Friday, August 16, 2019

The One Percent

The government’s proposed wage restraint would turn the PSW shortage crisis into a catastrophe

On June 5, Peter Bethlenfalvy, Ontario government Treasury Board president, announced that the government was implementing a one percent salary cap for all employees in the broader public sector for a period of three years. The announcement came just as the government was recessing for the summer, and, not coincidentally, just as the province enters into negotiations with all of Ontario’s teachers’ unions.

It is expected that the government won’t resume sitting until October, but if the bill is passed as it is written, it would take retroactive effect to June 5, 2019. This means that any collective agreement entered into after that date will be capped to one percent annual increases. Collective agreements that were in affect on that date continue unaffected until they expire. But any subsequent collective agreement will then be subject to the three-year wage cap.

Wage freezes and caps have been used before, although historically, all hospital and long term care homes were equally affected. In this bill, long term care homes that “operate for a gain or profit” are excluded, and so too are homes operated by municipalities. In effect then, only charitable homes and hospitals are captured by this bill. Retirement homes are not captured by this bill.

In the lead up to this bill, the government engaged in broad stakeholder consultations. CLAC participated with a submission and made a special appeal to exempt long term care homes and homecare workers from any wage restraint legislation. CLAC showed that over the past 10 years, due to lower-than-inflation wage increases, and a zero percent freeze experienced in 2012 and 2013, workers in this sector were already making less today than 10 years ago, when adjusted for inflation. In a sector that is already experiencing a crisis due to the shortage of PSWs, further wage constraints could serve to turn this crisis into a catastrophe.

What happens next with this proposed wage restraint won’t be clear until the government resumes sitting in October. Until then, some negotiations in this sector remain at a stand still. CLAC members have submitted hundreds of letters to their local MPPs demanding that the wage restraint be lifted.

The One Percent

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