How minimum wage works

Minimum wage is the lowest amount employers can pay their employees by law.

The hourly minimum wage is the same for adults, liquor servers and young people. There's a separate weekly and monthly minimum wage for some salespersons and domestic employees. Learn more about minimum wage rules and exemptions.

About 254,000 Albertans – 11% of all workers – were earning less than $15 per hour. More than half of them worked full-time and nearly 40% are parents.

Low-income earners should be able to support their families without having to visit the food bank. That’s why we changed Alberta's minimum wage to $15 on Oct. 1, 2018.

Table 1: Minimum wage rates

Employee type Oct 1, 2017 Oct 1, 2018
General $13.60/hour $15/hour
Salespersons
(including land agents and certain professionals)
$542/week $598/week
Domestic employees
(living in their employers home)
$2,582/month $2,848/month

Why Alberta moved to $15/hour

A higher minimum wage can help:

  • reduce poverty
  • lessen the burden on social support programs
  • improve the quality of life for vulnerable people

It can also improve employee satisfaction, which can help employers reduce staff turnover, recruitment and training expenses. Higher levels of employee satisfaction and productivity may improve profits and help expand business.

Recent studies in Canada and the US show that gradual increases to the minimum wage do not have a negative effect on overall employment levels.

Positive effects of raising minimum wage include increased consumer spending, better health outcomes and lower wage inequality, especially for women.

Who made less than $15/hour in Alberta?

About 254,000 people, or about 11% of employees in Alberta, earned less than $15 an hour.

  • 63% of low-wage earners are female
  • 37% are parents
  • 53% work full-time
  • 76% have permanent jobs

For detailed information, see the Alberta Low Wage Profile: April 2017-March 2018.

Information for employers

We phased in minimum wage increases to ensure employers are aware of the timing well in advance so they can plan accordingly. To further assist employers, we have:

  • reduced small business tax rates from 3% to 2%
  • introduced the Enhanced Innovation Voucher and Small/Medium Enterprises Support program
  • created the ministry of Economic Development and Trade to provide Alberta’s private sector job creators with a one-stop shop for economic development and diversification
  • dedicated $34 billion over the next 5 years to support modern, efficient infrastructure for Alberta families and businesses
  • provided more capital for ATB Financial and Alberta Enterprise to encourage investment in Alberta businesses
  • expanded the mandate for the Alberta Investment Management Corporation
  • reinstated the Summer Temporary Employment Program
  • implemented the Canada-Alberta Job Grant, a six-year initiative with the Government of Canada to support employers in building a strong workforce through better trained workers
  • introduced the Capital Investment Tax Credit to encourage investment and support job creation

What is a living wage?

A living wage isn’t the same as the minimum wage. A living wage is an estimate of what workers need to earn to cover the actual costs of living in a specific community.

The living wage is calculated as the hourly rate at which a household can meet its basic needs, once government transfers have been added to the family's income and deductions have been subtracted.

The living wage gets families out of severe financial stress by lifting them out of poverty and providing a basic level of economic security.

Some sources set that figure as high as $18/hour or more, depending on the region.

Raising Alberta’s minimum wage to $15/hour is a reasonable step that is meaningful for low-income earners and gives employers and organizations time to adjust.

A living wage:

  • enables working families to have sufficient income to cover reasonable costs
  • ensures that families are not under severe financial stress
  • is a conservative, reasonable estimate
  • promotes social inclusion
  • supports healthy child development principles
  • engenders significant and wide ranging community support
  • is a vehicle for promoting the benefits of social programs such as childcare

For more information, see Living Wage Canada’s index of living wages in Alberta.

Minimum wage research

There has been ample research on the effects of raising the minimum wage. Recent studies include: