Human Resources Committee on May 21st, 2013

[Joe Daniel, Conservative, Don Valley East, ON]

It's a small operation.

[Capt Craig Blandford]

In my remarks I alluded to the fact that we're going to have a pilot shortage, because the pay and the employment opportunities are just not there anymore, and until those get corrected.... It's a significant investment. You either have to join the air force and invest your time in a career for 15 or 20 years, or you have to spend years and years and years flying in the bush. You have to pay a lot of money yourself to get trained. It's a huge investment, and unless you're sure that investment is going to produce a career.... A lot of us do it for passion. A lot of us do it for a career. You're lucky if, like me, you do it for both, but there is a significant investment and there is just not enough incentive these days for young Canadians to start flying when they see the downward pressure on wages, pensions, other benefits of being employed with, say, a legacy carrier.

Our defined benefit pension for pilots is gone. It no longer exists. That's an indicator. Why would you get into this profession without those kinds of benefits that generations before have benefited from? We're concerned about that. We really are. I seriously think that until the pay and benefits improve—it's the old supply and demand situation—to incite young Canadians to want to get into that profession, you'll get those who have the passion, but otherwise we're going to have an issue.

[The Chair, Conservative, Ed Komarnicki]

Thank you, Mr. Daniel. Your time is up.

We'll move to Mr. Cuzner and conclude with him.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Great. Thanks very much, Mr. Chair.

Thanks to the three witnesses. It was excellent testimony today.

I'll just reiterate what my colleague Mr. Daniel said. I wouldn't want to speak on behalf of the NDP, but certainly the Liberal Party understands that this is an important program as well, and where it's gone in the last six years causes great anxiety on our part. It has to be a program that both serves the interests of Ms. Reynolds and Mr. Davidson and does not imperil Canadian jobs.

We're trying to find out...and as Mr. Lapointe said, I don't think this is going to be an extensive enough investigation into the issues around it.

The points you brought up, Ms. Reynolds, are real. The questions you asked are real. They are sincere. They are insightful and they deserve an answer. Have you been putting the questions that you posed at the end of your testimony to the government, to the department to try to get information?

[Joyce Reynolds]

We have participated in a consultation process in terms of the temporary foreign worker program, so we have put forward our comments in a fairly comprehensive brief to the government.

I don't know that I've put forward every question that I've raised here today, but we've certainly made very clear our position and our concern that the changes to the program could make the program more costly and less accessible to our members. We've definitely raised those concerns.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Again, I think the needs of the Canadian workforce have probably changed significantly since the program was initially developed, so there should be a total rethink of the program or at least of what's working well and what needs work. I don't think we're going to get that through the exercise we've been tasked with from the finance committee.

That being said, I want to ask this of Captain Blandford, if I could, because this isn't a new problem with the foreign pilots. This isn't something that has just happened in the wake of the HD Mining incident in British Columbia. How long have you guys been beating the drum on this particular issue?

[Capt Craig Blandford]

I have documents in front of me going back years; I can say at least four years. Every time we meet with folks of influence like yourselves, we bring this up. I will meet several MPs this week. It is on my list of things to remind you of. It has been three or four years....

As I said in my remarks, I'm very reassured that you've been given this task and that the government has acknowledged that there are issues. Whether it's a fee-for issue or an LMO issue, I'm very reassured that it's being addressed. I'm now hoping to see results that will affect our industry as much as the others need this affected in their industries, but it has been quite some time.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

You feel reassured? It's been assured by the officials that they're going to address this? What do you base your assurance on?

[Capt Craig Blandford]

Well, my knowledge on the basis of how our country works is as basic as most people's. When I see the Prime Minister on national TV stating that he has acknowledged that there are issues with the program and that they will be looked at in some fashion, I'm reassured that you've invited me here to comment. Hopefully those comments will be taken and addressed and some legitimate action will result from them.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Because I would think the announcement that was made last year, which had been sort of reversed this year.... On this announcement of accelerated LMOs and the 15% reduction in the regional wage averaging, I would think that you would have been very concerned and your organization would have been very concerned on those two issues in particular.

