Alberta restaurants say cumulative effect of ‘hostile policies’ is ‘death by a thousand cuts’

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Alberta restaurant owners say an ever-increasing minimum wage, the carbon tax, and federal small business changes have created a ‘hostile policy environment’ that has pitted employees and customers against employers.

“Members are concerned about the many federal and provincial policies that are increasing their costs at these economically troubling times,” said Mark von Schellwitz, vice-president of Restaurants Canada, a non-partisan, non-profit industry group.

“It’s like death by a thousand cuts as each level of government imposes new costs upon restaurateurs in isolation, without understanding the cumulative impacts of all of these changes on the small businesses, on the employees, and on their customers.”

READ MORE: Feds’ tax proposal unfairly casts business people in a bad light: Chamber of Commerce

The group said the restaurant industry accounts for nearly four per cent of the province’s GDP, employing over 148,000 Albertans at nearly 11,000 eateries and bars.

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In a news conference Friday morning, local Edmonton restaurant owners joined Matt Jeneroux, Conservative MP for Edmonton Riverbend and co-chair of the Alberta jobs taskforce, and Nathan Cooper, interim leader of the United Conservative Party, to talk about how government policies and increasing wages are putting stress on local businesses.

READ MORE: ‘Our hand is sort of being forced’: Alberta businesses face changes due to minimum wage hike

“This is not easy,” said Patrick Saurette, co-owner of The Marc, a French restaurant in downtown Edmonton. “People are quick to say, ‘Oh, just raise your prices,’ and ‘Just take this action. Have you not thought of this?’ Believe me, we’ve though of it.”

“In many cases, the federal and provincial governments, specifically, have pitted customer and employee against employer,” Saurette explained. “They throw the policy to us and we have to wrangle with it and put a lot of livelihood at threat. It’s not an easy position to wake up to each morning.”

At the beginning of October, Alberta’s minimum wage increased to $13.60 an hour, making it the highest in Canada. The hike is part of the NDP government’s three-year plan to reach a $15-an-hour minimum wage by 2018.

READ MORE: Does $15 minimum wage kill jobs?

Saurette said if the minimum wage is going to reach $15 an hour, he wants to see incentives to hire youths for first-time jobs.

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“Because if we’re going to hire somebody at a higher rate, I want to make sure they come in the door pre-loaded,” said the French restaurant co-owner.” It’s going to be very difficult to look at those first-time jobs with great sincerity any longer.”

Chris DeCock, president and co-founder Hudsons Canada’s Pub, said municipal, provincial and federal governments make changes in isolation.

“People aren’t understanding and the governments aren’t understanding the cumulative effect,” DeCock said. “We do because we see it, because we’re impacted by all three levels.

“But municipal is just running their municipal policies that are negatively impacting us, then provincial are running provincial policies — the biggest being minimum wage and carbon tax — that are just punishing us. And now, on top of it, if the feds come in, and it’s a 1-2-3 punch that industry just absolutely cannot sustain.”

“The plea is: stop looking at it from one layer and please start looking at across the board from all three layers on how it’s impacting our business.”

DeCock said the financial difficulties will only get worse when the minimum wage goes up to $15 an hour next year.

“All of it is just so fast, so quick. The timetable to adjust to these things is just so unreasonable.”

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READ MORE: Restaurants say they will cut hours, staff due to hike in Alberta minimum wage

Last week, the UCP held another news conference with local chef Paul Shufeldt. He was the executive chef at Century Hospitality Group for 10 years before leaving to open his own restaurant, Workshop Eatery, two years ago. The farm-to-fork upscale restaurant serves seasonal fare, mainly from local sources, and even grows some of its own food.

Shufelt noted he began his career as a dishwasher making minimum wage. He said in his southeast Edmonton restaurant, only two groups of employees earn minimum wage: dishwashers, who he noted are usually under 18 and live at home with family, and servers, who make tips. “As the man who signs their gratuity cheques bi-weekly, I can tell you that their income is between double and triple of that of what the NDP deems to be a fair living wage.”

Shufelt said his chefs and cooks make between $15 and $19 an hour, working eight to 12 hour days, five to six days a week. When it comes to wages there’s only so much money to go around, and if he had his way, he’d be giving more to his back-of-house kitchen staff who don’t earn gratuities.

“I’d love to give them a raise, but this government has forced my hand to ensure that we’re giving money to people that I feel don’t necessarily deserve it in the same way that some of those other employees do.

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“They’re forcing my hand to give raises to people that they feel need them,” Shufelt said.

WATCH: Edmonton chef Paul Shufelt joined Global News Morning in 2016 to argue minimum wage increases are harmful to small businesses.

Click to play video: 'Edmonton chef argues minimum wage increase bad for business'
Edmonton chef argues minimum wage increase bad for business

“Small business owners are having their hands tied as a direct result of policies that we didn’t ask for, and we can’t afford,” Shufelt said.

“There are razor-thin margins for small businesses across our province, and the government just doesn’t seem to realize that when they introduce policies, they are cutting directly into that margin that can mean the difference between closing and keeping the doors open.”

Shufelt is among the several business and industry groups — including Restaurants Canada — and opposition critics who have been urging Rachel Notley’s government to rethink the increases, saying the wage hikes are too much too fast and threaten to further cripple businesses still reeling from the protracted slump in oil prices.

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READ MORE: Restaurant industry has minimum wage ideas for Alberta

Last week, the federal Liberal government announced a small business tax break, which appeared to be in response to major backlash and outrage across the country over proposed tax changes announced in July.

At a restaurant in a Toronto Suburb, Justin Trudeau announced the small business tax rate will be lowered from 10.5 per cent to nine per cent by Jan. 1, 2019.

A new poll conducted last weekend and released Thursday by Abacus Data shows while the Liberals are still the most favoured party in Canadian federal politics — the Conservatives have gained support in recent months. The polling organization said reaction to the proposed tax change has been a drag on Liberal support.

READ MORE: Conservatives gain support as controversies plague Liberals: poll

— With files from the Canadian Press and Maham Abedi and Meaghan Craig, Global News

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