Human Resources Committee on April 18th, 2016

[Wayne Long, Liberal, Saint John—Rothesay, NB]

I find it hard to think the democratic principle is supported by weaker representation. I guess I'll leave it with that.

Mr. Kelly, what's your view of unions? Are you closer to an adversary or a partner?

[Daniel Kelly]

My personal views are irrelevant. For small businesses, we have 109,000 of them. I would imagine we would have some in both camps that view their union as a partner and those that view them very much not that way.

As I said, most of our members are not unionized, but I don't think it would shock you to believe that most small business owners are not huge fans of unions as they exist today. I'm from Winnipeg. I like to think that in 1919—as I have fought for 22 years now at CFIB, as of today, for the little guy—I would have been a strong proponent of unions at the time.

[Wayne Long, Liberal, Saint John—Rothesay, NB]

Would you say you're representing employees' rights or employer rights?

[Daniel Kelly]

Our members are exclusively all small employers, and therefore, my job is to represent their needs and views as employers.

[Wayne Long, Liberal, Saint John—Rothesay, NB]

It's no secret, obviously, you supported Bill C-377. The Barreau du Québec, Canadian Bar Association, constitutional experts like Bruce Ryder, Robin Elliott, Alain Barré, and Henri Brun, all view the reporting requirements in Bill C-377 as violating the Canadian Charter of Rights and Freedoms. All of these groups believe that the reporting requirements force unions to disclose information that could disadvantage them in joint collective bargaining.

How do you rationalize your support for the bill, the small business owners you represent, in light of the criticisms?

[Daniel Kelly]

There are lots of criticisms and there are lots of supporters. There's a former Supreme Court judge that believes that it's all bunk and the law is constitutional. None of this had been tested yet, right? That, I imagine, would have happened over time.

Our views of this are largely based on the fact that most of these rules exist in the U.S. right now. That would be why we believe this is a fair balance given the unprecedented powers unions have in Canada.

[The Chair, Liberal, Bryan May]

Thank you, Mr. Kelly.

We'll move on to Ms. Benson.

[Sheri Benson, NDP, Saskatoon West, SK]

Thank you very much.

Mr. Fanelli, I'd like to spend a bit of time with you with some questions. Obviously, we've heard you're not supportive of Bill C-377. It was too broad. It included employers and trusts, and many things where privacy would be an issue, but not only privacy.

You talked about the fact that it would actually give your competitors an advantage in the business world. Could you expand a bit on that? In what way?

[Tony Fanelli]

If all trust funds, all training funds, and virtually every fund that would be connected to a union are subject to public exposure, our competition would clearly understand over time how those monies go into training and how we do business. In the construction industry, training and development is a key component to the success of projects we build. The staff either make or break an employer. We saw this legislation would open the door for the non-union to come in, just as I mentioned.

On top of that are the reporting requirements, the reporting responsibilities, that would come out of this. When we did some of the preliminary audits on the cost of doing this, it was just prohibitive. It would happen not only with employers like us, the people I represent, the bigger employers in Canada, but across every employer association in every jurisdiction in this country. That's the reason we're opposed.

[Sheri Benson, NDP, Saskatoon West, SK]

Thank you.

Mr. Hynes, I get the distinction you're trying to make, although I don't agree with it. I think it is important for this committee to understand the history of what has worked well as far as the Canada Labour Code and that process. I think your comments about the way that this private member's bill came in...and if we were to allow a very important piece of legislation to in some ways get things attached to it willy-nilly, the impact for employers, even the cost involved, would be difficult for your association.

I would like to hear your comments on why it's important for your businesses, the people you represent, to protect that process around the Canada Labour Code.

[Derrick Hynes]

That's a great question. That's really one of our fundamental points throughout this process when Bill C-525 was brought forward. We've been consistently making the same argument and that is that under the Canada Labour Code, for our employers in particular, we do have a rich and successful history of the tripartite model for doing business, whereby government, management, and labour talk about issues. Nobody is delusional, thinking that we're always going to get along, but you quickly find areas of principle where you do agree, and then you sort out the ones on which you don't agree.

I think both employers and unions recognize that at the end of the day government is going to have to make some decisions when it makes legislative regulatory policy changes, but when we do it within the context of that tripartite model, it's proven to have worked. There are lots of examples of it, and even today we have various committees that meet various stakeholder groups where those three parties are around the table. It generally results in better solutions.

With respect to private members' bills, and I've heard this point several times, we don't think there's anything undemocratic about them. We just think that when it comes to the Canada Labour Code we have a process that does seem to work. It's worked for a number of years. It leads to better solutions where, at the very front end, we have discussions about key issues. They're not one-off issues, but we look at them in the totality of the entire code and what the implications might be for employers, government, and unions. Our experience has been that this leads to better outcomes.

