Evidence of meeting #11 for Finance in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was process.
A video is available from Parliament.
12:45 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you.
I'm sorry for cutting you off, but I want to get members' questions in. If we extend the witness time, then we are going to have to cut out some members' questions.
12:45 p.m.
Conservative
12:45 p.m.
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12:45 p.m.
Conservative
12:45 p.m.
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12:45 p.m.
Isabelle Roy General Counsel, Legal Affairs, Professional Institute of the Public Service of Canada
Thank you, Mr. Chair.
Thanks to the committee for the opportunity to make these submissions.
The Professional Institute of the Public Service of Canada represents about 55,000 professionals across the country in the public sector, most of whom work in the federal public service. Our members are directly affected by Bill C-4, in particular divisions 17 and 18, which amend the PSLRA and the PSEA, as well as the Canadian Human Rights Act.
It is our contention that the proposed legislation significantly impairs the right to collectively bargain, to the point where it in fact constitutes a violation of the freedom of association, protected by paragraph 2(d) of the Canadian Charter of Rights and Freedoms and the International Labour Organization’s convention 87, among others.
Our criticism starts with the process itself. Like my colleagues, we feel that burying such important amendments in omnibus legislation is certainly not the proper way to go about this. Instead, the changes should have formed part of a stand-alone piece of legislation that would have allowed for the meaningful consultation with subject-matter experts that we're used to in this country when it comes to these types of changes.
This government's approach of imposing sweeping changes without consultation with stakeholders has been severely criticized by the International Labour Organization and is considered to be an attack on freedom of association in different contexts.
The amendments to the PSLRA contained in Bill C-4 will result in collective bargaining that is in fact devoid of any fair and independent dispute resolution mechanism in the event of impasse at the bargaining table. That, in our view, is a violation of the right to collective bargaining that is protected by paragraph 2(d) of the charter.
Bill C-4 proposes to make conciliation/strike the default process to resolve disputes, while at the same time it grants the employer exclusive and unfettered power to determine which positions are to be designated essential.
Should the parties to collective bargaining eventually find themselves before an arbitration board—or even a conciliation board, for that matter—Bill C-4 proposes restrictions that give the employer considerable leverage throughout that dispute resolution process as well. The process will become less fair and more politicized.
These changes dilute the value of objective analysis of relevant economic factors and replace factual evidence with ideological preference.
Put differently, Bill C-4 completely stacks the deck in favour of the employer. It corrals unions to the conciliation/strike route while keeping exclusive and unchecked control over how many workers actually get to go on strike in the hands of the employer and the employer alone. The bill goes further by ensuring that arbitration or conciliation boards have their hands tied by the government of the day's desire to pay—not the ability, which is the proper standard.
The proposed system forces confrontation and results in a serious impairment of the freedom of association protected by the charter. Beyond these associational rights of public servants, the bill also attacks individual rights of our members.
Bill C-4 calls for the PSLRB, the Public Service Labour Relations Board, and the Public Service Staffing Tribunal to be consolidated to form a new entity, the Public Service Labour Relations and Employment Board.
While the purpose of these types of exercises is usually to find efficiencies, this legislation is actually going to have the opposite effect. There are currently long delays, both at the PSLRB and the PSST, and it is not apparent how merging these two entities will shorten those delays.
In fact, compounding these problems, this legislation will probably increase the volume of complaints by forcing similar individual grievances to be filed separately instead of using the policy grievance tool, which was a tool that was developed under the 2005 Public Service Modernization Act and had resulted, in our view, in a lot of efficiencies by handling a number of individual matters in one policy grievance.
The proposed legislation strips the Canadian Human Rights Tribunal—
12:50 p.m.
General Counsel, Legal Affairs, Professional Institute of the Public Service of Canada
Okay.
