This paper is regarded as a few papers made by the Secretariat towards the Professional Panel on contemporary Federal Labour Standards

This paper is regarded as a few papers made by the Secretariat towards the Professional Panel on contemporary Federal Labour Standards


As history information to stimulate the Panel’s talks. The documents usually do not reflect the views necessarily for the federal federal Government of Canada.

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For over two decades, the federal minimum wage was pegged when you look at the Canada Labour Code to your minimal wage rate within the province or territory where the worker is generally used. Should this method be maintained or should a freestanding minimum that is federal be reinstated? If your freestanding price had been become used, exactly just exactly how should it is set, at just what degree and whom must certanly be eligible to it?


The minimum wage may be the cheapest wage price that a company can legitimately spend its workers and it is a core labour standard.

The policy that is underlying for developing minimal wages differs. Governments have historically place them in position with a view to protecting non-unionized employees, decreasing the quantity of low-paying jobs, relieving poverty, creating incentives to function, handling inequality and stimulating development through increased need.

Minimal wages are set and modified in numerous methods: in legislation or laws; because of the government-of-the-day or a independent board; and according to inflation, typical wage prices or other financial facets.

The very first minimum wage prices were created in Canada within the very early 20 century and applied mainly to ladies and young ones. Manitoba and British Columbia introduced minimal wage legislation in 1918 and Ontario, Quebec, Nova Scotia and Saskatchewan adopted suit in 1920. Prince Edward Island ended up being the final province to pass minimal wage legislation addressing both women and men, which it did in 1960.

The federal minimum wage could be the minimum wage relevant to employees included in component III (Labour requirements) of this Canada Labour Code (the Code). This consists of employees in federally regulated companies, federal Crown corporations and particular native federal government tasks on First Nations reserves.

Pre-1996 approach

From 1965, whenever role III for the Code arrived into force, until 1970, the federal minimum wage ended up company being specified when you look at the Code and, at the time of 1971, the Governor in Council had the authority to regulate the price through regulation.

The federal minimum wage was set at $1.25 and rose to $4.00 each hour by 1986, from which point it remained unchanged for the following ten years or more. By the mid-1990s, the federal price had dropped dramatically behind provincial and territorial minimum wage prices, which averaged about $5.95 each hour.

Present approach

The Code had been amended in 1996 to handle this case. In specific, modifications had been made so your federal minimum wage would adjust immediately with alterations in provincial and territorial prices, therefore making certain the federal price would manage its relevance as time passes in numerous financial and social conditions in the united states.

The approach that is current present in section 178 of role III of this Code, has two important elements:

  • First, the federal minimum wage is set given that “minimum hourly rate fixed, every once in awhile, by or under an Act of this legislature associated with the province where in fact the worker is normally used and that’s generally relevant aside from career, status or work experience” Footnote 1
  • Second, the Governor in Council has got the authority, by purchase, to: a) replace the minimal rate that is hourly was fixed with regards to work in a province with another price; or b) fix the very least hourly price with regards to work in a province if no such minimum hourly rate was fixed. Neither of those two authorities has ever been utilized

In addition, area 178 offers situations where employees are compensated for a foundation except that a per hour price. In specific, such workers must get at the very least the exact carbon copy of the minimum wage. The Minister is authorized, by purchase, to correct “a standard foundation of work to which a minimal wage on a foundation except that time might be applied”, as well as “a minimal price of wage that when you look at the viewpoint regarding the Minister may be the exact carbon copy of the minimum wage”.

Present developments

There were phone phone calls in modern times for the authorities to re-establish a uniform, freestanding federal minimum wage. Some have actually argued that that is a matter of decency (for instance Arthurs, 2006) among others it is a matter of showing leadership that is federalfor instance New Democratic Party movement tabled into the House of Commons in 2014).

Provincial and territorial minimum wages have proceeded to steadily increase. At the time of 1, 2019, they averaged $12.23 per hour, with a low of $11.00 per hour in Saskatchewan and a high of $14.00 per hour in Ontario january. Many provinces and regions now additionally review and/or set their prices for a daily basis and many prices are indexed to inflation.

In addition, a few provinces have recently implemented significant increases within their prices, or have actually established that they can do this. Ontario raised its minimal wage from $11.60 to $14.00 each hour on January 1, 2018. The provincial rate increased from $11.35 to $12.65 on June 1, 2018 and will increase to $14.60 on June 1, 2019 and $15.20 on June 1, 2021 in Alberta, the minimum wage rate increased from $11.60 to $15.00 per hour on October 1, 2018 and, in British Columbia.

More generally, high-profile promotions to increase wage that is minimum led by labour and anti-poverty businesses have actually gained energy across the united states in the past few years (for example Fight for $15 and Fairness).

In addition, brand new research methodologies and findings have actually assisted to both spur renewed fascination with the results of minimal wages and notify the development of minimal wage-related reforms. The latter consist of city-level minimal wages in Seattle, Chicago, new york and Washington, D.C., along with the introduction of the minimum that is national in Germany in 2015 and a nationwide living wage in the United Kingdom in 2016.

Minimal wage when you look at the federally regulated sector that is private

This area provides an analysis of minimal wage and low-wage employees into the federally regulated private sector (FRPS), along with violations regarding the Code’s minimum wage demands.

Analysis of low-wage employees

In line with the jurisdiction that is 2015Federal Survey (FJWS) therefore the Labour Force Survey (LFS), the Labour Program estimates that there have been 42,000 workers into the FRPS earning the minimum wage when you look at the province in which they worked in 2017, amounting to 5% of most FRPS employees. This comes even close to 7% of workers earning the minimum wage in Canada all together (excluding the regions, which is why information aren’t available) in 2017. Footnote 2

It’s helpful to think about those employees making just over the present minimum wage who may be straight impacted by the use of a uniform federal wage that is minimum. For this, a wage limit of $15.00 each hour in 2017 had been chosen. The end result is approximately 67,000 workers making not as much as $15.00 each hour in 2017, equal to 7% of FRPS workers. In comparison, 21% of most workers in Canada will be making lower than $15 each hour. A far smaller share of FRPS workers would consequently be earning simply over the minimum wage in comparison to workers in Canada all together.

Here are some is definitely an analysis of this circulation of those two sets of employees—current minimum wage employees and the ones that might be earning not as much as $15 per hour—by characteristics that are various when it comes to FRSP as well as for Canada all together. Within the conversation below, the expression “low-wage workers” covers both groups. Footnote 3

The distribution that is provincial of employees involving the FRPS and Canada is approximately comparable ( Table 1). Roughly two-fifths of low-wage employees come in Ontario. About one-fifth to one-quarter come in Quebec.