Students speak up about some minimum wage issues

The province of Ontario has legislated an increase in minimum wage to $14/hour on January 1, 2018.  A year later it will be raised to $15/hour.  This is a complex issue with many points of discussion and sides to the debate. One thing that all will agree on is that the restaurant industry in Ontario will change significantly because of this event.

In our fourth-year hospitality leadership course we have been having active discussions about this increase all semester.  While I am well versed on this topic and have thought through many of the implications two points were recently brought up by students that I hadn’t considered and I believe deserve attention.

One of our students works in the kitchen of a large restaurant chain.  During his two plus years with the company he has worked hard, excelled, and seen his hourly rate increase from $10.50/hour to approximately $13/hour.  While he understands his wages will increase to $14 this upcoming January he is perplexed by the fact that he will be making the same wage as someone who will be starting new with the restaurant with no experience.  The leaders of his restaurant have already told him there is nothing they can do, he will be making the same wage as a newcomer and will be doing so for the foreseeable future.  The question becomes, how will this increase in minimum wage effect performance management and the motivation of people who have worked hard to earn at the high end of the scale?

Another student is currently a supervisor in the food and beverage department of a golf course. This student is on salary and is concerned because he has already been told that his department will have to get lean and run events with less staff because of the minimum wage increase. His concern? He’ll have to pull the extra weight of staff cuts and won’t see his salary going up any time soon.

While the news media, economists, and industry associations talk at length about the macro effects this increase will have on our economy and industry these two points presented by our students reiterate the fact that it’s not only businesses that will be affected by this legislation it is individuals as well.  We’re not sure what the new landscape will look like but we’ll be watching!