The Impact of Public Sector Wage Freezes on ETFO Members (From the General Secretary)

Last  fall, after reporting that the province is facing a $24.7 billion deficit, Premier McGuinty and  Finance  Minister  Dwight  Duncan  began to muse publicly about how to cut government costs. They floated the idea of unpaid days for public sector workers who, they believed, had not  experienced  the  same  negative  effects  of the  recession that  private  sector  workers  did.

“Dalton Days” were the talk of the town for several weeks before the premier put that idea to rest.
At the end of March the government again put forward the idea of public sector workers paying to help reduce the  deficit. The budget called for a wage freeze for all public  sector employees, potentially  affecting  workers covered by some 750 contracts. Some of these contracts, like the ones covering ETFO members, will not expire for two more years.

Finance Minister Dwight Duncan was quoted in the Toronto Star as saying: “We will not fund any increases in overall compensation as those agreements get renegotiated. That’s an important point to bear in mind.”1 The Public Sector Compensation Restraint to Protect Public Services Act was tabled on budget day  and  ETFO  sent  the  legislation  to  legal counsel to ensure we would be able to answer members’ questions as they arose.

The Act applies to government and quasi-governmental agencies, including school boards. However, it does not apply to unionized employees, including ETFO members, because the government has said it “will respect all current collective agreements.”2

But the government also said that when current agreements expire and new contracts are negotiated it will “seek agreements of at least two years’ duration that do not include net compensation increases.” Further, “the fiscal plan provides no funding for compensation increases for future collective agreements. It doesn’t matter whether contracts expire next month, next year or the year after that – all employers and employee groups will be expected to do their part.”3

ETFO members are doing their part. For the past two years they have been helping to reduce government costs by earning  2 percent less in salary than other education workers. This saves the government at least $45 million per year. Elementary educators also are short-changed by the gap in funding between the elementary and secondary panels. The elementary system receives less funding per pupil than is provided for students in the secondary panel. In this regard, elementary teachers and their students have saved the provincial government millions of dollars over the years.

For ETFO members, the next collective agreement is two years down the road. In the meantime, the proposed legislation  does not contain any mechanism to prohibit salary increases for unionized employees. Our members will rightfully  expect  the 2 percent salary deficit to be eliminated. That doesn’t mean the government will not bring pressure to bear. It was heavily involved in the last two rounds of education sector bargaining. Potentially it could be even more hands-on next time. It will likely also exert pressure on school boards to take a tough stand.

We face clear challenges in the next round of bargaining. They are challenges ETFO members working together must be prepared to meet head-on.

Notes
_{1   Robert Benzie. “Budget: Ontario vows freeze on public-sector wages.” The Toronto Star Mar 26, 2010
2  2010  Ontario Budget: FAQ: Public Sector Compensation  Restraint  To Protect Public Services Act, 2010,  available at  http://www.fin.gov.on.ca/en/budget/ ontariobudgets/2010/faq.html
3   2010  Ontario Budget: FAQ}