Department of Post-Secondary Education, Training and Labour
Chestnut Complex
P. O. Box 6000
Fredericton, NB
E3B 5H1
Via email: trevor.holder@gnb.ca
Dear Minister Holder:
Re: Bill 27 - An Act to Amend the Employment Standards Act
We are writing to you jointly regarding Bill 27 on behalf of our members as this is a cross-industry issue that would affect our entire memberships and indeed, businesses and organizations throughout the province. The bill calls for amending the Employment Standards Act to replace the current requirement that employers provide five unpaid sick days to ten paid sick days annually. It can be difficult to evaluate policy decisions such as paid sick leave while still in the shadow of the pandemic, but employers understand very well both the value and cost of paid sick leave. While we appreciate the good intentions behind the bill, it will have significant ramifications for the provincial economy that may not have been fully considered.
Workforce
As has been well established, employers are facing a very tight labour market now and for the foreseeable future – they are doing whatever they can to recruit and retain employees. Many businesses as well as not-for-profit and charitable organizations that do not currently offer paid sick leave would if they had the financial and human resource capacity.
Benefits such as sick leave are becoming an increasingly important employee attraction and retention tool and act as a differentiator to be an employer of choice. Similarly, employers are providing healthy and safer working environments since the pandemic and many offer work-from-home options for employees to avoid being sick or getting others sick.
In our opinion, paid sick leave should be left to the market to decide and not have this competitive advantage swept aside by the government. Additionally, because the Employment Standards Act prevails over collective bargaining agreements and sick leave is a negotiated piece of these agreements, essentially all (or most) collective agreements in the province would be caused to be renegotiated.
Cost
10 days of paid sick leave would be approximately equivalent to 4% of annual salary (the same as vacation pay). When also considering that these employees would have to be replaced for their missed shifts, that number essentially doubles to potentially increasing their payroll costs by 8% for individual employers. As has been well-documented, employers are facing a difficult cost environment for the foreseeable future. Inflationary pressure, a significant minimum wage increase in 2022 outside of the normal statutory review process, CPI increases, EI expansion, increasing carbon taxes, property taxes, and more. To put this additional cost on employers now would threaten the economic growth that the province has seen recently.
We can also take a broader view and look at the total provincial impact of 10 paid sick days per year, using the total number of workers and average wages and hours worked data from Statistics Canada :
Hourly Paid Employees
Number of hourly paid employees: 208,245
Average hourly earnings: $26.48
Average weekly hours worked: 32
- These figures total approximately $35 million per day. Given an average of 260 days worked per year, the cost is $9.1 billion
Salaried Employees
Number of salaried employees:115,700
Average hourly earnings: $39.27
Average weekly hours worked: 36.3
- These figures total approximately $33 million per day. Given an average of 260 days worked per year, the cost is $8.5 billion.
It may be instructive to consider that only two other provinces have legislated paid sick leave – British Columbia with five and Prince Edward Island with one. At a minimum, New Brunswick must maintain competitiveness vis-a-vis other provinces, not only for current employers but also for the government’s own investment attraction purposes.
It would be appropriate to consult with the business community before even considering legislation such as this, given the potential impact on employers throughout New Brunswick. Employers could bring perspective and context to such considerations as the inability to carry-over days, how they might be accumulated (based on hours worked vs. employment), if part-time employees would be included, how the number of employers each year would impact an employee’s accumulated sick time, etc. The private sector is responsible for economic growth, creating jobs and increasing the wealth / prosperity in the province that ultimately funds government to provide the services that citizens need. Governments, on the other hand, are responsible for creating conditions that will either facilitate or hamper this growth and ten paid sick days would fall into the latter category. We ask that the government not pass Bill 27 or, alternatively, provide a robust opportunity for input and consultation from employers.
Sincerely,
Krista Ross, CEO, Fredericton Chamber of Commerce
David Duplisea, CEO, Saint John Region Chamber of Commerce
John Wishart, CEO, Chamber of Commerce for Greater Moncton
Sheri Somerville, CEO, Atlantic Chamber of Commerce
cc: Hon. Blaine Higgs, Premier, Province of New Brunswick
cc: Hon. Ernie Steeves, Minister of Finance, Province of New Brunswick
cc: David Coon, Leader, Green Party of New Brunswick
cc: Susan Holt, Leader, Liberal Party of New Brunswick
cc: Hon. Ted Flemming, Chair, NB Legislative Amendment Committee
