Ontario Government to Extend Wage Freeze to Unionized Public Sector Employees
Unionized public service employees are being asked by the Ontario government to accept a wage freeze.
On March 25th, 2010, the Ontario government tabled Bill 16, which included the Creating the Foundation for Jobs and Growth Act, 2010. This Act enforces a two-year freeze on compensation structures and affects MPPs and over 350,000 non-unionized public service employees. The Act applies retroactively to March 25th, 2010.
The Act freezes the rate of pay to the rate which was in effect on March 24th, 2010, until April 2012. However, the Act does not deal explicitly with compensation increases that were promised, decided or approved by employers that were not in effect on March 24th, 2010.
The Act also prevents the across-the-board provision of new or additional benefits to employees. Benefits are only to be provided to employees if authorized under the compensation plan as it existed on the effective date.
When the government tabled the Ontario Budget and introduced the Act, it expressed the intent to restrain wages of unionized employees as well.
On July 20th, 2010, Finance Minister Dwight Duncan met with approximately 60 union leaders and public service employers. The meeting served as a consultation process prior to more detailed discussions regarding compensation.
Finance Minister Duncan expressed at the meeting that the province would respect current collective agreements; however, for agreements that are now open or that will soon expire, the government would expect “zero and zero” increases for a two-year period.
Public sector employers have been asked to stop negotiating if they are currently at the bargaining table. Finance Minister Duncan called on the public sector to assist the province in sustaining important services while working to eliminate the deficit.
The meetings are an attempt to reach a consensus as an alternative to imposing the wage freeze through legislation. We will keep readers apprised of developments in this area.