Raising minimum wage good for business growth, advocates say

Photo of Ontario Labour Minister Kevin Flynn via mama! mia!/flickr

Businesses have nothing to fear about the government's proposal to hike minimum wage to $15 an hour, say some Ontario small businesses and worker advocates.

The provincial government announced proposed changes to the Employment Standards Act and Labour Relations Act on Tuesday. This follows last week's release of the Changing Workplaces Review, the result of two years of consultation and review of Ontario's workplace legislation.

The new legislation is scheduled to be introduced this week.

The government plans to raise Ontario's general minimum wage to $14 an hour in January. It will increase to $15 an hour in January 2019, and then each year according to the rate of inflation. The minimum wage is set at $11.40 an hour now. It will rise slightly -- to $11.60 -- on Oct. 1 before climbing to $14 in January.

Approximately 30 per cent of Ontario workers get paid $15 an hour or less, Premier Kathleen Wynne said at Tuesday's announcement.

"It really is a good day for the little guy in Ontario," Minister of Labour Kevin Flynn, told reporters on Tuesday. Increasing the minimum wage will only benefit the province's economy, he said -- the money will be going to bread and diapers, not being stored in the Cayman Islands.

Workers' advocates say the proposed changes don't go far enough.

The final report recommended the government expand the definition of "employee" in the Employment Standards Act (ESA) to include "dependent contractors," those workers who are on contract to only one or two employers for their income. The government chose not to adopt this recommendation.

The government does plan on prohibiting employers from misclassifying employees as "independent contractors." Independent contractors aren't entitled to the same protections as employees under the ESA.

That's something some advocates were hoping to see, said Deena Ladd, coordinator at the Workers' Action Centre.

She applauded the government's intent to raise the minimum wage, saying it's an important step to fight against precarious work.

"All that these reforms are doing is putting in place a lot of fairness, and putting in place things that should have happened a long time ago," she said.

Many business owners also hailed the proposed legislation.

"Taking care of your staff is what leads to business growth. It's the first step," said Helmi Ansari, owner of Grosche. The company sells coffee, tea and coffee and tea accessories. It's a member of the Better Way to Build the Economy Alliance, a group of businesses committed to treating employees fairly. Grosche pays its 12 employees more than $16 an hour. Employees at the company's office in Cambridge earn $16.05 an hour; those at the company's Guelph store earn $16.50. Wages are based on the living wage of the community, said Ansari.

The minimum wage won't be rising to $15 for everyone. The minimum wage is still lower for students under 18. It sits at $10.70 now. It will increase to $13.15 in January and to $14.10 in January 2019. Liquor servers will still have a lower minimum wage. Right now, they get paid $9.90 an hour. It will climb to $12.20 in January and $13.05 the next year.

Flynn told reporters there is widespread support for students receiving a lower minimum wage because they're still learning. The minimum wage for servers is low to account for the amount they may earn in tips.

The government also plans to increase personal emergency leave time for all employees. The proposed legislation gives all employees 10 days of personal emergency leave, two of which are to be paid. Right now, only employees who work at businesses with more than 50 workers can get emergency leave, and none of it paid.

The two days of paid leave is less than the seven days advisers had suggested the government introduce, Flynn told reporters. "It's a starting point," he said. "It establishes a principle of sick pay."

"What we're announcing today is a new set of minimums," he said.

The legislation would also expand the reasons why someone can take emergency leave to include people needing to seek help for domestic violence situations. A private member's bill that called for Ontario to allow for up to 10 days of paid leave for domestic violence passed second reading in October.

That minimum is a "positive step in the right direction," said Dr. Kate Hayman, a member of the steering committee of the Decent Work and Health Network and emergency room doctor. The organization has been lobbying for paid sick days for years. It would have liked to see seven paid sick days in the legislation, Hayman said.

Businesses can afford paid sick days, said Jessica Carpinone, owner of Bread by Us bakery in Ottawa. The business is also part of the Better Way to Build the Economy Alliance. The company pays its full-time employees three hours' pay for sick days for up to seven days a year; part-time employees get the same for up to three days a year. It has seven full-time employees and two part-time employees.

"This encourages people to stay home when they're sick, which is step one," she said.

This is especially important in the food industry where sick workers can easily pass their illnesses on to customers.

The proposed legislation will also increase vacation pay to three weeks for employees once they've worked for an employer for five years.

Embracing these changes will only benefit businesses, said Carpinone. There will be challenges, but the "payoffs" are greater than the alternative -- resentful workers and high turnover rates, she said.

The government also plans to introduce changes to make sure that part-time, casual or temporary workers aren't paid less than full-time employees for doing the same job for the same employer.

Meagan Gillmore is rabble.ca's labour reporter.

Photo of Ontario Labour Minister Kevin Flynn via mama! mia!/flickr

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