New pay rate slightly higher than earlier projected rate of $18.10
HR professionals in federally regulated sectors have one week to prepare for a higher wage floor, as the government of Canada moves to raise the federal minimum wage to $18.15 per hour on April 1, 2026.
“Ensuring the federal minimum wage rises with inflation is a floor that protects workers, especially those in the lowest paid jobs in federally regulated sectors,” said Patty Hajdu, Minister of Jobs and Families and Minister responsible for the Federal Economic Development Agency for Northern Ontario. “Keeping the minimum wage up to date helps maintain a reliable baseline that strengthens earnings and keeps workplace standards strong for all workers.”
Employment and Social Development Canada (ESDC) announced that the new rate represents a cumulative increase of 21% since the standalone federal minimum wage was introduced in 2021.
The department said the measure has “supported thousands of workers in minimum-wage jobs across the federally regulated private sector” and that regularly updating the rate “protects the wage floor workers rely on and strengthens the standard for fair pay.”
The new federal base pay rate is higher than the earlier projected $18.10. The current hourly rate is $17.75.
Several provinces will also adjust their minimum pay rates by April 1.
Scope of coverage and employer obligations
The adjustment in the federal level will apply to employees in federally regulated private sectors, including banking, telecommunications and interprovincial transportation, who are currently earning below $18.15 an hour. ESDC confirmed that employers in these sectors are required to adjust their payrolls to ensure their employees are paid at least the minimum rate.
ESDC stated that “should the provincial or territorial minimum wage rate exceed the federal rate, federally regulated employers must pay their employees the higher of the two.”
The federal minimum wage is adjusted annually on April 1, based on Canada’s annual average Consumer Price Index (CPI) for the previous calendar year and rounded up to the nearest $0.05. The latest increase reflects a 2.1% rise in the 2025 CPI. ESDC said that by indexing the wage to inflation, the government is “providing greater certainty and security to more Canadians.”
The department framed the increase as part of a broader effort to respond to cost-of-living pressures. According to ESDC, the higher wage “complements other new measures aimed at bringing down the cost of groceries and other essentials, such as the Canada Groceries and Essentials Benefit and the Food Security Fund,” with the goal of making life more affordable while “building a strong economy that benefits all Canadians.”
