What To Do About Soaring Inflation? – BC Increases Minimum Wage
By: Michelle QuinnCo-authored by Summer Student, Kyusik Shin
It has been impossible to ignore the effects of rising inflation on your wallet. Everything you pay for including groceries, gas and the utility bill has became more expensive monthly, if not daily. What used to be a living wage may not be a living wage in 2023.
Effective June 1, 2023, the BC Government has increased the province’s minimum wage from $15.65 up to $16.75 per hour. This increase will make the minimum wage in British Columbia the second highest in Canada, only trailing Yukon by two cents.
Last year, in response to soaring consumer prices, the BC government made a commitment to match the minimum wage increase to the average annual inflation rate. The sharp increase of $1.10 per hour reflects this commitment. Below is an overview of the increases over the years:
- June 1, 2020 – $14.60 per hour (5.4% Increase from the previous year)
- June 1, 2021 – $15.20 per hour (4.1% Increase from the previous year)
- June 1, 2022 – $15.65 per hour (3% Increase from the previous year)
- June 1, 2023 – $16.75 per hour (6.9% Increase from the previous year)
B.C.’s annual inflation rate has been decreasing and is at 6.2% as of January 2023, down from 6.6% in December 2022 and the peak of which was 8.1% in May 2022. Therefore, we will unlikely see another sharp minimum wage increase next year.
The minimum wage applies regardless of how employees are paid, whether it is hourly, salary, commission or on an incentive basis. If an employee’s wage is below minimum wage for the hours they worked, the employer must top up their payment so that it’s equal to minimum wage. For example:
- If an employer has a salaried employee, the employer must ensure that the employee’s salary is at least equivalent to the minimum wage for the number of hours they work.
- If an employer has an employee on commission, the employer must ensure that the employee’s commission is at least equivalent to the minimum wage for the number of hours they work, regardless of whether the employee is paid 100% on commission or part commission and part hourly wages.
It is important to note that the Employment Standards Act (“ESA”) does not allow the minimum wage to be waived as part of an employment agreement. Any agreement on employment conditions that do not meet the minimum standards of the ESA, will be deemed to be of no effect.
It is the employer’s responsibility to ensure compliance with the new minimum wage. Failure to comply with the ESA and the regulations may result in financial penalties against the employer.
If you would like more information or advice about the new minimum wage and the application of the ESA to your workplace, please contact any member of our Employment and Human Rights Group.
-
The Canada Emergency Response Benefit (“CERB”) was introduced by the federal government in response to the pandemic in 2020. The program provides financial support to Canadians impacted directly by COVID-19. Terminated employees frequently ask whether these CERB payments are deductible from wrongful dismissal damages. In this post, we reviewed two recent BC Supreme Court decisions where the Court found that the payments were deductible, in particular, the CERB payments “raise a compensating advantage” issue. If the CERB payments were not deducted, the plaintiff would be in a better position than he/she would have been if there had been no breach of the employment contract.
-
In British Columbia, employees terminated without cause are entitled to notice or termination pay, while employees dismissed for cause are not. But what if, after a without-cause termination, the employer later uncovers misconduct that could have justified a for-cause dismissal? In our latest blog post, we review a recent BC decision where improper allegations of after-acquired cause backfired on the employer, highlighting important considerations for employers navigating termination issues.