[Capt Craig Blandford]

We have been, sir. All I can say is that I really hope the work your committee does helps to address some of these issues. We can see them as employees and workers, whether it is in flying airplanes or working in a restaurant. Hopefully we'll see some changes that are productive and realistic and address the concerns of all three of us.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Ms. Reynolds, if I could ask you—

[The Chair, Conservative, Ed Komarnicki]

Your time is almost up, so please, if you could, make it very short.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Okay.

We're hearing that with the accelerated LMOs, many are being pushed forward or are not really scrutinized. Do your members have much contact with the officials who are doing the processing? Do they visit the employers? What would be the frequency for that? Are there e-mails or phone calls? Is there much contact with the officials on these issues?

[The Chair, Conservative, Ed Komarnicki]

A short response, please, if you could.

[Joyce Reynolds]

My understanding is that the ALMO is now gone, which from our perspective is unfortunate, but those who were applying through the ALMO were employers who had already been using the LMO process and were very familiar with it. The officials they worked with were very familiar with their operations and with the labour market situation in those communities. It was a situation where there was a very strong relationship and a lot of contact between the officials and the employers.

[The Chair, Conservative, Ed Komarnicki]

Thank you for that response.

I should make mention that this particular legislation deals with some very narrow and specific issues, and that obviously, there will be round table discussions going forward with respect to future changes to the accelerated LMO process. It was temporarily suspended, so it's not gone.

[Joyce Reynolds]

Okay, good.

[The Chair, Conservative, Ed Komarnicki]

I want to assure you of that. It's meant to deal with the pretty restrictive, narrow issues now with the understanding that there will be modifications and discussions going forward to make it better.

Thank you very much, all of you, for appearing before us and sharing your thoughts.

We'll suspend for a very brief period as we install the second panel.

[The Chair, Conservative, Ed Komarnicki]

We've got some committee business, so we'll suspend a bit earlier today. I want to hear from all the members and allow an opportunity for questions, so we will commence shortly.

We have with us here today Paula Turtle, Canadian counsel to the United Steelworkers. We have David Sinclair, vice-president, human resources, Blue Mountain Resorts Limited; and Chris Roberts, senior researcher, social and economic policy department, Canadian Labour Congress.

We're dealing with some very specific amendments to the temporary foreign worker program. We're trying to get a perspective from the various sectors and industries, so we're looking forward to hearing from you.

You will present for about five to seven minutes, and then there will be questions from the members of each of the parties here.

With that, we'll start with Ms. Turtle.

[Paula Turtle, Canadian Counsel, Canadian National Office, United Steelworkers]

Thank you. I'm here on behalf of Ken Neumann, the Canadian national director of the United Steelworkers. I'd like to thank this committee for inviting us to appear here today.

As you may know, the Steelworkers is Canada's largest private sector trade union. We have about 225,000 members in virtually every geographic and economic sector of Canada's economy. We have a long history of negotiating and enforcing collective agreements on behalf of workers and of participating in many aspects of Canada's democratic process.

We represent workplaces in which temporary foreign workers are employed. We have organized workplaces where temporary foreign workers are employed. We were one of the first unions and we have continued to be one of the unions that have spoken up about our concerns with the application of the temporary foreign worker policy.

We're particularly concerned about changes to the temporary foreign worker policy over recent years, especially those changes that have seen a huge increase in the number of low-skilled workers who come to this country under the program. When the temporary foreign worker program was initiated many years ago, its purpose was to ensure that specific and narrow labour shortages would be addressed by bringing in workers for short-term employment. It was developed to target specific groups of workers whose skills did not exist in Canada.

Since 2002, it's been expanded hugely to cover workers, particularly those in national occupation classifications, NOCs, C and D, generally those jobs requiring secondary school and on-the-job training. Since then hundreds of thousands of workers have come to Canada to work in doughnut shops, hotels, retail stores, restaurants, and banks, typically in short-term, low-wage jobs. Most of those temporary foreign workers have come in under that aspect of the program and have little or no chance of staying in Canada. These current policies are essentially creating a permanent underclass of low-wage workers.

In short, this policy creates a pool of vulnerable workers and labour for employers who are not prepared to hire from Canada's 1.4 million unemployed.

We submit, and we have been submitting publicly for some time, that the temporary foreign worker program must be changed. Essentially there are three areas where we say the program must be changed in order for it to operate efficiently.

First, low-skilled work, that work I referred to a few minutes ago, covered by NOCs C and D should be excluded completely from the scope of the temporary foreign worker program and should be phased out.

