Human Resources Committee on May 23rd, 2013

[The Chair, Conservative, Ed Komarnicki]

I call the meeting to order.

I'd like to thank Minister Raitt for agreeing to appear before our committee, and of course the Deputy Minister of Labour as well, Hélène Gosselin, and departmental officials. We certainly appreciate your coming. We'll have you here for a half hour, and then we will have officials from HRSDC.

Without too much ado, we'll start with the minister making a presentation, and then we'll have a round of questions for each of the parties.

Go ahead, Minister, as you please.

[Lisa Raitt, Conservative, Minister of Labour]

Thank you very much, Mr. Chair, and thank you to the members of the committee as well for giving me the opportunity to talk to you about the labour program and why I think it plays such a vital role in our economy.

Canada, as you've heard, is making good progress towards recovery in this recession. We have strong fundamentals. We have prudent economic management by our government. Internationally, we're seen as a good place to do business and we want to keep it that way.

Now our job in the labour program is to support our government's goals of streamlining operations, reducing the burden of red tape, and finding efficiencies, but at the same time, we want to maintain those services we provide to Canadians. We are doing a couple of things. We are consolidating the Government Employees Compensation Act, otherwise known as GECA, to improve internal efficiency and effectiveness.

GECA provides injury benefits to federal public service employees or their dependants for work-related injuries and diseases. Last fiscal year, about $120 million was paid to individuals. The labour program also implemented the first stage of the labour electronic access forms project, or the LEAF project. This project takes previous paper-based reporting systems and streamlines them, which has reduced the burden on businesses and increased employer electronic reporting by 300%.

In general, and in the big picture, though, as the Minister of Labour, I want Canada to continue to be a good place to live and a good place to work. Our program is very busy in promoting safe, healthy, inclusive, and productive workplaces in federally regulated private sector businesses. Almost 10% of Canadians are employed in federally regulated sectors of the economy, such as banking, telecommunications, broadcasting, air, international rail, road, and pipeline transportation, shipping and related services, uranium mining, and of course crown corporations. These are only a small portion of industries in Canada, but they do provide the infrastructure that forms the backbone of our national economy. They are very important, and Canadians are entitled to be treated fairly on the job. Through our legislation, our programs, and our services, we try to foster good working conditions, workplaces that are free from discrimination, and as well, strong labour management relationships in the workplace, because we know that for our economy to thrive, we need to have labour peace and we need to have labour stability.

The labour program promotes cooperative labour relations in federally regulated businesses, and we do this through the Federal Mediation and Conciliation Service, otherwise known as FMCS. That's available to help workers and employers resolve their differences without resorting to a strike or a lockout. And just to give you an idea, last year our officers in FMCS helped with the ratification of more than 300 collective bargaining agreements under our jurisdiction. In the past five years, their success rate has been 94%. So 94% of collective bargaining negotiations were resolved without a work stoppage when FMCS was involved. It's a very good record. It's one that we're proud of.

We also work with parties to help them resolve issues and build cooperative relationships before they get to collective bargaining, and in that vein, FMCS provides preventive mediation assistance. They've done it in 68 workplace workshops and two conference workshops, and they've dealt with 50 grievance mediation cases in the past year.

But fostering a stable economy goes beyond ensuring labour peace. Good working conditions are one way to attract and retain skilled workers, and to optimize productivity as well. As Minister of Labour, occupational health and safety is a really big part of my mandate too. We are committed to working with unions. We're committed to working with employers and provinces, international partners and experts in the field, not only to raise awareness but also to improve occupational health and safety measures. We believe that people have the right to work in a healthy and safe environment, and all Canadians, no matter where they work or in what field they specialize, should return home safe after their workday.

In the past months, I have attended a number of events, and a number of MPs I know have attended events, to discuss important issues with respect to safety at work, especially April 28 being the day of mourning. The labour program has also introduced important initiatives to help protect our vulnerable workers. We are working to require federally regulated private sector employers to insure their employees’ long-term disability plans so that the promised benefits are there when they need them most, and we are protecting Canadian workers whose employers have gone bankrupt and closed down and didn't pay the money that was owed to Canadians.

Last year we added $1.4 million annually in operating funds to ensure that through the program that facilitates this, the wage earner protection program, the applicants get the benefits they are entitled to in a timely fashion.

The additional funding improved WEPP administration and improved the processing of the applications. Actually, in recent months Service Canada has exceeded its service standards for processing these applications. They complete more than 90% within the 42-day standard, rather than just 80% in the 42-day standard. Between July 7, 2008, and March 31, 2013, there have been 58,000 claimants, and they've received more than $133 million overall WEPP payments. Nearly half of those were fully compensated, with the remaining receiving the maximum payment.

