McGugan urges province to slow minimum wage hike

Business | Featured | Front Page | News.

Brooke-Alvinston Mayor Don McGugan says rapid increases to the minimum wage will hurt businesses in his community and he’s urging the province to slow down.
The provincial government wants to increase the current minimum wage of $11.40 to $15 in the next 18 months. McGugan recently appeared before the all-party committee reviewing Bill 148 when it was in London.
He told the MPPs while he agrees the minimum wage should be increased, hitting $15 in 18 months will be too much for some businesses to bear.
He gave them the example of Riverstone Pizza. The owners have estimated the wage increase will cost them $32,000 in the first year and another $19,000 in the following year.
“The owners consulted a financial analyst and in order for them to make a profit, the current price for an ordinary cheese burger with your choice of soup or salad plus a non-alcoholic drink will have to rise from the current $8.95 to $10.95, effective January 1, 2019,” McGugan told the committee. “They are not sure they or the supportive community can or will support this increase.
“This restaurant which just opened in Feb. 2016, may find themselves in the position of having to cease operation thus depriving 15 part time and two full time employees their jobs.”
McGugan says the province should spread the increase over a longer time frame.
“I’m not opposed to minimum wage going up and I’m not opposed to people making the same amount of money for part time as full time if they do the same job,” he says. “The solution I really think is that they do a six per cent increase per year for five years to get you to $15. I really believe society can do that.”
The mayor added the impact of an increased minimum wage will not just be felt in the cost of goods, but in services delivered to the most vulnerable.
McGugan says one resident who employs help for their special needs child says they will have to cut back on the hours they normally use to cover the cost of the increasing wages.
“I’d rather have my neighbours, both youth and adult, work with a minimum wage of $14 rather than have them wake up and have no job at all to go to because the employer was unable to pay the proposed immediate increase in wages and had to close his business,” he told the committee.
The bill is expected to go to the Ontario Legislature this fall.