Report in which the committee requests to be kept informed of development - Report No 292, March 1994

Case No 1722 (Canada) - Complaint date: 29-JUN-93 - Closed

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INTRODUCTION
A. Allegations of the complainant organizations
B. The Government's reply
C. The Committee's conclusions
The Committee's recommendations
ANNEX

511. In a communication dated 29 June 1993, the Canadian Association of University Teachers (CAUT) submitted a complaint of violations of freedom of association against the Government of Canada (Ontario). In a communication of 25 October 1993, the Canadian Labour Congress (CLC) expressed its support to the complaint on behalf of its own membership and that of several of its affiliated organizations. The Public Services International (PSI) and the International Confederation of Free Trade Unions (ICFTU) expressed their support to the complaint in communications dated 16 and 25 November 1993, respectively.
512. The federal Government, in a communication of 17 January 1994, transmitted the observations and information from the Government of Ontario, dated 12 January 1994.
513. Canada has ratified the Freedom of Association and Protection of the Right to Organize Convention, 1948 (No. 87). It has not ratified the Right to Organize and Collective Bargaining Convention, 1949 (No. 98), the Labour Relations (Public Service) Convention, 1978 (No. 151), or the Collective Bargaining Convention, 1981 (No. 154).

A. Allegations of the complainant organizations

514. The Canadian Association of University Teachers in its communication of 29 June 1993 and the Canadian Labour Congress in its communication of 25 October 1993 allege that the Government of Ontario violated ILO Conventions Nos. 87, 98 and 151 by enacting the Social Contract Act, 1993, "An Act to encourage negotiated settlements in the public sector to preserve jobs and services while managing reductions in expenditures and to provide for certain matters related to the Government's expenditure reduction program" (the "Act").
515. ILO Conventions require that public authorities refrain from any interference which would restrict the right of trade unions freely to organize their activities, including free collective bargaining. While the ILO has found that, as part of a wage stabilization policy, a government can place restrictions on the settlement of wage rates, it has held that "any restrictions should be imposed as an exceptional measure and only to the extent that it is necessary without exceeding a reasonable period, and should be accompanied by adequate safeguards to protect workers' living standards". The complainant organizations submit that the Act infringes ILO Conventions in several respects.
516. The Government is freezing wages for an unreasonable period, i.e. three years - and for a longer period if negotiations have not concluded for 1991 and 1992 - without any provision for adequately safeguarding workers' living standards in the event of a rise in the cost of living or other change in economic circumstances, and in the absence of compelling evidence that such a lengthy period of wage control is necessary.
517. The Government is unilaterally reducing workers' wages through a system of unpaid leaves, contrary to its responsibility to protect workers' living standards, and again in the absence of compelling evidence that such an extreme measure is necessary.
518. The Government has also retained ultimate control over the choice of the workers' representatives in negotiations for local agreements, in that Cabinet will have the power to make regulations relating to the authority of a provincial, national or international trade union to enter into an agreement on behalf of bargaining agents, contrary to Article 3 of ILO Convention No. 87.
519. The Act also placed pressure on unions to agree to the Government's programme, by adversely affecting workers whose unions fail to agree to a sectoral framework or a local agreement. In particular, the Government can determine the content of a "sectoral framework" if, in its opinion, either there is "sufficient support" for it or "special circumstances exist", whether or not a trade union agrees to it, contrary to Articles 3 and 4 of ILO Convention No. 87.
520. The sectoral framework specified in the legislation is designated by the Government and agreements are subject to the approval of the Government even when the Government itself is not the employer (e.g. universities, schools, hospitals and nursing homes).
521. Further, when a trade union does not sign a local agreement reflecting the Government's "sectoral framework", the following measures apply: (i) the Government unilaterally institutes the three-year wage freeze, together with a wage reduction through unpaid leaves; (ii) the expenditure targets set by the Government are not reduced as they otherwise would unless trade unions agree to the Government's sectoral framework and enter local agreements; and (iii) workers do not have access to a job security fund, i.e. an unemployment assistance fund, which would cushion the impact of a lay-off, unless the Government is satisfied that the union has made all reasonable efforts to enter into a local agreement.
