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INSIDER   June 2, 2015 pdf version


» ORHMA Welcomes New Board of Directors at the Annual General Meeting June 1, 2015 

On June 1st, the Provincial Board of Directors of the ORHMA (Ontario Restaurant, Hotel & Motel Association) held its Annual General Meeting at Four Points By Sheraton Mississauga Meadowvale.  
For a complete list of the ORHMA Board of Directors, including the Executive Committee and the Regional Boards, click here.

ORHMA President and CEO Tony Elenis delivered the following speech.

These recent years have seen Ontario’s overall economy being transformed. A huge Provincial deficit that…yes in a few years it will most likely be balanced but most importantly an enormous shift is occurring within the manufacturing industry. 

Not only has Ontario lost more than 20 million US tourists since the year 2000 but the US border States of Ohio, Michigan and New York are no longer building cars and manufacturing steel as they once did to boost their local consumer wealth for travelling up North. The USA is recovering,  it's great news but nowhere near where it used to be. 
  
And closer to home  a combination of policies , technology and stiff global competition have shrank Ontario’s once mighty manufacturing work force to a fraction.  Manufacturing has been a key demand driver for the prosperity of a restaurant and an accommodation business. It results in healthy employment for many creating consumer confidence and disposable income. 
    
If that is not enough government policies have made it tougher to succeed.  The ORHMA has been active in the various government matters and has met with the political folks calling for responsiveness been given to the hospitality industry.
    
In one of our government meetings we were asked a question …what is a normal profit margin for this industry?    Perhaps we were told the industry’s norm…is operating with low margins.  Let’s analyze the trends, comparisons and key expense drivers to determine if Ontario is at par: 
   
The last fifteen years brought significant increases to three specific cost categories that just happened to be the highest expenditures for this industry.  Food Commodities have skyrocketed and with this category making up an average of 35% of total expenses its been a challenge. 

The cost from utilities continues to escalate hammering hospitality operators in an industry that ranks first in the highest energy intense category. Conservation programs do help but incentives applied to demand peak times are useless as the industry operates at full throttle during the breakfast and dinner periods…and there is the Minimum Wage impact,  this is not about raising the Minimum wage debate its about the industry’s climate.  

Exhibit 1 –Shows the highest proportion of all Minimum Wage Earners at 39% work in the hospitality industry, a slight increase will have tremendous impact.

Exhibit 2-   Compares CPI increases to the recent Minimum Wage increases. Four consecutive year increases at 50% while CPI only went up 15.4.  Please make no mistake about it, the last recession being hit with the strain of minimum wage has changed this industry for a long, long time. 

Let’s now view historic trends and comparisons to determine Ontario’s profit performance …and to answer the question if Ontario is operating at normal margins. 

Exhibit 3- Ontario’s Accommodations sector profit margin up to the year 2002 outperformed the national average. This is no longer the case as Ontario is underperforming.

Exhibit 4- Shows the impact of the  labour cost increase - over time the Accommodation sector’s expense reversed from lowest to be the highest against the National average ….and off course impacting profit.   

Exhibit 5 –The Canadian Foodservice industry in 1990 performed at 9.6% profit margin and dropped by 56%  to 4.2% 2013 

Exhibit 6 – Illustrates Ontario’s Foodservice Margins against the National Average. Every Province performs at a higher profit margin than Ontario.   

Exhibit 7 & 8- Here we will see the unintentional consequences on Jobs precisely on Youth. 

Why Ontario has a higher youth unemployment than the rest of Canada? The Answer…Youth employment varies according to the Hospitality’s industry’s financial health. 

While operators have introduced every trick in the book to be successful and for many just to be sustainable…we see the effect of controlling hours and curtailing new hires…the correlation is clearly evidenced here in an industry that normally hires 35% of all youth.    Is Ontario a high cost province to do business in? The slides tell the story. 

In the midst of all these pressures we have a myriad of waves that go beyond Ontario and Canada. We seen smoking restrictions across the globe, drink and drive zero tolerance in some countries require that blood alcohol level acceptance to be at zero…and the health wave is driving nutritional legislation. In 2014 Ontario Hotels alone paid over $66m to OTA's in commission fees. 

And That's not all…A gigantic shift is taking place with up and rising emerging competition, whether it's the food trucks or the sharing economy within AirBnB, these type of concepts have enormous growth ahead of them, growth that is shifting away from brick and mortar restaurants and hotels.

Many players are there to assist but they are not going to turn around your business.  There is only one Individual that can take advantage of these enormous shifts ...one individual that has the passion, the care, the want and the necessity to make a business thrive and perhaps a leading edge. This individual is no other than the owner or manager of the business who over time has build success through resiliency, savviness and lots of hard work. 

