A raise for the working poor

The Ontario Liberals outlined a plan in the March budget to gradually raise the minimum hourly wage from $8 to $10.25 over the next three years, but with an election looming on Oct 10, the NDP says the working poor need a $2-per-hour raise immediately.

“The problem is of course that $10.25 in three years won’t be worth what $10.25 is worth now,” says NDP employment standards and small business critic Cheri DiNovo (Parkdale-High Park). “Ten dollars wasn’t plucked out of thin air. It is the low-income cutoff. It’s based on real costs. If you’re earning $8 now, you’re not able to pay the rent.”

But Liberal minister of labour Steve Peters (Elgin-Middlesex-London) says an immediate $2 hike would be unfair to the province’s employers.

“We have to move forward with a phased approach, a balanced approach, that recognizes the needs of those on minimum wage but also the impact on businesses,” he says.

The Progressive Conservatives pledge an annual review of minimum wage by government, social, economic and business leaders, but will not commit to the Liberal’s three-year schedule.

A report commissioned by the Ontario government estimates there are 260,000 minimum wage earners in Ontario – 4 percent of the workforce. Half are teenagers and a further 16 percent are between 20 and 24 years old. Two-thirds of those workers live at home with their parents, and two-thirds work in accommodation, food services and retail jobs.

The NDP estimates nearly 1,000,000 Ontarians earn below $10 per hour and that most beneficiaries of a raised wage will be adult women, immigrants, visible minorities and students.

How will a higher minimum wage affect those working and hiring in Toronto’s queer neighbourhood? An informal survey of Church St business operators suggests that most employees there already make more than $8 per hour.

“I don’t pay minimum wage,” says Ash Bhimani, owner of the Lettieri Espresso Bar and Café at Church and Wellesley. “Everyone makes better by at least 20 percent.”

“We start people at minimum wage, but raise it quickly,” says Danny Hayes, manager of 7/24 Video at 510 Church St. “For anyone trying to support yourself, it’s really difficult unless your partner’s working.”

Church-Wellesley Business Improvement Area chair Sam Ghazarian operates the Baskin Robbins at 536 Church St. He says minimum wage is a non-issue for Church St businesses.

“Payroll is not as much a concern as rent in this neighbourhood,” he says.

DiNovo agrees that a rise in minimum wage will be inconsequential to most employers and says that the change could even help reduce some of the tax burden for some businesses.

“Taxation is an issue for business, not wages,” she says. “The reason taxes go up is to pay for poverty elsewhere.”

According to Ontario’s employment regulations, the minimum wage for liquor servers – including the village’s waitstaff and bartenders – is only $6.95 because servers can expect to make extra money from tips. Under the Liberal plan, that wage will rise to $8.90. DiNovo says server wages will rise under the NDP plan as well, but that the exact proposed amount hasn’t been finalized.

Jeffrey Rock, a server at Byzantium at 499 Church St, estimates he makes $30 per hour after his tips are counted.

“I would never be able to work for minimum wage,” he says. “I know it wouldn’t be enough, but I’m making three or four times minimum wage.”

Some proprietors are consequently hostile to the idea of a mandatory wage hike for servers.

“I think the minimum wage is too low,” says Dean Odorico, general manager of Woody’s at 467 Church St, “But it’s the person making $8 per hour that can’t live on that amount that’s the problem. If a bar or restaurant has to increase wages for servers, people in the kitchen aren’t get-ting the raises they need.”

Odorico says if he is forced to raise wages he’ll have no choice but to raise prices, and that could be bad for business.

“I don’t think bars and restaurants can take anymore hits,” he says. “They’re already talking about the new tax on liquor, and we’re still reeling from the smoking ban.”

Other gaybourhood proprietors are less concerned about the effects of rising prices as long as customers have money and are willing to spend it.

“There has to be a buy-in from consumers,” says Bhimani. “It’s a social issue. If we want to affect people, there has to be a trickledown. That effect will be felt by businesses and consumers.”

Because most Church St businesses already pay above minimum wage, an increase could give a boost to urban businesses like those on Church St relative to businesses in areas where costs are lower. But Peters says wage flexibility is important when different regions have different costs.

“Church St in Toronto versus Talbot St in St Thomas, the prices are different,” he says. “We’re not going forward with a regional minimum wage. We leave that to the local economy to determine what the minimum wage is.”