircraft involved in the agreement along with their registration ids
• The specification that all flights are international flights only
• Proof that the means of transportation used is not registered in Canada and is foreign-owned
• Proof that the flights with the crew operate between Canada and an international destination (and that they do not stop in Canada)
• Proof that the foreign airline employs the foreign national
• The list of foreign pilots and first officer’s
• Name
• Date of Birth and,
• Nationality
• Other details like flight schedules with:
• Dates
• Times
• Destinations and,
• Aircraft id
• The CTA approved the wet lease

Assessing Reciprocity and the LMO Exemption

This Operational Bulletin guides officers to ways to check the LMO Exemption. Officers check to confirm that:

• The employer is the Canadian company
• The reciprocity agreement is signed and dated
• The reciprocity agreement declares the number of expected exchanges between the two companies annually or seasonally

In many cases, exact reciprocity might not exist. However, the general order of magnitude must be reasonably similar. Therefore, for exchanges exceeding over 25 individuals, the CIC might require a minimum reciprocity benchmark of at least 75 percent. In case, officers find it hard to prove reasonable reciprocity levels, foreign nationals must obtain the required LMOs.