The government is investigating allegations that an owner of a McDonald's franchise in Victoria broke the rules of the program, Employment Minister Jason Kenney said in a statement Sunday.
"I have reasonable grounds to believe that this employer provided Employment and Social Development Canada with false, misleading or inaccurate information," Kenney said.
The statement did not identify the franchise and contained few other details, but a government source said the allegations are that foreign workers were hired over Canadians.
The source could not indicate how many workers were involved, but said the franchise owner operated three restaurants and that all were part of the investigation.
Inspectors were called to visit the site and as a result all work permits for employees at the restaurant in question have been suspended pending the outcome of the investigation.
If the investigation determines the rules of the program were broken, the franchise owner will be blocked from hiring more temporary foreign workers, Kenney said.
McDonald's said had it launched its own investigation of the restaurant and that it would act on the government audit's recommendations.
"At McDonald’s Canada, we do not tolerate infractions of any kind – intended or unintended," said the company in a statement. "We are currently working through the process of terminating our relationship with this franchisee."
The Temporary Foreign Worker Program came under increased scrutiny after a series of abuses became public, including word last year that the Royal Bank displaced a number of Canadian workers after contracting out IT services to a foreign supplier.
The bank apologized for the incident and the Harper government backtracked on changes it made to the program, including a provision that allowed businesses to pay foreign workers up to 15 per cent less than the average wage for a job.
The program has also been criticized because some companies looking to reduce labour costs look to the program as the first option in hiring, rather than the last.
Some estimates suggest the number of temporary workers in Canada doubled in seven years to about 340,000 as of December 2012. The biggest growth came in the years following the 2008-09 recession, when hundreds of thousands of Canadians were out of work.
The government announced this year it was bringing in hefty penalties including fines that were to be in place by 2015.
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