Public sector

In Labour Relations History Truly Repeats Itself

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Sandra Matic/Shutterstock

What is going in the world of labour relations now, and what can we learn from labour history?

Remember learning the significance of the 1919 Winnipeg General Strike?

Click here if you need an LR history refresher.

The 1919 Winnipeg General Strike saw 30,000 people, including telephone operators, postal workers, police, fire fighters, cooks, and contractors take to the streets. But how relevant is this historical event to labour relations today?

In the hundred years that have passed since 1919, business has changed, employers and employment laws have changed, and employment standards have improved markedly for workers in most developed countries. If standards and laws have improved so much, why are general strikes and civil protest still happening?

In 2015, 400,000 public sector employees went on strike in Quebec. In France, a quarter of a million employees went on strike in October 2017, and 10,000 civil servants and railway staff joined forces and went on strike in April 2018.

Let’s look at the most recent strike occurring in France.

Click here to read a short article on this latest strike.

This has moved beyond a typical single employer/employee labour dispute, and is turning into a social movement. It now includes railway workers, teachers, and air traffic controllers. It has become a general strike.

The question is, why in seemingly well-developed societies, like Canada or France, have we not found a better way to resolve labour disputes than taking to the streets in protest? Is it because workers or employers are unreasonable people with unreasonable demands? If so, who determines which side is unreasonable?

Is there a better way? According to Roger Fisher and William Ury from Harvard University, there is.

Click here to read a summary of their book, Getting to Yes.

Getting to Yes talks about BATNA, an acronym coined by Fisher and Ury, which stands for the Best Alternative to a Negotiated Agreement (BATNA). Fisher and Ury emphasize that positional bargaining is not the most effective way to reach an agreement, and that it can actually do more harm than good. With positional bargaining one side must win and the other must lose. This is no way for employers and unions to treat each other in the 21st century.

Getting to Yes has been around for 40 years, yet employers and unions are still using positional bargaining. Why? Perhaps many unions and employers do not feel it meets their needs.

Does history repeat itself? It certainly seems to with Labour Relations. Where are we 100 years after the Winnipeg general strike? It looks like we’re in the very same place. Perhaps it is time to move past the adversarial model of Labour Relations. The question is, do employers and unions have the will to do that?

 

Discussion Questions:

  1. Read this summary of the concepts in Getting to Yes.
  2. Discuss why unions and management might be against using Getting to Yes principles.
  3. Can you describe specific situations where it would be more beneficial to use Getting to Yes concepts, such as interest-based bargaining, rather than traditional positional bargaining?

 

Perils of Pay Equity

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a young caucasian man in jeans taking two coins of one euro out of his pocketThe Pay Equity Act in Ontario has been in place since the 1980s. As we know from our studies, this legislation requires employers in Ontario to ensure that compensation levels for the value of work between traditionally designated ‘male’ and ‘female’ jobs are paid equally.

The pay equity process itself is extensive and exhaustive. It is also expensive, if compensation adjustments need to be implemented based on the results of the process. As this is a legislated issue for public sector employers in Ontario, it makes sense that public sector organizations will comply with this mandatory requirement.

Apparently not.

Recently, OPSEU (the union representing employees working with Community Living in Tillsonburg) issued an open letter as a result of the inability of Community Living to make the mandatory pay equity adjustments for its employees.

Click here to read the letter.

Why would any employer choose not to pay, when it is required to do so by law? As with most compensation dilemmas, the issue of affordability comes into play. A news article linked to this story provides an important insight into this seemingly simple pay issue.

Click here to read the article.

Public sector organizations receive their funding from the government. There are very strict parameters in place as to when and how the funding can be used, especially as it is linked to compensation. Given that the government will not fund pay equity adjustments, how can organizations like Community Living pay for mandatory wage adjustments if they do not have the money? It seems to be a Kafkaesque dilemma, as the government requiring the wage adjustments is the same source for funding that will not support the payment of these mandatory adjustments.

In the end, the employer is left holding the bag containing an unfunded liability and an unhappy workforce, which makes a heavy burden for the Compensation Manager to carry.