On another note, we are also ensuring that parents of critically ill, murdered, and missing children can't lose their jobs while they're taking time to care for their families and themselves in these devastating situations.

Last year we eliminated mandatory retirement in the federal jurisdiction so that older workers may continue to work for as long as they wish.

Canada's deepening trade relationships with international partners provide significant economic opportunities for businesses in Canada. The labour program contributes to this by negotiating labour cooperation agreements or labour chapters in the context of free trade agreement negotiations. They're going on right now with the European Union, Morocco, Ukraine, Korea, Japan, and the 11 countries of the trans-Pacific partnership.

Last year we finalized the Canada–Honduras labour cooperation agreement. These labour cooperation agreements are really important because they protect workers' rights while we develop our trade relationships, ensuring a level playing field and a competitive position for our businesses.

The Government of Canada also promotes good governance internationally through the labour funding program. The program helps by supporting domestic and international projects to support labour rights and improve workplace safety around the world. I have seen first-hand a number of these projects in other countries.

Our government is committed to ensuring that workplaces are safe, healthy, and free from barriers to employment, because our workplaces really are the engine room of the economy, and all individuals should have that opportunity to achieve and contribute their full potential. Everyone—employers, employees, governments—has a role to play when it becomes apparent that we need to promote inclusive workplaces that are free from discrimination.

I am the minister responsible for employment equity, and I take the issue very seriously. Last month I tabled the 2011 Employment Equity Act annual report, which describes the progress made by federally regulated employers in achieving an equitable workforce and represents Canada's diverse population. The report took a look at hiring, retention, and promotion of women, aboriginal peoples, persons with disabilities, and members of visible minorities.

We know that embracing diversity includes being open to hiring women in non-traditional roles as well, and we need to embrace diversity to maintain our competitive edge in a global economy because we are facing labour shortages. No one in Canada should be refused employment for a reason that is unrelated to their working ability.

Mr. Chair, in conclusion, our government has never wavered from our commitment to Canadians to strengthen the economy. The labour program continues to work diligently to support this commitment while enabling fair, safe, inclusive, and productive Canadian federally regulated workplaces.

On that note, I will wrap up and welcome any questions people may have with respect to the work of the labour program.

Thanks.

[The Chair, Conservative, Ed Komarnicki]

Thank you very much, Minister, for that presentation. We certainly appreciate it.

We will start our first round of questions with Mr. Boulerice.

Go ahead.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

Thank you, Mr. Chair.

Thank you, Madam Minister, for being with us today. We appreciate your being here. We share all of your concerns on health and safety in the workplace. The NDP hopes that all Canadian workers will not be risking their lives while trying to earn a living, and will be able to continue to benefit from the possibility of associating and organizing to negotiate their working conditions, that is to say, safe working conditions.

I want to ask you some questions on a matter that is of great concern to us. As the Minister of Labour, you are responsible for labour relations, and so I want to take advantage of your presence here to ask you some questions regarding division 17 of Bill C-60. In that provision, Treasury Board gives itself some unprecedented powers to intervene in the collective bargaining of crown corporations. Those corporations have very particular missions and mandates and should indeed be independent and at arm's length from the government.

I was just at the Standing Committee on Finance where a professor from Queen's University, Mr. George Smith, told us that this interference was a breach of the spirit of the Canada Labour Code. According to that code, negotiations must take place between the employer, that is to say the crown corporation, and its employees. Thus, the federal government should not get involved in those negotiations.

Do you not think that this interference is unnecessary, and, as Mr. Smith pointed out, that it may jeopardize labour relations and collective bargaining and make them completely dysfunctional?

[The Chair, Conservative, Ed Komarnicki]

You can make a general comment on that, if you wish. It's not specifically related to the estimates, but if you wish to make a comment, go ahead.

[Lisa Raitt, Conservative, Halton, ON]

I welcome the opportunity, Mr. Chair, to comment on the topic. I believe—and I disagree with my honourable colleague on this—that this is necessary, and I'll tell you why I think it's necessary.

At the end of the day, it's the federal taxpayer who is the employer of the employees at both crown corporations—and, indeed, public servants here in Ottawa. We know that; we run on that; and that's who we represent. When you are doing your analysis of collective bargaining—and you know this from your union time—the process that's followed in a lot of union shops is very similar. You strike a national committee, and you have a group of people who determine how they're going to go about setting the mandate. Membership is consulted about what they would like in this round of negotiations. When it comes back, it's analysed and that becomes the mandate for the bargaining committee. They go out and they negotiate face to face. But they have to go back to the executive and the membership for ratification. That's the process. There is nothing in Bill C-60 that affects that process, nothing at all. It's completely within the union's purview to approach it in that way.

