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Public Consultation Session
Mississauga - September 19, 2013

On September 19, 2013, the Minimum Wage Advisory Panel held a public consultation session in Mississauga, where they heard presentations regarding Ontario’s minimum wage policy from individuals and a number of organizations. The following represents a highlight of some of the comments that were heard during that session. The names of individual presenters have not been included.

List of Organizations Represented

  • Brampton-Mississauga and District Labour Council
  • Canadian Federation of Independent Business
  • Canadian Restaurant and Foodservices Association
  • Human Resources Professionals Association
  • ODSP Action Coalition
  • Oakville Chamber of Commerce
  • Ontario Campaign 2000
  • Ontario Federation of Labour
  • Ontario Restaurant, Hotel and Motel Association
  • Peel Poverty Action Group
  • UNITE HERE Local 75

Highlights of Comments Received

Minimum wage policy – general comments

  • The minimum wage policy should be objective, predictable and transparent; Ontario should move away from ad hoc and politically motivated increases.
  • The minimum wage has not increased since March 2010, but the cost-of-living has increased in those years, resulting in financial hardship for those whose incomes have not increased.
  • One of the issues that should be addressed is that of employees being overworked. Work/life imbalance costs billions in healthcare and absenteeism.
  • The minimum wage should bring people out of poverty.

Profile of minimum wage earners

  • Historically, the minimum wage was for young workers (summertime and first jobs). Now there are a lot of older workers working at the minimum wage.
  • Some statistics indicate that the majority of minimum wage earners are students who live at home (ages 15-24) and that most work part-time.
  • The restaurant and foodservices sector is the largest employer of minimum wage workers. Most of these workers are youths, students and first-time job holders.
  • Many minimum wage earners work multiple jobs (sometimes up to 3 or 5 jobs).
  • Most minimum wage workers work for large corporations.

Minimum wage rates

  • Determining adjustments to minimum wage is a multi-layered and complex issue. Any changes to the minimum wage will impact not only minimum wage earners and businesses, but also consumers.
  • Benefits of raising the minimum wage include more productive employees, lower turnover costs, lower absenteeism, and improved employee morale.
  • The minimum wage should be 10% above the poverty line using the Low Income Measure. Current minimum wage earners are living below the Low Income Cut-Off (LICO).
  • Women, youth, newcomers and seniors are greatly impacted by changes to the minimum wage.
  • Freezes in the minimum wage are unfair to workers and erode purchasing power.
  • Government should not increase the minimum wage unless it has exhausted its ability to assist low-income earners through tax relief and training initiatives.

Factors the government should consider when determining minimum wage rates

Minimum wage and poverty reduction

  • There are 370,000 people in Ontario living in poverty (based on the Low Income Measure after tax).
  • Poverty cannot be solved with just the minimum wage. The minimum wage is a blunt instrument and not a sharp tool.
  • Ontario should aim to reduce child and family poverty in Ontario. 100,000 children come from working poor families, families that have at least one parent working full-time and full year.
  • The current minimum wage is too low and keeps people living in perpetual poverty. Minimum wage earners should be able to afford the necessities they need.

Impact of minimum wage on the economy

  • Raising the minimum wage will lead to positive economic growth and more household spending.
  • The minimum wage should remain frozen until the economy recovers in every Ontario community.
  • Low-income workers spend all their income locally. Increasing their income will stimulate the economy.

Impact of minimum wage on business

  • Minimum wage increases negatively impact some industries. When minimum wage increased in 2008 and 2009, these increases impacted the hotel and restaurant industry significantly.
  • Some of the difficulties experienced by businesses include rising labour, food and energy costs. Restaurant operators are battling with shrinking operating margins.
  • A 10% increase to the minimum wage will result in job loss.
  • An increase in the minimum wage will result in price hikes, and business can only raise their prices to a certain extent before they lose customers, and perhaps, their business.
  • Raising the minimum wage will force businesses to reduce staff.
  • Some business owners have indicated that a minimum wage increase would not have a negative impact on their company’s bottom line, but may result in a hiring freeze or possible layoff and would make their company less competitive compared to other jurisdictions.
  • Industries that hire minimum wage employees may pass the costs of minimum wage increases on to consumers.

Establishing a process for review

  • There should be a formal mechanism to review the minimum wage, with a mandatory review every two years that includes public consultations.
  • The current mechanism is not predictable, and businesses want predictability.
  • Government should make the process for adjusting minimum wage transparent.
  • Factors that should be considered when adjusting the minimum wage include the number of new jobs in Ontario since 2009 (especially in the sales and service sector) and the proportion of workers on the minimum wage.
  • The minimum wage differentials for liquor servers and students should be maintained in order to balance the needs of employees and employers.

Tying minimum wage to economic indicators

  • The cost of living would be the best factor to use in reviewing the minimum wage. Minimum wage rates should be tied to the Consumer Price Index (CPI).
  • Low Income Measure (LIM) is a better tool than Low Income Cut-Off (LICO) for adjusting minimum wage.
  • The minimum wage rate should be calculated based on a 35-hour work week.
  • Tying minimum wage to CPI would be fair to employees and employers, as it is predictable and does not result in freezes or erosion of purchasing power.
  • Tying minimum wage to CPI would also be transparent, as it is understood by all and eliminates the politics.

Period of review of the minimum wage

  • Increases should occur every three years.
  • Increases should be predictable, and should occur every two years.
  • The minimum wage should be increased annually.
  • The minimum wage should be monitored to make sure it stays at 10% above the poverty line.

Notice period

  • There needs to be at least six months of notice for employers to give them time for budgeting and to plan for increases.