Ontario's Liberal government is confident legislation to impose a wage freeze on nearly 500,000 public sector workers will withstand court challenges, but there is a "very real risk" it could be struck down, admitted Finance Minister Dwight Duncan.

"There's constitutional risk with this, there's no question," Duncan told reporters after unveiling details of the draft legislation.

"This will be tested in the courts, no doubt, but we believe we've found something that will survive those court challenges and meet the tests that the court will establish."

Labour leaders quickly condemned the legislation, which resembles the bill the Liberals used to impose a wage contract on teachers earlier this month, freezing pay and benefits for two years but allowing some upward movement on salary grids.

Unlike the teachers' legislation, the bill applying to civil servants and workers at hospitals, colleges, hydro companies, long-term care homes and provincial agencies "preserves the right to strike," said Duncan.

However, it also gives Duncan the power to impose a contract if he doesn't like what the two sides negotiate, which union leaders said effectively takes away their right to strike.

"What he's basically said is that he'll impose a collective agreement, so we may have the right to strike for 10 minutes," said Ontario Federation of Labour president Sid Ryan.

"The minister's not being honest when he says the right to strike is preserved. That's a lie, and he knows it's a lie."

The Ontario Public Service Employees Union said Canadians won't stand for an attack on workers' rights.

"Workers are beaten down, they're frustrated, but I think — my fear — is that there will be a spontaneous combustion and people will start saying, 'To hell with it, let's take it to the streets,"' said OPSEU president Smokey Thomas.

"I would say this about Canadians: We may not know what we are, but we do know we're not Americans."

Municipalities are exempt from the legislation, which means the wage freeze will not apply to police, fire, ambulance, public transit or other local workers, but Duncan said there are changes to arbitration that should help municipal governments control costs.

'Not going to save the province money'

The Progressive Conservatives complained the legislation doesn't go far enough to impose a wage freeze on all public sector workers, and said the Liberals need to accept responsibility for creating a huge deficit.

The New Democrats called the bill "wrong-headed," and warned it will end up costing taxpayers more if — as they predict — it is struck down by the Supreme Court.

"It's not going to save this province money," warned NDP Leader Andrea Horwath. "It's going to create difficulty and turmoil in all kinds of workplaces where everyday families access their services."

The Liberals' bill is "fair and reasonable," asking all workers to do their part and take a pay freeze to avoid layoffs and service cuts, said Duncan. It's a lot less harsh than what many private sector workers have faced or the options being pursued by some U.S. states and even the federal government, he added.

"This is tame stuff, and when I compare it to what's gone on in the private sector, when I compare it to 20,000 jobs at the federal level being chopped, I think on balance it's responsible," said Duncan.

Duncan unveiled the proposed wage freeze bill to the media, but can't introduce it in the legislature because of an ongoing debate over contempt, which blocks all other business in the house.

Less union support for Liberals

The government doesn't need legislation to impose a wage freeze on doctors, and is still in negotiations with the Ontario Medical Association on their next contract, added Duncan.

Premier Dalton McGuinty has repeatedly warned that the Liberals were prepared to legislate a wage freeze if they can't get it through collective bargaining to help eliminate a deficit projected at $14.8 billion this year.

The Ontario Federation of Labour warned the Liberals won't be able to count on support from unions that helped get them elected in the past.

"They can kiss that goodbye," said Ryan.

"The Liberals have lost an army of volunteers. So they're in serious trouble in the next election."

Several unions representing most of Ontario's teachers have said they'll challenge the wage freeze legislation all the way to the Supreme Court of Canada.