The bill strips the tribunal of any jurisdiction in relation to allegations of violations of the Canadian Human Rights Act in the workplace for federal public service workers, granting exclusive jurisdiction to the new board. Under the present federal human rights scheme, a finding of discrimination against an employee may attract a direction that the employer cease the discriminatory practice and take measures, in consultation with the Canadian Human Rights Commission, to redress the practice. This power is not provided to the PSLREB in Bill C-4.
The proposed legislation will extend the discretion to dismiss grievances on the basis that they are considered trivial, frivolous, vexatious, or made in bad faith to the employer. Traditionally this was a power granted to independent bodies, like the CHRT or the PSLRB. It's unprecedented to give the employer this ability to unilaterally dismiss grievances before they're even heard. Don't be surprised if there's an increase in the number of grievances that end up in front of this new board for that very reason.
In conclusion, Bill C-4 erodes the associational rights of public servants to fair collective bargaining and their individual rights to prompt, efficient, and unbiased dispute resolution.
Division 17 constitutes an unjustified violation of the freedom of association guaranteed by the charter and is unconstitutional.
Divisions 17 and 18 should be separated from Bill C-4 to allow for proper consultations with stakeholders so that a true modernization of labour relations in the federal public service can take place, as opposed to proceeding with this regressive proposed legislation.
Thank you.
12:50 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you for your presentation.
We'll now go to Mr. Neilson, please, for your five-minute presentation.
12:55 p.m.
Director of Communications, Fair Pensions for All
Thank you, Mr. Chairman.
After reviewing Bill C-4 we were pleased to see some necessary changes made to labour relations and arbitration systems. We believe it's the right direction for the Canadian government to take at this time. Having said that, today we'd like to comment on income inequality, fairness in pensions, and keeping our seniors out of poverty, as we feel that these are issues the government needs to look at a little more carefully.
When we do talk about public sector compensation, it seems fashionable today to compare their compensation with the top 1% in our society. That is a completely false comparison. The richest in our society are rarely concerned about what the average public sector worker makes. Similarly, it wouldn't be fair to judge what a public sector worker makes by the poorest in our society, because it would be a complete imbalance.
What we are suggesting is that the committee focus on the average working Canadian when analyzing what compensation is equitable for a public sector worker. Since 2003 we've seen a significant increase in public sector compensation. According to the PBO, the average civil service employee now makes in excess of $77,000 per year. What makes that both alarming and unfair, in our opinion, is that the average private sector worker in the country today is making just in excess of $40,000. In other words, the private sector worker is making about 48% less than the public sector worker. I think in the previous panel one of your witnesses testified to that. He realized that the pay was so much spread apart between the public and private sectors.
At a time when inflationary trends are causing financial challenges for the average private sector worker, we do think it's very important for the government to fix this fiscal imbalance. I think there are some measures in this bill that certainly could do that.
The effect of rising salaries in the public sector has also had a very negative effect on pension programs. For every dollar that you give a civil servant in salary, the pension fund has to find $16 for that worker in retirement. When our pension system was created, the expectation was that an employee worked for about 30 years, would be retired for a few years, and then pass away. However, today our life expectancy is so much higher. A recent actuarial report that we have seen showed that the average life expectancy for a female public sector worker was 89.4 years and for a male it was 87.3.
Now, of course, we find ourselves two years into the baby boom retirement tsunami, and many of the pension plans are broken. It seems that the only answer to that has been to increase the contribution rates. That's not going to work. Over the last 10 years, in fact, we've seen contribution rates increase by over 130% into these pension funds, and now it is a fact that Canadians invest as much into public sector pension funds as they do into their own RRSPs. Again, this is unfair to the average private sector worker. As they struggle to pay the bills and have nothing left to contribute to their own pension fund, they have to match the contributions dollar for dollar of the public sector worker. According to the PBO, when you include pension matching and when you include some of the benefits, the average civil servant is costing taxpayers $114,000 per year. In fact, last year Canadians contributed over $34 billion into public sector pensions.
At Fair Pensions for All we believe that every Canadian should be able to save for retirement, not just the wealthy and not just those who are in government.