But today leadership calls for being adoptive to change and today more than ever the area of opportunity lies in hiring the best  people out there to do the job, the ones that are stronger and more competent than the employer who is hiring them. 

» Menu Labelling Law – Ontario is The First in Canada!
E-cigarettes Ban Their Use in Places Designated as Smoke-Free!

On May 26, 2015 the Ontario government passed the Making Healthier Choices Act, 2015. The government believes this Act will help Ontario’s children and families make healthier food choices, protect people from the harmful effects of tobacco use, and it is also taking a precautionary approach to regulate electronic cigarettes.   It’s the law! The first provincial menu labelling legislation in all of Canada! It does not surprise us that the provincial government has passed legislation requiring how and which restaurants provide nutritional information to customers. Such legislation is not new in North America. Many other jurisdictions have it and ORHMA committed to participating in helping Ontario, the province, develop its legislation and regulations.  

The Act has three parts: 
  • Menu labelling legislation will require large chain restaurants and other food service premises with 20 or more locations in Ontario who sell ready-to-eat and prepared food to post calories on menus. (compliance January 2017)
  • Amendments to the Smoke-Free Ontario Act will increase penalties for selling tobacco to children/youth, ban the sale of flavoured tobacco products, and further limit smoking in public areas.(compliance January 2016) 
  • E-cigarettes legislation will prohibit the sale of e-cigarettes to minors, regulate the display and promotion of e-cigarettes, and ban their use in places designated as smoke-free. (compliance January 2016)

This Act is the recommendations of the Healthy Kids Panel and taking action to reduce childhood obesity and helping Ontario’s children establish healthy habits from the start.

The government is also committed to achieving the lowest smoking rate in Canada as set out in Ontario’s Patients’ First: Action Plan for Health Care.
ORHMA advocated for the following:

  • calories only(government agreed)
  • applicable to standard menu items (government agreed)
  • no sodium requirement (government agreed) 
  • include: grocers, convenience stores, movie theatres (government agreed)
  • exemption for independent operators (government agreed)
  • a threshold requirement of 20 or more restaurants (government agreed)
  • provincial policy to supersede any municipal bylaws (government agreed)
  • exempt hotels (government agreed)
  • exempt beverage alcohol from posting calories (government disagreed)

ORHMA and our membership will continue to work with the government as they are currently drafting the regulations on this legislation to mitigate more red tape on our industry. Regulations require being prescriptive with input from our industry. The legislation should not be enforced until regulations have been approved. No Beverage Alcohol Requirement for Restaurants: We will continue to advocate that beverage alcohol should not be required to be posting calories on their restaurant menus. This should not apply. 

The government’s purpose of menu labelling is to address childhood obesity. The requirement to post alcohol beverages is unfair – the LCBO is a publically owned asset that continues to provide our hospitality sector with alcohol and they are not required to post calories but the private restaurant operator will legally be obligated to do so – this remains unfair and needs to be addressed by our government. As well the Beer Store is not included in this legislation – The Beer Store is not required to post calories on their menu board or bottles and this will likely create an unfair market advantage.

ORHMA ADVOCACY: ORHMA along with key members from A&W, McDondald’s Canada, Tim Hortons Inc. and Quiznos Canada met with the Associate Minister of Health to advocate that sodium should not be included in the menu labelling legislation. We also advocated for delayed implementation period and delayed Royal Assent. April 20, 2015 ORHMA was invited to participate at the Standing Committee on General Government – we sought exemptions and recommended a longer implementation period for compliance.

See link for Act: http://www.ontla.on.ca/bills/bills-files/41_Parliament/Session1/b045rep.pdf

Below is a link to the news release where more information about the legislation can be found:
English:   http://news.ontario.ca/m/32891 French:   http://news.ontario.ca/m/32905

Should you know of others who would benefit from this update please share and pass along. Should you have any questions please contact me directly lsmejkal@orhma.com

» The HAC Applauds the Federal Government’s Investment in Tourism 
News Release May 25, 2015


Ottawa – On May 22, 2015, Prime Minister Stephen Harper announced the federal government’s plan to invest $30 million over three years in Canada’s tourism sector in order to attract more American visitors to destinations across Canada.  
 
The Connecting America tourism campaign, led by the Canadian Tourism Commission (CTC), will market Canadian destinations to US travelers with the goal of attracting an additional 680,000 Americans over the three-year period.
 
