Province says it is aware of the problem of unpaid wages and is taking steps to fix it
Simranjeet Kaur says she was already having trouble making ends meet when her employer at an Ontario transportation company allegedly didn’t pay her the wages she was owed.
The Brampton resident says she worked for four months and should be paid a little more than $7,000.
According to the latest data from the Ministry of Labour and the Ministry of Finance, that money is only a small part of the $9 million in wages that advocates say employers in Ontario did not pay out in the 2021-22 fiscal year. Two Toronto-based groups, Downtown Legal Services and Parkdale Community Legal Services, asked for it under the Freedom of Information Act (FOI).
Experts and people who have been affected by wage theft are worried that not paying workers has become the norm and is getting worse.
The Ministry of Finance in Ontario says it knows that unpaid wages are a problem and is taking steps to help solve it.Advocates say that the provincial response is not nearly enough, and that for some workers, the measures come too late.
Kaur said that because she wasn’t getting paid, she had to ask her friends for help.
“My friends paid for everything, including groceries, rent, car payments, and insurance,” she said. “I asked them for help, and now I’m giving it back to them.”
A group of immigrants in Ontario called Naujawan Support Network fights wage theft by pushing for stricter rules that make employers pay workers what they’re owed. They help people like Kaur who file complaints with the province about wages that haven’t been paid. They also help people like Kaur who file complaints with the federal government.
In its just over two years of operation, NSN says it has helped 74 of its members get back $323,209 in wages they were owed. Employers who are accused of stealing wages are met with letters, protests, boycotts, and social media campaigns to put pressure on them.
There is growing worry that wage theft is becoming common
Anmol Sanotra, a member of NSN, says that wage theft is more likely to happen to newcomers, but that everyone is affected by the problem.
“It’s interesting that everyone, not just international students or people with work permits, has gotten in touch with us,” he said.
NSN says that the information it got through FOI requests shows that the number of prosecutions for not following orders to pay from the Ontario Ministry of Finance has dropped sharply, from 79 in 2017-18 to 12 in 2021-22. In 2020-21, only two people were charged.
In a letter to the Ministry of Labour last month, NSN asked for a meeting to talk about wage theft. They said that the way these employers treat the ministry seems to be something they all have in common.
“They regard the ministry as weak and ineffective — an institution that cannot enforce the orders it issues, and that will not prosecute employers who ignore the orders,” the letter read.
Claims reached historic low during pandemic: ministr
According to the data interpreted by NSN, the number of investigations into employment standards completed by the ministry dropped by roughly 50 per cent from 2014 to 2021.
According to Sanotra, the group wanted to know why there was such a “shocking” drop. He said that when they eventually met with ministry officals late last month, they were told that the ministry was aware of unpaid wages being an issue, but didn’t provide specifics about how it was being addressed.
He says if the ministry knows about wage theft, “it’s their job to investigate and plug those loopholes that are being exploited by the employers.”
The Ministry of Labour said in an email to CBC News that it has recovered more than $110 million in wages and other money owed to employees over the last five fiscal years.
“Employees are entitled to be paid for the work that they do and we investigate any and every claim for unpaid wages,” the email said.
It said one reason for the declining numbers of completed investigations, and subsequently, the number of prosecutions, is that during the COVID-19 pandemic, it received a historically low number of claims.
According to a media statement released earlier this month, the ministry said its inspections have shown that multiple temporary agencies in Ontario are illegally paying people below the minimum wage and denying other basic employment rights to gain an unfair competitive advantage over law-abiding agencies.
As a step to counter this practice, the announcement says roughly 2,300 temporary help agencies and recruiters of temporary employees across the province will require a licence to operate as of Jan. 1, 2024.
While applying for the licence, the agencies will be required to submit $25,000 in the form of an irrevocable letter of credit that can be used to repay wages owed to employees.
More enforcement needed 
Leah Vosko, a political science professor at York University who researches labour rights, says more needs to be done to ensure minimum employment standards are followed, especially as the cost of living rises.
“It’s shocking to me that employees for whom there are orders to pay wages often don’t receive their wages,” she said via email.
Often, there aren’t enough resources to make sure rules are enforced, Vosko said, adding that when those minimum standards aren’t met, it can become something that’s seen as normal and acceptable.
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In Kaur’s case, she says she knew something wasn’t right.
She came to Canada from India in 2017 and started at Northedge Logistics, a transportation company in Caledon, Ont., in 2021. She says she worked there for two months before quitting.
Kaur alleges she wasn’t paid any of her wages when she left, despite multiple efforts to get in touch with the employer.
“There was a lot of mental stress.”
Pretty Grewal, director of Northedge Logistics, said via email that all allegations of wage theft were false.
“We haven’t kept a single dollar for anyone, but in this case it’s a matter of ethics, integrity, and the trust we put on them when we hire,” Grewel’s email said. “Now, they have put false allegations on us so we are dealing with the proper authorities.”
What happens after a complaint is mad
Kaur says her case has been under investigation for more than a year now under the Federal Labour Program.
The Labour Program, administered by Economic and Social Development Canada, said it couldn’t comment directly on Kaur’s case, citing confidentiality under Canada’s Labour Code. However, the program’s website explains that once federally regulated employees file a complaint, if it’s found admissible, the Labour Program will investigate.
If the complaint is founded, the program contacts the employer and asks it to voluntarily pay wages owed. Failing that, the program can issue a payment order, a legal document filed in the Federal Court of Canada. This means it has the same effect as if it were a judgment obtained in that court.
The government publicly lists the cases where the total amount owed exceeds $5,000. Since 2020, there have been 41 employers with payment orders filed in Federal Court.
In an emailed statement, the Labour Program said it is “taking action against non-compliant employers who are short changing their employees through tactics like wage theft,” the email said.
Scott Blodgett, spokesperson for Ontario’s Ministry of Finance, said in an email that the ministry makes every effort to recover what’s owed to claimants under the Employment Standards Act. If employers don’t pay up, he said the ministry “may take legal actions to collect monies owing.”
NSN’s Sanotra says the government should be doing a better job.
“The ministry has the authority, it has the options,” he said. “It’s not our job to stand up against the employers.”