There's also been a lot of talk about the big CPP recently. We reject that out of hand. We ask you to do the same, because we see that as basically a backdoor bailout of public sector pensions and we would suggest you ignore that.
12:55 p.m.
Director of Communications, Fair Pensions for All
Finally, I want to make a couple of suggestions, if I could, Mr. Chair.
We suggest that the government look at ending defined benefit pensions for government employees and replace them with defined contribution plans. We would suggest that those plans would be matched by the employer up to $3,000 per year, as that would more accurately reflect what a private sector worker can get. We also suggest that the government take the CPP, OAS, GIS, and QPP and make one simple-to-understand pension program. In doing that—and this is the last comment I'll make, Mr. Chair—we would suggest it use income testing to decide who actually needs this retirement income. If we do income testing with these particular government retirement programs, we can actually help the people who really need it. Our work shows we could increase the average retirement income to $25,000 per year without having to increase contributions.
With that, I thank the committee and look forward to any questions you might have. Thank you.
1 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you very much, Mr. Neilson.
We'll go to Mr. Murray, please, in Edmonton.
1 p.m.
Vice-President, Research, Frontier Centre for Public Policy
Thank you, Mr. Chair.
We at the Frontier Centre are proud to have been invited to speak today because we feel that Bill C-4 represents a series of essential changes and clarifications to a variety of aspects of Canadian government.
As requested, my comments here will be limited to part 3, divisions 17 and 18, which seek to modernize the collective bargaining and recourse systems available.
Popular interpretation and criticisms of divisions 17 and 18 seem to focus on an effort by the government to limit or eliminate labour rights, particularly from unionized workers, in an omnibus bill. For the most part, I would say the provisions of divisions 17 and 18 are aimed to create efficiencies in the labour processes, particularly in recourse mechanisms, and will in some cases reduce unnecessary duplication or confusion.
Clearly, the most controversial aspect of these sections is that which focuses on the ever dubious essential service designation. We at the Frontier Centre believe the time has come for a public debate about the right to strike in the public sector, and we welcome the opportunity to comment, though at the outset I would also urge caution with any expansion of the essential service designation.
There is no doubt that the essential service designation is important and could be more widely applied in the federal government, but there is a risk in overutilizing the concept. First, the clear expansion of government power in this area as a result of Bill C-4 is in some ways problematic and really needs to be thought through further. Also, if overused, unproductive negotiations could continue for unusually long periods of time, unless parties agree to a final-offer selection of binding arbitration at the outset.
While we do support the arbitration process and believe that unions have historically done well under the process, I would stress that it is a key right of the employer to designate a service as essential, though any expansion of the designation or a reduction in the ability of unionized workers to strike or to access labour rights will clearly face significant opposition. As such, a long-term, honest consultation process should be embarked upon, which I believe this committee is trying to get at, but I hesitate to say will not go far enough in that consultation process.
Curtailing or limiting the right to strike or access to grievance arbitration will never be appealing to unionized workers as it is a vital last-resort option in times of difficult labour processes. I do believe the use of strikes has become far too overutilized. It is now seen as a tactic rather than a last-resort option. As such, we would support efforts to further limit the ability of a party to strike in some cases. As such, we would also urge that there would have to be curtailment of the ability to walk out simultaneously.
In any public sector work stoppage, it is not the government that is hurt, it is the taxpayers. Canadians pay a very high premium for what are supposed to be world-class public services and should not have to face close-downs because of labour instability. We see little need for taxpayers to pay for services they have no access to, and it's time for these issues to be tackled.
Further, it is very much in the public's interest to have certain services declared as essential, but the government must prepare for the myriad of court challenges that will come as a result of expanding the designation. Ultimately, if this bill is to move forward, the success of a court challenge would, at least in part, be dependent upon how much consultation has actually taken place and how impartial that consultation process truly is.
Other aspects of divisions 17 and 18, such as the expanded use of conciliation, the extension of bargaining timelines, streamlining recourse and grievance processes, and the consolidation of matters into one board are all very useful in their own right in some cases, though each must be considered and valued on its own merit.
