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Many Freshii customers have already encountered “Percy”.

The video calling device is attached to cash registers in a few select Freshii stores across Ontario, and it turns on when customers approach the counter.

At the other end of the screen is a cashier wearing a headset, ready to take orders. Unlike Freshii workers who pack burritos and clean floors, these “virtual” workers are nowhere near the store. Instead, at least some of them process orders from a Nicaraguan call center nearly 6,000 km away, where they earn far less than Ontario’s minimum wage.

The program is still in the early stages of testing, but Freshii’s virtual cashiers are part of a wave of outsourcing and automated technology that is slowly changing the retail industry in Canada.

For many Ontario retail workers, the implications of these innovations raise a daunting question: how secure is my job?

Freshii, a franchise with 343 restaurants across North America, declined to provide details to the Star about its virtual cashier technology, but in a statement, Freshii business development manager Paul Hughes said Percy was operated by a third party company.

“Just like with Uber Eats, Skip the Dishes, self-checkout options, and other emerging ordering/cashier technologies, Freshii is always looking to be an early tester and adopt new technology solutions that could make ordering easier. healthy meals for our customers and our franchise partners to run more successful restaurants,” said Hughes.

The company has yet to speak publicly about the program, other than to mention several “workforce optimization programs in development” that it hopes will “further help partners manage costs and protect profitability,” in a recent corporate brief.

But employees at the company’s franchises told the Star they had known about the program since November. The Star has verified three locations in Ontario that use these virtual cashiers – two in Toronto and one in Waterloo. One location, in Toronto’s Rosedale neighborhood, has been using a Percy cashier since January.

Two virtual cashiers who spoke with the Star said they were in Nicaragua, where they work at a call center that pays them $3.75 (US) an hour.

In North America, Freshii typically hires for server positions that pay between $12 and $16 per hour, according to data collected by Glassdoor, a US job search website. In Ontario, where the minimum wage is $15 (Canadian), Freshii’s virtual cashier program could potentially save the business $10 or more per hour.

The practice is entirely legal, several labor lawyers told the Star.

“It’s like any other kind of outsourcing: if you’re sending jobs to people in another country, you’re only obligated to comply with the labor standards of that country,” Jonathan said. Pinkus, labor lawyer and partner at Samfiru. Tumarkin LLP. “Being virtually present in Ontario does not change that.

Ontario’s Employment Standards Act applies to workers who work in Ontario or who perform work outside of Ontario that is considered a “continuation” of work performed in Ontario.

Freshii is likely relying on the argument that their cashiers’ work is not a continuation of work done in Ontario, but rather another job that call center workers may be doing in another jurisdiction, said Michael Wright, lawyer and founding partner of Wright Henry LLP.

Yet the program has sparked outrage from union organizers who see the practice as a way to circumvent Ontario’s minimum wage laws.

“Shipping jobs to an offshore location to pay less than a third of our minimum wage here is just hugely disappointing, and quite frankly I’m disgusted that a company like Freshii is taking this approach,” said Bea Bruske, President of the Canadian Labor Congress.

“We need jobs that pay taxes in Canada and help drive our economy.

An increase in outsourcing and automation could prove to be one of the economic legacies of the COVID-19 pandemic. From factories to fast-food chains, companies have turned to technology to keep operations afloat despite physical distancing measures and tight labor markets.

Some of these changes have prompted curious innovations. Sobeys introduced “smart carts”: carts that scan shoppers’ items, track bill totals, accept payments and allow them to skip the checkout line. Late last year, Dark Horse Espresso opened a chain of “robo-cafes” around Toronto – stand-alone touchless machines that take up street-facing retail space and spit out lattes.

Research on automation in Canada contains mixed results. A report released Monday by the Center for Future Work titled “Where are the robots?” argued that Canadian businesses have been slow to invest in automation over the past two decades, which has reduced the impact of robots and automated technology on the workforce.

The report finds that business investment innovation as a share of GDP has declined significantly over the past 20 years, from 2.3% in 2001 to 1.8% in 2021.

Sectoral research, meanwhile, detected a decline in jobs in grocery stores and food retail. A recent report from Ryerson University’s Brookfield Institute for Innovation and Entrepreneurship found a 15% drop in full-time positions in grocery stores between 2006 and 2016, mostly in customer-facing roles. .

More broadly, a report released by the International Monetary Fund last year predicted that pandemic-era automation would increase global inequality in years to come.

Some companies have resorted to outsourcing rather than automation to reduce labor costs. Wage gaps between Canada and some countries in the South are stark, making offshoring a prospect that is hard to resist.

While a call center worker in Ontario earns at least $15 per hour, a worker in India earns an average of $0.35 (Canadian) per hour, a worker in the Philippines earns 1. $65 per hour and a worker in Bangladesh earns $0.11 per hour.

“Employees have been forced to work remotely during the pandemic whether they like it or not, and companies have realized it’s easier than ever to send that work overseas,” Bruske said.

In a statement, Ontario Minister of Labour, Training and Skills Development Monte McNaughton called the virtual cashier program “outrageous.”

“This … is going entirely in the wrong direction. I expect better from a Toronto-based company and I know customers will vote with their feet,” he said.

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