522. The Act also violates Article 8(2) of Convention No. 87, which requires that "the law of the land shall not be such as to impair, nor shall it be so applied as to impair, the guarantees provided for in this Convention".

B. The Government's reply

523. In its communication of 12 January 1994, the Government generally submits that the Act is consistent with the applicable ILO Conventions and principles, which recognize that governments must be given the flexibility to deal with economic crises. The Committee on Freedom of Association has in the past concluded that economic stabilization measures restricting collective bargaining rights are acceptable provided they are of an exceptional nature, only to the extent that they are necessary, without exceeding a reasonable period and that they are accompanied by adequate safeguards to protect workers' living standards. (Digest, para. 641.) The Committee of Experts has adopted a similar approach on this issue (General Survey on Freedom of Association and Collective Bargaining, 1983, para. 315).
524. Before replying specifically to the allegations, the Government gives extensive explanations and figures, summarized below, on the economic and fiscal background which, it argues, made the adoption of the Act an absolute necessity.
525. The 1990-92 recession hit Ontario particularly hard. It had dramatic effects on jobs, social service expenditures and revenues. It had an especially serious impact on Ontario's debt, which rose from $42 billion to $68 billion during the recession. The recession also had a devastating effect on employment. Ontario accounts for nearly 70 per cent of all jobs lost in Canada during the recession, with manufacturing most affected; permanent plant closures accounted for 65 per cent of major lay-offs in 1992, up from 24 per cent in 1982. The recession also created additional pressures for social service expenditures, in particular social assistance: since 1989, the number of recipients has doubled and expenditures have more than doubled to $6.2 billion.
526. The recession also led to the collapse of provincial tax revenues, which have fallen for two years despite significant tax-raising measures. Revenues declined proportionately more than nominal GDP. Tax revenues for 1991-92 declined by 5.2 per cent; for 1992-93, they fell nearly $1.75 billion short of the forecast in the 1992 Budget. This drop in revenues has sharply increased Ontario's deficit in the past three years, pushing it over $12 billion in 1992-93. If the Government did not take action, the Province's deficit for 1993-94 would rise to almost $17 billion in 1993-94, and the accumulated debt possibly approaching $120 billion by 1996. Public debt interest currently absorbs about 13 cents of every dollar of revenues. In the absence of strong action to cut expenditures and raise revenues, that share could double by 1995-96. The annual cost of servicing the debt could rise from $5 billion now to about $12 billion and become Ontario's largest "program", eclipsing education and hospitals. Excluding sovereign countries, Ontario has become the largest borrower in the world, borrowing on average more than $1 billion a month. The Province spends more on interest costs than it spends on its schools.
527. There are approximately 900,000 persons employed in the public sector, about one in five jobs in the provinces, with a total compensation bill of nearly $43 billion. The cost of Ontario's public sector grew by 61 per cent from 1986 to 1993, whereas the Gross Domestic Product remained at the same level, i.e. $202 billion. Expenditures on health, education and social services account for 71 per cent of provincial government expenditure, over 50 per cent of which represents compensation for public service employees. Since 1980, private sector employment rose by 10 per cent, while public sector jobs increased 47 per cent.
528. Faced with this situation, the Government had no choice but to take action rapidly, which it did in two ways. The 1993-94 Budget included an Expenditure Control Plan with spending cuts of $4.6 billion, $720 million of which were to come from a decrease in the Government's operations and overhead costs, including payroll, and from a streamlining of operations. By the end of 1994, there will be almost 5,000 fewer full-time equivalent positions in the public service, through, wherever possible, normal attrition and voluntary retirements and resignations. These measures, however, were not enough to respond adequately to the debt and deficit problem.
