Ontario’s New Minimum Wage Increase May Adversely Affect Some Caribbean And Black Businesses And Workers

By Neil Armstrong
Pride Contributing Writer

TORONTO, Ontario – The increase of the minimum wage in Ontario from $10.25 to $11 per hour, effective June 1, may adversely affect the earnings of farmworkers who come to Ontario under the Caribbean and Mexican Season Agricultural Workers Program.

Ken Forth, president of the Foreign Agricultural Resource Management Services (F.A.R.M.S.) says the increase will mainly affect the fruit and vegetable and nursery industry: the greenhouse industry. He said the livestock and cash crop farmers do not hire that many people but these other industries hire “armies of people.”

“Now we have to compete on a global market and before this increase, we were globally uncompetitive with our neighbours. Wages are substantially lower in New York, Ohio, Michigan and California,” he said, noting that California is perhaps the most liberal-minded wealthy jurisdiction in North America and they just moved their minimum wage to $9.

Effective July 1, 2014, the minimum wage in California is $9.00 per hour and effective January 1, 2016, the minimum wage there will go up to $10.00 per hour.

Forth said Ontario is now almost 25 percent higher than California, “so if you’re in the fruit and vegetable business, especially in the field vegetable business, they are a direct competition.”

He said the farmers are in a world market and have no tariff protection. “We have higher labour standards, higher labour rules and now, vastly higher wages than any of these jurisdictions that are next door to us.”

Foreign Agricultural Resource Management Services is a non-profit, federally incorporated in 1987, to facilitate and coordinate the processing of requests for foreign seasonal agricultural workers. It is authorized by Human Resources Skills Development Canada, F.A.R.M.S. and performs an administrative role to the Caribbean and Mexican Seasonal Agricultural Workers Program.

The Seasonal Agricultural Worker Program provides Ontario fruit and vegetable growers a vital source of supplementary labour.

According to Forth, what will happen initially, as result of the wage increase, is that some jobs on farms will not be done any more and eventually there will be crops that get dropped.

He said the foreign worker program has worked well for the agriculture industry and for the citizens of those countries that come here to work on the farms.

He said that unless something changes, the industry will start to shrink and he was critical of consumers.

“The consumers of this country do a lot of lip service to wages going up and they turn around and they buy Mexican vegetables in the store that’s produced at $8 a day, not an hour, a day, no labour standards, no food safety, no nothing,” he said.

Meanwhile, the Canadian Federation of Independent Business (CFIB) says any change to the minimum wage will affect the ability of businesses to grow and create jobs.

It said the province’s small and medium-sized businesses employ over half of the working population, create the bulk of new jobs and account for about half of Ontario’s GDP.

“The expected increase to $11 per hour would once again make Ontario’s minimum wage the highest in the country (tied with Nunavut), following a near 50 percent increase since 2003,” the CFIB said in a press release.

The organization is Canada’s largest association of small and medium-sized businesses with 109,000 members across every sector and region.

Vincent Lai, founder of the well-known Niceys Food Mart in Toronto, says the increase should be phased in slowly over a period of four years.

He said if it is implemented at one time, it could result in unemployment for some workers because some independent businesses would not be able to pay increased wages.

According to Lai, this may also result in more unemployment insurance, more welfare and lead to more crime because fewer young people would be able to find jobs.

“It’s okay. I suppose Toronto being the major city in Canada, it should have the higher minimum wage but it shouldn’t be too much higher because the unemployment is just going to skyrocket,” he said.

Lai also said independent owners, like himself, or even the small corner stores may start using underage kids to help them. He emphasized that he does not have any underage kids but some of these stores may use such kids to help them because they are family members and “they don’t have to pay them so they don’t need to hire anybody.”

In Brampton, local business owner, Arthur “Johnny” Hamilton of P&J Barbers hair grooming shop and salon, says the increase is long overdue since the minimum wage was frozen in 2010 and should be indexed to the cost of living.

“This increased minimum wage will boost the productivity of workers. It’s totally unfair for hard-working people who work for so many years to have their wages stuck while hydroelectric power, rent, transportation and the business sectors are allowed to increase the cost of living on a yearly basis,” said Garfield Scarlett, a barber at the salon.

Pauline Christian, president of the Black Business and Professional Association (BBPA) says the increase causes some perplexity for her as community advocate and business owner/employer.

“As we are very much aware, salary is the biggest expense for most businesses, small and otherwise. Therefore any increase to this expense line could and will be viewed by many small and medium enterprises (SMEs) as a negative, as most small/medium business owners can barely get by in keeping their business afloat and may feel themselves that they are merely straggling the poverty line.”

She also noted that when one takes stock of the rate of inflation and examine the socio-economic state of “our people in the marginalized neighbourhoods, where they are unable to take care of the basic necessities of life, a feeling of benevolence then takes grasp of one’s mind.”

The BBPA president said a balance must be reached to engage the spirit of corporate responsibility and give the extra dollar to improve the lives of others who are in grave need.

“Albeit, this is the state of the nation, one must not disregard the need for our government to stand behind our SMEs, especially those in the diverse corridors to ensure they can keep their doors open and provide those jobs and more jobs that will drive a successful economy,” she said.

The government announced last week that this new rate of $11 reflects the rise in the Consumer Price Index (CPI) since the last minimum wage increase in 2010 and is part of its commitment to fairness.

It will also introduce legislation that would tie future minimum wage increases to the CPI. This will ensure the minimum wage keeps up with the cost of living, and that increases are predictable for businesses and families.

Under the proposed legislation, increases would be announced by April 1 and come into effect on Oct. 1.

The proposed legislation would act on the recommendations of Ontario’s Minimum Wage Advisory Panel, which included business, labour, youth and anti-poverty representatives.

“Increasing the minimum wage will help improve the standard of living for hardworking people across the province, while ensuring that businesses have the predictability necessary to plan for the future,” Premier Kathleen Wynne said.

The province’s Minimum Wage Advisory Panel recommends that the province perform a full review of its minimum wage rates and revision process every five years.

The panel held 10 public consultations across the province and received more than 400 submissions from organizations, businesses, and individual Ontarians.
However, the Ontario Federation of Labour (OFL) said pegging the increases to inflation is welcome news to the province’s one million workers who earn at or near the minimum wage, but $11 an hour will leave them leaning on taxpayers to make ends meet.

“Workers and community groups are finally seeing the fruits of our labour. After a yearlong campaign to raise the minimum wage, we are proud to see the Wynne government implementing the inflationary increases we’ve been calling for but there is more to be done,” said OFL president, Sid Ryan.

He said Ontario would make history by adopting annual increases that protect workers’ wages from erosion and political games.

Ryan said a $14 minimum wage would allow every low-wage earner to work their way out of poverty, anything below that leaves workers relying on taxpayer support to provide for their families and to make ends meet.

Meanwhile, he said, very profitable corporations are being allowed to continue to pay poverty wages and there is nothing fair about that.

The Ontario Federation of Labour represents 54 unions and one million workers in Ontario.