Tim Hortons slams franchisees for response to Ontario minimum-wage hike

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Tim Hortons has lashed out at franchise owners who have cut paid breaks and other perks for their employees by calling the moves reckless, as finger-pointing over Ontario's minimum-wage hike escalates.

A day after Ontario Premier Kathleen Wynne said that the children of Tim Hortons co-founders were bullying employees at their two stores in Cobourg, Ont., by cutting benefits after the hourly minimum wage was raised to $14 on Jan. 1, the Oakville-based company said store owners were jeopardizing the reputation of the iconic doughnut chain through their actions.

"Tim Hortons [employees] should never be used to further an agenda or be treated as just an 'expense.' This is completely unacceptable," the company said in a statement on Friday. "These recent actions by a few restaurant owners … do not reflect the values of our brand."

The backlash facing the company started after employees at two Tim Hortons owned by Ron Joyce Jr. and his wife, Jeri Horton-Joyce, who are the respective son and daughter of chain co-founders Ron Joyce and Tim Horton, said they received a letter in December that stated they would no longer be entitled to paid breaks or a number of other perks. In addition, they would need to cover at least half of the cost of their dental and health benefits. The couple said the minimum-wage increase from $11.60 required them to make the cuts.

On Thursday, Ms. Wynne said the couple's reaction to the wage increase was "the act of a bully." The benefit cuts do not violate Ontario's labour standards. Mr. Joyce and Ms. Horton-Joyce did not respond to a request for comment from The Globe and Mail on Friday.

With a mandatory conference call scheduled with its store owners on Friday afternoon, Tim Hortons said it was committed to helping franchises cope with the minimum-wage increase. However, the company did not elaborate on what steps it would take. Tim Hortons also pushed back at the Great White North Franchisee Association, which it called a "rogue group." The association was created by franchisees unhappy with how the company has been run since its acquisition by Restaurant Brands International Inc. in 2014. The association did not respond to the company's comments.

The Ontario Liberals have faced months of pushback from business leaders who have warned that the minimum-wage hikes will lead to a loss of jobs. Earlier this week, the Bank of Canada said that minimum-wage hikes could cost nearly 60,000 jobs across the country by 2019.

"Our members have made it clear that Bill 148 [which increased the minimum wage and made other labour changes] will be costly and jeopardize the stability of businesses of all sizes," the Ontario Chamber of Commerce said in a statement. "Now, we are seeing these consequences come to fruition as businesses look to control costs."

Tom Cooper, with the Hamilton Poverty Coalition, said that paying workers a higher wage means that they are healthier and more productive. "As somebody from Hamilton, where Tim Hortons was initially founded, I'm certainly taking issue with the tactics that some of the franchise owners are taking," he told The Globe. "It's not a proportional response to the wage increase; it's deplorable."