529. In April 1993, the Government initiated negotiations towards a Social Contract with employers and employees in the public sector to complement the Expenditure Control Plan. The Social Contract is a process to achieve basic trade-offs between economic performance measures, such as productivity enhancements and the containment of compensation costs, in return for employment security gains and labour's empowerment in planning processes; its purpose is to preserve public services and public sector jobs while putting them on a secure financial footing. Together, the Expenditure Control Plan and the Social Contract will enable the Government to keep its commitments to create jobs, maintain important services and minimize public sector job impacts, while achieving operating savings that will total $6 billion in 1993-94.
530. To make sure that the above-noted compensation savings were achieved in the fairest way, in April 1993, the Government invited public sector employer and employee representatives and representatives of independent health practitioners to negotiate a Social Contract with the Government. During the negotiations which took place in April, May and June of 1993, the Government tabled a framework agreement that included provisions for: savings through unpaid leaves of absence while protecting public services and accommodating the preference of individual employees; enhanced employment including redeployment, training and adjustment for employees; encouragement of efficiency and productivity savings in the public sector; access to a fund to supplement unemployment insurance benefits or to permit the extension of notice periods or to allow for retraining; and protection for those earning less than $30,000 per year. Despite the progress made in these talks, they ended on 3 June 1993, without an agreement.
531. The Government's last framework offer, presented on 2 June 1993, outlined a fair and balanced way of achieving the $2 billion in social contract savings while protecting jobs and services. It contained many ideas from social contract participants, employee and employer representatives alike. It reflected their shared concern for a humane restructuring of government, for more affordable and efficient government, for greater openness and accountability in government and, above all, for the preservation of public services. That framework has become the foundation for the Social Contract Act, 1993. The Government is committed to saving $2 billion a year for the next three fiscal years through reduced compensation costs. The Act seeks to achieve the savings in the spirit of the Social Contract.
532. The purposes of the Act are: to encourage employers, bargaining agents and employers to achieve savings through agreements at the sectoral and local levels primarily through adjustments in compensation arrangements; to maximize the preservation of public sector jobs and services through improvements in productivity, including the elimination of waste and inefficiency; to reduce expenditures for a three-year period and to provide criteria and mechanisms for achieving the reductions; and to provide for a job security fund.
533. The significant features of the Act are as follows: (a) the Minister responsible for the administration of the Act is authorized to establish expenditure reduction targets for the various sectors and employers in the public sector; (b) a Public Sector Job Security Fund is established; (c) a structure for negotiated settlements to achieve the expenditure reduction targets is established at both the sectoral and local levels for bargaining unit employees; (d) a structure is also provided for plans in respect of non-bargaining unit employees; (e) if there is no agreement or plan, employers will implement expenditure reduction targets through freezes in compensation and, if freezes do not produce the necessary savings, through unpaid leaves to a maximum of 12 days; special provision is made for employees who perform critical functions; (f) those who earn under $30,000 annually are given protection; pay equity entitlements are also protected; (g) the Province is authorized to reduce its payments to public sector employers and, in cases prescribed by regulation, to require payments for them; the Act applies to independent health professions; (h) the Act applies to members of the Assembly and other office holders, whether elected or appointed.
534. As regards the first specific allegation made by the complainants (freezing of wages for an unreasonable period without adequate safeguards) the Government submits that in passing the Act, it was taking action to protect the living standards of workers by reducing the likelihood of lay-offs and unemployment. Nothing in Convention No. 87 prevents the Government from deciding drastically to reduce funding for public service delivery. Government forecasts were that between 20,000 and 40,000 public sector workers would have lost their employment if a negotiated restructuring outcome was not pursued and supported by legislation. The Act has succeeded based on projections that very few lay-offs will occur. This supports the claim that the living standard of workers has been protected. As of 13 December, only 66 people have applied for access to a $300 million employment security fund provided by the Province.
535. The Act does not necessarily freeze wages. In the vast majority of cases, employers and their unions concluded local agreements under the Act, some of which voluntarily accepted a freeze for a period of between one and three years, while others did not feel the need to agree on any freeze at all. Collective bargaining continues during this period and bargaining outcomes will reflect the terms that the local parties agreed upon. This notwithstanding, considering the Government's current fiscal/deficit crisis, a period of three years freeze is a reasonable approach to balancing the living standards of workers' with the need to return to economic stability.
