Money Why Ontario employers can pay veteran workers the same wage as new hires

18:22  10 january  2018
18:22  10 january  2018 Source:   cbc.ca

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A Toronto labour lawyer says veteran workers who find themselves being paid the same wage as a newly hired staff member after the implementation of the new minimum wage may have little recourse.

Even worse, she says, was the news that employees like her, who had been earning slightly over the old minimum wage after years on the job, would earn — the same wage as a newly hired staff member.

a car parked in front of a window: Karen Seenath, who worked at a Tim Hortons drive-through for more than seven years, opted to quit over how her employers handled the minimum wage rollout.© Provided by Canadian Broadcasting Corporation Karen Seenath, who worked at a Tim Hortons drive-through for more than seven years, opted to quit over how her employers handled the minimum wage rollout.

Karen Seenath said it felt like her dignity was on the line when she opted to quit her job at a Brampton Tim Hortons —- a position she'd held for the past seven and a half years.

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Tim Hortons franchisees bully employees: Wynne

  Tim Hortons franchisees bully employees: Wynne TORONTO - The premier of Ontario is accusing the children of Tim Hortons' billionaire co-founder of bullying their employees by reducing their benefits in response to the province's increased minimum wage. In a letter to workers at two Tim Hortons restaurants in Cobourg, Ont., Ron Joyce Jr. and Jeri Horton-Joyce said that as of Jan. 1, staff would no longer be entitled to paid breaks, and would have to pay a portion of the costs for dental and health benefits to offset the $2.40 jump in the hourly minimum wage. Premier Kathleen Wynne says if Joyce Jr. wants to challenge the Ontario government policy, he should come directly to her and not take it out on his workers.

Ontario 's minimum wage hike draws mixed reaction from workers , employers . The proposed legislation also says: Equal pay would be mandated for part-time workers doing the same job as a full-time workers .

Why Ontario employers can pay veteran workers the same wage as new hires . Multiple Tim Hortons franchises, other Ontario businesses cut pay , benefits. 'Greed is not OK': Backlash grows against Tim Hortons worker benefit cuts.

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The franchise she worked at, she told CBC Radio's Metro Morning , had posted a notice saying that break times would be reduced and new rules about breaks would be implemented.

Even worse, she says, was the news that employees like her, who had been earning slightly over the old minimum wage after years on the job, would earn $14 — the same wage as a newly hired staff member.

"I think that that was unfair for me, working there so long, to be starting off at the minimum wage, when I should get a higher raise," she said.

She sent in her notice on Boxing Day, explaining that she felt her bosses weren't taking their employees into consideration.

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And in Australia, employers who hire temps must pay them a 15 to 25 per cent premium on their hourly wage in recognition that such workers rarely receive benefits. But while Ontario ’s Employment Standards Act mandates pay equity between men and women

Why Is It So Hard for Americans to Get a Decent Raise? A new answer could change how we think about unions, monopolies, and the minimum wage . The same goes for collective bargaining. And workers can’t ask for fair pay if there aren’t enough businesses out there competing to hire .

Labour lawyer Muneeza Sheikh, a partner at Levitt LLP, says she's heard a number of stories similar to Seenath's since the new minimum wage was implemented on Jan. 1.

Businesses can run in 'way they see fit'

So is it illegal? Likely not, Sheikh told CBC Toronto.

"If you have a situation where you have certain employees who have received raises or bonuses commensurate with their tenure or their seniority, at the end of the day an employer is allowed to run their business in a way they see fit," she said.

The only possible recourse for an employee who earned over the old minimum, but has found themselves returned to a flat minimum wage since January, is to check company policies and their own employment contract, said Sheikh.

a person with collar shirt: Labour lawyer Muneeza Sheikh says it's easy for businesses to re-assess their bottom line and opt to pay more senior employees the same as newer hires.© Provided by Canadian Broadcasting Corporation Labour lawyer Muneeza Sheikh says it's easy for businesses to re-assess their bottom line and opt to pay more senior employees the same as newer hires.

"If an employee can prove that by only getting the bump to $14 … there was a breach of some policy the employer had, they may be able to argue that there was a fundamental breach of one of the terms of their employment contract," she said.

By the numbers: How much will the minimum wage hike cost Tim Hortons?

  By the numbers: How much will the minimum wage hike cost Tim Hortons? The Great White North Franchisee Association says the minimum wage increase will cost the average Tim Hortons franchise $243,889.10 a year Here’s a closer look at the numbers provided by the association, which says on its website it represents 50 per cent of the Tim Hortons chain in Canada. The figure is based on a minimum wage increase of $2.40 an hour The calculation assumes the $2.40 increase will be applied to every worker’s salary. Only employees who were making the previous minimum wage, $11.60 an hour, are legally entitled to the new rate, $14. Some businesses have said the higher rate will inflate their entire payroll because they want to maintain pay differentials between newer hires and more senior staff. The $2.40 rate is bumped up to $3.35 an hour when other costs are factored in. GWNFA says this figure includes Canadian Pension Plan, Employment Insurance, Employee Health tax, workers’ compensation premiums, training costs, sick leave, and increased vacation pay. Increased vacation pay introduced by Bill 148 will only impact workers who have been with a company for five years or more. They will now be entitled to three weeks leave. Average number of employees at a Tim Hortons store: 35 Average increased cost for one full-time employee: $6,968.26 Divided by the hourly cost increase (of $3.35) per employee and a 52-week year, this figure suggests Tim Hortons employees work a 40-hour week.

Under Ontario 's new formula, public holiday pay is calculated by dividing regular wages earned in Ms. Kwiecinski says many companies will stop hiring part-time workers as a result of the change. That is the same public holiday pay as a full-time staff person working 35 hours a week will receive.

Contact the Pay Equity Commission at: 1-800-387-8813 A Guide to Interpreting Ontario 's Pay Equity Act. An information return is the T4 slip and the T4 Summary form used to report salary, wages , tips or Employers can use these online resources to recruit and hire new Canadians for their business.

But Sheikh says it's unlikely that a non-union employee who is paid close to the minimum wage would have that kind of contract.

"I would find it shocking if they find an employment agreement that guaranteed them any sort of raise or guaranteed them a bonus or commission, because those are terms that are usually reserved for more senior level positions," she said.

  • Ontario's experiment with minimum wage could transform Canada's economy: Don Pittis
  • ​Clawing back employee perks after minimum wage hike 'completely unacceptable,' Ontario labour minister says
  • Too many workers lack a voice – and that hurts employers, too .
    Media reports describing how some employers – most notably some Tim Hortons franchises – have responded to Ontario’s minimum wage increase illustrate gaps in our employment standards system. Had employers consulted with their employees first, before unilaterally slashing paid breaks and other benefits, they might have received some useful suggestions on how to offset the wage increase without hurting the bottom line, and most importantly without tarnishing their brand along the way.

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