The Yukon Chamber of Commerce has fired off a strongly-worded letter to the territorial government over the increase in the minimum wage and proposed co-paid program for employees’ sick days.

“COVID has wrecked the balance sheets,” Rich Thompson, the chamber’s past chair, said Monday afternoon. “It’s terrible timing.”

In the letter, obtained by the Star, the chamber stated:

“We are writing you to lodge concern with the ‘perfect storm’ that is being experienced by small and medium enterprises (SMEs) in the Yukon with a focus on the actions, policies, and proposals by the Government of Yukon (YG) that are crippling business at a time when the COVID-19 pandemic has already eroded sales and evaporated profits for many SMEs in Yukon.

“At a time when support, austerity and common sense is required from our government, we are experiencing actions that are completely insensitive to businesses and the economy.

“We provide the following examples of government-led policies, actions, proposals and consequences that are increasing the cost of doing businesses at a time when many businesses are hanging on by a thread and feel that their government is ‘kicking them while they are down.’”

The chamber focused on the proposed paid sick leave program recently presented to the government by a committee.

“The YG is considering recommendations from the Making Work Safe Panel to introduce a co-funded paid sick leave program that would be imposed on the private sector,” writes the chamber.

“Acknowledging the difficult situation that some employees without sick leave benefits found themselves in due to COVID pandemic-related absences from work, the imposition of a statutory obligation to offer 10 days of sick leave would create an additional immediate burden of a 3.8 per cent increase in payroll expense, reduced efficiency and increased administrative costs.”

The chamber says it’s opposed to any proposal that generates a significant increase in the cost of doing business for SMEs.

“Many Yukon private sector employers currently extend reasonable sick leave benefits to their employees – this proposal would change this environment from an employer-managed benefit to an employee entitlement no longer under the control of employers,” the organization writes.

The chamber also pointed to the economic update released by the Yukon Bureau of Statistics in December 2021.

It shows public sector employment in 2021 grew by 1.8 per cent (10.5 per cent in December) while the private sector/self-employed segment over the same period has shrunk by 1.8 per cent.

“This is a highly disturbing trend that confirms that government continues to grow in spite of commitments by government to diversify the Yukon economy,” the chamber points out.

“This growth in the public sector is seeing employees leaving the private and self-employed sectors to join the public sector in increasing numbers, which has resulted in increased costs for SMEs to recruit and retain employees in a market that is struggling to attract and retain employees.”

The chamber wrote it also isn’t happy with the increase to the minimum wage introduced by the government as part of its April 2021 Confidence and Supply Agreement with the Yukon NDP. It will rise from $15.20 to $15.70 per hour on Apr. 1.

“The minimum wage in Yukon has increased by 36 per cent in the past five years – at triple the rate of inflation and the largest increase in over 50 years,” the chamber says.

“A report commissioned by the YG clearly states that the increase in minimum wage will have minimal impact on poverty.

“The greatest defect with minimum wages is that they are poorly targeted towards poor households. Most minimum-wage earners aren’t poor (e.g., students and youths living with their parents), and many poor don’t earn minimum wage (Government of Yukon, Economic Evaluation of Proposed Changes to the Minimum Wage, 2020).”

Very little was spared the chamber’s wrath in the letter. Representatives also took aim at liquor sales and electrical rates, for example.

“The government pulled back on the discount on liquor offered to licensees, but continued to introduce and maintain restrictions that limited the ability of these businesses to remain open at full capacity,” it writes.

“We are still in an environment where the liquor pricing policy does not consider competitive retail pricing and margins that would enable licensees to be achieve reasonable profits while offering Yukoners fair pricing.”

The government has not responded to a proposal from the chamber’s food and beverage and cannabis committee to privatize liquor sales in the Yukon, “which would provide enhanced opportunities and some relief for this sector,” the the chamber writes.

As for electrical rates, “they continue to rise, increasing the cost for SMEs. The current rate application and Yukon Utilities Board governance model has enabled over-earning by utilities and lack of predictability in costs for SMEs.

“SMEs in Yukon who are already facing lost revenues, struggling to stay open, with many facing bankruptcy, are feeling under siege from their government.

“We contend that a key value that the YG should adhere to is ‘do no harm.’ Instead, we are seeing action and proposals that directly increase the cost of doing business,” the chamber comments.

“The most recent proposal to introduce paid sick leave suggests that our government is out of touch with the fragile circumstances that many Yukon businesses are experiencing.”

Thompson added, “Business are absolutely being brutalized.

“They’ve exhausted their resources, and the government supports aren’t what they were. It’s not the right time to consider these measures.”

In the letter, the chamber writes: “While there is no question that your government responded well in supporting businesses during the initial onset of COVID lockdown impacts, and in fact, in some ways led all regions in Canada with their proactive and timely program responses, it is now clear that there has been a shift to a complete lack of understanding the challenges SMEs face as they try to recover from COVID lockdowns and related impacts.

“We feel a government that has shown an understanding earlier in this crisis and responded with programs and support that made a difference, would want to avoid undoing all the good that was done.”

The chamber is asking for a meeting with senior cabinet ministers for an open discussion about moving forward “in a way that supports business sustainability, considers the impact of policies and programs on business and how industry can support and contribute to our journey out of this pandemic.”

The chamber would invite its board and some senior industry leaders to any session.

Jacob Wilson, a cabinet communications analyst, said, “We appreciate the concerns of local businesses and the challenges they are facing as a result of public health measures to mitigate the impacts of COVID-19 in the territory.

“The Yukon government has been a national leader in supporting local businesses throughout the pandemic. Premier Silver spoke directly with Mr. (Denny) Kobayashi and Mr. Thompson in recent days to reassure them that the Yukon government will continue to support the business community as we move forward on the path to recovery.”

Wilson added that Economic Development Minister Ranj Pillai “is also in regular dialogue with business leaders throughout the territory to understand the pressures they are facing and adapt government supports to meet their needs.

“A meeting is being set up with the Yukon Chamber of Commerce to discuss their concerns and how we can work together to ensure local businesses continue to benefit from the territory’s strong economic growth.”