CBC News broke the story broke this week that workers at the Division Street Tim Horton’s location in Cobourg were being denied their paid breaks and various benefits as a result of the increased minimum wage in Ontario. Other stories have emerged about employer efforts to mute the effects of higher minimum wages by effectively reducing their labour costs, including this Twitter thread by @AndrayDomise. (See his news story here.) A piece posted today by CBC News does a good job of summing-up the stories that have so far been confirmed by journalists in Ontario.
The reactions I have seen to this news on social media has focused on employer greed. In the statement Premier Wynn issued about the story, the focus is employer bullying. Some commentators have stated that something like this was bound to happen, given the business rationale for keeping costs down and the challenge of managing such an unusually large wage hike. But another common theme has been that the story reveals the need for unions. This tweet by Bruce Anderson is an example.
One thought I have had about this story is that it points to the important truth that raising the minimum wage does not alter employment relations. It is possible that we are seeing examples that contravene Ontario labour laws, but any recourse in the courts will take a long time, and employers are as free, within the law, as ever to set employee benefits and effective earnings, and to define the employment relationship.
Minimum wage reform is a good way of addressing the problem of low incomes, but far from enough on its own to make a major difference because the structure of employment relations fundamentally shapes earnings. Minimum wage regulations do not apply to the self-employed, for example, and precarious employment makes finding work, or maintaining multiple income streams, arguably more important than rates of pay. And it is the structure of employment that triggers employee benefits, where they exist, and access to CPP and EI. Ontario law does not require paid breaks during a work shift, or mandate employment benefits. Canadian Pension Plan (CPP) and Employment Insurance (EI) payments are deducted, but these often do not apply to minimum wage workers due to the precarity of their employment.
The structure of franchising plays a role in employee pay too, as the owners of the Cobourg store state in their letter to employees, as can contracting out and sub-contracting. Another major pattern affecting earnings is the so-called “share economy,” in which services are provided by supposedly independent entrepreneurs making use of digital platforms to connect with customers. Uber is the best-know example, and it’s claim to be a ride-sharing service and not an employer is being challenged, but regulation is far behind the innovators in this sector.
The minimum wage is a prominent issue, one of the topics that puts labour issues in the news, in part because of the hard-fought and ongoing $15 and Fairness campaign. But part of the news about wages should be that they are not the only factor determining earnings.
Sources
Aaron Saltzman, “Tim Hortons heirs cut paid breaks and worker benefits after minimum wage hike, employees say,” 3 January 2018, CBC News, http://www.cbc.ca/news/business/tim-horton-s-tims-timmies-doubledouble-minimum-wage-ontario-kathleen-wynne-labour-1.4470215 (accessed 5 January 2018)
Aaron Saltzman, “Multiple Tim Hortons franchises, other businesses cut pay, benefits, citing minimum wage hike,” 5 January 2018, CBC News, http://www.cbc.ca/news/business/tim-hortons-heirs-minimum-wage-wynne-ontario-1.4472878 (accessed 5 January 2018)
Andray Domise, “Sunset Grill employees say chain is punishing them for Ontario’s minimum wage hike,” 4 January 2018, Vice, https://news.vice.com/en_ca/article/j5vj43/sunset-grill-employees-say-chain-is-punishing-them-for-ontarios-minimum-wage-hike (accessed 5 January 2018)
Kathleen Wynne, “Wynne: Pick a fight with me Mr. Joyce, not those working the Tim Horton’s pickup window,” 5 January 2018, TheStar.com, https://www.thestar.com/opinion/contributors/2018/01/05/pick-a-fight-with-me-mr-joyce-not-those-working-the-pickup-window.html (accessed 5 January 2018)
David Doorey, “On Tim Hortons, Minimum Wage, Conspiracy, and Unlawful Reprisals,” 5 January 2018, Law of Work, http://lawofwork.ca/?p=9247 (accessed 5 January 2018)
Fight for $15 & Fairness, http://www.15andfairness.org/ (accessed 5 January 2018)
Citation
Nathan Smith, “The News About Wages,” HIS241.com, 5 January 2018, http://www.his241.com/?p=467