536. For those employers and unions that failed to reach an agreement, there is a mandatory freeze on compensation and employers are free to require employees to take up to 12 days' unpaid leave per year for a period of three years. Actual reliance on 12 unpaid leave days appears to be less than anticipated. Where employers select this option they are restricted by statute from relying on "other measures at law" (lay-offs) until they have clearly demonstrated they cannot achieve their savings through a compensation freeze and unpaid leave days. Untenable employer claims are subject to compulsory binding third party arbitration/adjudication with a regulatory requirement they provide detailed financial information to support their claims. The Act does not place restrictions on the ability of third party interest arbitrators to award increases in compensation during the period 14 June 1993 to 31 March 1996. This provision applies in cases where a local agreement is concluded or where there is no local agreement. There is no comparable restriction on the right to strike for increases in compensation except where the terms of a local social contract agreement prevail in case of conflict with a local agreement, or where the Act provides for a freeze in compensation if no local agreement is concluded. This is a reasonable restriction on the collective bargaining process when the Province's fiscal situation is considered.
537. To protect workers' living standards, the Act provides for the protection of employees earning less than $30,000 annually, excluding overtime pay and allows exemption for this only where approved by a sector plan and with the support of a local bargaining agent. The protection is otherwise unaffected for unorganized elements of the workforce.
538. Concerning the second allegation (that the Act reduces wages by up to 5 per cent through a system of unpaid leave), the Government states that the Act provides for opportunities to negotiate solutions that need not require a reduction in workers' wages. While the Act is intended to find most of the initial savings "primarily through compensation", sector plans encourage local parties to find innovative solutions to increase efficiency and productivity levels while protecting workers' standards of living by offsetting the need or pressure for involuntary lay-off. The Act temporarily affects workers' income in cases where local agreements are not concluded. Special attention was given to ensuring that workers received comparable time off whenever income was reduced under these circumstances. As well, pension entitlements are maintained without negative consequences for plan contributors. The Act was an alternative statutory intervention to simply rolling back workers' salaries on a permanent or temporary basis without establishing an environment where negotiated restructuring would offset the shortfall in provincial grant support. Great effort was made to provide a model for negotiating change in the face of the fiscal crisis facing the Province.
539. Contrary to the third allegation (that the Government proposes to retain ultimate control over the choice of the workers' representatives in negotiations for local agreements), the Government states that it assumes no right to override any existing and legally recognized rights of representation by bargaining agents. Subsection 5(3) of the Act precludes the Minister from designating an organization as a bargaining agent under the Act for employees who are represented by a bargaining agent. Subject to this limitation, the Act extended the rights of workers to form associations specifically for the purpose of seeking bargaining rights under the Act. On no occasion did these rights supersede those of an existing bargaining agent. The Act went on to extend to either trade unions or employers the further opportunity to form associations or to enter into agreements on behalf of their affiliates.
540. As regards the fourth allegation (provisions in the Act to exert pressures on unions to agree to the Government's programme "special circumstance" provisions of section 11), the Government submits that the Act provides incentives to conclude local agreements by making lower savings targets available and by providing a $300 million job security fund to help provide retraining for workers who might be laid off as a result of their employer's decision. As well, where unions can demonstrate they made "all reasonable efforts" to conclude a local agreement but were not successful, they can still gain access to this fund on behalf of their members. Section 11(4) of the Act in no way restricts the abilities of any bargaining agent to manage its own internal affairs; to draw up rules and constitutions; to elect their representatives; to formulate their programmes, etc. The Act was not intended to be applied in this fashion and has not. Where "special circumstances" have been relied upon and a sector plan designated, unions are under no binding obligation to implement the sector plans under a local agreement. It is even possible to conclude a local social contract agreement that does not implement a sector framework plan. The Act does not extend to the Government any authority to dissolve by administrative authority any workers' or employers' organization; it actually extends the right to organize.
