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N.L. minimim wage to hit $12.65 by 2021

Minimum wage will increase on the Island in the spring.
Minimum wage will increase on the Island in the spring. - 123RF Stock Photo

The minimum wage in Newfoundland and Labrador is set to increase, leaving labour groups disappointed for different reasons.

The provincial government announced the minimum wage will increase from $11.40 an hour to at least $12.65 an hour by October 2021.

The changes will come in four steps. On April 1, the wage will increase by 25 cents, with another 50 cents added on Oct. 1.

On April 1, 2021 another 25 cents will be added to the wage, including any increases associated with inflation. By Oct. 1, 2021, the final 25 cents will be added to the minimum wage, bringing it to $12.65.

Alyse Stuart, chair of Common Front NL, says any increase is good news, but her group will continue advocating for a $15 an hour minimum wage in Newfoundland and Labrador.

“This does not come close to addressing the massive amount of poverty and inequality that we currently have in this province. These increases that will happen over the next 20 months – that’s a long time to tell families and individuals in this province to wait for a living wage,” she said.

“There was some good news in this announcement, but it’s so far from where we need to be. This increase in April will only keep us to the second lowest (minimum wage) in Canada, even with the increase.”

Rhonda Tulk-Lane, interim-CEO of the St. John’s Board of Trade, says the changes mean higher costs for businesses, particularly small business, in Newfoundland and Labrador.

“We’ve been talking to some of our members already and given what we’ve just gone through in 2020, they’re just starting to get back on track. Now they’re looking at the increase on April 1. Some of our members have said they’re already trying to figure out how to they absorb that,” she said.

“Perhaps it might be cutting some hours to be able to meet payroll. There’s definitely still an impact to some small businesses, with the approach taken.”

Based on current rates, the current minimum wage in this province is the second lowest in Canada.

Based on current minimum wages across the country, the $12.65 minimum wage would be the third highest minimum wage in the country. However, other provinces also have minimum wages indexed to inflation, so it’s unknown where Newfoundland and Labrador will rank nationally on its minimum wage by Oct. 1, 2021.

According to the report filed by the minimum wage review committee, of the 205,900 workers in this province, 13,200 work for the minimum wage, or 6.4 per cent of workers in the province. Of those, 54 per cent are women. Retail makes up the largest number of minimum wage earners at 46 per cent.

The decision comes after a committee, appointed by government to review the minimum wage in October 2019, delivered its report. The department of Advance, Education, Skills, and Labour notes the review committee did not reach a final consensus on minimum wage.

The panel was comprised of chair Steve Tessier, business representative Brenda O’Reilly and labour representative Allison Doyle.

david.maher@thetelegram.com

@DavidMaherNL

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