A look at minimum wage increases in the Prairie Provinces

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The last round of revisions is rolling out in Alberta, Manitoba and Saskatchewan. Here are some facts and numbers to put things into perspective.

On October 1, the provinces in Western Canada will undergo the year’s last bout of minimum wage raises. Every year, millions of Canadian employees await with bated breath for the news of wage increase to ring true once more. For those in Alberta, Manitoba and Saskatchewan, the first day of the last quarter of 2018 will reflect just that.

Alberta

  • New minimum wage: $15 (previously $13.60)
  • Highest in the nation as of October 1, 2018
  • Ranked lowest in 2015

Manitoba

  • New minimum wage: $11.35 (previously $11.15)
  • The first increase since 2015
  • The first province to enact minimum wage legislation in 1918

Saskatchewan

  • New minimum wage: $11.06 (previously $10.96)
  • Revised annually in the last five years
  • The lowest of the nation

 

A quick history of Canada’s minimum wage

Canada’s wage legislature began in 1900 when the federal government introduced a fair wage policy. This was followed by the federal Fair Wages and Hours of Work Act, created as the statutory basis to address pay, hours of work and unhealthy working conditions.

Today, the minimum wage rates are reviewed annually but not necessarily revised at the same frequency. Employment standards and requirements also vary by province and territory. In Saskatchewan for example, this rate increases based on the average of the percentage change in the Consumer Price Index and the percentage change in average hourly wage during the previous year. Meanwhile, in Quebec, there are different wages based on the types of work to take note. For example, tipped workers get a lower hourly rate to take their gratuity into consideration.

 

What does this mean for employers?

It is the employer’s duty to fulfill the minimum employment standards, minimum wage included. But there’s more to consider than just a pay raise. You may experience higher payroll costs since the pension plan contributions and employment insurance premiums will go up as well.

You should also think about revising the rates for the other employees to stay competitive. Imagine this: You own a bookkeeping firm where your junior clerk is employed at minimum wage (previously at $13.60), while a senior admin is at $16.50 an hour. With the new rate, the difference between both team members is now only $1.50. What can you do to ensure the previously higher-paid employee stays motivated in his or her role?

Remember that the appeal is not always monetary. Consider increasing benefits or flexible working schedule based on seniority. Ultimately, find out what works best for your business and your employees.

 

What does this mean for accounting professionals?

If your clients are small business owners, help them navigate through this change, from budgeting to payroll processing, and ensure they stay compliant. If you’re a TSheetsPRO and your clients have yet to automate their employment time tracking process, you can sponsor your clients at a discounted rate to get them onboard. Connecting them with business apps and software solutions that integrate with their existing suite can help cut costs and save time and money. Be the trusted advisor they need to make informed decisions.


Disclaimer: This content is intended to be informative and was accurate at the time of publication. It should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

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