541. With respect to the fifth allegation (that the sectoral framework in the Act is designated by the Government and that agreements are subject to the approval of the Government even when the Government itself is not the employer), the Government indicates that nothing in the Act compels a bargaining agent or an employer to implement the terms of any sectoral framework plan into their local social contract agreement or even to have such an agreement. The Government has designated sectoral agreements only after achieving some level of support from participating employers and unions.
542. As regards the allegation that the Act violates Article 8(2) of Convention No. 87, the Government submits that it chose to balance the rights of public service workers to enjoy free collective bargaining, the need to adequately safeguard their living standards and the need to protect vital public services, with the harsh fiscal realities; otherwise public services would have been slashed and jobs lost. The Province did this within a statutory framework that went great distances to maintain workers' rights and living standards, the principle of collective bargaining and the need to adopt a negotiated restructuring model to support the continued delivery of services in an efficient, effective and affordable manner.
543. The Government attaches to its observations a series of documents some of which show that despite the above-noted economic stabilization measures taken by the Province, there is a continuing deterioration of its fiscal situation. As indicated by the Province's September 1993 Quarterly Update, provincial revenues for this fiscal year will be even lower than forecast in the Budget; a revenue shortfall of anywhere from $800 million to $1 billion has led in November 1993 to a downgrading of the Province's credit rating.
544. The Government concludes that it finds any prospect of overriding collective agreements painful and difficult, but this is nothing compared to what the alternative would mean for the Province. In accepting a hierarchy of principles, the Government determined that the right to enjoy free collective bargaining does not supersede the rights of others in society in every case, at all times. However, the economic stabilization measures set forth in the Act are of an exceptional nature, are only to the extent necessary, do not exceed a reasonable period and such measures are accompanied by adequate safeguards to protect workers' living standards.

C. The Committee's conclusions

545. The Committee notes that the allegations in the present case relate to an intervention in the public sector collective bargaining process in Canada (Ontario) which, according to the complainants, violates Conventions Nos. 87, 98, 151 and 154.
546. The complainants argue that these measures were taken in the absence of compelling evidence of necessity. The Government submits for its part that it had no choice but to intervene in view of the severity of the fiscal and economic crisis facing the Province and that, in so doing, it attempted to balance the interests of all parties. As was already mentioned in a previous decision involving various restrictive provincial laws in Canada, including Ontario (Cases Nos. 1172, 1234, 1247 and 1260, 241st Report, para. 113) it is not for the Committee to express a view on the soundness of economic arguments put forward by the Government to justify its position or on the measures it has adopted; see also the general remarks made in this respect in the report of the study mission undertaken in Canada in 1985 (ibid., paras. 9-13). On a related issue, the Committee cannot ignore the fact that the present case is far from isolated: several other Canadian jurisdictions, invoking similar reasons, have also enacted legislation dealing with collective bargaining in the public service, which prompted a number of complaints of violation of freedom of association, that were examined recently or are currently pending.
547. As regards economic stabilization measures which limit collective bargaining rights, the Committee recalled recently that when a government "for compelling reasons of national economic interest and as part of its stabilization policy, considers that pay rates cannot be settled freely through collective bargaining, such a restriction should be imposed as an exceptional measure and only to the extent that is necessary, without exceeding a reasonable period, and it should be accompanied by adequate safeguards to protect workers' living standards" (Case No. 1616, 284th Report (Canada), para. 635). The Social Contract Act must therefore be examined in the light of these criteria, to assess whether it went beyond what the Committee has considered to be acceptable limits that might be placed temporarily on free collective bargaining.
