Council blasts off against minimum wage hike

Posted on September 9, 2015 by Taber Times

By Trevor Busch
Taber Times
tbusch@tabertimes.com

Plans by the Notley NDP to raise Alberta’s minimum wage level to $15 per hour over the next three years has drawn fire from members of Taber town council.

Objections from the regional business community to the province’s plans to gradually increase the minimum wage level in Alberta prompted the Taber Regional Joint Economic Development Committee (TRJEDC) to submit a letter asking town council to consider a motion to put forward a resolution to the AUMA and AAMDC requesting the Alberta government re-evaluate increasing the minimum wage. The TRJEDC made the request following a motion passed at their June 25 regular meeting.

“Wages are obviously a consideration, because staff is hard to retain,” said Coun. Joe Strojwas at the Aug. 17 regular meeting of council. “Higher wages lead to higher prices, which I believe leads to higher inflation. What actually happens when you increase the minimum wage, those that were making up from minimum wage, they also want an increase. So consequently this is a snowball effect, which in my 30 years in business, is a reality.”

In the Request for Decision, administration had cautioned council in making a decision on the request, indicating that “Council should be aware that the debate on the effects of minimum wage levels on the economy is contested in economic circles. Economists on both sides of the argument have studies and logic to back up their positions. While higher wage levels obviously have an effect on an employer’s decision about how many people to hire, a higher minimum wage also lifts with well being of many people and provides them with more money to spend in the economy, generating more jobs.”

Strojwas drew a direct connection between a perceived decline in levels of service in the restaurant industry and rises in the provincially-mandated minimum wage.

“I can remember — and probably you can, too — when you went into a restaurant, your table was pre-set for you. It doesn’t matter what restaurant you go into now, you get a roll-up set down in front of you when you sit, and you may or may not get a glass of water. Years ago, when minimum wage was $6 or $7 per hour, this is in the last 10 or 12 years before it was put up to $9, these are the realities: you had more staff, so you set the tables, and had a glass of ice water for your customers. That service has gone by the wayside because of a lack of staff, and higher prices.Increasing wages does lead to higher inflation, and higher costs.”

Alluding to his experience as a business owner and operator, Strojwas characterized most individuals working for minimum wage in the province as “bottom line workers” in the fast food industry, an assertion attacked as a false stereotype by many critics.

“That’s my personal experience in a restaurant — it does and will effect the bottom line of companies. We can put up wages all we want, but in most cases, these are bottom-line workers, part-time workers, students, seasonal workers — it doesn’t affect a lot of manpower out there except for the McDonald’s and the A&W’s, and these types of businesses. We need to take this into consideration.”

Mayor Henk De Vlieger warned of a trickle-down effect that will be experienced by business operators as a result of raising minimum wage levels to $15 per hour.

“It’s a complicated issue. I fully agree with Joe (Coun. Strojwas), it has lots of snowball effects. A person that makes $15 per hour probably wants to make $20. A person that makes $20 wants to make $25. There’s a lot of long-term effects. This won’t only affect only the service industry, but everybody else as well, so it’s an important issue if you look at it that way for the town, because we’d like to see the town economically grow — from that aspect, I guess you could say we care.”

Political objections at the municipal level to minimum wage hikes that were a platform pillar of a now-majority government are unlikely to have an impact, according to Coun. Andrew Prokop.

“We’re dealing with a scenario, this is a campaign promise by the NDP. I guess we can try anything we want, but I don’t know being that they made this campaign promise and suggested that the first increase is going to be October of this year. The stage is set, right?”

A vocal opponent of the idea, Strojwas continued to push for council’s formal support of the TRJEDC’s resolution.

“We have businesses in this community that we need to be proactive about, and support. The bulk of them don’t want to see this go forward. Let me put it this way. We’re in contract negotiations with our employees with the town. Do we have employees making $15 per hour right now? Will that mean they’ll want to go to $20? Are you going to sit there and say this isn’t going to affect us as administrators of the town?”

Coun. Randy Sparks was a solitary voice in suggesting the issue of a minimum wage increase wasn’t quite as simple as what had been suggested by other members of council.

“I guess it depends on what side of the coin you’re on here. If you’re an individual who is going to school and trying to pay off a student loan at $10.20 per hour, or $9.20 if you’re working in bar, you can see this as a huge plus for them, and they’ll look at it that way. I’m kind of on the fence on this one, because I see the detriments and the benefits of both sides here. Because $10.20 per hour, try to make a living on that — it just doesn’t happen. But I understand what everyone else is saying, too.”

De Vlieger didn’t mince words, concluding that a minimum wage hike to $15 per hour would have a “negative effect” on the economic situation in the province and community.

“I know as councillors, we should be concerned about our economics. This is definitely going to have a negative effect. A letter of concern, I personally wouldn’t have a problem with.”

At their Aug. 17 meeting, town council voted 5-1 to draft a letter to the TRJEDC in support of a recommendation to the AUMA and AAMDC conferences in regards to keeping minimum wage levels at a lower level than that proposed by the NDP provincial government. Coun. Laura Ross-Giroux voted in opposition to the motion, while Coun. Jack Brewin was absent.

Administration’s original recommended motion — which was not followed — was for council to not take a position on the province’s minimum wage initiative, and thus decline the Taber Regional Joint Economic Development Committee’s request.