Work­place changes? Con­sumers bear the costs

The Hamilton Spectator - - BUSINESS - Ed Can­ning prac­tises labour and em­ploy­ment law with Ross & McBride LLP, in Hamil­ton, rep­re­sent­ing both em­ploy­ers and em­ploy­ees. You can email him at ecan­ning@rossm­cbride.com

After two years of study, a re­port sug­gest­ing changes to the Em­ploy­ment Stan­dards Act of On­tario has been re­leased and it in­cludes 173 rec­om­men­da­tions.

Among them is to phase out, over three years, the abil­ity of em­ploy­ers to pay stu­dents un­der 18 a min­i­mum wage of $10.70 per hour in­stead of $11.40. Given that the present prac­tice is a form of age dis­crim­i­na­tion, it makes sense.

It is rec­om­mended that part­time, ca­sual, con­tract, tem­po­rary and sea­sonal em­ploy­ees should be paid the same hourly rate as full­time em­ploy­ees do­ing com­pa­ra­ble work un­less there is a ba­sis in merit or se­nior­ity to dif­fer­en­ti­ate.

The ques­tion be­comes whether, in the long run, im­ple­ment­ing this rec­om­men­da­tion will lift the in­comes of part-time work­ers or sup­press those of full-time work­ers.

Busi­nesses that do not make a profit will close. If over­all labour costs sig­nif­i­cantly di­min­ish or elim­i­nate profit, they have to be con­trolled some­how for busi­nesses to sur­vive. How much profit is enough profit? I am not go­ing there.

If adopted, these rules will ap­ply to the five-per­son stand­alone re­tail out­let as well as the multi­na­tional chain.

I am go­ing to spec­u­late that large chains are bet­ter able to ab­sorb these ex­tra costs and ad­just their busi­ness plans than small stan­dalones.

On the other hand, why, if there are two peo­ple with the same se­nior­ity do­ing the same job, should the part-time per­son earn less than the full-time per­son? Given the in­crease in part-time work­ers in our econ­omy and the in­creased dif­fi­culty in ob­tain­ing full-time em­ploy­ment, there is clearly a fair­ness is­sue in­volved.

It has been sug­gested that after five years of ser­vice, all em­ploy­ees should get three weeks of paid va­ca­tion a year. While this rec­om­men­da­tion will again in­crease costs to em­ploy­ers, com­pared with Euro­pean stan­dards it is noth­ing. In fact, a num­ber of other prov­inces al­ready re­quire it.

On the good news side for em­ploy­ers, the re­port rec­om­mends elim­i­nat­ing the re­quire­ment that they must seek ap­proval from the Min­istry of Labour in or­der for em­ploy­ees to work more than 48 hours in a work week and up to 60.

This will af­fect full-time em­ploy­ees, but will, of course, do noth­ing for the myr­iad of peo­ple work­ing two or three part-time jobs to make ends meet.

If the gov­ern­ment is go­ing to adopt this rec­om­men­da­tion, it needs to make sure that it spends more money and time in­ves­ti­gat­ing reprisals and sanc­tion­ing em­ploy­ers for dis­crim­i­nat­ing against an em­ployee who has de­clined to work more than 48 hours in a week.

While the change sug­gested would elim­i­nate the need for gov­ern­ment ap­proval, it would not change the fact that em­ployee con­sent is re­quired in most work­places for work­ing more than 48 hours in a week.

Even with in­creased en­force­ment, a per­fect bal­ance will not be struck. It is trite to say that if you refuse over­time of­ten enough, some way, some­how, your re­sent­ful em­ployer will likely get back at you.

They will do it in ways that you will never be able to prove were as a re­sult of you want­ing to have a life out­side of work.

Right now, em­ploy­ers are per­mit­ted to pay peo­ple who serve liquor $9.90 an hour in­stead of the reg­u­lar min­i­mum wage of $11.40. The re­port rec­om­mends that this be phased out. Of course, the lower wage re­flects the as­sump­tion that liquor servers earn tips and in­vari­ably make more than other non­tipped min­i­mum wage work­ers.

I have never been con­sulted by a liquor server who did not earn sig­nif­i­cantly more than the min­i­mum wage when tips are in­cluded. So I am not sure that this rec­om­men­da­tion makes sense.

The vast ma­jor­ity of these rec­om­men­da­tions re­dis­tribute wealth.

That’s not nec­es­sar­ily an aw­ful re­sult. We al­ready do it in many ways, not least of which is through our tax bill.

Sooner or later the mar­ket ad­justs to changes such as these, and the costs passed along to the end con­sumer. That would be you. I am not say­ing that is a bad thing, I’m just say­ing it is a true thing.

The vast ma­jor­ity of these rec­om­men­da­tions re­dis­tribute wealth.

ED CAN­NING

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