Ontario Government Double Counting in Minimum Wage Calculation

Retail Council of Canada (RCC) expressed its concerns today over the Government of Ontario’s announcement to raise the minimum wage in Ontario to $11.

“While RCC supports the Ontario Minimum Wage Advisory Panel’s recommendations announced earlier this week to link minimum wage to Ontario’s Consumer Price Index – the move to retroactively apply this principle is quite simply double counting,” says Diane J. Brisebois, President and CEO of RCC.

The last round of increases, put in place by the Ontario Government from 2008-10, raised minimum wage by $2.25 an hour, a significant increase over three years – 28% – one that more than captures all CPI inflation from 2008 to today.

“At a time when Ontario CPI was typically only 2% annually, employers were required to absorb a huge increase to their labour costs over those three years,” says Brisebois. “To go back now and apply a further 6% in retroactive CPI is unfair and inconsistent with the principles just announced in the Panel’s recommendation. It’s bad for job creation, and bad for the economy.”

RCC participated in the Advisory Panel and recommended that any changes to Ontario’s minimum wage be linked to key economic indicators, specifically the Consumer Price Index (CPI).

RCC encourages the government to apply the recommendations outlined in the report on a go-forward basis. “Any attempt to apply the recommendations retroactively would result in Ontario’s minimum wage being seriously out of step with other Canadian Provinces, and neighbouring U.S. states, which would, in turn, have a direct impact on Ontario’s economy,” says Brisebois.

Retail Council of Canada is the Voice of Retail. Founded in 1963, RCC is a not-for-profit association which represents more than 45,000 stores of all retail formats, including department, grocery, independent merchants, regional and national specialty chains, and online merchants.

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