Minimum wage in Canada
Under the Canadian Constitution, the responsibility for enacting and enforcing labour laws, including the minimum wage, rests with the ten provinces as well as the three territories which have been granted this power by federal legislation. Some provinces allow lower wages to be paid to liquor servers and other gratuity earners or to inexperienced employees.
The federal government in past years set its own minimum wage rates for workers in federal jurisdiction industries (railways for example). In 1996, however, the federal minimum wage was re-defined to be the general adult minimum wage rate of the province or territory where the work is performed. This means, for example, that a railway company could not legally pay a worker in British Columbia less than C$12.65 per hour regardless of the worker's experience.
In 2013, 39.8% of minimum wage workers were between the ages of 15 and 19; in 1997, it was 36%. 50.2% of workers in this age group were paid minimum wage in 2013, an increase from 31.5% in 1997. Statistics Canada notes that "youth, women and persons with a low level of education were the groups most likely to be paid at minimum wage."
Minimum wage levels by jurisdiction
Assuming a 40-hour workweek and 52 paid weeks a year, the annual gross income of an individual earning the lowest minimum wage in Canada is C$22,880 (in Nova Scotia) and the highest minimum wage is C$31,200 (in Alberta).
The following table lists the hourly minimum wages for adult workers in each province and territory of Canada. The provinces which have their minimum wages in bold allow for lower wages under circumstances which are described under the "Comments" heading.
|Jurisdiction||Wage (C$/h)||Effective date||Comments||Indexation Formula
("CPI" refers to Statistics Canada's Consumer Price Index — All-items)
|Alberta||15.00||October 1, 2018|
|British Columbia||12.65||June 1, 2018|
|Manitoba||11.35||October 1, 2018||
||Each October 1, based on Manitoba CPI for the previous calendar year, unless the government decrees a freeze due to economic conditions.|
|New Brunswick||11.25||April 1, 2018|
|Newfoundland and Labrador||11.15||April 1, 2018||Each April 1, based on Canada CPI for the previous calendar year.|
|Northwest Territories||13.46||April 1, 2018|
|Nova Scotia||11.00||April 1, 2018||
||Each April 1, based on Canada CPI for January through November of the previous calendar year.|
|Nunavut||13.00||April 1, 2016|
|Ontario||14.00||January 1, 2018||Each October 1 (resuming in 2020), based on Ontario CPI for the previous calendar year.|
|Prince Edward Island||11.55||April 1, 2018|
|Québec||12.00||May 1, 2018||
The previous government intended to raise the minimum wage to 50% of the provincial average wage in 2020. An anticipated schedule of increases was announced in 2017. Due to strong wage growth, the 2018 increase was greater than anticipated.
|Saskatchewan||11.06||October 1, 2018||Each October 1, based on the average of the changes in the Saskatchewan CPI and in the average hourly wage in Saskatchewan as measured by Statistics Canada for the previous year, subject to Cabinet approval.|
|Yukon||11.51||April 1, 2018||Each April 1, based on Whitehorse CPI for the previous calendar year.|
Critics of the minimum wage, such as the Canadian Federation of Independent Business and the C. D. Howe Institute, contend that minimum wage laws actually hurt the very people they purport to help by forcing employers to raise prices, reduce staff, or close down. Another critic of minimum wage increases, University of Laval economics professor Stephen Gordon, has argued that the poverty-reducing impacts of the minimum wage are overstated. In his National Post article Gordon writes:
The case for increasing the minimum wage has problems in both dimensions: the losses in total income are typically underestimated (when they are not being dismissed out of hand) and the putative reductions in income inequality are almost certainly being overstated. Let’s examine total incomes first. Labour demand curves slope down: everything else being equal, higher wages reduce the quantity of labour employers demand. And fewer people with jobs means less total income. If the theoretical point is clear — and I’m not aware of a compelling theoretical argument suggesting that employers will react to higher minimum wage by hiring more workers — the empirical evidence is not.
Other Canadian economists have supported minimum wage increases. David Green, a professor and director at the Vancouver School of Economics, has conducted extensive research on the minimum wage’s effects on the economy. In his work entitled “The Case for Increasing Minimum Wage”, Green presents a rebuttal to the critics of the minimum wage stating:
Claims that increases in the minimum wage will generate huge efficiency costs for the economy and mass unemployment are not credible. While estimates of employment losses from minimum wage increases for teenagers in Canada exist, the estimated effects on adult employment are minimal at best. Those results cannot be translated into big costs for the economy.
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- Marchand, Joseph. "Thinking about Minimum Wage Increases in Alberta: Theoretically, Empirically, and Regionally". CD Howe Institute. Retrieved 23 October 2018.
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- David Green (2015). "The Case for Increasing the Minimum Wage" (PDF).
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