Minimum Wage in Nunavut: 2025 Updates

The remote location, limited infrastructure, and climate in Nuvanut create unique challenges that drive up living costs. To help address this, the territory has set the highest rate in Canada. Knowing your rights under the minimum wage in Nunavut is important to ensure fair pay, proper compensation, and workplace protection.

What is the Minimum Wage in Nunavut for 2025?

The current minimum wage in Nunavut is  $19.75 per hour as of September 1, 2025, the highest among Canada’s minimum wage. This significant bump was intended to relieve the cost of living and escalating inflation.

This covers all territorial workers, including those in Iqaluit, Rankin Inlet, Cambridge Bay, Arviat, Baker Lake, Igloolik, Pond Inlet, Kugluktuk, and Gjoa Haven.

Beginning in 2025, Nunavut calculates minimum wage adjustments using a formula based on 2 key economic indicators:

• Consumer Price Index (CPI) 
• Average hourly wages in Nunavut for the previous year

The adjusted rate undergoes public announcement by July 31 each year. The new rate takes effect on September 1 and is published in the Nunavut Gazette.

It applies universally to all Nunavut workers regardless of age or profession, with minor exceptions.

Exemptions for Nunavut’s Minimum Wage

Here are 3 employment categories that fall outside minimum wage requirements:

• Trappers and commercial fishery workers: These traditional harvesting sectors constitute substantial portions of Nunavut’s economic output. When employers in these industries provide lodging or board, they may deduct these benefits from wages paid.
• Professional students in certain regulated professions: Educational institutions placing students in work experience programs must obtain permits from the Labour Standards Officer, who determines appropriate wage rates, if any.
• Managers employed in managerial capacity: They receive exemption from Part I Hours of Work provisions, though other labour standards still apply.

Young Person Employment Rules

Workers under 17 years old face 3 specific employment restrictions:

• Prohibited hours: Young persons are not permitted to work between 11 PM and 6 AM without written Labour Standards Officer approval.
• Permission in the construction industry: Applications must convince the Labour Standards Officer that the proposed work will not endanger the young person. The Officer also considers requirements under related legislation, like the Safety Act administered by the Workers’ Safety & Compensation Commission.

For non-construction employment, employers should still apply for approval when hiring young persons. 

Overtime Rules in Nuvanut

In Nunavut, overtime begins after an employee has worked 8 hours in a single day or 40 hours in a week. It is compensated at a rate of 1.5 times the regular wage. Besides, there are strict limits on the maximum allowable hours:

• A maximum of 10 hours per day
• A maximum of 60 hours per week

Employers cannot require or permit work beyond these limits without special authorization.

Nunavut Minimum Wage Deductions

Nunavut’s minimum wage is governed by territorial and federal requirements. Various standard deductions apply, and additional deductions may also occur in certain situations.

Canada Pension Plan (CPP)

The Canada Pension Plan is a federal program that all Canadian employees and employers contribute to for retirement income. For Nunavut workers, CPP deductions total 5.95% on income above $3,500 annually.

Employment Insurance (EI) Premiums

Employment Insurance is another federal program funded by premiums paid by employees and employers. Nunavut workers pay EI premiums of 1.58% on up to $61,500 of insurable earnings annually.

Income Taxes

As a territory, Nunavut can set its tax rates. Income taxes are deducted from minimum wage earnings according to 4 tax brackets, depending on income level:

• Up to $54,707: 4%
• $54,707 to $109,413: 7%
• $109,413 to $177,881: 9%
• Over $177,881: 11.5%

Source: https://www.wealthsimple.com/en-ca/tool/tax-calculator/nunavut

Other Deductions

Additional deductions may be made for items like garnishments, child support payments, insolvency payments, etc., if legally required. The employee must authorize these in writing.

Source: Nunavut Minimum Wage in 2025 – savvynewcanadians.com

Role of Minimum Wage in Nunavut

In Nunavut, the minimum wage isn’t just a number. With the highest cost of living in Canada, the baseline for wages is important.

Nunavut’s Challenging Economic Reality

4 unique economic factors underscore the importance of an adequate minimum wage in the territory:

• Extremely high costs – Prices for necessities like food, housing, and utilities are dramatically inflated compared to elsewhere in Canada due to supply chain constraints and limited infrastructure.
• Reduced employment options – With a small population of just 38,780 residents across a massive geographic area, the options for economic development are restricted. This results in fewer jobs and income sources.
• Reliance on country food – With store-bought food prices so high, many residents rely heavily on hunting, fishing, and foraging to meet nutritional needs. An increased minimum wage in Nuvanut enables more time and resources for these activities.
• Growing social assistance needs – High costs without corresponding incomes have led to a dependency on income support and social assistance programs in Nunavut. An increased minimum wage can reduce reliance on these programs.

How Minimum Wage in Nunavut Supports Affordability

With these unique economic realities, Nunavut’s minimum wage level is essential in the 4 following ways:

• Allows workers to better afford the high costs of basic needs like food, shelter, clothing, and transportation.
• Provides low-income households with better financial stability and reduced risk of crises.
• Enables single-income families to make ends meet more feasibly at a basic level.
• Promotes higher disposable income that can circulate in the local economy.

Perspectives on the Minimum Wage in Nunavut

Workers, businesses, and economists have reacted mixedly to Nunavut’s $19 minimum wage increase. Uncertainties remain about its potential impacts on the territory’s economy.

Consultations by the Government of Nunavut found workers eager for increased earnings, but businesses were concerned about remaining viable and cutting staff. Retailers like Arctic Co-op highlighted potential pressures on food costs.

Some economists have suggested that minimum wage hikes lead to increased unemployment as businesses struggle with costs. Others dispute this, arguing that improved worker productivity offsets higher wage expenses for employers. The actual impacts in Nunavut remain uncertain.

Given the mixed perspectives, the Government of Nunavut emphasizes that an ongoing review of the minimum wage will be essential to strike the right balance between Nunavut’s economy and affordability.

Potential Future Changes in Minimum Wage in Nunavut

While the focus remains on the $19.75, Nunavut’s government is exploring potential policies for future minimum wage changes.

Indexing to Inflation

The Government of Nunavut is assessing options to index future minimum wage increases to the national Consumer Price Index. This would enable automatic incremental hikes alongside inflation.

Regular Review Process

Regardless of indexing, the government emphasizes that the minimum wage will continue to be reviewed annually to account for economic conditions in the territory.

In Canada, each province and territory has the autonomy to set its own minimum wage rate for provincially regulated workers. Provincial/territorial minimum wages may be higher or lower than the federal rate based on local economic conditions, business factors, and the cost of living. Currently, the minimum wage in Canada varies across the different provinces and territories.

• Minimum Wage in Newfoundland and Labrador
• Minimum Wage in New Brunswick
• Minimum Wage in Manitoba
• Minimum Wage in Alberta
• Minimum Wage in Northwest Territories
• Minimum Wage in Nova Scotia

The bottom line

An adequate minimum wage in Nuvanut is vital for Canada’s northernmost territory to ensure the affordability of living in an exceptionally harsh climate and remote environment.

While uncertainties exist around potential impacts, the increase offers much-needed financial relief for the territory’s workers struggling with its world-leading costs.

Going forward, a balanced approach involving annual reviews and indexing considerations will be instrumental in determining the right policy for Nunavut’s economic conditions. Affordability depends on the minimum wage.

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