548. The general structure of the Act, the main provisions of which are reproduced in Annex I, is as follows:
- - article 7: the Minister shall establish expenditure reduction targets for public sectors and employers;
- - article 11(1): the Minister may designate as a "sectoral framework" a plan that relates to a given sector, provided it meets certain criteria (sufficient support for the plan, based on negotiation; provisions achieving the expenditure reduction target; no adverse effect on employees earning less than $30,000; provisions to minimize job losses, respecting redeployment and training of employees, and adjustment programmes);
- - article 13: bargaining agents may conclude local agreements that implement sectoral frameworks; if such local agreements are concluded, article 7(2)(a) provides that the Minister shall establish lower expenditure reduction targets;
- - articles 23 and 24: where there is no agreement or plan, compensation is frozen for three years; if these measures are insufficient to meet the expenditure reduction target, employers may, under article 25, require employees to take unpaid leaves of absence, up to a maximum of 12 days in each of the three following years;
- - other provisions in the Act: cover non-bargaining unit plans; protect employees earning less than $30,000; guarantee pay equity entitlements; establish a job security fund; and institute, in some cases, a review procedure before an adjudicator.
549. The Committee notes that the main purpose of the Act is to achieve reductions in public expenditure over a three-year period which, of necessity, entails some interference in the collective bargaining process, unless the government could convince all public sector bargaining agents and employees of the soundness of its action. While the Act encourages bargaining agents to conclude negotiated settlements, i.e. local agreements implementing a sectoral framework (which, in order to be designated as such, must include provisions that will assist public sector employers in achieving the target established by the Minister) expenditure reductions may ultimately be obtained through a freeze of wage rates or, if this is insufficient, through compulsory unpaid leaves of absence or special leaves. Collective bargaining, therefore, cannot be said to be voluntary in that context and the Committee regrets that the Government did not give full priority to collective bargaining and felt compelled to adopt the Act to establish the employment conditions in the public sector.
550. The Committee notes however that the Act embodies a number of features which, to some extent, mitigate its effects and its alleged incompatibility with ILO Conventions. Firstly, the Act protects employees at the lower end of the wage scale, who are likely to be most affected, and guarantees pay equity entitlements which, in practice, benefit mostly women. Secondly, as far as the Committee is aware, the Act is not another piece of legislation immediately following other government interventions in the collective bargaining process. Thirdly, and although these were not successful, it appears that some consultation and negotiation on a framework agreement took place from April to June 1993. Furthermore, Part VII of the Act establishes under certain conditions a third-party review procedure when no local agreement is concluded.
551. In addition, article 12 of the Act leaves some room for the negotiation of sectoral frameworks by listing a series of subjects that negotiators may consider including in the framework. The Act also attempts to persuade bargaining partners to have regard voluntarily to the major economic and social policy considerations and the general interest invoked by the Government, as article 7(2) provides the incentive of lower expenditure reduction targets where local agreeements implementing the sectoral framework are concluded. Noting that the Government states that agreements were concluded in the vast majority of cases, the Committee requests it to provide additional information in this respect, in particular on the number of such agreements, and on their percentage in relation to the total workforce and sectors.
552. As regards the reasonableness of the period during which the Act will be in effect, the Committee notes that this assessment depends highly on the view taken as to the seriousness of the fiscal and economic situation of the Province, a subject on which the Government and the complainants hold irreconcilable views. Considering, however, that a three-year period of limited collective bargaining constitutes a substantial restriction, the Committee trusts that the legislation will cease producing effects at the latest, at the dates mentioned in the Act, or indeed earlier if the fiscal and economic situation improves. It invites the Government to refrain from taking such measures in the future.
553. As regards the allegation that the Government retained control over the choice of workers' representatives for the negotiation of sectoral agreements, the Committee notes that article 5(1) empowers the Minister to recognize additional bargaining agents, for the purposes of the Act, but is precluded under article 5(3) from designating a bargaining agent for employees who are already represented by a bargaining agent. It therefore considers that this aspect of the case does not call for further examination.

The Committee's recommendations

554. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
- (a) While regretting that the Ontario Government did not give full priority to voluntary collective bargaining as a means of determining the employment conditions of public sector employees, the Committee considers that, taking into account all circumstances and all the provisions of the impugned legislation, the Social Contract Act did not go beyond acceptable limits that might be placed temporarily on collective bargaining.
