With new contracts kicking in for community and school-support workers in B.C., tension is emerging over who will foot the bill.
That tension is a legacy of the government's "co-operative gains" bargaining mandate for public-sector workers, which came into effect last year and replaced a "net-zero" mandate that had been in place since 2010.
Under co-operative gains, any wage increases were supposed to be offset by savings found elsewhere in the contract, without government putting in any additional money and without services being affected.
But as wage increases negotiated under the more recent mandate come into effect, some employers say it is difficult or impossible to cover increased wage costs without cutting staff or services.
"For the past five years, or more in some cases, these agencies have been operating on a zero-increase mandate," Jason Gordon, provincial advocate with the B.C. Association for Child Development and Intervention, said on Friday. "So after five years of operating in that manner, and then have to be faced with this additional crisis of having to find even more savings internally – it's really putting agencies in a bind."
BCACDI is an umbrella agency for 28 non-profit groups that provide services to special-needs children around the province. Many of those groups' employees are in line for wage increases under contracts signed this year with the Health Sciences Association or the Community Social Service Employers' Association of B.C.
Although contract changes were supposed to cover the wage increase – 3 per cent over two years in most cases – some groups are finding it difficult to make ends meet.
"The savings we have received are basically pennies on the dollar for the costs we are incurring," Darrell Roze, executive director of the Child Development Centre of Prince George, said on Friday.
The Prince George centre employs about 60 people, many of whom are covered by HSA contracts. While new provisions in those deals might help large employers, such as hospitals with hundreds of employees, cover wage increases, the same provisions are not as helpful for smaller, affiliate members such as the Prince George Centre, Mr. Roze said.
"The savings that were put in [to the contract] – it was immediately apparent that they wouldn't provide any savings to the affiliate members," Mr. Roze said. "There was definitely some savings to the [regional] health authorities."
Those provisions included changes to working hours to reduce overtime and benefit costs.
For the Prince George centre, the increased wage costs amount to more than $50,000 a year for an organization with a budget of $3-million a year. To cover the increases, Mr. Roze said he is looking at changes such as having families come to the centre instead of workers visiting families in their home.
Layoffs are also restricted under the new agreement, he said.
"So we are facing a situation where we can't lay anyone off, we have higher overall base costs and then we have more hours we have to pay people for," he said, adding that demand for agency services has increased significantly over the past five years.
Similar conversations around costs are taking place in relation to a tentative deal reached last month for public-school education workers who are members of the Canadian Union of Public Employees. That deal provides a wage increase of 3.5 per cent over a two-year contract that expires June 30, 2014. It covers about 27,000 workers, including custodians and teaching assistants, who are CUPE members.
Union locals and school boards have to ratify the agreement for it to take effect. School districts are now studying their budgets for ways to fund the increases.
Vancouver School Board chairwoman Patti Bacchus said it will cost about $4.2-million a year to cover the new agreement.
"My position is that the government went out and negotiated a new agreement and they are refusing to pay any of the costs of that agreement and they are downloading the cost to school-board budgets," Ms. Bacchus said on Friday.
B.C. Education Minister Peter Fassbender, however, has said boards should have anticipated the additional costs and developed savings plans in accordance with the co-operative gains mandate.