Ongoing minimum wage review is causing uncertainty
St. John’s, November 29, 2019 – The Canadian Federation of Independent Business (CFIB) is asking Advanced Education, Skills and Labour Minister Christopher Mitchelmore to delay increasing the minimum wage to give time for small business owners to adjust.
Newfoundland and Labrador’s minimum wage rate was to increase by the rate of national inflation (approximately two per cent) on April 1, 2020, but the ongoing work of the Minimum Wage Review Committee is creating uncertainty.
“When it announced the current mechanism for setting the minimum wage rate in 2018, the provincial government stated this was an open and predictable approach,” said Vaughn Hammond, CFIB’s director of provincial affairs in Newfoundland and Labrador. “However, by maintaining the minimum wage review, the provincial government is making it more difficult for business owners to plan for the coming year.”
Section 30 of the Labour Standards Act requires a review of the minimum wage at least every two years. Unfortunately, when it established the minimum wage rate setting mechanism in February 2018, the provincial government did not repeal this section.
Tying minimum wage rate increases to national inflation does provide some predictability, but now business owners are facing the prospect of a minimum wage rate in 2020 that could be anywhere from the status quo (a two per cent increase in labour costs) to a living wage (a 65 per cent increase in labour costs), as shown in the attached table.
“Once the Minimum Wage Review Committee delivers its report later this year, the Minister will need to take the time necessary to carefully consider the evidence prior to delivering a decision on what the minimum wage rate will be and how to set it,” explained Hammond. “We’re asking the provincial government to delay any minimum wage rate increase by at least six months from the date of announcing any decision. This will give business owners the time needed to adjust to these government-imposed payroll pressures.”
For media enquiries or interviews, please contact:
Vaughn Hammond, Director of Provincial Affairs, CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 110,000 members across every sector and region, including 2,000 in Newfoundland and Labrador. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.