Ontario's Public Sector Wage Freeze: A Q&A

For public sector workers in the midst of a global recession, Ontario's wage freeze legislation only makes things worse.

Citing a $20-billion deficit, Ontario has sought to enact a wage freeze that would affect over 1 million public sector employees in the province. Ken Lewenza, President of the Canadian Auto Workers (CAW), spoke to The Mark about how the negotiation process has worked (or not worked) so far.

The Mark: What are CAW union members saying to you about how the wage freeze is impacting their ability to continue working?

Ken Lewenza: It's not a matter of impacting their ability to continue to work, it's a matter of whether public sector workers should suffer the consequences of a global financial crisis that they have no control over. What our members are saying is that we're getting it from both ends. We've got a legislative freeze by the provincial government and we have transfer payments to the service providers, like hospitals and long-term care facilities, that don't meet the rising costs. So, at one end you are asked for a wage freeze, and at the other end, there still continues to be cuts to public services, as hospitals and the education system try to balance their budgets. So workers feel the insecurity at both ends.

TM: Can you give us a sense of how labour negotiations with the province have been going thus far?

KL: I don't call these negotiations with the province. It began with a consultation process where the Minister of Finance gave a presentation on the financial challenges of the provincial government, which included the debt and asked for cooperation. As a result of that, a number of unions, including the CAW, broke off into groups to talk with employer groups in terms of how we may be able to solve this particular direction of the provincial government. For example, the CAW sat in a room with private operators of long-term care facilities, people like the managed extended-care, Rivera [Retirement Lodge]. These are private companies where CEOs are doing very well, shareholders are doing very well – very profitable. We're suggesting that they should be excluded from being defined as public service because it's a private company. When we went into those consultation discussions, there was no response to that type of a definition. When you asked the mediator from the provincial government, "What does this mean? This is a private company – shareholders, profits. Why is it that workers have to take a wage freeze under these circumstances?", there was no answer. So that's why there are some inconsistencies of the message that is being sent, and the policies that are a result of that message.

TM: Given that McGuinty and Finance Minister Dwight Duncan have said that the province's deficit prevents them from lifting a wage freeze, how do you expect the negotiations will play out?

KL: It's going to be difficult. You use the analogy that you go into bargaining with one arm behind your back, and again, if the Premier doesn't allow free collective bargaining (which means the individual bargaining committees from each sector within the public sector) […], then it's going to be incredibly difficult. At the end of the day we keep advocating, for example, when the New Democratic Party introduced the social contract, that was controversial, but they also excluded workers that fell below the $30,000 income level. So there should be discussions about an income level where workers should be excluded. Because, surely, workers that make under a certain threshold should not be forced to continue to fall further behind those that work in comparable [positions] in the private sector. There are still a lot of unanswered questions, and that's why it's going to be difficult. Because each employer within the public sector today is saying "sorry, we're under these restraints," but aren't in a position to bargain enhancements in other areas.

TM: What balance should be established between private employers and public sector workers that might be able to level the playing field with the province's limited financial resources?

KL: There is a statistical fact (it's not a union point of view, it's not a company point of view) that […] when you make progress in the private sector, it carries over to the public sector. If the private sector doesn't do that well, then the public sector shares the same kinds of consequences. And when we showed Minister Duncan those kinds of stats, what we said to him was that the bargaining itself will naturally find some restraints, because there are some restraints in the private sector. But don't interfere with free collective bargaining […]. So if you just lift this wage freeze, and let the bargaining committees decide the priorities after being engaged with their members, the chances are you are going to have bargained collective agreements. But there has to be some flexibility. Workers in some sectors may say, "listen, a wage increase isn't a priority, but job security is, enhancing service is." There's got to be that balance, and the only way to do that is through free collective bargaining, not through the legislative arena.

TM: What is the likelihood of a strike, and if that happened, what would the province realistically be able to do to bring people back to work?

KL: They could legislate people back to work. In health care facilities, for example, some are determined as essential services, so you can't strike and are forced to go to arbitration in some cases. The CAW has always taken great pride at getting a bargained agreement versus going to arbitration. In terms of the legal perspective, you still have a right to go to arbitration on essential services. Workers still have the right to democratically decide whether they will withdraw their labour. But I've been emphasizing this week that we have had minimal labour disputes in the Province of Ontario, less than 1 per cent of collective agreements fall into strike action, but they get 99 per cent of the attention. That's exactly the message we're sending to the Premier – let the collective bargaining draw itself out, and you'll find out that through that process, bargaining committees understand their workplaces better than the legislature does.