Why some businesses are paying staff a living wage, not just the minimum

At Massy Books in Vancouver, staff get sick days, benefits and wages that are based on the cost of living in one of the country's most expensive cities.

"I'm responsible for paying somebody a wage that's going to allow them to pay their bills and to support their families," said Patricia Massy, proprietor of the Indigenous owned-and-operated bookstore, which specializes in the works of underrepresented authors.

Massy Books is one of a growing number of businesses and organizations signing on to become what's known as living wage employers committing to paying wages corresponding to the costs of things like rent, food, transportation and child care in the region where they live.

The store was recently certified by Living Wages for Families BC, one of several advocacy groups across Canada pushing for a living wage. There are similar groups in Alberta and Ontario and a spokesperson with the Ontario Living Wage Network says more than 400 businesses and organizations in the province have committed to paying more than minimum wage.

"Employers want to know that they're not holding their employees in working poverty," Craig Pickthorne said.

WATCH | Patricia Massy on why she decided to pay her staff more:

Why a bookstore owner decided to pay her staff more

2 years ago

Duration 0:49

Patricia Massy, the owner of Massy Books in Vancouver, says she feels a responsibility to her workers.

Minimum wage vs. living wage

The living wage is calculated by determining how much a person in a given municipality needs to earn per hour in order to meet the essential costs of living and still be above the poverty line, with the chance of social mobility.

That means "enough money to put aside to, let's say, go to school, to get a better job, to get them to get a better income, or put aside money to start a business," said Minh Nguyen with the Montreal think-tank Institut de recherche et d'informations socioconomiques (IRIS).

Though the minimum wage is going up in some provinces, Nguyen said he sees the gap widening between those new figures and the living wage. In Montreal, Nguyen's 2021 report calculated the living wage to be $18 per hour, whereas Quebec's minimum wage is currently $13.50. Paying the higher, living wage, Nguyen said, would help a lot of workers.

"They have to think about how to get to the end of the month," he said. "If they actually earned a living wage, they would have more freedom. They could have more lightness in their lives. They could think about the future."

Employers, organizations and labour unions use Nguyen's annual calculation to determine employee wages or lobby employers for better pay.

Nguyen acknowledges that living wages will cost businesses more, but envisions a gradual transition to higher wages, using government subsidies to help businesses through.

At Perspectives Jeunesse, a Montreal non-profit focused on preventing teens from dropping out of school, the living wage calculation is used to determine employees' salaries, said executive director Louis-Philippe Sarrazin.

If I can't pay staff properly, there's no point in having a store.- Patricia Massy, bookstore owner

"When you pay people [a living wage] they feel more comfortable," he said. "You will keep them, you will be able to develop them and grow the company with them."

Yann Mailhot-Heroux, a school intervention worker at Perspectives Jeunesse, said he's left similar jobs in the past due to issues with pay and working conditions. But the higher wage, benefits and sick days, make him want to stay where he is now.

"When you don't get paid, you don't get recognized with your employer and you get paid minimum wage, it not only affects your mental health, but your motivation to go to work," he said.

Are higher wages the answer?

But some say hiking wages is not the most effective way to reduce the impact of poverty.

Ian Lee, associate professor at Carleton University's Sprott School of Business, said a living wage paid by a handful of businesses and organizations is not a sustainable approach.

Lee said governments have the power and tools to createtargeted social policies, such as a guaranteed annual income, to help those who most need it.

"Trying to drive up the wages [for] small businesses that already have very small profit margins, and they have high failure rates, I don't think it's the way to go," he said.

For Massy, though, it's worth the extra cost. She sees it as a way to recruit and retain employees, while keeping her business strong.

"If I can't pay staff properly, there's no point in having a store," she said.

One of Massy's employees, Jana Rankov, 24, said she would like the government to adopt policies that address the high costs of food and housing, but sees a living wage as one measure that makes her feel valued.

"There's no feeling of being disposable," she said.