“The National Round Table on Travel & Tourism, which includes the Hotel Association of Canada, the Tourism Industry Association of Canada, the Canadian Airports Council, the National Airlines Council of Canada and the International Air Transportation Association, has worked diligently with the government to facilitate this program”, said Tony Pollard President, the HAC. “This announcement demonstrates the government’s commitment to the tourism industry in Canada.”
 
Canada’s tourism industry is one of the country’s most crucial economic drivers with overall revenue reaching $17.3 billion in 2014. The United States is Canada’s largest inbound tourism market, welcoming 11.5 million American visitors yearly however this number is down 24% from a decade ago.  The Connecting America campaign will raise awareness of Canada’s one of a kind tourism experiences while promoting economic growth. 

» TODS Program Review – Final Report
Ministry of Tourism, Culture and Sport

The Ministry of Tourism, Culture and Sport (MTCS) and the Ministry of Transportation (MTO) have been engaging with tourism partners over the past year and a half to review the Tourism-Oriented Directional Signing (TODS) program. This has included assessing client satisfaction and identifying suggestions for program and policy improvements. I am pleased to let you know that we have now completed the review of the TODS program.

Based on feedback from our tourism partners, we will be implementing a number of policy and program adjustments that will strengthen and modernize the program and improve the effectiveness of our tourism highway signing. The ministries will work with service provider Canadian TODS Limited (C-TODS) to begin to implement changes starting immediately.

Significant improvements will include:
  • Tourism-designated outlet malls and regional travel information centres to apply for TODS signage on our roadways
  • Extending full signing opportunities to campgrounds on freeways to permit the full spelling of a campground’s name
  • Allowing more rural downtowns, trail access points, museums and cultural centres to qualify for signage
  • Strengthening program awareness and service delivery

The current service contract for the administration of the TODS and Logo programs expires in December 2018. In the coming months, the ministries will implement policy and program changes from the TODS program review and examine options for the future management and delivery of the TODS and Logo programs in anticipation of contract expiry.

The ministries are committed to continuous improvement of our tourism highway signing and will continue to consider suggestions for TODS program adjustments on an ongoing basis as the tourism industry in Ontario continues to evolve.

For more information on the results of the TODS program review, please visit the MTCS website: www.mtc.gov.on.ca/en/tourism/tods.shtml

Additional comments or questions about the TODS program review can be submitted by email to: Tourism.Signs@ontario.ca

For program information including eligibility criteria and costs, please contact C-TODS at 1-888-263-9333, or visit their website: www.canadatods.interstatelogos.com

» March 2015 Tourism Snapshot

The Tourism Snapshot provides a monthly and year-to-date update on key CTC market visits to and from Canada, performance of competitors, and other tourism related statistics. See the Report here:  March 2015 Tourism Snapshot

» Summer Safety Blitz 

We’re focusing on the safety of new and young workers during a four-month blitz which includes the hospitality business. Details can be found here Summer Safety Blitz

» New Food Truck Regulations in Effect
The Varsity- May 22, 2015

In light of new regulations, the food truck debate continues - On May 14 2015 the new food truck regulations approved by the Toronto City Council came into effect. Food trucks may now park a minimum of 30 metres distance from any restaurant, a decrease of 20, from the original 50 metres.

The duration of time that a food truck may stay in a certain location has also been increased from three hours to five, on the grounds that food truck set-up takes about an hour.

Tony Elenis, president and CEO of the Ontario Restaurant Hotel and Motel Association, expressed concerns about the competition that food trucks pose for restaurants. He argues that he is “trying to protect the small business restaurants,” and says that merely surviving in the restaurant business is extremely difficult. 

Zane Caplansky, owner of Caplansky’s Deli on College Street and the Thunderin’ Thelma food truck, believes that competition between restaurants and food trucks is healthy. “Competition is the foundation of our entire economy,” Caplansky says. As a small business owner himself, Caplansky says that he does not have sympathy for those unwilling to compete with his business.

“If your shawarma place needs to improve in quality and price, so be it,” Caplansky says.

Elenis states that 35 per cent of youth are employed within the restaurant industry and food trucks threaten that job security. “[The Toronto City Council makes] political decisions that end up hurting job growth,” Elenis says, adding that he does not think the council is “close enough to the action” to make an informed decision.

In an interview with The Varsity, Elenis said that he receives calls from underground food courts saying that they are losing customers to food trucks. To Elenis, it seems that even the current competition is hurting the restaurant industry.

Caplansky argues that ten members of his food trucks have started restaurants on their own, hiring multiple people to run them. “[Food trucks are] not decreasing employment but increasing competition,” he says. Caplansky wants to continue to increase the competition by further reducing the distance regulations to 15 metres.

