Ontario is bumping up the province’s minimum wage to $16.55 an hour starting Sunday. Here is what you need to know about the increase.
Who is eligible for the pay bump?
It doesn’t matter if an employee is full-time, part-time, or casual, or paid hourly, commission, flat rate, or salary, the vast majority of people earning less than $16.55 per an hour in the province will be eligible for more money starting this weekend. The province’s general minimum wage increase from $15.50 an hour to $16.55 an hour will come into effect on Sunday. A list of employees who have jobs exempt from the minimum wage provisions can be found on the Ontario government’s website.
It is estimated that there are more than 900,000 workers in the province who are earning the general minimum wage. A person earning the general minimum wage and working 40 hours a week will see an annual pay increase of about $2,200.
The student minimum wage, which applies to people under the age of 18 who work 28 hours a week or less when school is in session or during summer holidays, will see an hourly increase of $1, from $14.60 to $15.60.
Homeworkers, who do paid work out of their own homes for employers, will see a minimum wage increase of $1.15, from $17.05 to $18.20.
Hunting, fishing and wilderness guides will go from $77.60 to $82.85 per day when working less than five consecutive hours in day, and $155.25 to $165.75 per day when working five or more hours in a day.
What is the minimum wage in other parts of Canada?
One province and one territory have higher minimum wage rates than Ontario. In B.C., the minimum wage is now $16.75 per hour and in the Yukon, it is $16.77.
Saskatchewan and New Brunswick have the lowest minimum wage rates at $14 and $14.75 respectively. Nova Scotia, Prince Edward Island, Alberta, and Newfoundland and Labrador have all set the minimum wage at $15 per hour.
In Quebec, the lowest amount of money workers can be paid is $15.25 per hour, $0.05 lower than Manitoba’s minimum wage of $15.30. Nunavut has set its minimum wage at $16 per hour and in the Northwest Territories, the minimum wage is $16.05.
The federal minimum wage, which applies to federally regulated private sectors, including banks, postal and courier services, as well as interprovincial air, rail, road, and marine transportation, rose to $16.65 per hour on April 1, up from $15.55.
What is a living wage?
Each year, the Ontario Living Wage Network analyzes the hourly earnings residents in the province would need to make in order to have an income that covers their cost of living. It has found that the minimum wage in Ontario is significantly out of step with what is actually required to afford to live in the province.
In its latest report, the group discovered that in most regions of Ontario, the living wage was more than $19 an hour and more than $23 an hour in the Greater Toronto Area.
They noted that the calculations were made amid “a backdrop of record–breaking inflation and Consumer Price Index increases,” adding that “workers at the bottom end of the wage scale are most vulnerable to these kinds of fluctuations.”
“A living wage is an effective tool to combat working poverty by making sure that employees can make ends meet where they live,” the report stated.
“By incorporating expenses that a worker must cover, such as shelter, food, transportation and more, our living wages are much closer to reality than a politically set minimum wage.”
Another report published by the Canadian Centre for Policy Alternatives this summer found that two minimum wage workers in Toronto would not earn enough to reasonably afford a one-bedroom apartment in the city.
“The discrepancy between the rental wage and the minimum wage is such that, in most Canadian cities, minimum-wage earners are extremely unlikely to escape core housing need,” the report read. “They are likely spending too much on rent, living in units that are too small, or, in many cases, both.”
How has the minimum wage changed in recent years?
A $15 minimum wage was to take effect by 2019 in a plan developed by the previous Liberal government but Premier Doug Ford suspended that when he took office.
The province announced in 2021 that it would be boosting the minimum wage from $14.35 to $15 in January 2022. It was further bumped from $15 to $15.50 in October of 2022.
Labour advocates have called for the province to introduce a $20 minimum wage in Ontario.
“If Premier Ford had not canceled both the increase to $15 that was set for January 2019 and the cost of living adjustments for two years, we’d be much closer with a $17.95 minimum wage this year,” the Workers Action Centre wrote in a post back in March, when the minimum wage increase was first announced.
What does the business community think?
The Ontario Chamber of Commerce said it is supportive of scheduled minimum wage increases tied to inflation rates as it “allows businesses time to prepare.”
“We support the principle of fair compensation and scheduled wage increases that are planned and done in close consultation with the business community so that businesses have time to plan and implement the changes,” Daniel Safayeni, the chamber’s vice-president of policy said in a written statement.
“We acutely recognize the affordability challenges faced by many workers who are struggling with the escalating cost of living. Ensuring the minimum wage keeps pace with rising inflation will help, in part, address affordability challenges at a time when Ontario is experiencing a record pace of net interprovincial migration losses.”
The statement went on to say that “amidst declining productivity,” wage increases must be accompanied by “greater investments from both the public and private sectors” to boost “productive capacity” and improve living standards for the residents of the province.
When will minimum wage rates be raised again?
According to the province, “on October 1 of every year starting in 2022, the minimum wage rates may increase annually.”
The rates, the province said, come into effect on Oct. 1 and will be published on or before April 1 every year.
