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Economy

Scaling back wage top-up from $18 is ‘completely unfair,’ says MLA


A program that tops up the territory’s minimum wage of $13.46 to $18 is set to expire on February 28.

Frame Lake MLA Kevin O’Reilly raised the imminent expiry of the program in the legislature this week, noting residents have been relying on the funding to help them through recent months.

The wage top-up program started in April 2020 and has been extended several times since. It boosts the salaries of eligible employees to $18 an hour during the pandemic if they normally make less than that.

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“The need for this program is a clear sign that our minimum wage is too low, far too low,” O’Reilly said.

“It would be unbelievable, if not completely unfair, if the effective minimum wage in the NWT is rolled back from anything less than $18 an hour, which is what people have been getting for the last 10 months.”

As of February 3, 95 businesses have taken part in the program, with 2,298 individuals benefitting from the top-up. The total cost to run the program is said to be a little over $2.5 million.

Referencing an Alternatives North report from 2019, O’Reilly said the living wage in the NWT – the necessary amount of money a full-time worker must earn to afford basic living expenses – was around $24 an hour per adult to sustain a household of two parents and two children in Yellowknife, and close to $25 for Hay River.

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“Covid hasn’t changed the cost of living,” he said.

“This program isn’t going to go on forever … but it’s also a clear indication of how ridiculously low our minimum wage actually is.”

Employment minister RJ Simpson said he is in the process of reviewing the NWT’s minimum wage options.

The territory has a minimum wage committee made up of two members of industry, two members with backgrounds related to labour, and one member from a non-government organization. The committee reviews the minimum wage every two years.

Simpson said the committee had recommended three ways of moving forward. The nature of each of those recommendations has not been made public, and Simpson is now reviewing the proposals alongside feedback from regular MLAs.

“I consider we’re in a pandemic and our borders are closed, and that the majority of those earning minimum wage are in the hardest-hit sectors of our economy,” the minister said.

“I’ll make a determination at some point in the coming weeks, I imagine, just so that everyone is aware of what’s happening and has plenty of heads-up.”

Lifting residents out of poverty

O’Reilly asked Simpson how the territory could expect to lift people out of poverty when residents making the minimum wage aren’t earning close to a living wage.

Simpson said the responsibility of solving that quandary fell on the entire NWT government.

“It’s not just mandating a minimum wage of a certain amount. If I were to mandate a minimum wage of a living wage, $25 an hour, we’d be putting people out of business,” Simpson said.

“The cost of goods would go up because the cost of doing business goes up, and we’d need a new living wage.

“What we need is a cross-government approach.”

RJ Simpson in September 2020
RJ Simpson in September 2020. Sarah Sibley/Cabin Radio

Simpson said British Columbia carried out a two-year study released in January that looked at addressing the issue using a guaranteed basic income.

He said the report concluded targeting supports were an effective solution, as opposed to pursuing a basic income model.

Targeted supports include creating jobs for residents, effective programs for those with addictions issues, ensuring proper training is given to people, and having adequate housing for everyone.

“Just throwing money at a problem, as simple as it seems and that’s probably the allure of it, doesn’t necessarily mean it works,” the minister said.

Simpson added a review of the NWT’s income assistance program is being carried out to ensure it helps people “get over the welfare wall, get out of poverty.”

Student financial assistance and apprenticeship programs are also under review.

“Everything we do in this Assembly is to get people out of poverty,” Simpson said. “It’s to improve the lives of our residents.”

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