Similar to trends in other areas of Canada, the minimum wage in the Northwest Territories will increase from $12.50 per hour to $13.46 per hour effective April 1, 2018. Minimum wage in Nunavut is currently $13.00 per hour.
Minimum wage rates in the Northwest Territories and Nunavut have historically been among the highest in Canada as a result of the high cost of living in northern and remote communities. Higher rates tend to fall in line with the policy objectives of encouraging economic development and creating financial incentives for residents to enter the workforce rather than rely on social assistance. Assessment of the appropriate rate has often proven challenging due to a lack of comparative information such as local consumer price indexes.
The minimum wage rate in the Northwest Territories is prescribed by regulation under the Employment Standards Act. In 2013, a Minimum Wage Committee (“MWC”) was established to review the rate every two years. The MWC is comprised of representatives appointed by the territorial government and drawn from business, labour and community organizations and is called upon to conduct extensive research into minimum and average wages across Canada as well as examine socio-economic factors particular to the Northwest Territories. Following a thorough review, the MWC makes recommendations to the Department of Education, Culture and Employment on options for maintaining or revising the minimum wage rate.
Prescribed under the Labour Standards Act, the minimum wage in Nunavut increased to $13.00 per hour effective April 1, 2016, making it the highest minimum wage at that time in Canada. Further increase is not anticipated over the short-term. The minimum wage in Nunavut is reviewed annually by the Department of Justice taking into consideration a number of factors, including: a comparison with rates across Canada, the cost of living in Nunavut, and consultation with business and community organizations. Results of the review are reported to the Legislative Assembly. As a result of recent amendments to the Labour Standards Act, future changes to the rate can be made by regulation.