Second, we say for the remaining temporary foreign worker categories, employers must be required to prove on the basis of rigorous tests that there exists a genuine labour shortage before an LMO can be issued. Hand in hand with this reform we say that the government should and must develop policies that will encourage employers to develop, implement, and maintain job training and apprenticeship programs that enable Canada to have a skilled and well-trained workforce.

As it stands, the temporary foreign worker program operates as a disincentive to employers to develop those kinds of training programs that we would like to see put in place.

Finally, our third concern with the temporary foreign worker program as it is currently in place is that temporary foreign workers under the existing policy are vulnerable to exploitation. The policy must be changed to ensure that workers who come to Canada are not in a situation in which they are systemically vulnerable and in a position of feeling they can't speak out against abuses. The situation in which temporary foreign workers are vulnerable and exploited harms not just temporary foreign workers but all members of Canada's domestic labour market. In other words, if temporary foreign workers are treated badly and among other things permitted to be paid up to 15% less than workers in the domestic labour market, that exerts downward pressure on the wages of all workers. That's wrong.

We say that the better solution to meeting Canada's labour needs is to have a fair system of immigration that ensures people can come to Canada, can work here, can contribute to Canada's social and economic fabric, and stay in Canada and become citizens, and continue to participate in our country's economic future.

That is the kind of long-term solution Canada needs, and we urge that the program be reformed. The current system, which gives rise to exploitation and vulnerability, can and should be changed to ensure that workers who come to Canada come as citizens, not as temporary migrant workers who we invite in for a short period of time and who we then tell, at the end of that period of time, “Here's the door. You can go home”.

In addition, for current workers who are here and for any temporary foreign workers who come in under a revised system in the future, a quicker and more reliable path to citizenship would go a long way to reducing the potential for exploitation and vulnerability.

Thank you.

[The Chair, Conservative, Ed Komarnicki]

Thank you for that presentation. I know your suggestion regarding making them citizens or part of the social fabric is important. A previous witness, Mr. Davidson, mentioned that in Saskatchewan the provincial nominee program has provisions for that.

Mr. Sinclair, go ahead.

[David Sinclair, Vice-President, Human Resources, Blue Mountain Resorts Limited]

Thanks very much.

Good afternoon, ladies and gentlemen.

We're concerned about one specific change that you are considering to how the temporary foreign worker program is administered, which may disqualify my company from participating. In the broader sense, as more changes might be considered right now or in the future, I hope that by describing to you our situation you might better appreciate how useful the temporary foreign worker program has been in the last few years.

For you to appreciate our perspective, I need to describe our business and some of the challenges. Blue Mountain is a year-round ski, golf, summer attractions, lodging, and conference resort. Located on the southern shore of Georgian Bay, it's two hours from Toronto and 15 minutes from Collingwood, a town of 18,000 people.

Though we are a year-round operation, the majority of our business occurs between the Christmas break and the March break—three months. We budget for 700,000 skier visits, and we sometimes exceed that, and we know that thousands more come who don't ski during that three-month period. To service the customer volumes during this three-month period, we recruit 1,300 seasonal employees to supplement our 500-person year-round workforce. There's a total of 1,800 people for a three-month period, and then, at the end of the ski season, we lay off the 1,300 employees.

Clearly, the recruiting process for seasonal employees in a winter business like ours is one of the company's strategic processes. Our top priority is the condition of the ski hill, but next to that, it's the employees we recruit who generate a great guest experience.

I've been managing the human resources function at Blue Mountain since 1991. I've seen many economic peaks and valleys. I have experienced tough recruiting times and easy recruiting times.

I believe that we've tried just about every technique one could try to attract and to hold on to seasonal employees. We've raised wages over those of the local employers. We've provided free transportation from the local towns. We've provided discounted day care for kids of employees. We've offered referral incentives: refer your friends and family and we'll pay you some money. We've worked with consultants to get welfare recipients into our jobs. We've offered incentive pay to the staff in our hardest-to-fill jobs, and we've recruited around the world to bring in international employees with travelling work permits.

Each year we spend a considerable time analyzing what worked and what didn't work the previous season. However, except for the recession of the 1990s, and more recently 2008-10, hiring seasonal employees has always been a struggle in some departments. Each winter season, there are a few departments running short the entire season. We cannot find enough interested and qualified employees to fill the least desirable jobs for the three-month winter season.

