Ontario's Minimum Wage Rises October 1: How to Control Labour Without Cutting Your Team
On October 1, 2026, Ontario's general minimum wage rises from $17.60 to $17.95 an hour.
That's a 35-cent increase, about 2%, tied to the province's Consumer Price Index. The student minimum wage (for students under 18 working 28 hours a week or less during the school year) goes to $16.90. And since the separate liquor server rate was eliminated in 2022, your servers move to $17.95 too.
Thirty-five cents doesn't sound like much until you multiply it. A restaurant scheduling 1,200 hourly hours a week at or near minimum wage adds roughly $420 a week, or about $21,800 a year, before vacation pay and payroll costs. Staff already earning a little above minimum will reasonably expect their rates to move as well.
For operators already feeling squeezed, the reflex is to cut shifts or cut people. That's usually the wrong move. In a market with high turnover and a hard time finding committed hospitality staff, the people you have are worth protecting. Rising wages don't mean you should cut staff. They mean you have to manage labour better. Here's how.
Retire the "old way" of scheduling
Most owners and managers haven't changed how they schedule in years. The old way is easy and consistent, and it worked for a long time. But over the last 5 to 10 years, labour and nearly every other cost have climbed, and the old way no longer keeps labour in check.
The old way looks like:
Manual scheduling. Pen and paper, or copying last week's schedule in Word.
Basic spreadsheets. Excel tables that list shifts and maybe total a few costs.
No real measurement. No line of sight into what a schedule costs or where the inefficiencies are.
Underused software. Many operators pay for tools like 7shifts, Push, Ameego or their POS scheduling module but only use them as a digital calendar.
A scheduling tool is only as good as how you use it. Used properly, even Excel can control labour. Used as a copy-and-paste calendar, the best software won't.
Start with your numbers
Before you can control labour, you need information you can make decisions with. Ask yourself whether you have:
Daily sales reports that include wages and the cost of hours worked, not just sales
Labour cost reports you actually review
Regular financial statements prepared by you or a bookkeeper
A profit and loss statement
Ideally, a budget
Then check whether your reporting tells the right story. We often see labour lumped into a single "wages" line, with no split between front- and back-of-house, or between fixed management salaries and variable hourly labour. Break it out, and show each category as a percentage of gross sales:
In this example, back of house is the highest single cost at 15% of sales. That's where a manager would look first. Percentages are more useful than dollars because they scale with your sales: a $12,000 FOH week means something very different in a busy month than a slow one.
There's no single "right" labour percentage. The old rule of thumb was 30% total, but that's no longer typical for every business. Your target depends on your concept, service style and menu.
Build a smarter labour system
Once you can see labour by department and as a percentage of sales, you can manage it. The system has five steps: forecast sales, share the labour plan, build schedules to it, review performance daily, and act on what you find.
Forecast sales accurately. Budgets are a starting point, but things change, so forecast one week at a time.
Use historical data: last week, the last 4 to 6 weeks, and the same week last year.
Factor in seasonality: holidays, tourism, patios closing for the season.
Account for events inside and outside the restaurant, and the weather, that will lift or hurt sales.
Staff to expected demand.
Communicate targets clearly.
Share daily and weekly sales goals with your team.
Set a labour cost percentage, with separate targets for FOH and BOH, and give them to whoever writes each schedule.
If you don't have targets yet, pick a starting goal and test it week over week.
Empower your managers to own the result.
Write smarter schedules.
See the labour cost of the schedule while you build it. With the new $17.95 rate loaded into your system, every shift shows its real cost.
Adjust shifts before you publish. Don't post a schedule until it fits the budget.
Schedule to the forecast, not to hope.
Manage daily performance.
Track actual labour against target in real time. Tools like 7shifts show projected sales, labour and performance each day.
Make mid-shift and mid-week adjustments: send someone home early on a slow night, trim a shift later in the week.
Use dashboards to stay on track. One caution: a flat target like 17% labour every day of the week rarely reflects reality. Set true daily targets.
Adjust weekly.
Review performance every week.
Look for overstaffing, and for sales you missed because you were understaffed.
Adjust next week's schedule and forecast. Tracking hours, not just dollars, often makes the gains easier to see.
Invest in your team to grow sales
Controlling labour is half the equation. The other half is making every labour hour earn more. When guests spend more and come back more often, the cost of each labour hour has less impact on the business.
Guest experience is the goal
Guests have less disposable income right now. When they do go out, they want to spend it somewhere special. That makes a 10/10 experience more important than ever: roughly 90% of guests who rate a visit 9 or 10 out of 10 will tell others to try the restaurant. Your staff are the ones who make that happen.
Make training ongoing and affordable
Training isn't a one-time event. Build it into your annual budget, refresh it for seasonal menus and events, tailor it by role, and review it every year. Staff should know what's expected and know the food and drinks well enough to deliver a consistent experience. It doesn't have to be expensive:
Cross-train so staff can move between roles. It gives you flexibility when you trim a shift.
Hold daily pre-shift meetings while everyone is already together and on the clock.
Use your suppliers to run product training.
Use tech such as Push or 7shifts for messaging, onboarding and central manuals.
Show staff the payoff: better product knowledge means better tips and more money for them.
Keep the people you've trained
Replacing staff costs far more than keeping them. Consider:
Hiring initiatives
Referral programs
Retention bonuses
Location-based rewards such as park passes, rentals or gift cards
Your checklist before October 1
☐ Update pay rates in payroll and your scheduling software to $17.95 (general) and $16.90 (students under 18), so every schedule shows its true cost.
☐ Price out the increase. Run your current schedule at the new rates and see what it adds per week, per department.
☐ Forecast labour for the coming weeks based on past performance and your October sales outlook.
☐ Set FOH and BOH targets as a percentage of sales and hand them to whoever writes the schedules.
☐ Don't publish a schedule until it fits the budget.
☐ Look at your slowest hours. If an hour or day consistently doesn't cover its labour, consider closing then.
☐ Review your menu costs. Will your margins cover the new labour cost? If not, it may be time for menu engineering or pricing changes.
☐ Plan your training and retention so you keep the team you've built.
The October 1 increase is a good reason to rethink how you manage labour, not just a cost to absorb. Know your numbers, schedule to your forecast, and invest in the people who create the guest experience. That's how you protect both your team and your profit.