New rules cost Calgary restaurateur $11K in stat holiday pay for staff

New labour laws that came into effect Jan. 1 have already hurt local restaurateur Michael Noble, who had to pay staff that day even though his eateries are always closed on Mondays.

Owner of The Nash and Notable starts year on sour note due to Alberta labour law changes

Chef Michael Noble owns Notable and The Nash, two Calgary restaurants that were hit hard by new labour laws that went into effect Jan. 1, 2018. (Anstice Communications)

 Michael Noble had a lousy New Year's Day.

The award-winning chef, who owns Notable and The Nash, took a big hit New Year's Day, when neither restaurant was open.

That's because, thanks to new labour laws that went into effect the same day, Noble was forced to pay his staff of 140.

"On New Year's Day, the hit to the combined two restaurants that I own and run was $11,000 in statutory holiday pay, on a day when I had zero revenue," Noble said, in an interview on the Calgary Eyeopener.

New guidelines for holiday pay

According to Alberta labour guidelines, all eligible employees are entitled to holiday pay, where they are paid the equivalent of a day's pay whether they work or not.

Previously, according to Noble, "the old law stated that the employer would pay the stat pay if an individual employee had worked five of the past nine days that the stat holiday fell on."

Starting Jan. 1, "the new law states that every employee in the business now receives five per cent of their last four weeks gross pay on the stat holiday … whether or not they ever work on that day of the week."

The Nash is one of two restaurants owned by Michael Noble, who says new Alberta labour laws cost him $11,000 on New Year's Day, which this year fell on a Monday, when his restaurants are always closed. (Anstice Communications)

All of it came due on a day that neither restaurant ever opens on.

"The history of my restaurants is that I've been always closed on Monday," Noble said. "I'm 100 per cent labour rules compliant, but the great thing about being closed on Mondays was that any stat holiday that fell on a Monday, I wasn't paying out a ton of stat holiday pay, because nobody ever works in the [restaurant] business on Monday."

Noble said the new labour laws will "mean over $50,000 this year combined, between the two restaurants."

Eligibility guidelines 

Noble's very bad day was an example of some of the challenges facing Calgary small businesses as the labour guidelines are revised, according to consultant Wendy Giuffre, who joined Noble on the Calgary Eyeopener on Monday.

"From a dollar perspective, certain businesses will be affected more [than others]," Giuffre said. "But from a business interruption perspective, it could be quite large."

One significant change reduces the period of time for an employee to become eligible for various leaves from one year to 90 days of service.

"Business interruption for some companies is going to be more of an issue than actual dollar cost — but then other businesses, like Michael Noble's business, the dollar cost is going to be significant," Giuffre said.

Voluntary benefits in peril

Noble says cutting staff to reduce costs isn't an option — and he hopes cutting benefits isn't either.

"I have the same amount of service staff that I've always had," he said, "because  it's an experience that people come to a restaurant for. So you hold the line."

Noble has voluntary benefits programs available for every employee who has been with the company more than three years, including hourly workers, which the new guidelines may force him to rethink.

"I know Tim Hortons [in Ontario] took a shellacking last week on social media, because they cut some programs — and from what I understand, those were voluntarily introduced by Tim Hortons. 

"It's a great example of if you want to keep your business open, you have to look at every aspect of it."

Absorbing the cost

Giuffre added that the perception that most Alberta businesses can simply absorb extra costs is inaccurate.

"You just have to look at the number of businesses that haven't made it — and that's probably not a fair assumption," she said.

"People are going to be looking at cutting other programs if they want to keep the same staff, same service [and] same quality of work, same quality of product," she said. "They're going to have to find other ways to cut [costs]."

With files from the Calgary Eyeopener