Employment & Labour

Proposed minimum wage hike a good start but not enough: MacDonald

By AdvocateDaily.com Staff

The proposed increase to Ontario's general minimum wage is positive for low-income earners — but it's simply not enough, says Toronto employment lawyer Natalie MacDonald.

The plan, announced among a slew of recommended amendments to labour and employment standards legislation by Premier Kathleen Wynne, will hike hourly wages in increments to $15 by 2019 from the current $11.40.

"My reaction to the raise in the minimum wage is exactly that. Minimum," says MacDonald, co-founder of Rudner MacDonald LLP, and author of Extraordinary Damages in Canadian Employment Law.

She says the Liberal government's efforts to improve the basic hourly wage is "a start, but there's so much more to do." She notes that taken as a whole, the proposals do help improve overall conditions for some lower-income and precariously employed workers.

But MacDonald doesn't believe the increase in the minimum wage alone will lift anyone out of poverty or move a young person out of their parents' basement. At $15 an hour, a person would earn $2,400 before taxes a month, or $28,800 a year in 2019.

The poverty line for a single person living in a city of 500,000 or more is $24,328 before tax, according to Stats Canada figures for 2014.

"It's not a sufficient amount on which to live," MacDonald says.

If the province is seeking to make a significant change in workplace income, then the proposals are "a drop in the bucket," she says. "It's a start to have a conversation, but it's not going to make a significant dent in families being able to live well."

Meanwhile, as a whole package and despite the possible financial pressures the proposals could put on small businesses, MacDonald says the proposal overall is helpful and "necessary to support our workforce."

"I think we have a much more significant problem. Many workers, mostly millennials, are underemployed and working precariously, from contract to contract or as part timers,” she notes.

This, MacDonald says, creates a three-pronged cyclical effect on people and the economy.

"It's bad for the economy since people aren't spending money because they don't have permanent employment," MacDonald says. "It's bad for morale because they are living in a welfare-type of state as people are living paycheque to paycheque and it's bad in the social sphere because many millennials continue to live with their parents, so they're not out socializing, spending money in restaurants or buying new houses and, of course, that trickles back to being negative for the economy."

MacDonald adds there's a growing concern with the significant number of part-time workers in Canada.

"I commend the Liberals for at least looking at it," she says, noting that while the minimum wage increase alone amounts to little "when you look at all of the changes" it could help address some problems.

"The issue, of course, is we haven't had any sweeping changes like this since 1990," she says. "It's something that we needed because the Employment Standards Act, in particular, is really out of touch with the realities of the workplace today and some clauses in it are inconsistent with what would happen in the common law."

While the proposals would deal with some of the legal inconsistencies in legislation, if adopted, many would deal with adjusting "the bare minimum" in wages, vacation and equity, MacDonald says.

The province, however, appears silent on medical benefits for part-time workers, which has been a simmering issue for some time, she says.

"Those without permanent full-time work often don't have benefits," she says. "And so it becomes quite frightening for them if they become sick."

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