- (b) Considering, however, that a three-year period of limited collective bargaining constitutes a substantial restriction, the Committee trusts that the legislation will cease producing effects at the latest, at the dates mentioned in the Act, or indeed, earlier if the fiscal and economic situation improves. It invites the Government to refrain from taking such measures in the future.
- (c) The Committee requests the Government to provide additional information on the number of local agreements concluded in relation to the total workforce, and to keep it informed of the collective bargaining situation in the public sector.

ANNEX

An Act to encourage negotiated settlements in the public sector to preserve
jobs and services while managing reductions in expenditures and to provide for
certain matters related to the Government's expenditure reduction program
PART I
GENERAL
...
4. This Act binds the Crown in right of Ontario and all employers, employees
and bargaining agents in the public sector.
5. (1) The Minister may recognize as a bargaining agent for the purposes of
this Act an organization that in his or her opinion represents employees but
that does not have bargaining rights under an Act.
(2) The recognition may be subject to such restrictions as the Minister
specifies.
(3) The Minister shall not designate an organization as a bargaining agent
under subsection (1) for employees who are represented by a bargaining agent.
(4) A bargaining agent designated under subsection (1) has the right to
bargain on behalf of the employees for the purposes of this Act.
6. Nothing in this Act shall be interpreted or applied so as to reduce any
right or entitlement under the Human Rights Code or under the Pay Equity Act.
PART II
EXPENDITURE REDUCTION TARGETS
7. (1) The Minister shall establish expenditure reduction targets for sectors
and for employers.
(2) If there is a sectoral framework in respect of a sector, the Minister
shall establish lower expenditure reduction targets for every employer in the
sector who,
(a) enters into a local agreement, not later than August 1, 1993, that
implements the sectoral framework;
...
PART III
PUBLIC SECTOR JOB SECURITY FUND
8. (1) A fund to be known in English as the Public Sector Job Security Fund
and in French as Fonds de securité d'emploi du secteur public is established.
(2) The purpose of the Fund is to provide, in accordance with this Act and the
regulations,
(a) payments to employees who are released from employment by their employers;
and
(b) payments to employers for the purpose of extending the employment of
employees who will be released from employment by the employers.
...
PART IV
SECTORAL FRAMEWORK
11. (1) The Minister may designate, as a sectoral framework, a plan that
relates to a sector.
...
(3) the Minister shall not designate a plan as a sectoral framework unless, in
the opinion of the Minister, the plan meets the following criteria:
1. There is sufficient support for the plan, based on negotiations leading to
the development of the plan, for the plan to form the basis for local
agreements in the sector.
2. The plan includes provisions that will assist employers in the sector in
achieving the expenditure reduction target established by the Minister for the
sector.
3. The plan will not adversely affect employees in the sector who earn less
than $30,000 annually, excluding overtime pay.
4. The plan contains appropriate provisions to minimize job losses in the
sector, appropriate provisions respecting the redeployment of employees in the
sector who are released from employment or who receive notice that they will
be released from employment, and appropriate provisions relating to employee
training and adjustment programs.
5. The plan will be fair and equitable in its application to all employees.
(4) Subsection (3) does not apply to a plan if, in the opinion of the
Minister, special circumstances apply and it is desirable to designate the
plan as a sectoral framework.
...
12. In addition to the provisions referred to in subsection 11(3), persons
seeking to negotiate the contents of a sectoral framework may consider
including the following provisions in the framework:
1. Provisions relating to organizational restructuring, including early
retirement options and labour adjustment programs.
2. Provisions relating to improvements in productivity, including the
elimination of waste and inefficiency.
3. Provisions relating to alternate work arrangements.
4. Provisions relating to the binding resolution of disputes.
5. Provisions relating to the sharing of information and decision-making by
employers and employee representatives, including the sharing of financial and
planning information.
6. Provisions relating to sectoral bargaining.
7. Provisions relating to the establishment of joint committees at the
sectoral and local level.
8. Provisions relating to pensions, including the joint trusteeship of pension
funds.
9. Any other provisions proposed by a party to the negotiations.
PART V
LOCAL AGREEMENTS WITH BARGAINING AGENTS
13. (1) One or more bargaining agents may, not later than August 1, 1993,
enter into a local agreement with an employer.
