OTTAWA -- The Conservative government's controversial temporary foreign worker program got another makeover Friday with limits on where low-paid hires can work and strict penalties for companies that fudge their requests for cheap help.

But no sooner had Employment Minister Jason Kenney and Immigration Minister Chris Alexander unveiled the new-look program than it was denounced by critics who fear it could force some employers to close or cut back hours.

"For a government that has made significant strides to reduce the red tape burden on small business, this is a complete 180-degree turn," said a fiery statement from Dan Kelly, president of the Canadian Federation of Independent Business.

"This change represents a 'gutting' of the TFW program for many in the restaurant, hotel and retail sectors and is the most small business-unfriendly move ever made by this government."

Kenney and Alexander, standing elbow-to-elbow at a news conference that lasted some 90 minutes, billed the changes as a badly needed "overhaul" to ensure temporary foreign workers are brought to Canada as a "last and limited resort."

There will indeed be "adjustment costs" as a result of the reforms, Kenney acknowledged.

"Yes, undoubtedly, there will be some businesses in that sector that end up paring back their operating hours," he said. "That we fully anticipate."

The changes prevent employers in places with high unemployment rates from applying for temporary foreign workers in the lowest wage and skill groups in the accommodation, food service and retail sectors.

A cap is also being placed on the number of low-wage temporary foreign workers an employer can hire at each worksite: 30 per cent of a worksite's employees starting immediately, dropping to 10 per cent by July 2016.

Companies will also be required to re-apply each year to hire low-wage temporary foreign workers, instead of every two years. They'll pay more for the privilege, too: $1,000 per employee, up from $275.

The added cost will go towards the extra $14 million it is expected to cost Statistics Canada to gather new, more accurate data on jobs and wages.

The changes will significantly reduce the number of temporary foreign workers in Canada and improve labour market information, all the while strengthening enforcement and penalties, Kenney said.

"We'll severely sanction those who break the rules."

The changes were roundly panned by groups representing employers, employees and immigrants alike.

"Today's announcement does nothing to change a system that still allows irresponsible employers to exploit workers with impunity," Paul Meinema of United Food and Commercial Workers Canada said in a statement.

"The Harper Conservatives are only now acknowledging problems with this file because of a number of irresponsible employers."

Chris Ramsaroop of the Migrant Workers Alliance for Change said the new program will do little to end the exploitation of immigrants who do menial, undesirable work in Canada for unjust wages.

"Migrant workers are still employed under an indentured system where they work without voice, without rights and without protections."

The government also says it will post the number of temporary foreign workers approved every quarter, along with the names of companies that get the green light to hire them, in an effort to enhance accountability.

Employers who hire temporary foreign workers must promise not to lay off any Canadian workers or cut their hours, and they must tell the government how many Canadians applied and were interviewed for jobs, along with why they were not hired, Kenney said.

"We'll ensure employers re-double their efforts to hire Canadians."

The program will now be based on provincial wage levels instead of the government's national occupational classifications. Low wages are defined as anything below the provincial median; high wages are anything above it.

The amount of time a low-wage temporary foreign worker can work in Canada is being reduced to a cumulative total of two years from four years.

The government is also lifting its freeze on hiring temporary foreign workers in the food-services sector, imposed in April at the height of complaints that the program was being abused by restaurants and keeping jobs from Canadian workers.

The government had promised to begin inspections of those employers that use temporary foreign workers, but the government's response to a request for documents indicates those inspections have yet to begin.

The Canadian Press made a request under the Access to Information Act for all inspection reports of workplaces that employ temporary foreign workers. But in a letter dated June 2, Employment and Social Development Canada said none have been carried out.

But Kenney insisted so-called "employer compliance reviews" are indeed taking place. He says there have been around 3,000 done since 2011, many of which have been done on-site.

The temporary foreign workers program has become a hot potato for the Harper government ever since stories of abuses came to light in the news media, including one case where Royal Bank employees were asked to train foreign workers to take over their jobs.

In February, 65 Alberta ironworkers alleged they were let go so that foreign workers could replace them.

Canadian firms are using the program more and more to fill both high- and low-skilled positions, despite relatively high levels of unemployment and data showing that the ratio of unemployed to job vacancies is rising.

A recent government calculation estimated there were 386,000 temporary foreign workers in Canada, or about two per cent of the labour force, up from about 100,000 in 2002.