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Ontario businesses face anxiety ahead of coming labour-law reform

Automatic Coating Ltd.vice-president Jocelyn Williams Bamford is worried changes to Ontario labour law will lead to a loss of competitiveness for her Toronto company and losing business to the United States.

Mark Blinch/The Globe and Mail

At Quinn's Steakhouse & Irish Bar, Mike O'Connor keeps running numbers in his head.

In the coming weeks, the Ontario government is expected to reveal the results of its Changing Workplaces Review. Like many Ontario business leaders, Mr. O'Connor is not sure what to expect. The two-year project, intended to catch labour legislation up with two decades of economic and labour shifts, proposes to legislate better conditions for part-time, contract and other precarious workers.

Many potential policies are under review, including rigid advanced scheduling that Mr. O'Connor and his colleagues feel could hinder both management and employee flexibility, and ramp up costs by forcing workers to come in on days they want off or when they're not needed.

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"Any increase to the cost of operating the business is going to affect us," says Mr. O'Connor, a four-decade dining veteran and general manager of Quinn's, at the Sheraton Centre Toronto Hotel.

"Our margins are 2 or 3 per cent. Everything has gone up. … Peoples' incomes aren't going up either, so we can't continue to raise prices and expect people to come."

Since last July, when the Ministry of Labour released its interim report on the labour-law review, stakeholders have been mulling the countless possible outcomes.

Many Ontario companies fear that some options on the table would have drastic consequences for costs and competitiveness, hindering their ability to hire and operate there in the first place.

On top of mandatory advanced scheduling, ideas under consideration include increasing minimum vacation allotments, changing emergency-day benefits and enforcing paid sick leave and mandatory wage parity for similar work done by full-time and part-time, temporary or contract employees of similar qualifications. Union organizing could also become easier.

The Ontario Chamber of Commerce says some of the policy options would hurt bottom lines for businesses of all sizes and industries. The hospitality, manufacturing, agriculture and temp-agency sectors are among those that would be most affected by these changes.

Larger companies, including multinationals, might feel less inclined to stay in the province, while small businesses' bottom lines could be immediately threatened, says Karl Baldauf, the chamber's vice-president of policy and government relations.

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While no one recommendation would be "catastrophic," he says they could have a cascading effect on operations: "Ontario's employer community is seeing a layering of input costs and increased regulations."

Asked how the final results might affect businesses' well-being, Labour Minister Kevin Flynn said in an interview that there are options "that either side would find fairly radical," between both business and labour. "I wouldn't read into that, that you're going to have a series of radical reforms. There's an understanding that this has to be balanced."

Craig Kowalchuk, the restaurateur behind Emma's Back Porch and the Water Street Cooker in Burlington, Ont., says the interim report has "no sense of hospitality." Some of its rigid advanced scheduling propositions, he says, could limit his ability to have employees on call, which could lead to costly overstaffing and limit workers' tip incomes, too.

Many hospitality operators are already struggling to sustain 1-per-cent margins with growing food, electricity and other costs, says Tony Elenis, chief executive of the Ontario Restaurant Hotel and Motel Association. "Any [cost] increase at all is going to unintentionally hurt jobs," he says.

At Automatic Coating Ltd. in Toronto, vice-president of sales and marketing Jocelyn Williams Bamford is concerned that the review might give unions easier access to employee contact information, which would tip the employer-employee relationship in her open shop into an "unfavourable position."

As a manufacturer, she's worried about losing business to the United States from rising costs. "Adding more legislation and additional cost does not make us competitive in a global marketplace," Ms. Williams Bamford says.

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Andrew Mitchell, president of 75-employee food manufacturer Select Food Products Ltd. in Toronto, says that "for manufacturing sectors with long-term contracts, where price is based on raw materials and not so much on labour or overheads, it becomes a huge issue.… Any company would have a hard time passing this on to their customer."

The ministry says it wants to align working benefits with the shift in how Ontarians are employed. Growth in part-time jobs outpaced full-time work between 2000 and 2015; and in 2016, Statistics Canada reports, 74,000 of the 81,000 jobs added in the province were part-time.

The Ontario Federation of Labour sees little benefit in defending this rise. "That's no way for people to have to survive," says Chris Buckley, its president. "The outdated laws do not adequately reflect today's labour climate."

"How many people do we know who say they can't even afford to move out of their parents' houses and start their life because of the employment environment in Ontario?" Mr. Buckley asks.

Companies that hire many of the people who work part-time, however, insist that stiffening regulations might make life more difficult. "Having a flexible schedule with our staff … makes them motivated and ready to work, because we've made our schedule around their availability," Quinn's Mr. O'Connor says.

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About the Author

Josh O’Kane is a reporter with The Globe and Mail's Report on Business. Since joining the paper in 2011, he has told stories from New Brunswick to Nairobi. In his spare time, he writes about music and the industry around it. More

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