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  • Local Businesses Speak Out On Unintended Impact of Impending Labor Reforms

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    The Ontario government has announced Bill 148, Fair Workplaces, Better Jobs Act set to be implemented later this year. The plan is proposing widespread changes to Ontario workplaces. In doing so, Brampton businesses warn of unintended consequences that could have negative economic effects. The Brampton Board of Trade is warning local MPPs of unintended consequences that will hurt consumers, workers and local businesses.

    Proposed reforms include a 32% increase in the minimum wage within the next 18 months; card-based union certification and a variety of other changes that will impact job creation, workplace harmony and business investment in Ontario. Read the full policy update on the impending changes here

    “I meet with business owners every day. They feel under attack by the provincial government. Changes are too drastic and the proposed implementation is too fast. They want the Bill killed and are scrambling to make contingency plans that keep customers, market share and competitive advantage”, says Todd Letts, CEO of the Brampton Board of Trade, “Some have stated clearly that these changes will impact their business survival.”

    “My plan is to increase fees by 14-18% in the next 6 months. I will definitely cut back on employee positions and employee benefits to offset costs”, says one Brampton business owner. 

    According to visits, calls and meetings local businesses have had recently with the Brampton Board of Trade, major concerns have been raised across all sectors regarding the impending changes. Local businesses tell the Board of Trade that:

    o The impending changes will result in an increase to consumer prices to offset costs of paying staff more. How will consumers respond to large increases in labour-intensive purchases such as childcare, elder care and groceries?
    o To mitigate increases to consumers, businesses will be forced to change their hiring practices accordingly — be more selective of who they hire – higher-skilledto justify a higher wage - which may exacerbate youth unemployment.
    o Bearing in mind the parameters of their allotted budgets, businesses have stated clearly that they will have less room to create jobs

    In the words of one small business owner: “As a small business owner with high staff: revenue ratio, I am concerned about the increase to minimum wage and related changes….the speed of the proposed implementation will be very difficult to bear. I believe a 5-year tiered-increase would achieve the same effect and be much less disruptive to Ontario businesses. Although an election is imminent I would really like to see decisions made by the Ontario government transcend the political horizon; this is a transparent vote-grab without thought for long-term consequences.”

    o Changes will mean a heavier burden will be placed on existing employees and business owners to fulfill tasks in the workplace. Concerns have been raised about the stress on business owners and their families.
    o The changes will result in wage compression and remove fairness in wages among staff levels, which will ultimately negatively impact workplace harmony
    o Some staff may see a reduction in their hours in order to keep all staff on.
    o Some businesses are considering not providing workers benefits in order to offset costs of the increased minimum wage
    o The impending changes will inevitably lead to layoffs and/or automation of work — businesses are being forced to invest less in people and more in machines and technology to replace low-skilled workers.
    o Businesses are concerned the changes are politically motivated and lack basic understanding of business reality

    Another business wrote the Board to say: “My concern is that the consequences of driving through changes at this speed will result in decreased new job creation and potential failure of existing businesses due to the need to significantly raise pricing to accommodate increased employee expenses (unrealistic in our increasingly globalized business environment), leading to decreased competitiveness of Ontario businesses and, ironically, a negative effect on Ontario employees.”

    Businesses want a full economic impact analysis before the plan is implemented. The Brampton Board of Trade is active on a number of lobbying strategies to help local MPPs and cabinet Ministers understand local business concerns. Through a coalition of businesses across the province, the Brampton Board is share concerns with all political parties and will continue to advocate for the current government to re-think, reverse and revise the impending changes in Bill 148. Please join this advocacy effort by sharing your thoughts on these changes and the impact you foresee at your business. Click here to participate in the survey.

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