Greater Sudbury approves living wage plan

In Sudbury, a living wage is set at $16.98 an hour

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It’s time for a living wage, say Greater Sudbury city councillors.

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Earlier this week, at the finance committee meeting, councilors approved a motion that will give most city workers a living wage. The changes will take effect in July.

Introduced by Ward 9 Coun. Deb McIntosh and Ward 7 Coun. Mike Jakubo, the motion directed staff “to undertake the work necessary to pay a living wage, currently $16.98 per hour, to all direct employees (excluding students), effective the 1st July”.

It will cost in 2022 around $217,000.

The full cost of the changes – approximately $434,000 – will be realized in 2023. Funding is to be determined “as part of the company’s year-end budget position.”

Additionally, the motion directed staff to prepare “additional options for implementing a living wage for consideration by the board when preparing a negotiating mandate.”

The Board approved the motion by a vote of 10 to 1. Only Ward County 11. Bill Leduc voted against. Councilors Michael Vagnini and Al Sizer did not vote.

The concept of a living wage is relatively new. As a staff report indicates, the Ontario Living Wage Network issues three levels of certification – Partner, Leader and Champion – depending on the number and type of employees earning at least a living wage.

Currently, there are only five municipalities in Ontario striving to reach the champion level. At this level, “all permanent full-time and part-time employees receive a living wage. All externally contracted (third party) employees who provide regular services are paid a living wage or will be when the contract is renewed,” the report states. These municipalities include Cambridge, Huron County, Kingston, St. Catharines and North Perth. The Region of Waterloo will present an implementation plan to its council at some point this year.

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Locally, five employers are certified as Living Wage Employers. These include Public Health Sudbury & Districts, Social Planning Council, Sudbury Community Legal Clinic, Sudbury Workers Advocacy and Education Center and Sudbury & District Labor Council.

“According to the Ontario Living Wage Network, employers who have committed to paying workers a living wage have reported higher morale, lower absenteeism rates, and cost savings on hiring and training due to ‘greater employee retention,’ the report notes. “Employees who have seen their pay rise to living wage have reported lower stress levels, being better able to provide for their families, feeling valued at work.”

Employers need to strike a balance, as an increase in wages could have deleterious effects on the workforce.

“Generally speaking, an increase in wages should generate an increase in the quantity of work – the quantity of applicants and by extension, the quality of applicants who will leave employment at minimum wage. The most basic analysis of salary increase holds that, within certain limits, a salary increase will be positive for the organization because it increases the supply of labor,” the report states. “At some point, however, rising wages lead to substitution. For example, rising labor costs could drive increased use of technology to reduce labor requirements. It could also lead to lower demand due to higher prices resulting from increased labor costs.

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It would cost more than $1.1 million to implement a living wage across City Hall.

“Increases to 15 positions would be required if the company were a living wage employer using our 2022 rates,” the report noted. “Using the 2021 living wage for Greater Sudbury and current wage rates as of April 2022, the cost of full living wage certification would be approximately $1.16 million. At current student wage rates ($15.23 to $16.68), the cost of moving all student classifications to living wage is $525,000 per year. … The cost for all direct employees, excluding students or third-party employees, is $434,000 per year.

The cost of implementing a living wage for third-party service providers is estimated to be an additional $150,000 to $200,000 per year.

As the report states, it would take several years to reach a level of champion certification, “as collective agreements and service contracts are renewed, or new ones are introduced”.

McIntosh and the staff report both noted that living wages aren’t even enough for long-term investments, including saving for retirement and post-secondary education.

“Even $16.98 isn’t really enough, but it’s a start for our municipality,” McIntosh noted.

While Leduc made a motion to defer discussion of the matter, McIntosh was not heard of it and it was easily defeated. She said $16.98 isn’t even a high enough salary to really keep up with the cost of living.

“We have just learned that inflation is 6.7%. The job is supposed to get you out of poverty and I don’t think anyone is living very well on $15 an hour,” McIntosh said. “I really believe we have to make this decision now, because prices are going up.”

mkkeown@postmedia.com
Twitter: @marykkeown
Facebook: @mkkeown

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