Discussion Questions:

  1. If you were the Compensation Manager for a public sector organization required to make Pay Equity Payments, what steps would you include to design an affordable compensation plan?
  2. Who should be responsible for ensuring funding for pay equity costs in the public sector? Explain your rationale.

Compensation Cuts in Alberta

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Word Reward against the red falling graph. 3D illustration picture
Imagentle/Shutterstock

In late February, the Alberta government announced the implementation of significant compensation cuts for individuals holding senior executive positions in public sector agencies, boards, and commissions.

On the face of it, these cuts are significant.

Click here to read the Globe & Mail’s assessment of this change.

Click here to read the CBC’s reporting on this change.

The compensation decreases come as a result of a long term review of compensation levels for these positions which are paid for by the taxpayer. There is no doubt that the individuals holding executive-level positions are just as dedicated to their work as any other Canadian committed to a life of public service. On the other hand, is the value of the work performed at the executive level limitless? Do the performance requirements match the rewards that include housing allowances, golf course memberships and hundreds of thousands of dollars in salaries?

In isolation, the answer to these questions would be that the levels are excessive. Of course, the Albert government’s actions to implement these drastic cuts appear reasonable for these types of positions where the compensation levels seem to be excessively rewarding.

However, nothing linked to compensation exists in isolation.

Alberta has gone through an extreme economic change that has impacted all levels of industries and services across the province. When the economic times were good in Alberta, they were exceptionally good for everyone. All compensation levels were high. It would make sense that any executive-level position was paid equitably in comparison between the public and private sector markets. As the Alberta economy has dropped, so too have the opportunities and compensation levels for everyone. In order to compete in the market place, everything must adjust to current economic realities.

Rather than seeing this compensation adjustment as a reduction of individual proportions, we have to consider the context that is part of a larger economic cycle which ebbs and flows based on what the market, and the taxpayer, will bear.

Discussion Questions:

  1. What is the difference between public service and civil service?
  2. What are the risks associated with capping severance pay for other senior executive positions across Canada as a result of this change in Alberta?
  3. From a Human Resources perspective, what are the challenges that these public sector organizations will face into the future?
  4. If you were one of the executives facing a $500,000 salary cut that reduced your earnings from $900,000 to $400,000 per year, how would you react?

Interesting Agreements

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Vintage poster for Workers Rights
Source: Tribalium/Shutterstock

Recently in Ontario, the provincial government and the public sector union representing correctional workers came to a historic negotiated agreement.  This agreement categorizes and recognizes the work of the bargaining unit members as essential services, on par with police and first responders.

It also means that the union gave up, through the negotiation process, the right to strike.  This guarantees that wages and financial benefits will be determined by a neutral, third-party arbitrator in the future.

Click here to read the Article

Click here to read OPSEU’s announcement of this historic agreement.

As we have learned through our labour relations studies, the right to strike is a basic principle for unionized workers.  Further, it is a powerful leveraging tool during the collective bargaining process.  A strike threat applies legitimate pressure on the employer in order to come to a negotiated agreement.  If there is no successful conclusion through a negotiated agreement, the parties will be faced with a service shutdown through strike action by the union or a lockout by the employer.

Why would any union give up what appears to be a fundamental right?  What would tie the parties together to work toward a successful conclusion in this case?

Common interests.

While we are not privy to the details of what was a very lengthy and difficult negotiation process, as noted in the embedded articles, both parties wanted safety and security.  It appears that it was not in the interest of the government to have to deal with strikes where the public may be put at risk.  It appears that it was not in the interest of the union to put themselves at continued risk if reasonable wage and security increases were not achievable through the traditional process of negotiation.

This may be a case where the common interests of both parties outweighed the positional, combative approach, which may not have led to a successful conclusion for anyone.  Both parties, in this case, had to compromise future bargaining power in order to ensure they would get what they most valued.

Both parties wanted and were able to achieve, by recognizing common interests, a successful conclusion that appears to serve their best interests now and into the foreseeable future.

Discussion Questions:

  1. Identify three common interests shared by the union and the employer (the government) as they are presented in the embedded articles.
  2. What is the main message to the union members in the OPSEU announcement?
  3. Do you agree that giving up the right to strike was the right thing to do in this case? Why or why not?
  4. What benefits are in place for the employer (the government) as a result of this agreement?