ECONOMIC IMPACT & RESOURCES

Minimum wage increasing October 1 in several provinces

Manitoba – Minimum wage will increase on October 1, 2022 from $11.95 per hour to $13.50 per hour. It will further increase on April 1, 2023 to $14.15. The province will then return to annual adjustments based on provincial CPI, and projected the hourly rate to be approximately $15 on October 1, 2023

Ontario – Minimum wage rates in Ontario will increase on October 1, 2022 to $15.50 an hour. Click here for more details

New Brunswick – The minimum wage in NB will rise to $13.75 in October 1, 2022. View more information.

Newfoundland & Labrador – On October 1, 2022, minimum wage will increase to $13.70 per hour. This is part of a three step plan to bring the wage to $15.00 by April 1, 2024. Eligible small businesses can apply for assistance with these significant increases to the base wage through the Minimum Wage Transitional Support for Small Businesses. Deadline for applications is December 1, 2022.

Nova Scotia – Nova Scotia will raise its minimum wage on October 1, 2022 to $13.60. The province is in the midst of a five step plan to bring the wage to $15.00 by April 1, 2024. Beginning April 1, 2025, the minimum wage rate will be adjusted with inflation plus an additional 1% annually. View more information

Saskatchewan – The government has announced that on October 1, 2022, the minimum wage will increase from $11.81 to $13.00 per hour. On October 1, 2023, minimum wage will increase to $14 per hour and on October 1, 2024, it will increase to $15 per hour. View more information.

OTHER NEWS

Court rules employers must include electronic tips under pensionable earnings

The Federal Court of Appeal (FCA) has ruled that a Halifax restaurant must include a portion of the electronic gratuities intended for wait staff as “pensionable salary and wages” when calculating its liabilities under the Canada Pension Plan.

The recent case involved a popular, seaside restaurant in downtown Halifax that didn’t remit CPP and EI on part of its servers’ tips. Customers sometimes leave a tip in cash, which the servers are free to keep without advising their employer. Most customers, however, choose to pay their restaurant bills using a debit, credit or gift card, and include a tip in their electronic payment. The restaurant, in turn, shares these tips with its servers in a formalized, daily procedure.

The restaurant took the general position that due-backs (payments to the servers based on the tips received through the POS system receipts) received by servers were not considered to be “pensionable salary and wages” for purposes of CPP rules, nor “insurable earnings” for purposes of the EI Act. As a result, when it calculated its CPP and EI liabilities for 2015, 2016 and 2017, it did not consider any portion of the electronic tips.

The CRA took a different view and assessed the restaurant on the basis that a portion of the servers’ electronic tips for 2015, 2016 and 2017 should have been considered. The taxpayer took the matter to Tax Court in 2020 and lost. It then appealed the decision to the Federal Court of Appeal (FCA), which heard the case earlier this year.

The key question the court had to decide was whether the due-backs were properly considered to be amounts paid by an employer to employees “in respect of” their employment. The restaurant argued the due-backs are not paid in respect of a server’s employment and are not insurable earnings because a server’s due-back bears “little or no relation to the server’s net tip. It is simply the difference between cash payments for meals and electronic tips owing.”

The three-judge appellate panel disagreed, citing a seminal 1983 decision of the Supreme Court of Canada, which stated that the words “in respect of” have “wide scope and import such meanings as ‘in

relation to,’ ‘with reference to’ and ‘in connection with.’ In other words, “but for” their employment as servers by the restaurant, the servers would not receive any tips paid to them in the form of due-backs.

The FCA, in a written decision released last month, concurred with the lower court’s decision, and concluded the due-backs were “contributory salary and wages of the employee paid by the employer” for purposes of the CPP and “insurable earnings” for purposes of the EI Act.

Click here to read the Court decision.

Federal government to end COVID vaccine travel requirements, and make ArriveCan app optional

Canada has said it is dropping all remaining Covid border restrictions, including vaccine requirements for travellers. As of 1 October, travellers will also no longer need to provide proof of COVID vaccination, to undergo any testing or to isolate and quarantine.

The mask mandate on planes and trains will also be lifted. The ArriveCan app – used to upload health documents when entering Canada – will become optional.

Federal health minister Jean-Yves Duclos said in an announcement on Monday that Canada is “in a much better position” than it was earlier in the pandemic, in part due to availability of Covid-19 vaccines and treatment options.

The country’s high vaccination rate – with around 82% of the population having received two doses – and a falling death rate are also factors.

Click here for the full media release.

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