Canadian Manufacturing

Better labour mobility Canada’s biggest CETA win, report says

Encourages businesses to start preparing now in order to reap rewards of landmark trade agreement with Europe


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Pratt & Whitney Canada's PW150 series turboprop engine. PHOTO Pratt & Whitney Canada

Mutual recognition agreements will need to be negotiated under CETA for individual professions and trades where workers are licensed, certified or registered. PHOTO Pratt & Whitney Canada

OTTAWA—A new report says Canada’s biggest win under the massive trade deal it’s negotiating with the European Union (EU) will be improved labour mobility both into and out of the 28-nation bloc.

While details of the Comprehensive Economic and Trade Agreement (CETA) with Europe late last year are still being finalized, the report from the Conference Board of Canada says better labour mobility is a key gain for Canada, but businesses should start preparing now if they want to reap the rewards.

“Removing barriers to labour mobility could make it easier for Canadians to tap into the vast EU market and beyond,” Danielle Goldfarb, associate director of the think-tank’s Global Commerce Centre, said in an accompanying statement. “However, Canadian businesses need to start planning now, even before the deal is completed.”

According to the report, Across the Sea with CETA: What New Labour Mobility Might Mean for Canadian Business, the deal with the EU is expected to offer Canadian and European workers the ability to work more freely in each others markets—from the current 90 days to a maximum of three years.

“Complaints by Canadian businesses about the current difficulties of sending workers to EU countries show the need for CETA’s reforms,” the report reads.

Chief among the complaints are the red tape surrounding visa and work permit requirements, “widely varying definitions and terminology,” and long application processing times, the report continues.

Issues with taxation and spousal visas have also been noted.

“In comparison with previous free trade agreements that covered labour mobility, CETA breaks new ground in several respects,” the report reads.

While only the outlines of the agreement’s labour mobility provisions have been announced to date, the Conference Board says EU officials have agreed to use a “negative list” of worker categories—ones excluded from the agreement—rather than a “positive list” specifying what services are covered.

A so-called “positive list” is used in North American Free Trade Agreement (NAFTA) signed by Canada, the United States and Mexico.

According to the think-tank, categories of workers covered by the agreement include: corporate transfer employees; investment-related visitors; contract and independent service providers; and short-term business visitors, with varying durations of stay.

The CETA will also include a framework for professional groups to negotiate mutual recognition agreements (MRAs) with the EU for professions where workers are are licensed, certified or registered.

Which professions will be covered by the deal, however, remains unknown at this point.

The report calls professional qualifications and how they relate to MRAs “one of the trickiest elements” of the Canada-Europe trade deal because Canada’s provincial and territorial governments, as opposed to the federal government, regulate professions and trades.

With variations in qualifications from one province or territory to the next, negotiating a blanket agreement on any one trade or profession could prove to be cumbersome for the associations responsible for negotiating with their European counterparts on MRAs.

Referencing a 2008 Canada-EU joint study on labour mobility, the Conference Board report notes there are more than 440 professional regulatory bodies in Canada representing workers in more than 100 occupations.

“Ottawa is not in the driver’s seat when it comes to securing uptake of professional recognition provisions in CETA, or any other international agreement,” the Conference Board report reads. “All the federal government can do is ‘encourage and support the negotiation of MRAs between professional bodies through the development of appropriate frameworks and provisions contained in its international trade agreements.'”

This means it is “entirely up to professional bodies” whether to negotiate an MRA.

The waters get murkier still, as it is then up the provinces and territories to decide whether to accept any agreement as part of its individual licensing practices for any given profession or trade.

The report also notes that negotiating MRAs is voluntary for professional organizations, and no level of government can force them to enter negotiations unwillingly.

Regardless of how—or if—MRA negotiations take place across the board, the Conference Board says in its report that it is “unlikely Canada will experience big losses from CETA’s labour mobility provisions,” and points out the deal isn’t “a mechanism for unemployed Europeans to flood the Canadian labour market and take jobs, or vice versa.”

If anything, the agreement’s labour mobility provisions will help alleviate skills shortages on both sides of the Atlantic, the Conference Board report says, citing the Canada-EU joint study.

“Technical negotiations for CETA are ongoing, and the agreement won’t be finalized for another two years or so,” the report continues. “Until more information is made publicly available, and the agreement comes into effect, how should Canadian businesses understand the potential labour mobility implications of CETA and prepare to respond to them?”

For starters, according to the Conference Board, employers should be doing their homework ahead of CETA’s roll-out, and “actively seizing opportunities” once it takes effect.

“Few gains will come to those who don’t take advantage of it through individual initiative,” the report notes. “The prospect of the agreement coming into effect in two or three years should serve to galvanize mindsets and spur planning—above all, to look beyond U.S. markets to the EU.”

The deal between Canada and the EU also provides Canada with “a limited-time window” to lay down trade roots in Europe before a similar deal is ratified between the U.S. and EU, the report continues.

“The U.S. and EU have already begun talks on the Transatlantic Trade and Investment Partnership (TTIP), though they are going slowly due to disagreements over regulatory and other issues,” it says.

In closing, the report recommends businesses encourage professional associations to negotiate MRAs with their European counterparts, as well as government “to get the fine print” of the deal right and to consult and support professional associations as they look to hammer out potential MRAs across a host of professions and trades.


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