(2) A provincial, national or international trade union may enter into local
agreements on behalf of bargaining agents that are affiliated with the trade
union and have authorized the trade union to act on their behalf.
(3) An employer association may enter into local agreements on behalf of
employers that are members of the association and have authorized the employer
association to act on their behalf.
...
PART VII
WHERE NO AGREEMENT OR PLAN
23. (1) This Part applies to,
(a) those bargaining unit employees in respect of whom there is no local
agreement.
...
(2) This Part does not apply to employees who earn less than $30,000 annually,
excluding overtime pay.
24. (1) The rate of compensation of an employee is, for the period beginning
June 14, 1993 and ending with March 31, 1996, fixed at the rate that was in
effect immediately before June 14, 1993. ...
25. (1) If necessary to meet the expenditure reduction target established by
the Minister, an employer may require employees to take unpaid leaves of
absence to a maximum of twelve days or their equivalent in each of the
following periods:
1. June 14, 1993 to March 31, 1994.
2. April 1, 1994 to March 31, 1995.
3. April 1, 1995 to March 31, 1996.
26. (1) If employees perform critical functions as prescribed by regulation
and the employer is unable, without impairing those functions, to meet its
expenditure reduction target by utilizing unpaid leaves of absence under
section 25, the employer may require those employees to take special leaves.
...
27. (1) If the fixing of compensation under section 24 does not result in an
employer achieving its expenditure reduction target, the employer shall,
(a) make all reasonable efforts to achieve its target by utilizing unpaid
leaves of absence under section 25 or, if applicable, special leaves under
section 26 before taking other actions available to it at law; and
(b) develop a program setting out the manner in which these leaves are to be
implemented.
(2) The program shall be developed consistent with the following criteria:
1. Employees described in subsection 23(2) will not be adversely affected.
2. Employees will not be required to take an unpaid leave of absence to the
extent that it would result in their annual earnings, excluding overtime pay,
being reduced to under $30,000.
3. The program will assist the employer in achieving the expenditure reduction
target established by the Minister for the employer.
4. The program will be fair and equitable in its application to all employees.
5. The employer will participate in any redeployment plan that exists under a
sectoral framework for the applicable sector or that is established by the
Minister under section 50 for the applicable sector.
...
(4) In order to enable employees to evaluate the basis for the program, the
employer shall, upon request, make such financial information available to the
employees as is prescribed in the regulations.
...
28. (1) A written summary of the program shall be made setting out,
(a) the manner in which the unpaid leaves of absence are to be administered;
(b) whether the employer intends to use special leaves to meet the expenditure
reduction targets;
...
(2) The summary of the program shall contain sufficient details so that
employees are aware of how they will be affected.
29. (1) The summary of the program and a copy of this Part shall be posted in
such a manner that they are likely to come to the attention of the employees
affected by the program. ...
(3) An employee or bargaining agent who objects to the program because it
fails to meet the criteria set out in section 27 may within ten days of the
summary of the program being posted request in writing that the employer amend
it.
...
(5) The employer shall, within ten days after the objection period has
expired, review the objections and post in the same manner,
(a) a notice of confirmation of the original program; or
(b) a summary of the amended program.
...
30. (1) If following the employer review under subsection 29(5), an employee
or a bargaining agent considers that the program or amended program still does
not meet the criteria set out in section 27, he, she or it may, within ten
days after the posting under subsection 29(5), request a review of the program
by the person or body designated in the regulations as an adjudicator for that
purpose.
(2) The request shall be in writing and shall specify the grounds for the
objection to the program.
31. (1) Subject to the regulations, if any, the adjudicator may establish
procedures for carrying out the review.
(2) The adjudicator shall review the program and shall,
(a) confirm the program if it meets the criteria set out in section 27; or
(b) amend the program so that, in the opinion of the adjudicator, it is
consistent with the criteria set out in section 27.
...
(5) The decision of the adjudicator is final.
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