Government moves to control wages at Crown corporations

The government has introduced legislation that gives it sweeping powers to intervene in the collective bargaining process of Crown corporations. Government will be able to dicate terms and conditions for employees and approve wages of unionized and non-unionized workers.

Sweeping powers introduced to monitor bargaining sessions and set executive wages

Canada Post vehicles sit outside a sorting depot in the Ville St-Laurent borough of Montreal. The government wants to control wages and conditions for employees of Crown corporations, including Canada Post. (Graham Hughes/Canadian Press)

The federal government has introduced legislation that gives it sweeping powers to intervene in the collective bargaining process of Crown corporations, and even in the scale of executive salaries.

The provisions, which are part of the omnibus budget implementation bill tabled Monday, say that government ministers on the Treasury Board Secretariat will be able to impose "any requirement" on Crown corporations at the bargaining table.

The new legislation also says employers at agencies such as the CBC, Canada Post, Via Rail and over 40 other Crown corporations must seek approval from Treasury Board before fixing working conditions for both unionized and non-unionized employees. 

Treasury Board will also be able to appoint one its own officials to sit at the negotiating table as an "observer' when collective bargaining takes place.

Denis Lemelin, national president of the Canadian Union of Postal Workers (CUPW), said the changes are "unbelievable."

"In 2011, the Harper government got rid of our right to strike. Now, with this omnibus bill, they got rid of our right to negotiate," said.

Lemelin was referring to government legislation that ordered postal workers back to work in the summer of 2011 after the union had begun a series of rotating strikes. CUPW has launched a constitutional challenge to the legislation.

Lemelin said Wednesday in a telephone interview that the right to negotiate is guaranteed in the Charter of Rights and Freedoms. He continued that CUPW had fought for Canada Post to become a Crown corporation in the 1970s so that the union could negotiate directly with it .

Under the new legislation, the government will be the real negotiator, he said.

'Taxpayers end up paying the ticket'

However, Gregory Thomas of the Canadian Taxpayers Federation said Wednesday his organization has been advocating for just this kind of legislation.

"Companies that are government owned but have independent boards of directors can be very irresponsible with decisions they make, especially with regards to executive compensation. And yet the taxpayer ends up holding the bag, paying the ticket," he said in a telephone interview. 

Thomas pointed to a report done by the parliamentary budget officer in December that found compensation in the federal service has outpaced inflation and that of other employees — both in business and other levels of government — over the last 13 years.

Thomas doesn't see much difference between public sector employees and employees of Crown corporations. He calls Crown corporations "government companies", although most Crown corporations are supposed to be at arm's length from government.

Tony Clement, the president of the Treasury Board, issued a statement Wednesday saying the government would like to see "consistency" among all Crown corporations and the civil service. 

His statement said, "Government will look at options to improve the financial viability of Crown corporations, including compensation levels. We are ensuring that public service labour costs align and that taxpayer’s hard-earned dollars are used efficiently."

Opposition Leader Tom Mulcair, pointing out Wednesday is International Workers Day, said outside the NDP caucus room in the House of Commons that every time a question is asked about Crown corporations the government always says they are autonomous.

"They can't suck and blow at the same time, that's what they're doing," he told reporters.

George Smith, a labour relations expert at Queen's University and a former CBC executive, said Wednesday in an interview,  "In my 40 years of bargaining in the federal sector, there has never been anything like this."

He added: "[The government] have effectively pre-determined that collective bargaining won't work, so that when the government intervenes to impose a settlement, they'll have an excuse."

"I think this is an unbelievable and unprecedented intervention of government into the free collective bargaining process, and, you know, I have to say that most of us in the world of industrial relations are completely taken aback by this development," he said.