[Sheri Benson, NDP, Saskatoon West, SK]

I'm certainly not saying there isn't room for change or improvement, but I think we have a process in place with the Canada Labour Code that works, and I think we should stick with that. I agree with you, we're not saying a private member's bill would be undemocratic, but why not use a system that works that includes consultation with all the key partners. I think a collaborative approach to labour-management relations is better for everyone. It's better for business and it's better for employees and ultimately it's better for communities.

Thank you.

[The Chair, Liberal, Bryan May]

Thank you.

We'll move over to MP Ruimy, please.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

Thank you very much.

Thank you very much for coming.

Mr. Kelly, as a small businessperson myself, I sometimes find the challenges you talk about...it's a challenge. In my position as an MP I now have to look at both sides of the coin and doing so has enlightened me a little.

Under your CFIB mandate, your organization's top three priorities are fighting for tax fairness, reasonable labour laws, and reduction of regulatory paper burden. Are you doing well in those areas?

[Daniel Kelly]

Yes, it depends on the day.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

Your organization has been a strong advocate for cutting red tape. You have an annual cutting red tape week, I believe, and as part of that week, you have what's called a paperweight award.

Correct?

[Daniel Kelly]

Indeed.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

Something like this.... This is typically what you're asking unions to fill out on a yearly basis. That doesn't seem fair. That goes against your reduction of paperwork burden.

[Daniel Kelly]

Sure.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

I have a hard time trying to understand that. To me, that doesn't seem fair.

The proposed requirements would advocate for unions to face tax unfairness compared to their association counterparts, such as professional associations, charities, and think tanks, which don't have to do that, and would result in labour laws that are not deemed reasonable or constitutional providing further barriers for workers, and again, more paperwork. I don't know how we come to terms with that.

If the Government of Canada imposed a new reporting requirement that requires you to fill out a report that is hundreds of pages in length, full of detailed information, would that qualify for that award? It would, wouldn't it?

[Daniel Kelly]

Certainly.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

What if, by the government's official estimates, that report would create a burden of about 536 hours a year at a cost of about $17,000? I guess that would still qualify. Would it qualify for tax fairness? Because when it comes down to it, as small businesses, we all want to make a profit. I can't imagine my paying $17,000 to fill out documentation.

This, by the way, is coming from the U.S. government, when they calculated the impact their reporting regulations would have on unions.

I see you're nodding your head so I'm glad we agree. Given that Bill C-377 is based on these regulations, I have no reason to believe the estimate would be any different for Canadian organizations under Bill C-377.

Again, would this fit your definition of red tape?

[Daniel Kelly]

Sure. There's absolutely no.... Let me say this very clearly. I did say this in my presentation too. There's no question that this bill creates red tape. It creates costs. It requires a giant leap forward in accountability measures, in detailed reporting requirements for unions.

Let me quickly clarify our views on regulation and red tape. We have never come to government to suggest that there should be no red tape and no regulation. We are opposed to red tape, I suppose, but regulation is an appropriate measure for governments to take. Our only request is that the balance of the regulation be fair, that it be in keeping with the need for the regulatory intervention in the first place.

As I said earlier, our first choice with respect to this legislation would be the opportunity for workers in a unionized environment to choose whether to pay dues or not, as exists in every other country in the world save a couple, and only a few states now in the U.S. That would eliminate the need for any measure like the measure that was taken in Bill C-377, so our hope was that these additional measures would be balancing the unprecedented powers that unions have to force the unwilling to pay dues. That is the reason we were in support of this.

I recognize and fully believe that a large number of unionized employees are happy to pay union dues, but for those who aren't, we believe that either they should have the ability to opt out or at the very least additional disclosure should be given to them to allow that to happen. I don't deny any of those things you said. We continue to be huge champions for red tape and regulatory reduction, balanced of course with government's need to regulate in important areas of public policy, but I can square that circle pretty easily.

[Dan Ruimy, Liberal, Pitt Meadows—Maple Ridge, BC]

I'm glad you can, because I can't, and that's a problem for me. We're not balancing with other organizations. Professional associations don't have to do this type of reporting. Charities don't have to do this type of reporting. Think tanks don't have to do this type of reporting. It's not fair. Your mandate is all about being fair, and this is not fair.

That's where I start my challenge. As it is right now, it's just not going to—

[Daniel Kelly]

On the fairness side, I would say that with all of those groups you mentioned, though, if somebody is uncomfortable or is unsure as to how they're spending the dollars that are contributed to them, they have the ability to withhold those dollars. In unions they don't.