A commentary by Wendy Ferguson
Premier Jason Kenney has begun to reverse some of the decisions of his predecessor by announcing imminent changes to employment legislation in anticipation of boosting our suffering Alberta economy. This labour law reform will reverse some of what the NDP government had put into place in 2018, and will undeniably impact all businesses in the province.
As a business owner and employee, you can expect these changes in the coming weeks and months:
- INTRODUCTION OF A YOUTH MINIMUM WAGE: The youth minimum wage will be $13/hour and through an Order in Council, this change will take place on June 26th. This wage applies to workers under the age of 18.
It is important to note that there has been a huge decline in youth employment in recent years with young males hit the hardest (10.6% unemployment). Youth labour force participation rate has gone from 72% to 62% in recent years, indicating that many have given up on their search for work. It is estimated that there are currently 30,000 young Albertans seeking employment.
Jobs like these often exist in the retail and hospitality industries. I have worked with several small business owners who have been hit hard by the 2018 minimum wage increase and were forced to lay off a portion of their workers. As Premier Kenney stated, “thirteen bucks an hour is a heck of a lot more than zero bucks an hour”, and I believe he’s right…the NDP had in fact priced the youth out of the labour market. Let’s hope to see more job creation in the coming months.
- OVERTIME STANDARDS WILL REVERSE: Essentially, the overtime law will revert to pre-2018 legislation. Eligible employees will continue to be paid 1.5x their wage for overtime hours. Alternatively, a banked overtime agreement is an option for employees to take 1:1 time off. The UCP call this a ‘flexibility tool’ and believe that they are bringing fairness and balance back to employers.
The overtime law was hurting many small businesses to the point of disallowing overtime hours as a company rule, despite some of their employees’ desire to work overtime. In many situations it had the opposite effect of what was intended by the NDP. It was meant to enhance earnings for employees, but instead it eliminated the opportunity for extra income altogether.
- HOLIDAY PAY CHANGES: The eligibility period for holiday pay will revert to the employee having to have worked 30 days over the preceding 12 months. In addition, employees who would normally work a general holiday will be entitled to receive holiday pay.
- UNION CERTIFICATION REVERSAL: Unions will go from 6 months to a 90-day period to provide evidence of employee support for certification. Mandatory secret ballots for all union certification votes will be reinstated.
It is estimated that these new labour standards (except for the youth minimum wage) will come into effect by September 2019, after Bill 2 is passed. At a press conference on May 27th, Kenney said the UCP are “making as many changes as we feel prudent at this time”, noting more changes should be expected this Fall. As it stands now, none of the job protected leaves that were implemented in 2018 have been altered.
Today the overall unemployment rate in Alberta is hovering around 6.7%, with Edmonton experiencing 6.9% and Calgary trailing at 7.6%. To put that into perspective, in 2014 Alberta’s unemployment rate was a healthy 4.6%. It is estimated that around 200,000 Albertans are out of work today, and some have been unemployed for 2 or 3 years. Businesses have closed and jobs have been eliminated…clearly the status quo wasn’t working.
The NDP’s 2018 minimum wage increase wasn’t solely to blame, nor any one of their individual labour law changes. However, when the NDP chose to significantly overhaul labour legislation during a time of other major business disrupters (business taxes, carbon taxes, pipeline obstruction, decline in oil prices) it was a recipe for disaster. These changes are welcome and will help revitalize our economy.
Wendy Ferguson is a Human Resources Professional and owner of Stick People Solutions (SPS), providing simple, flexible and effective solutions for complex people issues. SPS specializes in employment legislation, policy, workplace investigations and recruiting. Please follow Wendy Ferguson on LinkedIn for future articles about HR in Alberta.