Nova Scotia Government eliminates partial hour rule / upsets businesses by adding last minute increase to minimum wage

The Nova Scotia government made a surprise announcement to eliminate the partial hours rule for minimum wage workers and to implement a last-minute increase to the province’s minimum wage.

For years, RCC has advocated for the government to consider either the removal of the partial hours rule or to harmonize the rule with the existing rules in other provinces. RCC is pleased with the government’s decision to eliminate the partial hours rule as it will reduce administrative burden while improving fairness for employers.

The government’s decision regarding minimum wage was both surprising and disappointing as there was no consultation. The government’s decade long legislated practice of basing minimum wage changes on an objective formula also included a commitment to provide businesses with adequate time to prepare for the increased costs that come from an annual increase in the base wage. It is unacceptable that the government announced a significant increase to minimum wage only two months in advance of the implementation date for the wage change.

RCC members were anticipating an increase in the minimum wage to $12.10 on April 1, 2020. Instead, businesses will now be scrambling to deal with a move to $12.55 on April 1^st.

Background:

Partial Hours:

For years, if a Nova Scotian minimum wage employee worked anytime from 1-15 minutes beyond the end of their shift, the employer had to pay the worker to 15 minutes past the hour. If the minimum wage employee worked anytime from 16-30 minutes past the end of their shift, the employer had to pay the worker to 30 minutes past the hour. This practice is common in other Canadian provinces.

The troubling difference with the Nova Scotia regulation was that if a Nova Scotian minimum wage employee worked 31 minutes or more beyond the end of their shift, the employer had to pay the worker for the full 60 minutes. In other provinces with partial hours, the regulation allowed the employer to continue paying in 15-minute intervals.

Retail Council of Canada applauds the decision to eliminate partial hours as it helps create administrative efficiency for businesses. Nova Scotia retailers will now only have to pay for the additional minutes that the minimum wage employee actually works. NOTE: This rule change does not impact any other existing rules surrounding pay (e.g. waiting hours, etc.).

Minimum Wage:

For years, Nova Scotia has followed a legislated approach where annual minimum wage increases mirrored the change in the Consumer Price Index (CPI) for the previous year. RCC supported this approach as it created predictability for retailers in planning for upcoming labour costs. In recent years however, many provinces have implemented unpredictable and/or substantial increases to their minimum wage. These actions resulted in Nova Scotia’s minimum wage becoming the lowest in Canada in 2018.

Accordingly, Nova Scotia’s Minimum Wage Advisory Committee recommended that the provincial government use its legislated ability to temporarily suspend its CPI formula and increase the province’s minimum wage by $0.55 annually from 2019-2021.  This was supposed to move the wage from $11.00 per hour to $12.65 per hour. The provincial government accepted this recommendation, and Nova Scotia businesses planned accordingly for the special increases. There was limited backlash to the government’s decision because:

• there was ample time given for businesses to adjust and
• the government promised that in 2022, it would revert to its legislated approach of increasing minimum wage by the change in CPI for the previous year.

On January 30, 2020, the Premier of Nova Scotia announced that the scheduled April 1, 2020 minimum wage increase of $0.55 would instead be moved to an increase of $1.00. This would be followed by the $0.55 increase on April 1, 2021 before reverting back to the CPI formula for 2022. 

RCC has already expressed its disappointment regarding this last-minute decision to the government and the media.

Next Steps:

RCC will continue to oppose this approach and push for a return to predictability and transparency in setting the province’s minimum wage.

If you have any questions or concerns, please don’t hesitate to contact: Jim Cormier, Director (Atlantic) at:  jcormier@retailcouncil.org or (902) 422-4144