Finding a well-paying job in any country, not only Canada, can be challenging especially if one is not sure about the local laws and rules. In Canada, the situation may be even more complicated due to the differences between provinces and territories where each has its own nuances. Below, we discuss seven of the most important facts about wage rates and rules. Those interested in more details should read the research on minimum wage in Canada to make more informed decisions when looking for a job!
Fact 1: Varying Rates for Provinces and Territories
In Canada, there is a federal minimum wage, yet each province and territory holds the autonomy to establish its lowest wage standards. This results in a diverse range of wage rates across the nation.
The minimum wage reflects the lowest legally acceptable remuneration an employer can offer to their employees, presented as an hourly price.
While the Canadian government doesn’t establish an upper limit on employee wages, its primary concern lies in establishing a lowest wage that would cover the living costs. The point of the lowest wage rate is to secure the lower-paid workers, part-time workers, students, and other categories of employees and prevent their vulnerability.
Minimum wage standards may show really impressive disparities across the country because they are determined by the labor laws and the cost of living in each province and territory. For instance, Yukon has the highest minimum wage at $16.77 per hour, while Saskatchewan, on the other hand, has the lowest rate of just $14 per hour.
Several provinces, including Saskatchewan, Manitoba, and New Brunswick, have a mechanism applied by the local governments for automatic lowest wage adjustments. They connect these adjustments to the provincial Consumer Price Index, which monitors changes in the cost of living and strives to prevent the impact of inflation. To compare, the lowest wage in the Northwest Territories undergoes a review every two years only and the local authorities decide whether the rate increase is necessary.
Fact 2: So-Called Youth Rates
A few provinces offer what is commonly known as ‘youth rates’ for young workers like students, and these rates can be noticeably lower than the standard minimum wage. For students under 18, the lowest hourly rate across Canada, in theory, is set at $13 but this can still vary for each province.
Employers, in turn, have the flexibility to provide higher compensation to student employees. This rate applies to the initial 28 hours worked during a school week. Should students work more than 28 hours in a week, they become entitled to the standard lowest wage, set at $15 per hour.
When it comes to overtime, as a rule, employees earn one and a half times their regular rate of pay for hours worked beyond 28 in a week.
Fact 3: Living Wage Gaps for Population
The minimum wage in many provinces frequently falls short of what is needed to support a basic standard of living, even for a single person, let alone for a family of three or more. This leaves workers struggling to meet their essential expenses like rent, housing, groceries, etc.
Minimum wage adjustments that are made are intended to enhance the well-being of people who are near the poverty threshold. However, in Canada, all these adjustments quickly travel to the pockets of landlords that set too high prices for rent. Therefore, it is safe to say that the biggest cause of why the lowest wages do not match the cost of living across Canada is rent cost and poor regulation of rent costs. Fewer and fewer people just cannot afford any housing.
Fact 4: Wage Rate Differences for Tipped Workers
Several provinces in Canada have implemented a reduced minimum wage for workers who collect tips during their working hours, like waiters, with the expectation that these tips will bridge the gap between the actual pay and the expected pay (which should reach at least the minimum wage rate).
As of May 1, 2023, the lowest wage for employees receiving gratuities and tips stands at $12.20 per hour – lower than anywhere across the country. Employers are obligated to ensure that these workers earn a wage at least equal to, or higher than, the prevailing lowest rate.
Fact 5: Part-Time and Temporary Workers
Temporary and part-time workers typically earn a lower hourly wage compared to their full-time colleagues. A full-time job typically involves consistent work of over 30 hours per week, with many employers defining it as an eight-hour workday and a 40-hour workweek.
Part-time workers are expected to be paid extra when working overtime (more than the defined part-time job negotiated with their employer) and should have typical statutory holidays or holiday compensations.
Fact 6: Farm Workers Exemptions in Minimum Wage Rates
In specific Canadian provinces, workers of the agricultural sector may either be excluded from standard minimum wage rules or receive a reduced minimum wage. Farmworkers who receive compensation on an hourly basis, through a salary, or by any other method (except for piece rate, as described below) are eligible for the general lowest wage.
Young farm workers under the age of 16 are not eligible to receive the obligatory minimum wage. Also, farm workers who are compensated based on the work they complete during the harvesting of fruits, vegetables, and tobacco, are also not eligible for the lowest wage requirement.
Fact 7: Wide Gender Wage Gap
Women often find themselves in more low-paying job roles and face a serious impact from the minimum wage standards. According to the statistics of 2022 in Canada, the gender wage gap for both full-time and part-time female workers stands at 0.89, which means that women earn 89 cents for every dollar earned by men in similar positions. Despite the fact that Canada is far from gender discrimination in general, the substantial pay gap still exists in 2023.
Final Thoughts
Learning about all the rules and limitations that workers in Canada may face due to the cost of living, the cost of rent, and variations of the minimum wage rates can be depressing. However, this knowledge will help those looking for a job to be more mindful and make wise choices.
Disclaimer: The views and opinions expressed in this article are those of the authors and do not reflect those of Geek Vibes Nation. This article is for educational purposes only.
Amanda Lancaster is a PR manager who works with 1resumewritingservice. She is also known as a content creator. Amanda has been providing resume writing services since 2014.