Court strikes down province’s controversial wage-freeze legislation By: Dan Lett Posted: 7:00 PM CDT Thursday, Jun. 11, 2020

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This article was published 10/06/2020 (1562 days ago), so information in it may no longer be current.

Controversial wage-freeze legislation passed in 2017 by Manitoba’s Progressive Conservative government has been struck down after a court determined it violated the constitutional rights of unionized public sector workers by eliminating their right to collective bargaining.

The decision by Court of Queen’s Bench Judge Joan McKelvey was clear in its condemnation of the Tory government’s infamous Public Services Sustainability Act, which was passed by the Manitoba Legislature in 2017 but never proclaimed.

The PSSA is a “draconian measure which limits and reduces a union’s bargaining power,” McKelvey wrote in her 224-page decision, released Thursday afternoon.

“The PSSA has left no room for a meaningful collective bargaining process…. The right to meaningfully associate in pursuit of a fundamental and important workplace goal has been denied.”

Kevin Rebeck, president of the Manitoba Federation of Labour and spokesman for the coalition of more than two dozen public sector unions that challenged the law, said the decision validates all of the concerns they expressed about the PSSA when it was first unveiled.

“This is a huge win for 120,000 public sector workers in Manitoba,” Rebeck said in an interview. “Over the last four months, the premier has been calling public sector workers ‘heroes.’ Enough of that talk. It’s time to go back to the bargaining table. I really hope the premier will starting using some common sense.”

Rebeck confirmed the coalition of unions will likely return to court to make arguments about being awarded costs and possibly to ask for damages. “The door is open to both of those options right now,” he added.

“This is a huge win for 120,000 public sector workers in Manitoba,. Over the last four months, the premier has been calling public sector workers ‘heroes.’ Enough of that talk. It’s time to go back to the bargaining table. I really hope the premier will starting using some common sense.”
– Kevin Rebeck, president of the Manitoba Federation of Labour

Neither Premier Brian Pallister nor Finance Minister Scott Fielding were available for comment. In an emailed statement, a spokeswoman indicated that a final decision on whether to appeal had yet to be made.

“We will take the time to carefully review the decision and assess appeal considerations,” the spokeswoman said. “The legislation had never been proclaimed into law and was in the process of being amended. So, as before, regular labour relations and collective bargaining will continue.”

The spokeswoman did raise the prospect that the province would re-argue its case on appeal based on the fiscal challenges created by the COVID-19 pandemic “and the unprecedented negative economic impacts it has caused.”

Although the province may still appeal, the detail and complexity of the analysis in McKelvey’s decision makes for a steep hill.

The province had argued that the PSSA represented a reasonable limit on the constitutional rights of unions because it was, at the time the law was drafted, facing a budget deficit crisis. However, McKelvey established in painstaking detail that by the time arguments were made in her court, the province had abandoned that rationale.

Even the economic expert brought in by the province admitted that its fiscal policies — most notably decisions to reduce revenues by hundreds of millions of dollars by cutting taxes and parking hundreds of millions of dollars more in the Fiscal Stabilization Account — were political and absent of any “economic rationale.”

The judge was also concerned that through testimony, it was established the Pallister government made no attempt to consult with unions about alternatives to wage-freeze legislation and produced no estimates of how much money it expected to save from the PSSA. Despite its name, government officials could provide “no evidence … as to how the PSSA would serve to protect public services and balance the budget.”

Further, the court said the PSSA’s prescribed wage schedule — two years of wage freezes followed by 0.75 per cent and one per cent in the third and four years — was arrived at arbitrarily and without any analysis or internal modelling.

The court also found that despite the fact the PSSA has not yet been proclaimed, and thus has no legal authority, “is effectively in force in the Province of Manitoba” by creating a “substantial interference with collective bargaining.”

The court noted that only 21 public sector contracts representing only 8,800 employees — less than eight per cent of all the workers represented by the public sector unions involved in the court challenge — have been settled since the law was passed.

The path to Thursday’s court decision has been long and, at times, quite convoluted. Not only did the Pallister government change its argument in mid-stream — abandoning claims that it was facing a fiscal crisis when it brought forward the legislation — but also introduced a bill to amend the PSSA while arguments were still being made in court.

Bill 9, which has not yet been passed, changes some of the terms under which the province can negotiate settlements that are above the four-year wage schedule in the original PSSA. However, public sector unions have argued that the amending legislation does not fundamentally change the sections of the PSSA that have been declared unconstitutional.

If the Pallister government does not appeal this decision, or does and loses, then it could be forced to go back to the bargaining table and revisit at least three years of de facto wage freezes that were imposed on public sector workers simply by threatening to enact the PSSA.

dan.lett@freepress.mb.ca

Dan Lett
Columnist

Born and raised in and around Toronto, Dan Lett came to Winnipeg in 1986, less than a year out of journalism school with a lifelong dream to be a newspaper reporter.

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