In Bill C-60, we are formalizing management's process to come to a negotiating mandate. This includes, appropriately, I would say, an analysis performed to determine what is the opinion of the sole shareholder, via the Government of Canada, with respect to the mandate. The reality is that those crown corporations report directly to the minister, and the minister is responsible to the people for those crown corporations. So it makes sense that the people, through the government, have a say in what the mandate is.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

You already have your word to say, Madam Minister, since you appoint the executives of crown corporations. They are definitely the representatives of the federal government, who see to the proper management of the funds that you grant them. Is this not a type of vote of non-confidence in them? You are telling them that they are incapable of managing public funds properly and that you are going to bypass their authority during negotiations by imposing mandates, rejecting agreements in principle, and even by imposing working conditions directly on the non-unionized employees of crown corporations.

This is unprecedented. It is a complete departure from the existing labour relations framework. Your representatives are at the negotiating table. They are executives you appoint, members of the board of the crown corporations. It is strange, but each time we ask a question on the closure of a post office in a region or a village, you say that you have nothing to do with that because that is an arm's length corporation. However, when the time comes to negotiate pension funds, insurance or salaries, you decide to bypass the managers that you appointed yourself to these positions and to interfere. You are running the risk of jeopardizing collective bargaining. This is serious.

[Lisa Raitt, Conservative, Halton, ON]

First of all, I think it makes sense to point out that nothing in collective bargaining in the Canada Labour Code is changed by anything in Bill C-60. Collective bargaining will continue the way it always has within the Canada Labour Code. With respect to the opportunity for the government, through the Treasury Board, to look at the mandates of negotiation for these crown corporations, it has nothing to do with how effective or ineffective appointees may be on these boards. In fact, it's no different from a shareholder wanting to have a say in how their board is directed. As to the operations of the crown corporations—

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

The shareholders cannot get involved in negotiations. This is not just about the mandate. During the negotiations, and even at the end of them, you can intervene and say that you reject the agreement in principle. This is not at all comparable to a situation where a shareholder would give a mandate and then let the two parties involved negotiate freely and work things out amongst themselves. This is much more intrusive than that.

[Lisa Raitt, Conservative, Halton, ON]

I don't know how you can argue with the notion that seeking ratification from the membership is a bad thing. That's what happens at the end of the day in the union context, doesn't it? In fact, that's how we get into trouble a lot of times in the federal private sector—when ratification cannot be achieved.

That being said, Canadians expect their tax dollars to be managed prudently. As such, it makes a lot of sense that we do take into consideration the care and control over what's happening at crown corporations. This is what we have in the legislation to ensure that the taxpayer's voice is heard through the government and that the management of crown corporations understands that there is going to be a government analysis of the appropriateness of the mandate and what they're trying to seek. I think it'll be a great process and I think it'll work very well.

[Alexandre Boulerice, NDP, Rosemont—La Petite-Patrie, QC]

I simply wanted to make a comment; you are not obliged to respond to it.

I understand that we have to be prudent with public funds. I hope that the Conservative government, which ventures to give crown corporations advice on management, is also prudent and has not misplaced or lost sight of the $3 billion.

[The Chair, Conservative, Ed Komarnicki]

Thank you for that exchange.

We'll go now to Mr. Mayes.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you, Mr. Chair, and thank you, Minister, for being here today.

In 2008, a number of bankruptcies and receiverships reflected the downturn in the economy, and there were some business fatalities during that time. We reacted with the wage earner protection program.

Now, because of our economic action plan and the right investments we've made in infrastructure and dealing with the economy and showing some leadership, we're seeing some light at the end of the tunnel. It's obvious that businesses are expanding, and there are labour shortages.

In saying that, have you budgeted a lesser amount for the wage earner protection program? It says last year we added $1.4 million annually in operating funds. Is that in benefits or is it just in the administration of that fund?

I also congratulate you on the fact that the time for completing these applications has improved quite substantially. Would you attribute that to a larger number of employees or that people can send in their applications and their claims with greater ease?

[Lisa Raitt, Conservative, Halton, ON]

I'd like to thank the member for the question.

From the formation of the policy it made a lot of sense to bring in this program, and I agree with the member. The federal government will step into the shoes of the employee who's owed back wages, severance, and termination. We started with a program that was a little smaller in scope and we've expanded it twice. Those expansions have been important, because they reflect that we hear what's happening across the country.

