Every year hundreds of businesses and organizations renew their certification with the Ontario Living Wage Network (OLWN). There are small salons with a few employees and large automotive manufacturers – and everything in between – represented in the certified living wage employer directory.
In order to qualify for certification, employers must agree to pay all employees at least a current, local living wage. They pay an annual fee and enter into a legal agreement with the OLWN. They must also reflect any increases to the living wage rate when they’re updated every November.
Our certification program started in 2016, and it has undergone several stages of growth and improvement. In 2023 we began collecting more information beyond just program compliance. We wanted to know about changes employers have noticed since becoming certified, and whether they attribute such changes to living wage certification.
We also began to ask questions about other aspects of their workforce such as benefits offered and employee turnover.
The questions in the survey are objective – i.e. how many employees’ wages were raised – and subjective ones about morale and productivity.
These extra questions are optional, but they reveal what is happening to the majority of certified businesses and organizations after they become living wage employers.
With this report we will have a look at what these employers are experiencing. For some it will be their first year, and for others it will be after many years of certification.
Key findings:
- Number of wages raised by renewing employers in Ontario in 2024: 1,758
- Sectors with highest percentage of raised wages due living wage certification were food/beverage/hospitality (23%), and cleaning services (48%)
- 84% of respondents reported offering health benefits to employees
- 39% of of respondents in for-profit sectors needed to make adjustments to their wage levels to qualify for certification, vs. 56% in the non-profit sectors
- 91% of respondents agreed that "Paying a living wage has helped us live up to our organization/company's values"
Employer Certification Program
The OLWN calculates the living wage for 10 different economic regions across Ontario each year. Employers in the province can choose to be recognized for paying a living wage to all their employees.
Certified living wage employers (LWEs) make the commitment to pay both direct and indirect employees at least a living wage. This includes both workers on payroll and third-party contracted workers who meet the criteria.
Each year certified living wage employers renew certification in the OLWN employer program by completing a renewal survey and paying an annual fee.
In 2024, 316 employers completed the renewal survey which accounts for 60 percent of the total renewing employers from the year.
This report reviews the responses from employers who are renewing certification in the living wage program. It is recognized that employers who choose to continue with the certification likely view the program more favourably than those who do not renew the living wage commitment. We collect the reasons that employers depart the certification program and this is information is contained in the appendix, but this is not the focus of this report.
Certified Living Wage Employers 2024
By December 31, 2024 there were 598 certified living wage employers in Ontario. Of those, 128 were joining the program for the first time, with 454 electing to recertify. This count does not include branches or additional locations, which would bring the total number of living wage workplaces to 774 by the end of 2024.
The distribution of employers who have renewed multiple times shows the surge in new employers in 2021-22 have chosen to remain with the program. Half of LWEs by the end of 2024 had been with the program for 2-3 years.
The economic region where we’ve gained the most living wage employers is the Greater Toronto Area living wage region (GTA)[1] The majority of these employers can be found in the City of Toronto.
This is closely followed by 26 new employers in the Dufferin Waterloo Guelph-Wellington region. The majority of these employers were from Waterloo Region.
We’ve had a resurgence in non-profit and social service organizations either renew or become certified for the first time over the past couple years. When non-profits cancel living wage certification it is typically due to lost or insufficient funding that make it impossible to keep up with annual increases to the living wage.
The health care sector includes organizations such as public health units, Canadian Mental Health Associations and businesses that provide personal support workers. Considering that poverty is a major indicator of the social determinants of health, the living wage is something that fits well with the values of health care organizations and should be used to make a case for encouraging more certifications in this sector.
In 2024 new living wage employers reported a total of 287 wages raised in order to join the program. This is not quite 6% of the total 4,852 employees working for these businesses and organizations. Renewing employers during this time indicated increasing 8.8% of employee wages at the time of renewal in order to remain certified.
While sector can be an indication of the number of employees who will see a wage increase in order for a business to become certified, the size of the business also plays a role. This may be the result of larger businesses being better able to absorb the cost of raising wages to a living wage. We have also heard from a number of small business employers who’ve become certified that paying a living wage has always been important and their business model was created with this in mind.
2024 Employer Survey Results
The OLWN collects renewal information from employers using Google Forms as a part of our Non-Profit Workspace account. Certified employers are sent an email 30 days prior to their anniversary date that includes a link to pay the annual fee, a link to the survey, and other renewal information. See the appendix for a truncated sample of the survey.
Respondents are only required to answer certain questions about their wage levels in order to establish their eligibility to renew their certification. The rest of the questions about their observations, experiences, and feedback as a living wage employer that make up the remainder of the report are voluntary. Some respondents answer all the questions, other are selective. This will be reflected in the skip column.
A total of 316 employers responded to the renewal survey. For-profit employers made up 61% of survey respondents followed by non-profit employers at 31%, and finally public sector employers at 2%. These employers represent 19,936 employees in total and indicated that they raised the wages of 1,758 employees over the course of certification.
