Towards Living Wages and Decent Work

by Greg deGroot-Maggetti

Living Wage Employers in Waterloo Region received Living Wage Certificates during living wage week celebrations the first week in November.  (Credit: Ontario Living Wage Network)

“We need to create a parade that politicians want to get in front of.”

That is how one participant at a forum on the living wage and public sector employers put it.

At the heart of decent work is fair pay – the ability to earn a living wage. Not a poverty wage. But enough to meet your needs and fully participate in the life of your community.

But the growth of low-wage and precarious employment has become one of the defining labour market challenges in our time and one of the root causes of growing income inequality.

In 2017, the Government of Ontario’s Changing Workplaces Review found that 30% to 32% of workers in Ontario were in low wage jobs with few if any benefits. Many people in standard jobs, “work for very low pay and do not have a private pension.” (An Agenda for Workplace Rights, p. 45)

How does one change that reality?

One approach is to advocate for change in government policy. Groups like the Workers’ Action Centre and the Fight for $15 and Fairness Campaign have been doing just that in Ontario. And in 2017, their efforts began to bear fruit. Indeed, the very fact that the Changing Workplaces Review took place is a testament to the effectiveness of that advocacy. And although the review was not tasked with reviewing the minimum wage — which happened a few years earlier — when the Government led by Kathleen Wynne announced policy changes based on the Changing Workplaces Review they included a plan to raise the Ontario minimum wage to $15 an hour by January 2019 alongside a number of improvements to employment standards.

Policy change can be characterized as an exercise in taking two steps forward and one step back. That is just what happened in Ontario. In June 2018 a new government was elected. One of the first things the new premier, Doug Ford, did was to freeze the minimum wage at $14 an hour and roll back many of the employment standards changes that the Wynne government had brought in.

Advocates have also taken another approach to create change alongside the direct engagement with government. This approach has been directed at employers, encouraging them to voluntarily pay a living wage to all of their employees – full-time, part-time and contracted services, like custodial, security or food services. The living wage differs from the minimum wage in a couple ways. First, the minimum wage is government mandated and applies to most employees across the province. The living wage is a policy voluntarily adopted by employers. Second, the minimum wage tends to be arbitrarily set, usually bearing no relation to the actual cost of living. The living wage is independently calculated based on the actual cost of living in communities. In Ontario, living wage rates calculated for close to two dozen communities are all above the $15 an hour target for the minimum wage. The living wage rates in these communities vary from $21.75 in Toronto, Canada’s largest city to $16.05 in Thunder Bay.

The Ontario Living Wage Network came together in 2014. Nearly 200 employers have enrolled in the Living Wage Employer Program. Hundreds of employees have seen a pay raise as a result.

But the impact is greater than the number of employees directly affected.

In 2017, the Government of Ontario held hearings about upgrading employment standards. Typically in such situations, workers’ organizations and anti-poverty advocates speak in favour of raising the minimum wage, providing fair scheduling, paid sick days, etc. In the other corner are business groups – chambers of commerce, industry associations and the like – who caution about the presumed negative economic effect of making such changes. Into that mix, a group of living wage employers helped launch a new initiative – the Better Way Alliance. Members of the Better Way Alliance talked from their own experience about why paying a living wage and implementing positive employment practices makes good business sense.

The government of the day listened. They brought in many of those changes. But political times change. And the new government began to unwind many of those changes.

Living wage employers are helping create a new understanding and a new culture around employment practices. They note that the living wage is a practical tool helping employers who want to know they are paying their employees enough to make ends meet and participate in community.

Being able to attract qualified employees, seeing better staff retention, saving money on hiring and training as a result, reaping the benefits of higher productivity and better service from a stable workforce, seeing better morale among employees, are just examples of the many benefits of paying a living wage. Living wage employers are speaking up about them.

A few organizations have become leaders in a movement to counter poverty and encourage wage equity. The Ontario Living Wage Network is one among a number of movements promoting decent work. The Ontario Non-Profit Network has made decent work a focus. They have created a Decent Work Checklist  and a pension program for Non-Profit Organizations. The United Way of Greater Toronto has provided a toolkit for businesses to transform precarious jobs into stable employment. The B Corporation movement is demonstrating how sustainable environmental, social and employment practices can be integral to long-term business success.

Each of these initiatives helps demonstrate how old assumptions about trade offs between decent wages or sustainable environmental practices and profitability are false. As these initiatives expand, they create the political space for public policies grounded in proven employment, social and environmental practices of employers of all sorts. They form the “parade that politicians can get in front of.”

Greg deGroot-Maggetti serves as MCC Ontario’s Walking with People in Poverty Program Coordinator and is co-chair of the Ontario Living Wage Network. MCC Ontario is a certified Living Wage Employer.

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