We had a situation whereby wages were covered, and then we expanded it to include severance and termination, because we were hearing from people, unions and workers alike, around the country that this was needed, and we did that.

Then we heard in some cases there were people whose companies would try to reorganize or restructure or go into receivership and they were unsuccessful eventually, but the way the timing worked in the program, those people would not have been eligible for WEPP, so we expanded it again to make sure we captured those people.

It's one of those programs where you're continually listening to make sure you're getting it right, and the good part about it is that we're managing the money very well. Putting that extra money into the administration allows us to deal with matters more quickly. We have had an increase in the number of applications as a result of expanding the program, but I'm hoping we're going to see fewer bankruptcies around the country so that we'll not have to use the program as much.

It's a successful program in the way it's run, in that it gets money into the hands of people who very much need it, but it's a program that you don't want to have necessarily, because you're addressing a situation where employers are closing and not paying their employees. But we don't believe they should bear the brunt of it, so we step in and we make a payment to make sure that during that period of time they have some cover and help.

It's one of the clearest programs we've put in place that goes to the root of helping people, and you can see it around the country. As time goes by and we work with more trustees and more recipients and they understand how it works, our department works much better and we're able to move those service standards along. But the goal, quite frankly, is that we have a situation where people don't need access to this program.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Is there any cost recovery from the companies that go bankrupt where you see some funds come back because after the dust settles, after the bankruptcy, there are funds that can be used to help the workers?

[Lisa Raitt, Conservative, Halton, ON]

That is the case. We also amended the Bankruptcy and Insolvency Act to give the government a super priority for wages, so that we do improve our position and line in the case of a bankruptcy, and we do have people who are to cost-recover, in the sense of going out and recovering from the companies that have gone bankrupt. That's the point. Sometimes bankruptcies can take years to go through their process, and as an unsecured creditor or as a creditor of the company, a regular worker would have to wait that period of time. We step into their shoes; we take their place in that line.

Of course, it's expected that the department will recover. I don't have numbers on what the recovery rate is, but I do know that it's definitely at the heart of the program, to ensure that they're recovering, as would the employee if they were in their own shoes.

The deputy just reminded me, if I may, that applicants actually went down last year, in 2012-13, so hopefully we can extrapolate that to having better economic conditions.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Right.

I think that's all I have.

[The Chair, Conservative, Ed Komarnicki]

Good. We'll now move to Mr. Cuzner.

Go ahead.

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

Thanks very much.

Thanks for coming, Madam Minister. It's always good to see you.

I have two questions, probably both somewhat outside the estimates, and although we might not agree on aspects of the approach taken, I know the minister knows her files and I'm sure she'd be comfortable commenting on them.

[The Chair, Conservative, Ed Komarnicki]

We'll see.

[Voices]

Oh, oh!

[Lisa Raitt, Conservative, Halton, ON]

Buttering up, Mr. Chair. It's that Cape Breton charm.

[Voices]

Oh, oh!

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

The first one is with regard to the Canada Labour Code and reporting provisions for organized labour. There are those provisions within the code now for unions to report audited statements. With the push forward on Bill C-377, that really exposes a great deal more detail. Could you give me your opinion as to whether you find there are redundancies there? Is there a necessity in going to the extent that Bill C-377 does, with the burden this is going to place on organizations? There's time, energy, the cost behind these reporting regimes. Are they not already covered within the Canada Labour Code?

[Lisa Raitt, Conservative, Halton, ON]

I'll answer the questions.

In the Canada Labour Code, under federally regulated, it is mandated that should a member of the union request financial statements of the union leadership, they are to provide them free of charge. That is covered in the Canada Labour Code.

Bill C-377 is not solely limited to the Canada Labour Code. As you know, it's coming in through a different act that is pan-Canadian in all jurisdictions. There are three provinces in Canada—Alberta, P.E.I., and Saskatchewan—that have no reporting requirements within their provincial statutes. So there are three provinces where, even if you asked for financial statements, you're not necessarily going to get them; you can't get any information. There is a gap in terms of what can be asked for on reporting provisions across the country.

With respect to the burden, I will tell you that it's not an insignificant amount of money that we're talking about here. For the purposes of our own, we took a look at the federal private jurisdiction, the very general calculations that you can glean. It's about a half a billion dollars in dues that are paid in the federal private jurisdiction. That's just 10% of the entire workforce in Canada, and that's a significant number. If you extrapolate that, you're in the $5 billion range in terms of union dues and maybe even more.

So when you talk about the burden on unions, I think they have adequate resources to provide this information, which is being sought by their members, and I'm comfortable with Bill C-377.