Ultimately, what we see the government is trying to do in divisions 17 and 18 is very positive, though we have questions regarding why this is being embedded in an omnibus budget bill. The status quo is not working well for any party involved in negotiations at this point in time, and it's certainly a time for alterations in the ability of public sector employees to strike and their access to certain labour recourse mechanisms to be reviewed, so as to not hold taxpayers hostage.
Even so, legitimate, fair, and transparent practices are by far the best ways to achieve labour peace. We would hope that these underlying values are being contemplated—
1 p.m.
Vice-President, Research, Frontier Centre for Public Policy
—when all political parties make their decisions on these matters.
Thank you.
1 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you very much, Mr. Murray.
We'll now go to Mr. Pruden in Windsor, please.
Mr. Pruden, can you hear me?
1 p.m.
Vice-President, Labour Management Strategy, Postmedia Network Inc., As an Individual
Yes, I can. Thank you very much, Mr. Chairman.
I'd like to begin by thanking the committee for the invitation to participate in these consultations.
I am an individual who has worked for over 30 years in the labour relations field in the private sector and the public sector. For 20 of those years, I was the chief negotiator for the Government of Manitoba, for both the government as an employer and for a number of crown corporations and government agencies, so I have considerable experience with interest arbitration.
To be honest, I'm not a big fan of it. I find it interesting that there seems to be a lot of concern about the impact of this bill on collective bargaining, that there will be no meaningful bargaining. I think in an interest arbitration environment, it's pretty well documented that interest arbitration has a chilling effect on bargaining. That's the term that's used, and it's based on the tendency of arbitrators to split the difference between the parties' positions. I have found, and I think it's been well researched by others, that bargaining in an interest arbitration environment largely involves excessive demands, minimal compromise, and an attempt to have an arbitrator split the difference. There are some real problems associated with the impact of interest arbitration on collective bargaining.
In addition, there is a narcotic effect that has also been researched that talks about the tendency for parties who basically delegate their problems to an interest arbitrator to become addicted, for want of a better term, to that mechanism, so it can have a detrimental effect on the relationship between the parties.
When I look at the role of government, it seems to me that two things in particular are important. One is to protect the safety and security of the public, and the second is to be responsible with regard to the use of government funds. I don't believe government should negotiate the safety and security of the public, and I think the danger with that—and that's part of the existing process where there's a negotiation process—is that bargaining by its very nature has compromise. What that means is essentially the government and the unions are in a position where they are compromising the safety and security of one group of the public to the benefit of another. So compromise is not an appropriate mechanism when you're dealing with safety and security issues.
I don't really even believe that those issues should be delegated, for want of a better term, to a third party. A third party should not be imposing a compromise on safety and security issues. These are key issues; they are fundamental issues. I think that whether or not those issues are essential services and are subject to negotiation or third-party review, they are fraught with difficulty for the public.
With regard to the grievance arbitration process, or adjudication process, there's been some comment about that. I venture to say that if you started with a clean sheet of paper, you would not set up the existing system in the federal system to handle grievances. When I look at the ideal grievance procedure for individuals, it should be an efficient process to achieve final resolution of disputes. I think the changes that are being proposed will certainly increase efficiency, and they will better enable the parties to achieve a final resolution by avoiding some of the jurisdictional issues that have been problematic in the grievance arbitration process at the federal level.
1:05 p.m.
Vice-President, Labour Management Strategy, Postmedia Network Inc., As an Individual
The point I would make on that is that the existing process is a very imperfect process, and these changes on the grievance arbitration process, in particular, I see as quite positive. I don't see any discrepancy between what's being proposed for the public sector here and the private sector. It starts to mirror the private sector more closely, and I think this is a more important goal.
1:05 p.m.
Conservative
The Chair Conservative James Rajotte
Thank you very much, Mr. Pruden, for your presentation.
We'll begin members' questions with Ms. Nash for five minutes.