Carleton Grant, director of policy and strategic support at the City of Toronto, is one of the advisors to the Toronto City Council, suggesting how best to balance the needs of both restaurants and food trucks.

Grant believes that the council’s decision will provide more opportunity for trucks, but also emphasizes that the council is “not building a downtown solution,” and he hopes to see food truck owners take advantage of opportunities outside of the downtown core. For Grant, this means the expansion of food trucks to Etobicoke, Scarborough and North York.

» Toronto Public Health Recommends Action to Regulate Hookah Smoking in Licensed Businesses
News Release, May 25, 2015         

Toronto Public Health recommends action to regulate hookah smoking in licensed businesses - A new report that will be presented to the Toronto Board of Health recommends that City Council prohibit the use of hookahs in businesses licensed by the City of Toronto. The report, to be presented at the June 1 meeting of the board, highlights significant health risks linked to smoking hookah products.

"Using a hookah to smoke any substance poses health risks, such as heart and lung diseases, lung cancer and other respiratory problems to users and those exposed to second-hand smoke, including employees," said Dr. David McKeown, Toronto's Medical Officer of Health. "Hookah smoking is on the rise among young people, who often mistakenly believe it is a safe form of smoking."

A hookah is a device that is used to smoke moist tobacco or non-tobacco herbal products, known as shisha. Hookahs are also referred to as waterpipes. Charcoal is used to heat the shisha and produce smoke, which is cooled by the water before the user inhales it. The water does not filter harmful chemicals and particles from the smoke, contrary to common misconceptions.

The Smoke-Free Ontario Act (SFOA) bans smoking tobacco in a hookah in indoor public places and workplaces, but there is currently no law prohibiting indoor non-tobacco hookah use in Toronto establishments. Air-quality monitoring at Toronto hookah businesses suggests that tobacco is sometimes served, potentially without the user knowing it. Toronto researchers have measured harmfully high levels of air pollutants in these businesses regardless of what is being smoked.  

"Hookah use in public places undermines the success of the SFOA and other smoke-free laws because it contributes to the social acceptability of smoking in public. This change is an important step toward creating safer and healthier spaces for residents", said Dr. McKeown.

The report is available at http://bit.ly/1Kvg0mq.

This news release is also available on the City's website: http://bit.ly/1F6unG8

Toronto is Canada's largest city, the fourth largest in North America, and home to a diverse population of about 2.8 million people. It is a global centre for business, finance, arts and culture and is consistently ranked one of the world's most livable cities. Toronto is proud to be the Host City for the 2015 Pan American and Parapan American Games. For information on non-emergency City services and programs, Toronto residents, businesses and visitors can visit http://www.toronto.ca, call 311, 24 hours a day, 7 days a week, or follow us @TorontoComms.

» Vaporizing Alcohol Not Permitted for Sale or Service in Ontario Licensed Establishments

Recent news reports have indicated that some distributors may attempt to market a liquid vaporizer to Canadian bars and restaurants. Vaporizing liquor, also known as “smoking alcohol” and “alcohol without liquor” (AWOL) is a mixture of alcohol and oxygen, or other gases, to produce a mist for inhalation. Using a device, sometimes called a “Vaportini”, the resulting vapor product is inhaled. The alcohol fumes enter the bloodstream faster and its effects are more immediate than regular alcohol drinks. In Ontario, only alcohol in its original form is permitted to be sold and served at licensed establishments as per Regulation 719/90, so licensees are reminded that they are prohibited from permitting the use of AWOL or vaporizers in their establishment.

» Pricing and Promotion of Liquor for Liquor Sales Licensees

Minimum liquor pricing in Ontario is intended to provide licensees with the ability to offer responsible drink price flexibility through the setting of a floor price for liquor sold in licensed establishments. A standard-sized drink may not be sold or supplied for less than $2.00 including taxes whether the liquor is sold separately or as part of a package that includes food. A serving of liquor is defined as follows: • 341ml (12 oz) of beer, cider or cooler • 29ml (1 oz) of spirits • 142ml (5 oz) of regular wine • 85ml (3 oz) of fortified wine The minimum price changes depending on the size of the serving of liquor provided to the patron. If a licensee offers for sale a serving of liquor that differs in size from those listed above, the minimum price for that serving will increase or decrease in direct proportion to the difference in volume of liquor contained in that serving. For easy reference, the following chart provides some examples of the minimum price for various common sizes in which liquor is served.

