Ontario's secret wage deal will create labour chaos, experts warn

Share

A secret accord awarding Ontario's largest public-sector union a wage increase totalling 3 per cent for 2012 sets the stage for others to demand the same terms, and could pave the way for reopening some existing collective agreements, say labour experts.

The quiet top-up for 38,000 members of the Ontario Public Service Employees Union left the Ontario government on the defensive on Thursday, with opposition members, labour arbitrators and employers widely denouncing it.

Arbitrators say they are shocked that the government struck the confidential deal with OPSEU employees, awarding them an additional wage increase of 1 per cent in 2012, and say it is unprecedented in their experience.

"Apart from what I see as an ethical deficit in trying to keep it secret, there's a naïveté involved in thinking that you would succeed," said arbitrator Martin Teplitsky. "Obviously they thought they would succeed, but they haven't succeeded, and it's embarrassing. It makes one lose confidence in government."

Arbitrators have played a key role in the McGuinty government's failure to impose a culture of restraint throughout the public sector. Arbitrators have all but ignored the government's calls for a voluntary, two-year wage freeze for public-sector workers who bargain collectively. In the absence of legislation compelling the freeze, they have awarded annual wage increases ranging from 1.5 per cent to 2.75 per cent for employees of universities, hospitals and long-term care homes over the past year.

But everyone involved in the collective-bargaining process - labour leaders, employers and the arbitrators - expected government officials to follow their own pronouncements on the need to rein in spending and help erase the province's multibillion-dollar deficit. The revelation of the secret deal, first reported by globeandmail.com and made 15 months before the wage freeze was announced, has hurt the government's credibility.

The mayor of Thunder Bay, Keith Hobbs, said his municipality has signed several new deals with municipal workers this year, with wage increases averaging 1.75 per cent. But he said the agreement with provincial ministry employees in OPSEU represents a potential blow to the belt-tightening municipalities have been advocating.

"If this turns out to be an extra per cent on the wage that's been hidden, and now other unions are going to find out about it, yeah, this could have a ripple effect not only on Thunder Bay but through the province," Mr. Hobbs said.

The OPSEU deal, he said, would mostly affect negotiations for contracts beginning in 2012, making 3 per cent the new benchmark raise.

Sharleen Stewart, head of the Service Employees International Union, which represents hospital workers, said she has every intention of asking for the same deal the OPSEU employees received when she heads into bargaining.

Any union that has negotiated a collective agreement with the province since the OPSEU deal was struck in December, 2008 can now move to reopen it, said Paul Cavalluzzo, a veteran Toronto labour lawyer.

"What would be the point of good faith bargaining if you can't rely on the fairness of representations that are made?" Mr. Cavalluzzo said. "Otherwise, you just have the law of the jungle."

The secret deal involving OPSEU has come to light because of a complaint filed with the Ontario Labour Relations Board by the union that represents 12,000 professional and supervisory public servants. The Association of Management, Administrative and Professional Crown Employees of Ontario accuses the government of bargaining in bad faith and of "deliberately misleading" its members.

OPSEU did not disclose that the collective agreement it signed in 2008 also includes an extra across-the-board increase of 1 per cent in 2012, bringing the total wage hike to 3 per cent, documents presented at the labour board show.

In return for the 1 per cent, which is on top of a scheduled wage increase of 2 per cent for 2012, the OPSEU members made a number of concessions on termination pay and other benefits, said Finance Minister Dwight Duncan, who came under fire during Question Period over the deal. The concessions, he said, add up to 1.25 per cent in annual savings.

"It actually worked out to be a good deal for taxpayers," Mr. Duncan told reporters. "If other unions are prepared to come to the table for those concessions then I'll be happy to talk to them."

With a report from Kirk Makin