On Revelstoke: The realities of paying a living wage

An conference in Revelstoke last week looked at what it would take for local businesses to pay a living wage.

Kevin Dorrius (right)

What would it take for Revelstoke businesses to pay a living wage? That was the dominant subject of conversation on day two of the economic development conference hosted by Community Futures  last week.

The day featured three key segments. First, a team of researchers from UBC Okanagan looked at what the impact of paying a living wage would mean for Revelstoke businesses. Second, Catherine Ludgate from the Vancity Credit Union spoke about what happened at workplaces that were living wage certified. The day concluded with an employer panel featuring four local businesses.

Where to begin?

I showed up on Thursday morning to hear what the researchers had to say about the impact of the living wage on Revelstoke. The living wage was calculated at $18.87 per hour in 2014. The rate was calculated based on what it would take for a family of four to be able to survive and participate in the community. According to Jill Zacharias, Revelstoke social development coordinator, 32 per cent of local households earn less than that.

“A truly sustainable, healthy community would be one in which wages matched the cost of living,” she said.

The talk by the academics from UBC Okanagan gave an overview of the potential impacts of paying a living wage. For workers, it would mean earning more and being able to participate more fully in the community, amongst many potential impacts.

For employers, it could mean much tighter profit margins, but could also lead to savings through better employee retention and reduced training costs.

In Revelstoke, the jobs that pay less than a living wage are overwhelmingly found in the service sector — food & beverage, accommodation, and retail.

The researchers focused on the impact of paying a living wage to restaurant and bar workers. They showed that restaurants would either need to increase sales by double digit percentages or raise prices to increase wages to $18 per hour. Unfortunately, the analysis didn’t factor in tips, something that pushes many restaurant workers (outside fast food) well above the living wage.

They didn’t look at retail or the hotel sector, where many low-wage people work, without the prospect of tips.

That gap was filled in by the employer panel in the afternoon, where Malcolm Bott from Universal Footwear, Steven Cross from Revy Outdoors, Angus Woodman from Downie Timber, and Sonia Ratte from La Baguette, talked about their strategies for compensating workers. Of the three, only Downie paid above $18.87 per hour. Downie’s strategy was fairly simple — pay union rates (despite not being unionized) and keep people working to keep them around. They also cover the cost of apprenticeships.

At Universal, where the starting wage is $15 per hour, Bott uses different tactics to support his employees. He uses a mix of  profit sharing, store discounts, and a health & wellness plan to boost compensation for employees. They get a share of profits if the store beats its sales from the same month a year earlier.

Bott said their sales have been up for 29 of the past 36 months compared to the previous year. “That tells me its working and they’re conscious of it,” he said.

At Revy Outdoors, owner Steven Cross pays his two full-time employees $14 per hour. He has decades of experience in retail, including managing Mountain Equipment Coop’s Toronto store, and said, “It’s been a huge frustration that I can’t pay more as a retailer.”

He pays for his employees season passes, lets them take powder mornings, provides a health & benefit program, and uses the store’s reward points to buy them flights home when he can.

Cross said he would need to increase sales by $72,000 in order to pay his employees a living wage.

“For us, that would be a 10 per cent sales increase overnight,” he said. “I don’t see that happening unless people make different choices.”

At La Baguette, which has expanded from six to 60 employees since it started in 2008, the focus is on what Sonia Ratte called their “key employees.” They are the year-round workers that are complemented by seasonal employees during the busy seasons.

“They get a better wage, more responsibility and they train our staff,” she said.

A variety of strategies are used to keep them happy. They work four 10-hour days per week, giving them three days off. She also allows them to shift between positions, so someone can spend time making gelato, and then move over to pastry making, then get into sandwiches.

Ratte also leads by example. “I’m passionate, I work hard for my business and I think people see that,” she said.

Staff get 50 per cent off at La Baguette and 10 per cent off at Le Marche, and they get a free meal every shift. They also get a season pass for RMR.

They pay out tips twice a year — at the end of ski season and end of summer, as an incentive for people not to quit early.  Finally, they aim to put on the best staff party in town.

All told, while starting wage is only $13-14 per hour, depending on the position, Ratte figures the benefits add up to bring it close to a living wage.

“There’s not much staff in Revelstoke, so you want to keep them when you can,” Ratte said.

One thing I took away from the panel was that three of the four businesses are very successful (the verdict is still out on Revy Outdoors, which only opened two years ago). They are established in the community and have a loyal customer base. That success allows them to attract workers and provide benefits that boost their compensation, even if their base pay isn’t at the level of the $18.87 living wage.

After the panel, I spoke to Kathy Burke from WorkBC, and asked her if she knew of any retailers or hoteliers that paid a base wage of $18 per hour. She couldn’t think of any, but one thing she did point out was that the wages for housekeepers, traditionally one of the lower-end and less desirable jobs in resort communities, was creeping up as hotels compete to attract workers.

It’s very difficult for many small businesses to pay better than a living wage. Often the owners don’t even pay themselves one. It was great to hear about ways businesspeople compensate for that.

 

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