Establishing A Fair Minimum Wage in Nova Scotia
“The Fight for $15” has become a rallying cry across North America for many progressives in terms of the ideal minimum wage. Championed at every campaign stop by American Senator Bernie Sanders in his run for the Democratic nomination, it has also become a platform plank for many within the NDP here in Canada, including the Ontario NDP, the Nova Scotia NDP, and just last month the BC NDP, all following the lead of the federal party and Rachel Notley’s Alberta government.
Having a fair minimum wage is an extremely important goal, vital in combating poverty and ensuring that all citizens have a decent standard of living. As always, however, the devil is in the details. Crafting a responsible policy is hard work, and requires a great deal of thought. In our modern society, it should also be accompanied by widespread public consultation, particularly on an issue like the minimum wage, which impacts both employees and employers directly.
Unfortunately, while the proposal put forward this spring by Gary Burrill and the Nova Scotia NDP to raise the minimum wage to $15 looks good on the surface, and might be good politics when it comes to rallying the party’s die-hard core followers, it’s a perfect example of how not to go about creating public policy.
For example, Burrill’s plan proposes exemptions for small businesses, which has the effect of creating a two-tiered system where large companies pay their workers $15 per hour and small businesses would pay their workers less. That would put local, independent businesses at a serious competitive disadvantage when it comes to hiring and retaining their workers. It would have the unintended consequence of actually making the big, international corporations that Burrill regularly lambastes more attractive places to work because the pay will be better.
The NDP plan will use the regulatory powers under the Labour Standards Act to exempt small and family-operated businesses which are unable to immediately pay higher wages. But what do they consider a “small business.” How will Burrill define it? Is a childcare center with 10 employees a small business? Will childcare workers at a non-profit center not get a much-needed raise? How about the workers at a Subway franchise? Burrill has stated that “the problem is large corporations, often from outside Nova Scotia, who take advantage of low wage rates in our province.” But most fast-food outlets are owned and operated as local franchisees. Was any consideration given by Burrill and his team to that factor? The exemptions that Burrill proposes will actually make it harder to ensure that all Nova Scotians have access to a living wage.
I absolutely believe that small local businesses need help when the minimum wage rises, but this can’t be done at the expense of the working class. There are other ways to help small businesses stay competitive as labour costs increase. For example, we could lower the small business tax rate, or provide tax credits to local businesses.
Then there’s the question of how all of this would come about. One of the worst aspects of the McNeil government has been its complete lack of consultation before implementing policy – the film industry and pharmacare fiascoes last year are the most egregious examples of what can happen without proper and meaningful consultation. It is the epitome of bad governance. Unfortunately, when it comes to his minimum wage proposal, Burrill wants to implement a dramatic 40% increase in labour costs without any consultation.
In Nova Scotia we have the Minimum Wage Review Committee (MWRC) – a joint labour-employer committee established under the Labour Standards Code that exists to advise the Minister of Labour and Advanced Education on the minimum hourly wage for Nova Scotia workers. Why not have get the committee’s input as to in what year Nova Scotia gets to a $15 minimum wage? That was the idea suggested by the previous NDP leader and former Halifax Needham MLA Maureen MacDonald, who wrote a letter in January to the MWRC asking them to study the best path to get to a $15 minimum wage, a perfectly sensible suggestion given that they have the resources to study and consult widely.
The McNeil government recently eliminated the right to minimum wage, vacation and holiday pay, and defined work hours for employees who are athletes. As both the Progressive Conservative Party and NDP labour critic Dave Wilson correctly pointed out, this was done without consultation or debate. Presumably, this was also done without the review or support of the MWRC. That’s wrong, and so is Burrill’s decision to bypass the MWRC when it comes to the question of the proper method and timetable for increasing the minimum wage.
The MWRC could study how other jurisdictions are getting to a $15 minimum wage – like Seattle, for example, where the city center gets to $15 more quickly than the suburbs or the state, or New York, where different counties rise at different rates depending partly on the cost of living there. Perhaps a 2022 deadline, like California has, would be a more realistic goal, instead of the 2019 deadline proposed by Burrill. Allowing for proper consultation, before introducing legislation, would have provided Nova Scotians with the opportunity to thoroughly examine and discuss all facets of the issue before reaching a measured and informed conclusion.
An independent review by the MWRC might even suggest an alternative to tying ourselves to the number “15”. If Nova Scotia decided our lowest paid workers should earn no less than 60 per cent of the average provincial wage, for example, it could set a workable and effective benchmark: minimum wage workers must make an hourly wage that’s relative to the average of all other workers. Perhaps it’s best to avoid arbitrary numbers altogether, and craft a solution that works for Nova Scotia based on our own unique set of circumstances.
Instead, what Nova Scotians were presented with was a hastily-cobbled together and poorly researched proposal that bypassed meaningful consultation with stakeholders just as much as the Liberals have done, and for the same reason – politics. Furthermore, by focusing solely on the arbitrary “Fight for 15” Burrill and the NDP have failed to take into account other policy measures that could work in conjunction with a measured raise in the minimum wage in order to help improve the economic situation of low income Nova Scotians, including an increase in the basic personal exemption, or a lowering of the income tax rate at the bottom end of the scale.
Basing your plans on a slogan and an arbitrary number, with no consultation and with no thought to a multi-faceted approach to achieve real progressive change, is a poor substitute for informed and effective public policy making.
Paul Kimball