Canadian HR Reporter

CANADIAN HR REPORTER June 1, 2015 NEWS 3 COST > pg. 6 RECRUITING FINANCIAL PROFESSIONALS? O er positions to over 190,000 Members Highly targeted advertising Immediate matching resume database access FOR MORE INFORMATION, cpacanada.ca/CPASource TELEPHONE•416 204 3284•EMAIL•TGardiner@cpacanada.ca 14-126a_EN_CPAsource_fullpagead_9.625x7.indd 1 10/8/2014 3:40:37 PM Will Alberta's orange crush flatten businesses in the province? NDP promised higher minimum wage, higher corporate tax rate, job creation tax credit BY SARAH DOBSON FOLLOWING more than four decades of Conservative rule, tra- ditionally blue Alberta is sporting a new colour: NDP orange. The May 5 election shocked many as NDP leader Rachel Not- ley enjoyed a landslide victory, with the New Democrats taking 53 seats. e Wildrose Alliance Party won 21 and the Progressive Conservatives held on to just 10. No sooner had the results been declared — and even before that — critics were predicting the province would suffer under the new rule, with employers leaving the province and jobs being lost. A group of five CEOs went so far as to hold a press conference before the election expressing concerns about the NDP's plans. But the NDP in Alberta are known as being pragmatic and business-friendly, according to Allan Dwyer, assistant professor of finance at Mount Royal Uni- versity in Calgary. "ey don't want to come in here and blow the place apart and then get thrown out after four years. ey want to be here for a generation because remember, Albertans, that's what we tend to do — we'll have a party in for 25 years and we'll throw them out and put in another party for 30 years." It's not an automatic that an NDP government and small busi- nesses will be at loggerheads, said Dan Kelly, president and CEO of the Canadian Federation of Independent Business (CFIB) in Toronto. However, the area of most concern is labour law, such as occupational health and safety, minimum wage policies, employ- ment standards and workers' compensation. "e full gamut of labour poli- cies is often an early target for an NDP government and that… has the potential to really strain the re- lationship between a government and the small business communi- ty," he said, adding a large number of Notley's team have deep roots in organized labour. "If the government does go down that road, if decisions are shifted away from the legislature and instead are being made by union halls, then that would lead to some potential dislocation in the small business-government relationship. And we've seen that happen, sadly." ere's still a lot of uncertainty as to what will happen, said Jeff Gaulin, vice-president of com- munications at the Canadian As- sociation of Petroleum Producers (CAPP) in Calgary. "We're already faced with a forecast decline in revenues of $50 billion in our industry this year… our capital investment is forecast to be down conservatively by at least $25 billion this year," he said. "e number of wells to be drilled in Western Canada declined by 50 per cent… and there are 10s of 1000s of people out of work in this industry because of what has hap- pened. So there's already question marks over the industry and what we can absorb to keep Albertans and Canadians working." But the association is comfort- able it will be able to find common ground with the new government, said Gaulin. "e oil and gas industry is, as the premier said, a significant job creator and the engine of the province in Alberta so it's in everyone's best interest that it's strong, healthy and growing." Higher tax rate While many of the NDP's prom- ises have yet to be confirmed — including a review of the prov- ince's energy royalties — several key policies could have an impact on employers and employees. For one, the new regime said it is looking to increase the corporate tax rate — currently the lowest in Canada — from 10 per cent to 12 per cent. "If you need a 10 per cent cor- porate tax rate to survive, then you probably shouldn't survive," said Dwyer. "Alberta has kind of cushioned its corporations for a long time and protected them in a way that's not done elsewhere, and I think it's healthy to start raising taxes… e confident, successful, com- petitive firms will shrug off a two per cent tax increase and they just will adjust their planning to make themselves competitive at a 12 per cent tax rate." Companies don't make invest- ment decisions based on small changes to corporate tax rates, said Gil McGowan, president of the Alberta Federation of Labour in Edmonton. "ey invest where they can make money. And even with the declining price of oil, Alberta continues to be a place where corporations both big and small can make money. at's not go- ing to change under a moderate New Democrat government. So I have no fear that there will be a massive flight of capital from the province." For CAPP, it's about look- "Alberta has kind of cushioned its corporations for a long time and protected them in a way that's not done elsewhere, and it's healthy to start raising taxes."

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