N.S. hiking minimum wage to $15.20 in April, indexing annual increases to 1 per cent above CPI

The more than 26,000 Nova Scotians who earn minimum wage will see their pay increase by 20 cents an hour, from $15 to $15.20, on April 1.

But it is not enough, according to the president of the Nova Scotia Federation of Labour (NSFL).

“The minimum wage increase from $15 to $15.20 is not nearly enough to bridge the gap between poverty and a living wage,” Danny Cavanagh said in a news release. “Workers are grappling with the escalating costs of housing, food, and basic amenities. 

“The current minimum wage does not realistically align with these costs, leaving many Nova Scotians struggling to afford their basic needs.

The increase follows the formula recommended by the Minimum Wage Review Committee in a Dec. 11 filing to the labour minister.

The recommendation was accepted by Labour Minister Jill Balser and the provincial government. 

Starting this year, the rate is to be adjusted by the national Consumer Price Index (CPI) plus one percentage point from the minimum wage rate set the preceding April. 

That results in an increase this year of 4.7 per cent from the April 2023 rate.

“This year has been very difficult for many Nova Scotians, business owners and workers alike,” Balser said in a department news release.

“I am grateful to the Minimum Wage Review Committee for putting forward the perspective of both employers and employees so we can ensure a balanced approach to increasing the minimum wage.”

Dissenting view

Cavanagh offered the only dissenting recommendation among the four review committee members, pointing out in the report that the current formula for adjusting the minimum wage does not allow minimum wage earners to manage the current cost of living and does not result in employees receiving fair compensation for their work.

In his Wednesday news release, Cavanagh urged the government and the Minimum Wage Review Committee to consider an alternative solution.

“We need to look beyond piecemeal increases,” he said. “We need a solution that brings our minimum wage workers closer to a living wage at a faster pace. The NSFL proposes that the committee should consider a comprehensive review of the province’s wage policies, including the introduction of a Living Wage Index.”

The Living Wage Index should be adjusted annually, should reflect the real costs of living in Nova Scotia, including housing, food, transportation, and other necessities and would be a game-changer for the province’s workforce, Cavanagh said.

“It would ensure that wages are equitable and reflect the true cost of living,” Cavanagh said. “It’s about fairness and dignity for Nova Scotia workers. They deserve to earn not just a minimum wage, but a living wage. The disparity is glaringly obvious when you consider that at 9:27 a.m. on Jan. 2, the average top Canadian CEO had already made the average Canadian worker’s annual salary.”

According to the latest report by the Canadian Centre for Policy Alternatives, Canada’s top 100 CEOs were paid a whopping $14.9 million, on average, in 2022. This is an all-time high and bested the previous record of $14.3 million, set last year. 

“We call upon businesses, unions, and workers to rally for this cause” Cavanagh said, noting that a collective voice can bring about the monumental change needed.

“The NSFL is committed to advocating for workers’ rights and will continue to work tirelessly to ensure that all Nova Scotians can afford a decent standard of living,” he said.

Concerns flagged

Under the provincial Labour Standards Code, the review committee, which has equal employee and employer representation, is mandated to conduct an annual review of the minimum wage in Nova Scotia.

The committee’s December 2021 report flagged concerns that without a change to the approach to setting minimum wage, there would continue to be a number of minimum wage earners who live below the poverty line and struggle to make ends meet. 

Concerns were also expressed that increases in the minimum wage rate be predictable and that employers receive notice of increases so that they can structure their practices to best absorb labour cost increases. 

In its 2021 report, the committee recommended incremental increases that would have Nova Scotia’s minimum wage reach $15 per hour on April 1, 2024, and that in the years following the minimum wage be set by the new formula that would index minimum wage to the Consumer Price Index.

The rationale was that since the economy tends to grow at a greater rate than inflation, annually increasing minimum wage by an additional one per cent over CPI would allow minimum wage earners to share in the economic growth of the province.

The committee’s December 2022 report noted that due to an unforeseen and significant increase in inflation for the 2022 calendar year – as well as the forecasted inflation rate for the 2023 calendar year – the incremental increases to minimum wage recommended in the December 2021 report would not have the expected impact on the purchasing power of minimum wage earners.

Accelerated hikes

In the December 2022 report, the committee recommended that the province accelerate the move to a $15 minimum wage, calling for the minimum wage to increase to $14.50 on April 1, 2023, and $15 on Oct. 1., 2023, along with adjusting the April 1 changes each year starting in 2024 to reflect the CPI plus an additional one per cent.

The committee’s December 2023 report profiled Nova Scotia’s minimum wage earners as six per cent of the province’s workforce, consisting of 26,000 Nova Scotians who worked for minimum wage during the period of April 2022 to March 2023.

During that period, the minimum wage was $13.60 per hour and an additional 27,700 Nova Scotians earned between $13.61 and $15.00 per hour. 

Minimum wage earners work primarily in retail trade and the food and accommodation industries, the report found. Fifty-six per cent of minimum wage earners are female, 63 per cent are non-students, 27 per cent are over the age of 35, 37 per cent are employed full time and 44 per cent have post-secondary education.

Upon the committee’s recommendation, the minimum wage in Nova Scotia did increase to $15 an hour in Nova Scotia on Oct. 1, 2023, and, according to the committee’s 2023 report, minimum wages in both Prince Edward Island and Newfoundland and Labrador were hiked to $15 on that same date.

New Brunswick’s minimum wage increased to $14.75 on April 1, 2023.

British Columbia’s minimum rate is set at $16.75 as of April 1 of this year, Ontario’s minimum wage reached $16.55 on Oct 1, 2023, Quebec’s went to $15.25 as of May 1, 2023, and the three northern territories are set at $19 an hour in Nunavut as of Jan. 1, the highest rate in the country, $16.77 for the Yukon, and $16.05 for the Northwest Territories.

Alberta’s minimum wage has been $15 an hour since October 2018, Manitoba’s is $15.30 and Saskatchewan’s minimum wage, now at $14 an hour, is scheduled to increase to $15 in October.