Business To Government: Bring Predictability To Minimum Wage

Businesses want the Ontario government to adopt a predictable, transparent, and fair process for determining Ontario’s minimum wage, according to a new report released by the Ontario Chamber of Commerce (OCC).

The report calls on government to introduce a new process that would link changes in the minimum wage rate to the Consumer Price Index (CPI), an economic indicator that captures changes in the cost of living.

Currently, Ontario’s minimum wage rate is determined by the government on an ad hoc basis and through unspecified criteria. This method results in sudden increases in the minimum wage, and unfairly exposes employers to unanticipated increases in the cost of doing business.

“We’ve considered all the options at Ontario’s disposal,” said Allan O’Dette, President & CEO of the OCC. “Tying the minimum wage to the CPI will bring predictability to the process. It will allow businesses to plan for increases in their labour costs and protect the long-term purchasing power of workers earning minimum wage.”

Though supportive of regular increases to the minimum wage, the group cautions against temporarily adopting a formula that would see rates outpace inflation.

“We’ve seen convincing evidence that major hikes in the minimum wage will have adverse effects on employment levels, particularly among youth and in Ontario’s retail, hospitality, and leisure sectors,” says O’Dette.

The report is based on extensive consultations and surveys with employers from across Ontario. Its release comes
as Ontario’s Minimum Wage Advisory Panel begins its consultations in communities across the province.

  • In a recent OCC survey, 60% of employers in the retail, hospitality and leisure sectors say that an increase in the minimum wage will hurt their businesses and force them to lay off employees.
  • Ontario’s minimum wage of $10.25 is above the national average and the highest in the Great Lakes Region.
  • The minimum wage in Ontario has increased 50 percent over the last 10 years.
  •  The Ontario Chamber of Commerce consulted with over 1,200 of its members from across the province to formulate its position on the minimum wage.

To read the full report click HERE.

Leave a Comment

You must be logged in to post a comment.