It is important to note that some of the survey respondents indicated that they were unaware of how many wages were raised or gave approximate numbers. One very large employer was uncertain how many wages would be affected by the increase to the living wage rate for their employees. However, they have raised a large number of wages each year to keep up with the updated living wage rates.
Employers by Economic Region
Between 49 to 92 percent of employers from each of the 10 different living wage regions responded to the survey. The GTA living wage region has the highest total number of certified living wage employers and the highest number of survey responses. This is unsurprising given the population of this area. While population is often an indicator of the number of total living wage employers in an area, efforts from local living wage organizers is also reflected. This is the case in areas like Waterloo Region, Niagara, and Perth Huron that have benefited from strong living wage movements that predate the OLWN.
Employers by Sector
Eighty-four sectors are represented in our living wage directory.[2] The top five industries indicated by renewing employers were Construction, Non-profit/charity and Professional Services. Manufacturing and Social Services.
Professional Services covers sectors such as doctors, engineers, veterinary services, architects and accountants. As employers could self-select their sector we also saw a number of employers select financial services and health/medical care that could also fit into this section. Quite often employers in the professional sectors may not have to increase wages of their direct employees, but may have to address third party services such as cleaning and security. Many health care providers see the living wage as something that reflects their values as poverty has a direct impact on health.
Wage Increases
Renewing employers reported a total of 1,745 workers had their wages raised in order to keep up with the most recent living wage increases across the province. This number indicates that 8.8% of the total number of employees received a wage increase due to the living wage program. Additional wages were likely raised as a few employers were unsure of how many wages were increased. And, some provide an annual cost of living increase which was enough to ensure all employees were earning above the living wage.
50% of employers indicated they were already paying above the living wage. 20% of employers indicated that only those earning less than the lw received a wage increase. 21% of employers indicated a tiered wage increase across all employees was implemented so that all employees received the same percent increase in their wage. 9% of employers indicated they used some combination of wage increases to employees earning less than the living wage and some wage increases to other pay bands but not necessarily all, or all at the same percent increase.
Looking at the number of wages increased by sector, we find that 21% of all the wages raised were in the municipal government sector, 20% manufacturing, 9% social services, 6% automotive/transportation and the remainder by other sectors.
The retails sector raised 27 wages in total which is only 2% of the total wages raised by renewing employers. However, this accounts for just over 25% of the total number of employees in that sector.
Likewise, almost 23% of employees in the food/beverage/hospitality sector saw an increase in wages and just over 47% of employees in the cleaning sector had a wage increase.
Health Benefit Offset
The living wage calculation methodology assumes that employers do not provide non-OHIP health benefits to their employees. Because of this, the calculation includes the cost of health insurance to cover potential health expenses. When employers provide health benefits they can be used to offset the living wage rate. Up to 100% of the cost of health insurance can be removed from the calculation depending on the coverage offered in a health benefit package.
Employers were asked to report on whether their employees received non-OHIP health benefits and if so, are these benefits used to help meet the living wage rate in their economic region.
A total of 84% of employers reported offering health benefits to employees, while 13% of employers indicated that they use health benefits to offset the living wage rate.
Cost of Implementing the Living Wage
Employers were asked to estimate the cost of implementing the living wage for their business. The way this question was asked left the time frame for cost up to interpretation. Some employers clearly indicated the cost just for the past year while others answered the question as a total over the number of year’s they had been certified. Costs reported range from no cost up to $400,000. The cost for implementation reflects to some extent the size of the business and total number of employees. Approximately 50% of total employers reported not cost to implementation of the living wage program. As shown below, 61% of for-profit employers reported no cost to implementation, while only 48% of non-profit and 44% of public sector employers reported the same.
A total of 8 employers reported an implementation cost that exceeded $100,000. When asked what approach was taken to wage increases 7 of these employers reported that a tiered wage increase approach was used. This means that all employees received an equal increase regardless of whether they were already earning above the new living wage rate for their living wage region. The remaining employer used the living wage approach meaning they only raised wages of the employees earning less than a living wage. These 8 employers were responsible for 37% of the total wages raised.
7 of these employers also reported an increase to their revenue and 3 reported that they believe the increased revenue was due in part to paying a living wage.
Some comments from these employers regarding the increase in revenue:
“Increased morale, desire to work, desire to provide good quality products”
“We are able to recruit and retain better talent. Because we have more skilled and reliable laborer's, we can reflect that in our pricing.”
“New funding for programs and services & one time funding becoming annualized”
1 of these 8 employers reported a decrease in revenue due to paying a living wage. They commented that… “Our sales have not increased and our operating costs including personnel cost have increased significantly.”
Revenue Changes and the Living Wage
Employers were asked whether their overall revenue had changed in the past year, and whether they felt this was due to paying a living wage. 40% of employees reported an increase in revenue and 33% of those employers reported they felt the increase was due to paying a living wage.
