Tag: Provincial Government

The Unintended Consequences of a $15 minimum Wage

The provincial government has introduced legislation that will increase the current minimum wage by over 30% from $11.40 to $15.00 per hour over the next 18 months.

Small business owners are expressing concern about the size and, in particular, the timing of the changes. Chamber members share the Government’s desire for broadly inclusive growth. However, in order to achieve this, we need to ensure that we are not risking job losses, rising consumer costs, and economic hardship as a result of over-regulation. The Ontario Government’s announcement of the Fair Workplaces and Better Jobs Plan which proposes numerous changes to current labour and employment standards legislation will go to committee over the summer months. 

The recommendations include:
  • Raising Ontario’s general minimum wage to $14 per hour on January 1, 2018, and then to $15 on January 1, 2019, followed by annual increases at the rate of inflation
  • Mandating equal pay for part-time, temporary, casual and seasonal employees doing the same job as full-time employees; and equal pay for temporary help agency employees doing the same job as permanent employees at the agencies’ client companies
  • Expanding personal emergency leave to include an across-the-board minimum of at least two paid days per year for all workers
  • Ensuring at least three weeks’ vacation after five years with a company
  • Updating employee scheduling rules, including requiring employees to be paid for three hours of work if their shift is cancelled within 48 hours of its scheduled start time.
The cost of all of these benefits will be borne by small business owners.  We believe the government has not yet fully understood the unintended consequences of these changes.   Chamber members have expressed their frustration and concern over rising costs and over regulation.

“It will impact our business cash flow and the costs will have to be passed on to the consumer.  Because taxes with source deductions are going to be higher. We are not against an increase if it is done in increments and not as a total 32% increase over a short period of time.” – Noel Lourenco, Boffo’s

Many affected employers have told us that these changes will have the opposite effect of what the Government is looking to achieve.  One small business owner told us that “Since higher costs for delivery will be passed down from the supplier to the merchant, it will result in inflation. I will be forced to pass the higher costs on to the consumer.” We have also heard from members who say the impact will be felt throughout their businesses.

“If something isn’t done this dramatic and unrealistic increase may force us to close our doors after being a Kerr Street merchant for the last 18 years.” – Dean MacLean, The Mermaid and The Oyster

Higher costs for employers will inevitably lead to higher prices for consumers.  If the businesses cannot transfer these new costs to the consumer, employers will be looking to reduce overhead by cutting staff hours and possibly cutting the number of staff.  This will reduce the job opportunities available to youth and other low-skilled individuals who need employment.

While we understand the commendable intentions of these proposals, it is clear that the government can’t legislate prosperity.  Instead of creating more opportunity for workers, changes like these often have the opposite effect by reducing jobs and increasing the cost of living. That is why the Oakville Chamber and the Chamber network with the Keep Ontario Working Coalition  have called on the government to conduct a comprehensive economic impact analysis.

As the provincial government moves this legislation through the committee process over the summer we urge them to truly understand the economic impact of these changes that have great potential to hurt job creation, consumer costs, and economic growth.  

How will this affect your business? Let us know: faye@oakvillechamber.com 


Immediate Action Required to Address Deficiencies in the Provincial Interest Arbitration System

As a result of wage settlements resulting from the provincial arbitration system, the costs of emergency services have increased at over three times the rate of inflation annually since 2002.

  Today the Oakville Chamber of Commerce, in partnership with the Ontario Chamber of Commerce, formally released an open letter to Premier Kathleen Wynne addressing deficiencies in the arbitration system. Cc’d on the letter were Minister of Labour Kevin Flynn and Minister of Municipal Affairs Bill Mauro. As recognized in the letter, the cost escalation resulting from settlements is unsustainable, particularly in an era of fiscal restraint generally, and especially in an environment where municipalities are greatly restricted in their options to raise new revenue. “Our principal concern is that the current system does not adequately consider the capacity of municipalities to pay” stated John Sawyer, President of the Oakville Chamber of Commerce. “In order to ensure the fiscal sustainability of municipalities, we believe that immediate action is required to address deficiencies within the provincial interest arbitration system.” Therefore, the Oakville Chamber of Commerce is calling on the Ontario Government to take 3 important steps:
  1. Reform the provincial interest arbitration system to reflect the current capacity of Ontario municipalities to pay for increased service costs
  1. Improve efficiency by requiring that arbitration decisions be delivered in less than 12 months.
  1. Improve accountability and transparency for the taxpayer.
Read the letter here.

Focus spring legislative session on strategic infrastructure and lowering costs to foster confidence: Oakville Chamber of Commerce

Today, the Oakville Chamber of Commerce, in partnership with the Ontario Chamber of Commerce, formally released its 2017 pre-budget submission containing recommendations to the Ontario legislature as it looks to begin its spring 2017 legislative session. The submission outlines four key budget priorities and thirteen specific recommendations for Queen’s Park to adopt in order to restore fiscal balance and spur economic growth. Specifically, the Oakville Chamber of Commerce is looking for immediate support for strategic infrastructure investments and sound budget management. Oakville businesses have stated rising costs as the most significant factor impacting business and industry, according to the Oakville Chamber of Commerce’s 2016 Advocacy Survey. The survey also revealed that transportation infrastructure and traffic congestion remains a top concern for the Oakville business community. In fact, 64% of respondents believe that traffic congestion is a significant obstacle for business. Furthermore, the top three infrastructure priorities identified by respondents were all transportation related, calling for investments in local roads and bridges, public parking, and transit. The Oakville Chamber of Commerce urges the provincial government to address the infrastructure deficit by investing infrastructure funds strategically to increase productivity and enable competitiveness for Oakville businesses. “The Ontario Chamber of Commerce, in partnership with our diverse Chamber Network, will continue to work with the provincial government to ensure that Ontario prioritizes reducing obstacles to business competitiveness,” said Allan O’Dette, President & CEO of the Ontario Chamber of Commerce. “By taking more authoritative action on this issue, we can ensure that Ontario remains an attractive environment for capital investment.” In the submission, Ontario’s Chamber Network is also calling on the government to send a clear message of fiscal stability by balancing the provincial budget by 2017-2018. Such action would result in a more attractive environment for business investment and growth as well as confront the challenge of mounting input costs, such as electricity prices. As signalled last week in the Ontario Chamber of Commerce’s Ontario Economic Report, businesses are maintaining their operations and holding onto cash rather than expanding production or investing. This indicates that industry sees the Ontario economy as high-risk. “The Government of Ontario must ensure that it addresses recommendations made by the Oakville Chamber of Commerce in their provincial budget in order to support economic growth for Ontario businesses,” stated John Sawyer, President of the Oakville Chamber of Commerce. “Government must focus on reducing the costs of doing business in Ontario, supporting strategic infrastructure development and strengthening its efforts to bolster business competitiveness that allows Oakville to thrive.” Addressing the current fiscal context and achieving a balanced budget is an underlying theme throughout the pre-budget submission. Ontario’s Chamber Network is committed to working with the Ontario Government to ensure the future economic success of the province. The submission is largely comprised of policy recommendations that are supported by resolutions passed by Ontario’s Chamber Network at the Ontario Chamber of Commerce’s most recent Annual General Meeting.