Bear in mind that some of these least desirable jobs also exist on a year-round basis. We'll have the seasonal employees join the year-round employees doing the same work. For instance, we have 80 room attendants—hotel cleaners—to which we add 30 seasonal employees.

It's the seasonal aspect of the job that presents the problem. It's our experience that when you recruit an individual for a job that's not desirable and you can only offer it seasonally, the job often goes unfilled, particularly where there's higher than average employment or lower than average unemployment, and this is key.

In our region, we drive by dozens of apple orchards every day on our way to work. Every one of those apple growers is using foreign workers, because they can't make their business work at a wage that would attract Canadians to do their pruning and picking for the season. Blue Mountain can relate to them and therefore wonders why tourism might be treated differently.

Prior to the recession of 2008-10, we had as many as 60 temporary foreign workers in our toughest-to-fill jobs. These employees came from Barbados. They all had a high school education and many had a post-secondary diploma in hospitality with an emphasis on either housekeeping or kitchen work. We employed them in those two areas. They were excellent workers and proud of what they did, and they were paid the same as the Canadian employees.

During the recession of 2008-10, we did not have any temporary foreign workers. It's our preference to hire Canadians.

Canadians don't need us to pay for flights, housing, bus shuttling, health insurance, or any orientation to the Canadian system. However, with the recession over and companies hiring again, the seasonal recruiting challenges have returned. Hence, this past winter we had 20 temporary foreign workers in our housekeeping department and we wished we would have applied for workers in our seasonal kitchens because we ran short all winter long. There was a lot of overtime.

Our former Governor of the Bank of Canada, Mr. Mark Carney, was quoted as saying that the temporary foreign worker program should not be used to fill the lower skilled jobs. He argues we should raise the wages and improve productivity. Rest assured we have worked on and will continue to work on both of those options, but there's only so much you can do. We hired industrial engineers a few years ago to help us figure out the most efficient and safe way to clean a hotel room, and as for wages, we already have the highest wage rates of all the hotels and motels in the region.

In fact, a couple of weeks ago I was asked by our chief executive officer whether we would attract enough people for these tough-to-fill jobs if we raised the wages by 30%. I had to pause and say, “I doubt it”. I said it might require a 50% wage increase to attract enough people to these seasonal jobs. But even a 30% wage increase creates problems. It creates a spillover effect into the other departments. Arguably perhaps a couple of hundred other employees would say “me too”.

This would shatter our lodging and food and business models forcing big price increases and a loss of business. A 30% increase would cost us $600,000 in wages for housekeeping employees. It's not hard to imagine another $600,000 in the spillover effect because of pressure from other workers. A 50% increase would mean $2 million. Either figure puts our lodging business into the red.

Several independent studies predict a labour shortage trend for the worst, partly in the short term and partly in the longer term. One by the Conference Board of Canada suggests it will be particularly acute for the tourism business. It specifically cautions tourism operators not attempt to solve their challenge with higher wages since that will force unsustainable higher prices.

A study by the Urban Futures institute suggests that Canada's demographics have us heading for tough times with respect to a supply of labour. It argues that neither a radical increase in workforce participation, i.e., you and I working into our seventies and eighties, nor a radical increase in childbirth rates nor increases in productivity nor increases in immigration will provide us with the labour force we need to support the GDP that's forecasted. I referenced both of these studies in my written submission.

It's my understanding that the temporary foreign worker program as it is written requires employers to submit a plan showing how the jobs filled by temporary foreign workers will soon be filled by domestic employees. Though this may have been written in the legislation, it's not been enforced that often in the past, but it will be in the future. Frankly we're at a loss as to what that plan would look like for the Blue Mountain jobs currently filled by temporary foreign workers.

We also understand there's a user fee coming.

[The Chair, Conservative, Ed Komarnicki]

We need you to bring it to a conclusion, if you could.

[David Sinclair]

I will.

We respectfully request you maintain the program to be as accessible as it has been. We understand the need for a reasonable user fee. We expect that you will want good data from companies proving their need, and that you will hold companies accountable for treating their foreign workers professionally, as professionally as they treat their Canadian workers, because in times of labour shortage, it's our experience that few Canadians will do some jobs offered only as seasonal.

Thanks.