N.B. reviews employment standards rules

Changes concern minimum wage, youth employment, workers not covered by act
By Sheila Brawn
|Canadian HR Reporter|Last Updated: 11/28/2016

Changes could be coming to three areas of employment standards in New Brunswick. The province’s Department of Post-Secondary Education, Training and Labour is reviewing minimum wage, youth employment and coverage under the Employment Standards Act.

In early September, the department released three discussion papers on the topics and asked for feedback by Oct. 7.

While the date for commenting has passed, the proposals put forward in the papers provide insight into possible amendments the government may table in coming months.

Two years ago, the government eliminated its Minimum Wage Board and replaced it with a requirement that the Minister of Post-Secondary Education, Training and Labour review the wage rate and determine if any changes are needed.

In the discussion paper Statutory Review of the Minimum Wage 2016, the department highlights four possible rate-setting choices, based on achieving different objectives:

• Increase the rate to $11 per hour and index it to inflation afterwards. This would maintain the purchasing power of the province’s lowest-paid employees.

• Set the rate by finding an appropriate distance between the province’s minimum wage and the median wage, and then adjust the minimum wage rate each year. This would maintain a relative level of pay between the minimum wage and median wage, which is the rate at which half of the workers in the province earn less and half more. In recent years, the minimum wage rate has lagged behind the median wage.

• Raise the minimum wage rate to the average rate in other jurisdictions in Canada and then adjust it each year to maintain the average. This would ensure New Brunswick’s minimum wage does not lag behind other parts of Canada. As of Nov. 1, the average minimum wage rate in all provinces and territories is $11.26 per hour.

• Look beyond just raising the minimum wage rate and implement tools or policies, such as a wage top-up program or guaranteed annual income, that ensure all provincial residents live above a low-income threshold.

The paper presents considerations and challenges for implementing each option. While the paper does not recommend one choice over another, the provincial government seems to be leaning towards implementing at least the first option.

It has previously said it is committed to raising the minimum wage rate, currently at $10.65 per hour, to $11 by the end of 2017, and to indexing it afterwards.

When it comes to indexation, the paper recommends that the government tie minimum wage adjustments to annual percentage changes in the total consumer price index (CPI) for New Brunswick and then round it to the nearest five cents. In the case of deflation, it says the rate would not go down.

The recommendations are similar to rules in other provinces that index the minimum wage rate.

In another discussion paper, Legislative Review of the Employment Standards Act: Employment Protections for Young Workers, the department looks at how legislation in the province can ensure the jobs young employees hold help them “gain work experience while not interfering with their development and growth.”

Post-Secondary Education, Training and Labour Minister Donald Arseneault says the review will help the department determine if its rules are in line with an International Labour Organization convention on minimum working age, which the Canadian government recently ratified, and with the province’s own strategy for preventing harm to children and youth.

“It is important to ensure that we are protecting all of our workers and are in line with the standards and best practices of other Canadian jurisdictions,” he says.

The province’s Employment Standards Act restricts children under 16 years of age from working in employment that is likely to be harmful to their health, welfare or moral or physical development.

In addition, it prohibits them from working more than three hours on a school day and more than six hours on other days. The total number of hours young people can spend going to school and working cannot be more than eight hours per day.

The act also prohibits employees under 16 from working between 10 p.m. and 6 a.m.

Employers that wish to have young employees work more than the maximum allowable hours or outside of the times permitted must apply to the employment standards director for an exemption permit.

The act puts additional restrictions on children under age 14. Employers are prohibited from hiring them to work in industrial enterprises, construction, forestry, hotels and restaurants, automotive service stations, and dance halls, among other places.

In the paper, the department proposes a number of changes to youth employment requirements, including:

• increasing the age for which restrictions apply from 16 to 18

• increasing the age for which prohibitions apply to certain types of work from 14 to 16

• requiring employers to obtain a parent’s or legal guardian’s consent before employing a youth under age 16

• no longer allowing exemption permits.

The department is also considering possible changes to the working hours restrictions for young people.

Options include increasing the daily maximum number of hours they can work from three to four on school days and from six to eight on non-school days.

The department is also looking at prescribing a maximum number of weekly work hours for young people.

The department also plans to review the list of restricted industries for young people to ensure it is up to date, and to examine whether to add provisions for entertainers under age 16 to the act.

The third discussion paper, Coverage under the Employment Standards Act, focuses on groups of workers not currently covered under the act.

“The aim of this review is to ensure that vulnerable people are protected and the act is applied fairly and equitably to all employment relationships,” states the paper.

As part of the review, the department is considering the following issues:

• It proposes to amend the definition of “employee” in the act to clarify how to determine whether an employment relationship exists. The department says it would base the new definition on common law tests for an employee versus an independent worker (for example, control, organization, ownership of tools) and best practices in other jurisdictions.

• It proposes to cover domestic workers under the act.

• It would add a definition of “hours of work” to the act. The definition would clarify that the act would consider time that employees are required to be at their disposal, including during night shifts and times when they may be sleeping, to be hours of paid work.

With the department proposing to cover domestic workers under the act, the paper says it needs to ensure they are treated the same as employees in other occupations who have to work overnight or be on-call, and who may be sleeping during that time.

It notes that employers would be able to apply for an exemption if it caused them special hardship or if they could show they provide employees with other benefits and advantages that would be reasonable compensation for the exemption.

It proposes to add minimum standards for room and board to the act.

“New Brunswick is the only jurisdiction in Canada that does not set minimum requirements under employment standards legislation for accommodations or room and board provided by employers to their employees,” says the paper.

The department proposes adding provisions to the act to prohibit the cost of employer-provided accommodation from reducing an employee’s wages below the minimum wage rate, and to allow employees to reach an agreement with their employer on whether they will live in employer-provided accommodation.

Other proposals include adding a provision stipulating employees who live in employer-provided accommodation would not be required to stay there during rest periods, vacations or leaves.

The paper proposes that the act cover all agricultural workers, except for those who are in a close family relationship with their employer.

The act currently applies to most agricultural workers in the province, except for those whose employer employs no more than three workers over a substantial period of the year (meaning six months), excluding those in a close family relationship with the employer.

The paper says the current provisions may violate human rights prohibitions on discrimination based on social condition, which includes source of income, level of education and occupation.

“This exclusion has created an issue of fundamental fairness and equality for long-term employees of farming operations who are not covered by the act, while short-term workers, such as harvesters, are fully covered,” it states.

A spokesperson for the department says it is too early to comment on whether the government will amend the Employment Standards Act to implement any of the proposals put forward in the discussion papers.

The department is now reviewing the feedback it received and will determine whether to recommend any amendments to the government.

Sheila Brawn is the editor of Canadian Payroll Reporter. For more information, visit www.payroll-reporter.com.

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