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Education Minister Laurel Broten talks during a news conference after a meeting of provincial and federal environment ministers in Toronto, Monday, May 28, 2007.

NATHAN DENETTE/Nathan Denette/Canadian Press

A contract offer that Ontario teachers called "offensive" and "unacceptable" is simply a plan to protect years of progress made in education, the province says.

Both elementary and secondary school teachers are up in arms over a proposed two-year deal that would freeze salaries and put an end to retirement payouts for unused sick days, a rare sign of labour strife to come for education-friendly Premier Dalton McGuinty.

But the government says a hard stand on labour costs are necessary to restrain the cost of education without resorting to the cuts to full-day kindergarten and hikes in class sizes recently recommended by hired advisor Don Drummond – measures the government contends would mean 10,000 lost jobs and a blow to quality.

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"We appreciate [Mr. Drummond's]advice, but we have a different idea," Education Minister Laurel Broten told reporters Thursday morning.

Mr. McGuinty's government has been calling for public sector wage freezes for much of the last two years, but struggled to secure them. The government's proposed parameters for teachers include a true freeze – zero salary increases, but also no movement within the existing salary grid, and a promise to revisit the salary grid in the next contract two years from now.

"We don't just want to freeze the grid: we're going to fix it for the long term," Ms. Broten said, adding that many teachers have been receiving total pay increases of 8.5 per cent annually.

The plan would also scrap an existing provision in most school boards that allows teachers, who are entitled to 20 sick days a year, to carry over up to 200 unused days to retirement, paid out as a lump sum payment equal to 50 per cent of their current salary. At present, a typical teacher at the high end of the pay scale could be owed $46,000 at retirement.

The government says its existing liability for this "retirement gratuity" is $1.7-billion, including $118-million this year. Days already accrued would be honoured, but Ms. Broten said the benefit is at odds with new fiscal realities. Under the new system, teachers would have six sick days that do not carry over, followed by up to 24 weeks at two-thirds salary.

Finally, the government's framework includes no increases to provincial pension contributions. Given that teachers are not expected to stomach contribution rises of their own, any deal would likely look at rolling back benefits.

The Elementary Teachers' Federation of Ontario and Ontario Secondary School Teachers' Federation both reacted with outrage. In a scathing letter to his members, ETFO president Sam Hammond called the tone of the proposal "mean-spirited" and wrote, "To say we were insulted is an understatement." The ETFO has also pulled out of two days of talks scheduled for next week.

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Other discussions are still ongoing, led by negotiator Jim Farley, a former Superior Court justice.

The teachers' contracts do not expire until Aug. 31, but the province has been pushing the pace of negotiations. Ms. Broten said it is normal to start negotiations for such important contracts this early, but that it is also important to have the negotiations guide the government's decisions on the budget due in the coming weeks.

Despite the hard-line stances on both sides, Ms. Broten refused to speculate on the government's willingness to endure a strike to push through these changes.

"I'm focused on where we are at today," she said. "I believe in our capacity to work together."

The existing agreements signed in 2008 awarded elementary teachers with 10.4 per cent salary hikes over four years, and secondary teachers 12.55 per cent over the same period.

The teachers contract is just one of several major public sector deals expiring this year.

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