Work permit expirations and refusals are creating real challenges. Over the past several months, this is an issue that has been coming up more frequently in conversations with small business owners across Ontario.

According to the Canadian Federation of Independent Business (CFIB), more than 1.3 million temporary work permits are expected to expire by the end of 2026. While immigration policy can often feel removed from day-to-day business operations, the reality is that these decisions are increasingly showing up in workplaces.

Many employers are trying to understand what their obligations are when an employee’s work permit extension is refused or when a worker is no longer authorized to work in Canada.

Employers are now finding themselves in situations where an employee who has been working with them for several years suddenly receives a decision that they can no longer continue working. Sometimes this is due to a refused extension, in other cases, it relates to a change in status or a delay in processing that removes their authorization to work. From the perspective of small business owners, the impact can be significant.

These are often not short-term workers or new hires. In many cases they are experienced employees who understand the business, the processes, and the expectations of the role. They are part of small teams where each position plays an important role in day-to-day operations. In many cases these employees have been part of the team for several years, making the situation difficult not just operationally but personally for both the employee and the business owner.

When a worker can no longer legally continue in their role, the operational impact is immediate. For small businesses, even one unexpected vacancy can affect production, scheduling, customer service, or project timelines.

Employers also face difficult decisions. Many want to support the employee and give them time to address the situation, but they must also ensure they remain compliant with employment and immigration requirements. If an individual no longer has legal authorization to work in Canada, the employer cannot allow them to continue performing work of any kind.

For many small businesses in Ontario, this creates operational stress as well as uncertainty about the right steps to take.

Questions are coming up such as:

• Can the employee remain employed while they resolve their immigration status?
• What documentation should the employer ask for?
• Should the employer hold the position open while the situation is being resolved?

These are not simple questions, and the answers can depend heavily on the individual situation.

In most cases, once an employee no longer has valid work authorization, the employer cannot allow them to continue working. This can create difficult situations for small businesses that rely on experienced employees and suddenly need to adjust staffing while the individual works through their immigration process.

From an HR perspective, situations like this require employers to balance compassion for the employee with their legal obligations as an employer. Understanding employment obligations, managing communication carefully, and documenting decisions properly are important parts of navigating these situations.

What is becoming increasingly clear is that this is not an isolated issue. It is a growing challenge that more small businesses across Ontario are beginning to encounter. As work permits continue to approach expiry over the next two years, this is likely to be a situation many more employers will need to navigate.

If your business is navigating work permit expirations and uncertainty around employee authorization, seeking HR guidance early can help reduce risk. Get in touch here.