Does My Business Have to Follow Minimum Government Legislation?

Your business must follow all Government Legislation but you have to remember that legislation is only the minimum. If this sounds like an opportunity you are right!

Every business and organization that employs people in Alberta and Canada must follow all Provincial and Federal minimum government legislation. Although, there is an opportunity for a business or organization to do better than the minimum to improve organizational culture, attract better employees, and give better customer service all to increase profitability.

How It Was

Since the start of the industrial revolution employees and employers have been in a fight over wages, hours, benefits, and everything else business-related. Before the industrial revolution, there were very few big businesses and most people supported themselves with farms, hunting, gathering, crafts, and everything cottage industry related.

How It Is

Today, businesses for the most part still see employees as the adversary or problem to be fixed. Employees should be looked on as the partner and driving force behind a successful business. Happy employees will lead to happy customers and that means a stronger business.

Workers

You Business Opportunity

So there is a big opportunity for a business to exploit and look good for employees. Knowing that legislation is just a minimum, businesses can look good if they always beat the minimum. But wait…what if your business can’t operate is you beat the minimum?

Bad for Business?

If your business can’t operate if you beat the minimum then your business structure needs to get fixed. This does not mean your business will fail but it is an indication that you can improve the business. Every negative issue you discover has a positive resolution if you can get creative and get past your own biases or preconceptions.

Too Big to Fail Myth

This always makes me think about the “too big to fail” class of businesses. Our government gets convinced that a business is so vital to the economy that they should give free money to millionaires and billionaires. This type of business is a myth with good lobbying. A big business may employe 3,000 people but 3,000 small businesses (like yours) may employ 300,000 people. Even though your business is more vital to the economy you will not get as much government support so you need to get creative.

After Stabilization

After you have stabilized your business structure or strategy now you need to investigate all the common government legislations that your employees may be concerned about. You should be reviewing legislation every year.

Minimum Wage

Wage is always the first thing employees are concerned about. This is important because if you pay low wages you risk losing hard workers. People need to make a good wage. I had a manager that always factored in if the worker had a spouse so he assumed he could pay that person less. You need to make sure you are paying a fair market rate regardless of what the legislated minimum wage is. Do a search for “wages for XXX” and you will get websites like Payscale.com, Indeed.com, and Glassdoor.com offering you information on wages.

Offer 10% less than the average you discovered to less experienced employees and 10% more  for experienced people. This is a rough place to start but you need to take into account local factors like cost of living.

Alternative to Fair Market Rate

I have come up with an alternative to using the fair market rate but to make it work you need to share your books and monthly financials with your employees. I know a lot of owners don’t want to share this info over fears that the employees will demand more money. If you are making a million dollars a month while only paying all your employees minimum wage then you should be paying more.

The alternative is to pay all your employees the local minimum wage plus a share of the previous months profits. Offer to pay all employees a share of 50% of monthly profits if they meet conditions that support your business. I like the idea of giving points for important tasks or activities. You can give as many points as you like. Points will be worth an equal share of the previous months profits.

If you make $20,000 profit last month and 50% of that will be shared among your employees based not he points they earned. If you gave out 100 points last month each point would be worth ($10,000/100points) $100. In this case an employee that earned 100 points would make an extra $1,000 for last month. Naturally, each month the point value will change with profit made and points earned.

Point Samples

The points may be a great way to get employees to do things that will help your business. Some ways to give out points would be:

  • 1 point for each shift or day worked
  • 1 point for each time they work late
  • 1 point for not being late all month
  • 1 point for no sick days all month
  • 2 points for each new paying customer referred to the business
  • 5 points fro being supervisor or manager
  • 1 point for earning the most points in the last 3 months

Vacation Days

Minimum Government Legislation will dictate the paid vacation days an owner must give to his employees. Some countries give up to 8 weeks of paid vacation each year! These places have confirmed that employees work hard and are more loyal when they have more paid time off. You only need to beat the legislated minimum.

In most places, you get X amount of paid vacation after one full year of work. Then after a few more years, you get more paid vacation normally in weekly increments. To beat this legislation you can simply given one extra paid vacation day per year. You can even give a day or two paid vacation after a new employee completes their three month probation period.

Other Minimum Government Legislation

The two examples above of minimum government legislation should get you thinking! Now check out other commonly disputed legislation and get creative. As long as you are following the minimum you can get creative with any extra you give. It is so important for employees to see that you are doing something extra.

Going On More Step

This will take you from a good boss to a great boss! Ask your employees what fun ideas they would like to see happen. Having the conversation and getting input from employees will create buy-in from your employees. When doing this always make sure you tell them you are just getting ideas and you will be making the final decision on your own.

Getting Help

It is always a good idea to get a second option or ask an expert about creative business and HR-related ideas. Don’t be afraid to ask for expert advice. A cheaper alternative for the do-it-yourself people is to get a few books! Yes, this will cost you some money but may be invaluable when your customers are happy and purchasing more.