Beer

284ml (10 oz)

455ml (16 oz)

568ml (20 oz)

1.7l (60 oz)

Minimum Price

$1.67

$2.67

$3.33

$10

 

Regular Wine

170ml (6 oz)

500ml (18 oz)

750ml (26 oz)

1l (35 oz)

Minimum Price

$2.40

$7.20

$10.40

$14

 

Spirits

14ml (0.5 oz)

43ml (1.5 oz)

57ml (2 oz)

85ml (3 oz)

Minimum Price

$1

$3

$4

$6



Tips for pricing and promotion of liquor
  • You may change your drink prices multiple times a day. 
  • Revised drink prices must always be posted or provided to patrons.
  • Liquor prices must be the same for all patrons. 
  • Drink prices may not be based on the purchase of other drinks. 
  • Prices and promotions may be advertised outside of the establishment. 
  • The posting and advertising of prices and promotions must be responsible in nature

» Settling an Employment Standards Claim

How are Employment Standards Claims Resolved?
There are four ways in which an Employment Standards Claim can be resolved:
1.  An officer investigates, finds the employer has violated the Employment Standards Act, 2000(ESA), and enforces the Act
2. An officer investigates, finds the employer has not violated the ESA, and denies the claim
3. The claimant and the employer settle the claim
4. The claimant withdraws the claim.

What is a Settlement?

The ESA allows claimants and employers to resolve a claim by entering into a settlement. If a settlement is made and both the claimant and employer do what they say they are going to do then the claim is considered to be withdrawn and any investigation relating to that claim will stop.

When can I Settle a Claim?

Claimants and Employers can decide to settle a claim at any time.

Do I Have to Try to Settle the claim?

No. You are not required to try to settle a claim. It is an option available if the claimant and employer want to try to resolve the claim on their own.

Under What Circumstances Would I Want to Settle a Claim?


In some cases, the investigation of a claim could take months; particularly where there are multiple complex issues that require the review of a large number of documents and records. A quick resolution to a claim may be important to some claimants and employers. If they are willing to work together to find a mutually acceptable solution, they may try to settle a claim.
Claimants and employers who choose to pursue a settlement can get more information about their ESArights and responsibilities by calling the Employment Standards Information Centre at 1-800-531-5551 or 416-326-7160.

What Happens if I Settle a Claim?

The claim will be considered to be withdrawn and any investigation into the claim will stop if a claimant and an employer:
  • Agree to a settlement,
  • Do what they say they are going to do in the settlement, and
  • Inform the Ministry of Labour in writing of the terms of that settlement.

What if the Claimant or the Employer do not Comply with the Settlement?


If the employer or the claimant fails to do what they said they would do in the settlement, call the Employment Standards Officer that was assigned to the claim. You can find the name and telephone number of the Employment Standards Officer on the letter that he or she sent to you after you entered into the settlement. The Employment Standards Officer will determine whether to resume the investigation of the claim.

For example, if the claimant and the employer have settled a claim with the agreement that $5000 will be paid to the claimant by October 1st and the claimant does not receive the money on or before October 1st, the claimant should call the Employment Standards Officer. The officer will continue with his or her investigation of the claim, make a decision about whether there was a contravention, and enforce the ESA if a contravention is found.

What if a Settlement was the Result of Fraud or Coercion?

If a claimant believes that the employer used fraud (lied to get the claimant to agree to the settlement) or coercion (used force or intimidation to get the claimant to agree to the settlement) they can apply to the Ontario Labour Relations Board to have the settlement set aside.

What Cannot be in a Settlement?


A settlement must not allow or require any person to engage in future contraventions of the ESA. For example, the settlement must not require the claimant to work overtime in the future without being paid an overtime rate of pay.

How do I Notify the Ministry of Labour of the Settlement?

If a claimant and an employer settle their claim, they must inform the Ministry of Labour of the terms of the settlement. For convenience, the Notification of Section 112 Settlement Form can be used. Complete the form and attach the terms of the settlement and send both documents to the Ministry of Labour.

» Success Stories Needed: Deaf & Hard of Hearing Employees


ORHMA and the Canadian Hearing Society (CHS) are collaborating on a project which will raise the profile of Deaf and hard of hearing people within the workforce, as well as providing guidance to ORHMA members on the AODA Employment Standard, Customer Service, Information and Communications, and best practices and guidelines related to the built environment.   

We’re looking for your success stories to share, via interviews and possibly shooting video on location.  If you have any Deaf or hard of hearing workers at your business, please contact: Jennifer Beer, jennifer.beer@chs.ca 
»  Industry Events     
  • September 17, 2015 – Save the Date! ORHMA Windsor Region 17th Annual Golf Tournament, Fox Glen Golf Course. 
Other Industry Events       
  • June 25, 2015 – Save the Date - 61st annual GTHA/ Tourism Toronto Golf Tournament. Click here for more information. 
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