Friday, August 17, 2018

Feds consider tips a wage but provincial government does not... confusing...

If you are a server in Alberta legally you are suppose to declare your tips as part of your wage so the CRA aka the Canadian Revenue Agency so they can tax you.  This would suggest that tips are indeed part of a wage since you get taxed on wages.  I know most servers only declare a small amount or no amount.  I imagine the kitchen staff which often gets a piece of the tip pie also rarely declares the full amount but in theory if you get tips you are suppose to declare those tips so the federal government can tax them.  

At the provincial level those tips are magic beans and do not exist when it comes to determining an employee's wage.  It doesn't matter that a server could be making an additional $30.00 an hour from tips, the wage that server makes is the amount listed on the pay slip the employer gives the employee every two weeks.  This matters because provincial governments get to set things like minimum wage.  In Alberta minimum wage is going up to 15 an hour.  Restaurant owner doesn't get any credit for creating a mechanism where a server can earn 45.00 an hour with tips.  The provincial government just sees the hourly wage on the play slip blissfully unaware that the server is taking home far more than minimum wage. 

I don't own a restaurant or a pub so this doesn't affect me directly.  I do think it is ridiculous that the federal government through it's taxation is saying tips are indeed part of a servers wage whereas the provincial government by not having tips count as a wage is saying no tips are not a wage.  Lets give these food establishments recognition for creating a way where people can earn far more than minimum wage and stop pretending tips are not part of a wage at the provincial level.  

Thanks for listening...

Master Iceman

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