What is minimum wage?
In the Northwest Territories (NWT), the minimum wage is $16.05 per hour.
The minimum wage is the lowest wage an employer can legally pay to an employee doing a specified job.
How is the minimum wage determined in the NWT?
Beginning September 1, 2023, the minimum wage will be adjusted annually using a formula based on the percentage change in the Consumer Price Index (CPI) for Yellowknife and the percentage change in the average hourly wage (AHW) in the NWT for the preceding calendar year.
As such, beginning in 2023, the minimum wage in the NWT will be adjusted using the established formula on September 1, and annually thereafter, unless otherwise directed by the Minister of Education, Culture and Employment (ECE).
Using CPI as a basis for adjusting the minimum wage rate allows the minimum wage to keep up with the increasing costs for NWT residents, and with other jurisdictions’ minimum wage rates. Many jurisdictions, and the federal government, use CPI as a basis for making annual adjustments to their minimum wage rates.
Businesses will be able to plan for the minimum wage rate to be adjusted on September 1 of every year, and the annual increases will be smaller, which will allow businesses to better absorb the impact of each increase.
The new formula will mean an increase in the minimum wage most years. However, if the percentage change in the CPI or AHW were to decrease below zero in a given year, and the application of the formula resulted in a decrease to the minimum wage, the minimum wage rate would remain the same.