BANFF – The annual adjustment of wages for Town of Banff staff will head to service review with wages potentially being adjusted 5.1 per cent to fit in with Alberta’s average inflation number.
Banff’s governance and finance committee (GFC) looked at its annual adjustment of town wages at its most recent meeting, something that has been made more difficult with the COVID-19 pandemic. The process is part of the financial plan process for the upcoming budget.
“The financial plan is a document that comes back to this committee annually,” said Chris Hughes, director of corporate services. “It is one of the main guiding documents for administration as we prepare the budget for the upcoming year.”
The annual adjustment is typically determined by calculating the average Alberta annual inflation, and the Statistics Canada annualized average change in weekly earnings.
“Based on the current forecast, and the letter of guidance in the financial plan, that would result in a 1.3 per cent wage adjustment,” Hughes said.
In 2021 and 2022, only the Alberta annual inflation number was used, due to the COVID-19 pandemic impacting average weekly earnings numbers. These numbers were inflated because of low-income earners losing employment, which caused high incomes to skew the results.
“What we expect happened with this index over the last three years is there was a lot of COVID-related impact,” Hughes said. “A number of people left the workforce. Lower-income workers were disproportionally affected by the loss of earnings.”
GFC was given three options. The first was to adjust wages by 1.3 per cent, based on the traditional formula using the years 2021 and 2022. The second was to adjust wages to 9.2 per cent based on the years 2019 to 2022 and the third option was to adjust wages 5.1 per cent using only the Alberta average inflation numbers.
The committee was concerned about ensuring a staff-friendly environment, as it debated which of the three options to approve.
“We have had a lot of changes in our marketplace, not just in our town but rampant across the country where some wages are being adjusted upwards,” Coun. Hugh Pettigrew said. “If we go with the lower value, my concern is that staff may not look at it very positively. I don’t want to end up in a situation where we are not in a staff-friendly environment if we don’t recognize the cost of living that is in front of us.”
Hughes said a market review of wages was going to be done this year, which would make up for shortfalls.
“If that is your most significant concern, catching up, the loss from previous years should be made up during that market review,” he said.
Mayor Corrie DiManno said the 5.1 per cent option was the best for the committee to consider.
“This is a deviation from the formula we typically used,” DiManno said. “This is what we have done in 2020 and 2021 and I think it is appropriate to go with this one. I believe it is fair and not as high as we would be looking at with the 9.2 per cent option.”
The 5.1 per cent option was supported by the rest of the committee as well.
“I am concerned about the amount, but it is a reality we have huge inflation numbers,” Pettigrew said. “Knowing there is a market adjustment coming up in conjunction with this, I am comfortable supporting it.”