Advertisement

Premier Wynne to blame for Tim Hortons cutbacks, not franchise owners: small business group

The Breakdown: Kathleen Wynne calls Tim Hortons heir a ‘bully’
The Breakdown: Kathleen Wynne calls Tim Hortons heir a ‘bully’

The head of Canada’s largest small business association is taking Ontario Premier Kathleen Wynne to task after she lambasted the children of Tim Hortons’ billionaire co-founder for cutting back employee benefits at their Cobourg, Ont. location, in response to the province’s increased minimum wage.

On Thursday, Wynne said of Tim Hortons franchise owner Ron Joyce Jr. that “if Mr. Joyce wants to pick a fight, I urge him to pick it with me and not those working the pick-up window and service counter of his stores.”

READ MORE: Premier Wynne accuses Tim Hortons’ founders’ children of bullying employees

Dan Kelly, head of the Canadian Federation of Independent Business (CFIB), says the Wynne Liberals were repeatedly warned that increasing the minimum wage would hurt workers, but went ahead with the move anyway for purely political reasons.

Story continues below advertisement
“Business owners had asked for a full impact assessment of the minimum-wage change to determine what the net effect would be, [but] the government refused to allow that to happen,” Kelly told Global News.

“I don’t think they give a care in the world as to how this is going to affect the business community. All they cared about are the optics of this, to flex their credentials with union members in order to try and win the next election,” he continued.

“This is a completely crass political move, one that they knew — or had to know — would have some negative repercussions, especially in the short term.”

Kelly explained that the minimum-wage hike represents a massive increase in costs for businesses, and that the negative consequences on workers are inevitable.

“This is a huge increase in the payroll budget for every business that pays at or near the minimum wage… and so it has to come from somewhere. Businesses have to have some degree of profit, otherwise why would the business owners continue to exist and keep the business afloat at all?” he said.

WATCH: Effect of new minimum wage begin to surface

Effect of new minimum wage begin to surface
Effect of new minimum wage begin to surface

“Businesses have routinely looked at ways to reduce cost and increase prices where they can, and I’m sure it’s going to be a combination of those things that’s going to be the end result of this,” he added.

Story continues below advertisement

“But the majority of it will fall on the payroll budget and there’s only a few ways that that could happen — either a reduction in the number of jobs, the hours that they’re offering or the associated cost of labour, which are benefit programs or other perks that the employer may have offered in the past.”

READ MORE: Lost jobs, cut hours, no paid breaks. Do minimum wage hikes hurt workers?

Still, many Canadians took to Twitter to express disappointment and ire at Tim Hortons.

Among them was Niki Lundquist, a Whitby, Ont. labour lawyer who is set to run for the NDP in the June provincial elections.

Lundquist says she only tweeted to express her personal viewpoint, but that her remarks caught fire for a reason.

“I think it’s because it’s intuitive to people that there’s something fundamentally wrong with employers not taking steps sooner to remedy the situation of low-wage labour, and that when government steps in to intervene on their behalf, that the immediate response is to cut from workers as opposed to consider other ways that this cost can be managed,” Lundquist told Global News.

READ MORE: Cuts similar to some Ontario Tim Hortons locations could come to B.C., says analyst

Lundquist said that while she appreciates that business owners would need to take some measures to deal with the minimum-wage increase, she was “appalled” at what she says is the needless haste in passing the costs down to low-wage workers.

Story continues below advertisement

She said the increase in wages would have been offset by increased consumer spending on the part of workers, which in turn would benefit local businesses.

“The people that are getting these [wage] increases are people who are low-wage workers, who are known to spend a high proportion of their income locally,” she said. “So the idea that [businesses] are not going to reap any benefit — they’re not waiting to see if there’s any benefit.

“Their immediate response is to cut from workers, the very people whom the wage increase is supposed to help, the very people who have been lagging behind for decades because businesses didn’t do what they should have done all along.”

Lundquist said that while she has made a personal decision “to not give my consumer dollars to a company that’s downloading the costs onto the backs of workers,” she isn’t necessarily calling for a boycott, but she does want the owners to rethink their measure.

READ MORE: 60,000 job losses by 2019 due to minimum wage increase: Bank of Canada

Many Canadians do seem to like the idea of a boycott however, with the hashtag #BoycottTimHortons trending nationally on Twitter on Thursday morning.

Kelly said he isn’t a fan of calls for a boycott because this would only serve to compound workers’ problems.

“Canadians need to understand that business owners, whether they’re part of a chain or purely independent, are going to have to address this cost,” he said.

“Even those that are sympathetic for a $15 minimum wage — and I understand why many would be sympathetic towards paying a $15 wage, or $14 now — would have to admit that having such a huge increase in such a short period of time, 32 per cent over 18 months, makes it impossible for any reasonable person to try and accommodate without some serious consequence.

Story continues below advertisement
“[Boycotting] will further hurt the very employees that they pretend to be sympathetic towards… they’re certainly not going to be helping those employees they pretend to care about.”

WATCH: Ontario passes labour reforms, hikes minimum wage

Ontario passes labour reforms, hikes minimum wage
Ontario passes labour reforms, hikes minimum wage

Lundquist says it’s important to remember that the workers in question are some of the most vulnerable in the economy.

“We’re talking about the very lowest-wage workers in the economy, the people who are struggling to get by, and a lot of those are women and single parents,” she said. “These are not jobs that we’re talking about anymore for just teens. It’s a huge, vast number of people in the economy now who are forced into minimum-wage labour, and the minimum wage hasn’t kept pace with inflation.

“It’s so obscene that the response immediately — when there’s a shift to actually improve the lives of workers — is to put that cost back on workers so that they don’t see the benefit.

“There’s something terribly wrong with that.”