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LABOUR: Food service industry says Alberta’s new minimum wage will not solve worker shortage issue

            (AlbertaIndex, June 18, Monday) --- The Alberta government last week announced an increase in minimum wages but missed an opportunity to help restaurant operators deal with the serious labour shortage plaguing the province, said the food service industry.

            The minimum wage will rise from $7 per hour to $8 per hour on September 1, 2007, representing a 14% increase on top of a 20% increase that took effect in September 2005.
           
The industry said restaurant wages in Alberta have jumped by an average of 19% in the past two years, or nearly twice the average industrial wage, which is up 10%. Still, the industry is struggling with an estimated shortfall of 11,000 employees.
            On behalf of its 3,900 members in Alberta, the Canadian Restaurant and Foodservices Association (CRFA) has asked the province to introduce a wage differential for front-of-house employees who earn gratuities.
            By holding the minimum wage at its current level for tipped employees - many of whom are not reliant on minimum wage because they earn most of their income from gratuities - employers would have more flexibility to raise wages for back-of-house employees and attract more candidates for these positions.
            “A 14% minimum wage increase will ratchet up wages across the restaurant industry,” said Mark von Schellwitz, CRFA’s Vice President, Western Canada.
            “Introducing a gratuity wage differential would have helped restaurant operators target wage increases to the more difficult-to-find, back-of-house employees while maintaining wage stability for gratuity earners.”
            In the labour-intensive restaurant industry, more than 30 cents of every dollar in revenue goes directly to payroll costs, which are second only to food and beverage costs.
            In announcing the new minimum wage to reflect the province’s strong economy, Premier Ed Stelmach said:
            “This increase to Alberta’s minimum wage is good news for Albertans. With an increase to $8, Alberta’s minimum wage will be the highest in Canada after taxes.”
            Iris Evans, Minister of Employment, Immigration and Industry said: “Minimum wage offers protection for workers. It sets the minimum rate of pay that employers must meet and ensures that workers, especially women and youth, who traditionally are in the lower income occupations, are making a better wage. This will help recruit and retain new employees in Alberta's labour force.”
            With Alberta’s vibrant economy and low unemployment, most employers are already paying more than minimum wage. Three per cent of Alberta’s workforce, about 41,000 people, currently earn less than $8 per hour.
            Future minimum wage changes will occur on April 1 of each year, and will be indexed to changes in the average weekly wage. Indexing minimum wage to the average weekly wage will reflect the actual wage changes that occurred the year before.

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