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Small biz calling for help in face of minimum wage increases

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Issue: 

The Manitoba government recently introduced Bill 33 – The Minimum Wage Indexation Act (Employment Standards Code Amended), which will annually index the minimum wage based on Manitoba’s Consumer Price Index (CPI) inflation rates from the previous calendar year. Annual increases will be determined by no later than April 1st, and will take effect on October 1st. CFIB is concerned that increasing the minimum wage annually by indexing it to inflation will hit the retail and hospitality sectors the hardest, and ignores better ways to help low-income earners.

Action:

May 23, 2017: CFIB presented small business owners’ concerns with Bill 33 to the Standing Committee on Social and Economic Development. We told the Committee that the overwhelming majority of small businesses already pay well above the minimum wage, as they weigh the education, experience and skills of their employees against the ability of their firm to pay. However, we also know Bill 33 will hit small businesses, especially in the retail and hospitality sectors. Furthermore, while indexing minimum wage to an economic indicator is an easily accessible tool for governments, entrepreneurs worry this approach assumes affordability for their businesses, and does not reflect current economic conditions.

May 15: 2017: The Manitoba government introduced Bill 33. The projected increase would see Manitoba’s minimum wage increase to $11.15/hr in October, 2017.

CFIB issued a news release immediately following the announcement which opposed Bill 33, and called for mitigating measures to help offset the negative impact to small businesses such as: introducing a training wage (for inexperienced workers, similar to Nova Scotia); and a gratuity wage (for workers who earn tips, similar to BC and Ontario).

February 1, 2017: CFIB submitted key findings of survey results to the Labour Management Review Committee (LMRC). The LMRC was asked to provide recommendations on minimum wage policy to the Minister of Growth, Enterprise and Trade.

September 29, 2016: For the first time in over a decade, the Manitoba government announced that it would not be raising minimum wage in October. Instead of increasing the minimum wage like other provinces across Canada, the Manitoba government decided to begin consulting on a new approach to minimum wage policy and that it would be seeking the input of Manitoba taxpayers and business owners.

September 19, 2016: CFIB sent a letter to the Honourable Cliff Cullen, Minister of Growth, Enterprise and Trade, highlighting the key findings of our survey and urging the Manitoba Government to freeze minimum wage in 2016.

June – August 2016: CFIB conducted the Employment & Wages Survey and received 7,495 responses from Canadian business owners (305 responses from Manitoba business owners). The message is clear; small business owners believe that there are better ways to help low-income earners than increasing the minimum wage. Raising the basic personal exemption and tax brackets, and improving training opportunities were identified as more effective ways to help low-income Manitobans.

Next Steps: 

CFIB will continue to fight Bill 33 and push the government to introduce mitigating measures to offset the impact, if an annually indexed minimum wage is implemented.

We believe the Manitoba government must exhaust all better options to help low-income earners before considering future minimum wage increases. Then, and only then, the government must conduct a thorough economic and employment impact analysis, and release it to the public for review.

If you have any questions, please contact Business Resources at 1-888-234-2232 or [email protected].

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