Social Policy in Ontario

The labour reforms Kathleen Wynne unveiled on Tuesday, including the phased-in introduction of a $15-an-hour minimum wage, comprise what may be the boldest, most important policy package of her time as premier.

It is a reminder that, while the factors radically transforming the workplace may be largely beyond the province’s control, the government need not throw up its hands and accept job insecurity as an inevitable consequence. Queen’s Park still has the power and the responsibility to protect the rights of workers. It is finally rising to the challenge.

The package is the province’s first comprehensive attempt to tackle the growing problem of the so-called precariat. In Ontario, about 22 per cent of workers are now employed in some form of precarious labour, many in low-wage, temporary jobs. In the GTA, that number is around 53 per cent.

Yet as the traditional perks of full-time employment – predictable hours, benefits, pensions, even the guarantee of minimum wage – have become increasingly elusive, the province has failed until now to intervene.

The Fair Workplaces, Better Jobs Act, which includes many measures the Star has long supported, would do much to improve the lives of the millions of Ontarians struggling to get by or support their families on part-time, contract or minimum-wage work.

The reforms would promote decent work by, for example, raising minimum vacation entitlements for many employees; requiring that companies provide fair notice before rescheduling shifts; improving emergency leave; and making it easier to form unions. Crucially, the plan would boost investment in enforcement of the labour code, ensuring that the new rules truly lead to more humane workplaces.

Perhaps most important, the government is tackling the politically thorny issue of inadequate pay. The new legislation would ensure, for instance, that part-time and temporary workers are paid the same rate as full-time employees doing the same job, closing a loophole that has left a great many workers in the province vulnerable to exploitation.

The biggest change, and the one that will receive the biggest blowback, is the proposed minimum-wage hike, which would raise the current rate of $11.25 per hour to $14 per hour on Jan. 1, 2018 and then to $15 per hour a year later, to be tied to inflation thereafter.

Ten per cent of workers in the province currently earn minimum wage. If they are among the lucky few who work 35 hours per week, they make an annual salary of $20,748. That’s well below the poverty line and nowhere near what is required to live in a city like Toronto. The new minimum would begin to redress that injustice.

Nevertheless, predictable concerns have emerged from predictable corners. The Canadian Federation of Independent Business, a small-business lobby group, put out a statement “demanding that [Ontario] stop punishing small business with higher costs they can’t afford” and warned of massive job losses.

The evidence does not justify this stridency. While some studies have shown hikes can have an impact on employment, the effect is not nearly as significant as those with a vested interest in keeping wages low would suggest.

Take British Columbia’s 2011 minimum-wage boost from $8 to $10.25 over the course of a year. A report from the business-friendly think tank The Fraser Institute estimated this would lead to as many as 55,000 lost jobs. The reality was about one-sixteenth as bad, and the vast majority of job losses affected teenagers. In this regard, Wynne was wise to maintain a slightly lower minimum wage for certain categories, including for those 18 or younger.

In U.S. states such as New York and California, which have significantly increased the minimum wage in recent years, we are seeing that not only are such hikes not the job-killers they’re purported to be, but they actually can help business by increasing worker motivation and reducing turnover.

They also have direct economic benefits, boosting the spending power of a large segment of the workforce. Many studies suggest that even if you take into account modest job losses, the total amount of wages is still almost certain to increase, thus growing economic demand.

And by raising many out of poverty and reducing economic inequality, minimum-wage hikes can strengthen our social fabric and reduce costs to governments.

When Federal Finance Minister Bill Morneau said last year that “job churn” – his euphemism for precarious work – is here to stay, he learned the hard way how fraught this issue is for many.

Morneau’s speech was in large part a welcome call to strengthen Canada’s social safety net, but his apparent fatalism about Canada’s evolving workplace offended a great many for whom steady work is increasingly hard to find and labour protections increasingly inadequate.

Yes, we are witnessing a technology-driven evolution of the workplace that policymakers can’t and shouldn’t want to stop, but the troubling consequences for workers are a result of the needless failure of public policy to keep pace with that evolution. Workers are struggling because of decisions our leaders have made or failed to make. As the premier showed this week, there is nothing inevitable about precarity.

https://www.thestar.com/opinion/editorials/2017/05/30/kathleen-wynne-shows-theres-nothing-inevitable-about-precarious-labour-editorial.html