CRFA: New wage legislation the right recipe

February 26, 2010, Charlottetown – Recent changes to the Employment Standards Act to allow for more than one minimum wage rate in PEI will bring more jobs and more investment by small businesses, says the Canadian Restaurant and Foodservices Association (CRFA).

The CRFA will deliver this message today in Charlottetown to a provincial standing committee studying the issue.

Seven other Canadian provinces have more than one minimum wage rate, notes Luc Erjavec, CRFA’s Atlantic Canada vice president.

“Not all businesses and all jobs are the same.  The PEI legislation, just like in seven other provinces, will give small businesses the flexibility they need to deal with local business conditions so they can create more job opportunities for Islanders.”

CRFA has proposed new minimum wage rates for liquor servers, who typically earn the bulk of their income through gratuities, and for inexperienced employees. The new wage rates would be introduced by freezing the minimum wage for these employees when the next increase in general minimum wage takes effect.

The restaurant and foodservice industry is one of the largest employers on PEI, with nearly 5,000 employees – about the same as the farming and fishing industries combined.

“It is time government recognized the significant income that liquor servers earn in tips, as well as the high cost of training inexperienced workers,” says Erjavec.  “Wage differentials would allow operators to pay more to non-tip earners and create more job opportunities in the industry, particularly during these tough economic times.”

Labour is one of the largest costs for restaurant operators.  In recent years the minimum wage on PEI has increased twice as fast as the consumer price index, putting tremendous pressure on business owners and contributing to the closure of several foodservice establishments.