Comments from employers who saw a decrease in revenue due to paying a living wage:
“Staffing costs are 50% of overhead cost therefore partial relationship to decreased gross profit."
“Much much harder to keep the business afloat! Especially with the cost of food rising up, general public do not have as much money to spend dining out, and you can't put a $40 burger on the menu to balance out the costs.”
Comments from employers who saw an increase in revenue due to paying a living wage:
“By offering a higher salary than all our competitors, we get to attract top talent and we get to be picky with who we hire! As a service provider, the "product" we sell is as good as our employees so having amazing employees is our priority.”
“Employees have a better quality of life which reflects their work.”
“Happier employees - We are now considered a destination employer in [our] county”
“Our turnover is so slow which I attribute a great deal to paying a living wage. This in turn provides consistency and a better overall experience for our customers.”
Benefit of paying a living wage
When we speak about the benefits of paying a living wage, previous studies have pointed to higher employee retention rates, greater staff morale and a way to demonstrate the values of a business or organization. These survey results remain consistent with previous findings. Notably, 80% of employers agreed that paying a living wage has had an overall positive effect on the workplace environment.
Employers were asked if they had noticed any of the following changes since becoming a certified living wage employer regarding both benefits to business, and benefits to the workforce.
Although 71% of employers reported that they did have employee turnover in the past year, 68% still indicate that paying a living wage has helped with employee retention rates.
When asked about the change in benefits to the workforce, there is more neutrality compared to questions about the change in benefits to the business. This could be due to employers having implemented other aspects of decent work into their workplace and already have loyal, motivated employees. Or perhaps subjective questions about morale, loyalty, productivity compel the respondents to choose a more neutral position. Collecting feedback from employees directly could be one way to gain further insights here.
One of our most-quoted benefits to employers appears to be holding true: 59% of respondents have indicated that increased morale as a benefit of paying a living wage.
The strongest disagreement came on net decrease in sick days taken by employees: 62% where neutral or disagreed that paying a living wage had a negative effect.
Living Wage and Third-Party Contractors
The living wage certification program requires employers to do their best to ensure that third party contracted employees earn a living wage for the hours that are worked for the living wage employer. This only applies to contracts that exceed 120 hours per year. Sectors such as cleaning services, security and food service tend to be areas of lower wage work.
Only 17% of employers reported having conversations with third party contractors. 6% of employers reported including a living wage clause in a third-party contract and 5% reported a result of third-party contractors increasing wages. While these numbers are small, the employers that implemented living wage clauses tend to be larger employers such as those in the public sector where a number of workers are contracted for cleaning, security, and food service.
Certified living wage employers are encouraged to show that they are certified by using at least one of the following items: the digital employer badge, window/vehicle decals, and posting the employer certificate. This serves to ensure employees are aware of the commitment their employer has made to pay at least a living wage, and to help spread awareness about the living wage program.
Employers were asked to share whether they’d been asked about the living wage program.
Only 23% of living wage employers reported that other employers have inquired about the living wage. However, when speaking with employers interested in living wage certification, many comment on seeing the living wage employer badge or window decal at other businesses. The expansion of the living wage certification program in Ontario has grown mainly by word of mouth. A number of employers have also commented that they find the OLWN through a google search.
Conclusion
This year’s renewal survey of certified living wage employers reveals a strong and growing commitment to fair compensation across diverse sectors in Ontario, with 92% of renewing living wage employers characterizing the living wage certification program as worthwhile. While only some employers were required to raise wages in order to renew, nearly 1 in 10 workers represented in the survey received a pay increase due to living wage certification.
Employers continue to cite a range of positive outcomes tied to certification, including improved employee retention, enhanced morale, and strengthened alignment with organizational values. These effects were particularly visible among employers who implemented tiered wage increases across their entire workforce, signaling a broader commitment to equity and decent work. Although some employers expressed concern about the cost of implementation, the majority reported either no cost or manageable increases, with many also reporting boosts to revenue and reputation as a result of certification.
While employers’ experiences are not uniform, the overall picture is clear: the living wage program is making a meaningful difference for both workers and workplaces. With nearly all renewing employers finding the program worthwhile, the 2024 survey underscores the value of centering wages not just as a cost to supress, but as a cornerstone of healthy, resilient organizations and communities.
Notes
[1] The OLWN’s GTA living wage region covers Peel, Halton, York and Toronto but not include Durham.
[2] While it is common to use the North American Industry Classification System(NAICS) to categorize sectors of operation, the OLWN uses it’s own non-hierarchical list. We do this in order to make it easy to find certified employers by the general public in our employer directory.
Appendix - 2024 Employer Renewal Survey
The renewal survey is sent via an automatically generated email to employers 30 days before their annual fees are due. There are a total of 30 questions across 17 sections in a Google Form, with mandatory fields regarding compliance with the certification program. For simplicity and ease of review, we have removed questions unrelated to the feedback covered in this report such as current address, contact confirmation and other administrative needs.