Questions and answers on the minimum wage

Why $15/hour?


In Canada, many families working full time still live below the poverty line. We believe that any job should allow everyone to support themselves and their families. There is only one way to do this: raise the minimum wage to $15/hour. A $15/hour minimum wage would bring all Canadian families out of poverty.

Raising the minimum wage to $15/hour is a practical way to reduce inequality and allow everyone to make a decent living. 

How much is the federal minimum wage?


In 1996, the Liberal government scrapped the federal minimum wage as part of a broad program of cuts. With no federal minimum wage, it was left up to the provinces to set a minimum wage. This, along with other poor decisions, contributed to growing income inequality.

Several studies show that increasing the minimum wage significantly decreases income inequality. In 2006, the Federal Labour Standards Review Commission recommended that the government reinstate the federal minimum wage and base it on Statistics Canada’s low-income cut-off. 

Why bring back the federal minimum wage?


Reinstating the federal minimum wage at $15/hour would have an impact on more than 800 000 employees in federally regulated industries such as the railway, transportation, banking and financial services, telecommunications, broadcasting, etc. It would be a significant step toward allowing them to make a decent living.

In reinstating the federal minimum wage, the federal government would be taking a proactive role in reducing inequality. It has the potential to take a leadership role in fighting inequality and influence its provincial counterparts. Currently no province has a minimum wage high enough so that workers can be paid a decent wage for their work. 

Difference between minimum wage and a living wage


Minimum wage is the legal minimum that employers must pay employees. Currently in Quebec, a single person earning minimum wage ($10.55/hour) working full time (37.5 hours/week) takes home $18,749/year. According to Statistics Canada, the low-income cut-off is $21,359/year.

The living wage is the minimum level that allows full-time workers earn enough to support themselves and their families, while also having the opportunity to potentially earn a higher income. According to one study, a single person living in Montreal would need an annual disposable income of $24,532. 

Is it true that the only people working at minimum wage are teens?


No. Of minimum-wage employees, 62% are over 25 years old, and a significant number of them have a postsecondary education. Almost two-thirds of minimum wage workers are women.

Contrary to the myth that working at a minimum wage job is only a temporary phase, many workers do not have an opportunity to make enough to lift themselves out of poverty. We are also seeing more precarious jobs, which helps nobody other than employers.

No matter a person’s age, education or type of work, everyone deserves a decent wage. 

Are companies able to afford $15/hour?


Starbucks, McDonald’s, Subway, Pizza Hut and a vast majority of businesses make exorbitant profits and CEOs are given record compensation packages and bonuses. Total compensation for the CEO of Tim Hortons in 2013 was $3.4 million, while employees were paid $20,400 per year on average. Figures show that Walmart’s CEO is paid more per day than what the average worker earns in a year.

As well, federally regulated companies tend to be larger and benefit from regulatory protection. They should be fully able to adapt to a gradual increase in the minimum wage.

The city of Seattle has proven to be a good example: after a year, the new minimum wage - $12.50 an hour now, increasing to $15 an hour by January 2018 - hasn’t raised retail products. Before the minimum wage law took effect, many employers were concerned and said that they would have to charge more. So far, that hasn’t happen and they have been able to pay they employees. 

Can small businesses afford $15/hour?


Employees of small businesses should also be paid a living wage like everyone else. The government, which currently spends millions of dollars on tax breaks for large multinationals, could take those subsidizes and instead use the money to provide tax relief to small businesses so they can pay their employees $15/hour. 

Wouldn’t increasing the minimum wage threaten our economy?


Remember that the 2008 financial crisis experienced by our neighbours to the south was caused by greed and dishonesty from Wall Street and U.S. banks, not by minimum wage employees. The real threat to our economy comes from the policies of big corporations and stock market speculation.

Raising the minimum wage to $15/hour would allow workers and their families to spend this money on goods and services, which would provide a big boost to the economy. Consumer spending has a much greater impact on economic growth than tax giveaways to the wealthy, who simply hoard their money.

Recent studies on increasing the minimum wage show that there was no negative impact on the labour market. That said, some fear blowback from companies if workers continually manage to receive pay increases. They could, for instance, threaten to mechanize production in order to cut jobs or outsource them abroad.

However, most minimum wage employees are in jobs that cannot easily be outsourced abroad. Bank tellers, railway workers, fast-food cooks, etc., need to do their jobs on site. Any jobs that could have been outsourced have already left!  

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