This paper is regarded as a number of documents served by the Secretariat into the Professional Panel on contemporary Federal Labour Standards


This paper is regarded as a number of documents served by the Secretariat into the Professional Panel on contemporary Federal Labour Standards

Disclaimer:

As history information to stimulate the Panel’s talks. The documents try not to always reflect the views for the federal Government of Canada.

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The federal minimum wage has been pegged in the Canada Labour Code to the minimum wage rate in the province or territory in which the employee is usually employed for more than 20 years. Should this method be maintained or should a freestanding minimum that is federal be reinstated? In cases where a rate that is freestanding become used, exactly exactly how should it is set, at just what degree and whom ought to be eligible for it?

Background

The minimum wage could be the cheapest wage price that a manager can legitimately spend its workers and it is a core labour standard.

The underlying policy intent for developing minimal wages differs. Governments have historically place them in position having a view to protecting non-unionized employees, reducing the quantity of low-paying jobs, relieving poverty, producing incentives working, handling inequality and stimulating development through increased need.

Minimal wages are set and adjusted in numerous methods: in legislation or regulations; by the government-of-the-day or a separate board; and centered on inflation, normal wage prices or other financial factors.

The minimum that is first prices had been created in Canada during the early 20 century and used mainly to females and kiddies. Manitoba and British Columbia introduced wage that is minimum in 1918 and Ontario, Quebec, Nova Scotia and Saskatchewan used suit in 1920. Prince Edward Island ended up being the final province to pass minimal wage legislation addressing men and women, which it did in 1960.

The federal minimum wage may be the minimum wage relevant to employees included in component III (Labour criteria) regarding the Canada Labour Code (the Code). This consists of workers in federally regulated companies, federal Crown corporations and specific government that is indigenous on First Nations reserves.

Pre-1996 approach

From 1965, whenever role III associated with the Code arrived into force, until 1970, the minimum that is federal ended up being specified when you look at the Code and, at the time of 1971, the Governor in Council had the authority to regulate the price through legislation.

The federal minimum wage was set at $1.25 and rose to $4.00 each hour by 1986, from which point it remained unchanged for the following ten years roughly. Because of the mid-1990s, the federal rate had dropped notably behind provincial and territorial minimum wage prices, which averaged about $5.95 each hour.

Present approach

The Code had been amended in 1996 to deal with this example. In specific, modifications had been made so the minimum that is federal would adjust immediately with alterations in provincial and territorial prices, therefore making sure the federal rate would manage its relevance as time passes in various financial and social conditions in the united states.

The approach that is current present in section 178 of role III for the Code, has two important elements:

  • First, the federal minimum wage is scheduled while the “minimum hourly rate fixed, every once in awhile, by or under an Act of this legislature associated with the province where in fact the worker is generally used which is generally speaking relevant no matter career, status or work experience” Footnote 1
  • 2nd, the Governor in Council gets the authority, by purchase, to: a) replace the minimum hourly rate that was fixed with regards to work in a province with another price; or b) fix the very least hourly price pertaining to work in a province if no such minimal hourly price happens to be fixed. Neither among these two authorities has ever been utilized

In addition, area 178 offers up situations where workers are compensated for a foundation apart from a hourly price. In specific, such workers must get at the very least the exact carbon copy of the minimum wage. The Minister is authorized, by order, to repair “a standard foundation of work to which a minimal wage on a foundation apart from time might be applied”, as well as “a minimum price of wage that into the viewpoint for the Minister may be the exact carbon copy of the minimum wage”.

Present developments

There were telephone calls in the last few years when it comes to government to re-establish a uniform, freestanding federal minimum wage. Some have actually argued that this really is a case of decency (for instance Arthurs, 2006) among others it is a matter of showing leadership that is federalas an example New Democratic Party movement tabled into the House of Commons in 2014).

Provincial and territorial minimum wages have actually continued to steadily increase. At the time of 1, 2019, they averaged $12.23 per hour, with a low of $11.00 per hour in Saskatchewan and a high of $14.00 per hour in Ontario january. Many provinces and regions now additionally review and/or set their prices for a basis that is regular many prices are indexed to inflation.

In addition, several provinces have recently implemented significant increases inside their prices, or have announced that they can achieve this. Ontario raised its minimal wage from $11.60 to $14.00 each hour on January 1, 2018. In Alberta, the minimal wage rate increased from $11.60 to $15.00 each hour on October 1, 2018 and, in British Columbia, the provincial price increased from $11.35 to $12.65 on June 1, 2018 and certainly will increase to $14.60 on June 1, 2019 and $15.20 on June 1, 2021.

More generally speaking, high-profile campaigns to increase wage that is minimum led by labour and anti-poverty companies have actually gained energy across united states in modern times (for example Fight for $15 and Fairness).

In addition, brand brand new research methodologies and findings have actually assisted to both spur renewed curiosity about the effects of minimal wages and notify the development of minimal wage-related reforms. The latter consist of city-level minimal wages in Seattle, Chicago, new york and Washington, D.C., along with the introduction of a minimum that is national in Germany in 2015 and a national living wage in the United Kingdom in 2016.

Minimal wage into the federally regulated private sector

This area has an analysis of minimal wage and low-wage employees when you look at the federally regulated sector that is privateFRPS), along with violations associated with the Code’s minimum wage needs.

Analysis of low-wage employees

On the basis of the 2015Federal Jurisdiction Workplace Survey (FJWS) additionally the Labour Force Survey (LFS), the Labour Program estimates that there have been 42,000 workers within the FRPS earning the minimum wage into the province for which they worked in 2017, amounting to 5% of most FRPS employees. This comes even close to 7% of workers earning the minimum wage in Canada in general (excluding the regions, which is why information aren’t available) in 2017. Footnote 2

It’s helpful to give consideration to those workers making right above the present minimum wage whom could be straight afflicted with the use of a uniform federal minimum wage. For this, a wage limit of $15.00 each hour in 2017 had been chosen. The end result is approximately 67,000 workers making significantly less than $15.00 each hour in 2017, equal to 7% of FRPS workers. By comparison, 21% of all of the workers in Canada could be making lower than $15 per hour. A far smaller share of FRPS employees would consequently just be earning over the minimum wage in comparison to workers in Canada in general.

Here are some is definitely an analysis associated with the circulation of those two sets of employees—current minimum wage employees and the ones that could be making lower than $15 per hour—by characteristics that are various for the FRSP as well as for Canada all together. When you look at the discussion below, the expression “low-wage workers” covers both groups. Footnote 3

The distribution that is provincial of workers between your FRPS and Canada is approximately comparable ( dining dining Table 1). About two-fifths of low-wage employees come in Ontario. About one-fifth to one-quarter come in Quebec.