Because of the tight labor market in Canada, workers should be making big gains. But with nearly as many unemployed workers as job vacancies, it appears that employers are simply not offering high enough wages to entice people to take jobs.
Recently, there have been many encouraging signs pointing to a strengthened position for labor, such as higher than average wage gains in new collective agreements and union organizing victories in the service sector. However, the fact that many employers are still not offering high enough wages to entice workers is a sign of a looming problem. A very small uptick in employment in September has not made up for the previous three-month streak of employment losses.
With the Bank of Canada continuing to raise interest rates in order to curb inflation and economists warning that it risks causing a recession, employers may have decided that sooner or later workers will be disciplined by the market and accept whatever jobs they can get. For their part, the labor movement and the New Democratic Party (NDP) have not provided the bold leadership that will be required to counter the erosion of workers’ current leverage or a possible recession.
What Are Unions Doing?
Back in January, Uber and United Food and Commercial Workers International Union Canada (UFCW), one of the largest private sector unions in the country, struck a controversial deal. The agreement paves the way for UFCW to offer representation for drivers without them becoming actual union members or recognized as employees.
As the Globe & Mail uncovered, both Uber and UFCW lobbied the Conservative Ontario government to keep drivers from being covered by the provinces’ Employment Standards Act. Unions should be prioritizing organizing efforts in the rideshare sector and the deal is an embarrassing and outrageous development to be sure. As work continues to be transformed, organizing the gig economy is essential to the survival of unions. Making cushy deals with the bosses is kicking the can down the road as private sector union membership in Canada continues to decline.
Over in British Columbia (BC), the BC General Employees’ Union (BCGEU) recently completed a tentative collective agreement with the province for around thirty-three thousand public sector workers. During the negotiations, the union called for refusal of overtime and began a strike of liquor and cannabis distribution centers. The strike lasted two weeks before the union called it off in what it explained was a “good faith” move because they felt negotiations were progressing well.
BCGEU’s tentative agreement with the province, reached on September 7, looked good on the surface. The agreement laid out some of the biggest pay increases for public sector workers that Canada has seen in years. However, given current inflation trends, if the agreement is ratified, these workers are likely to experience a decline in real wages by the end of the three year contract.
BCGEU has confronted a dilemma that many public sector unions in Canada face. The calculation of what use limited strike actions can offer under NDP governments is hard to determine. If negotiations do go well, unions will call off job actions so as not to hurt the nominally labor-friendly party’s standing among the public. This goodwill can put unions on their back foot.
With a deal on the table that offers significant pay hikes yet looks unlikely to keep up with inflation, the public sector union face hard choices. While NDP provincial governments have engaged in actions that have violated free and fair collective bargaining for public employees, Conservative governments have been far worse. There is a case to be made, however, that a lack of militancy now may lead to disaster later.
Under the last Liberal government in Ontario, some public sector unions moderated their organizing in the fear that militancy would hasten the return of Conservative rule. In light of the election of Doug Ford’s Conservative government in 2018, it is clear that the results of this playbook have not been successful.
Ontario’s health care system is in crisis. This is partially the result of long term underfunding colliding with the COVID-19 pandemic. But Ford unarguably triggered a staffing crisis among nurses by signing Bill 124 in 2018, which capped pay increases in the public sector at one percent per year. With conditions for health care workers plummeting, Ford’s chosen response to the crisis has been to increase the amount of private sector involvement in the health care system. He is now calling on other provinces to do the same.
Public sector unions in Canada have long been making the case that their working conditions are tied to the quality of the services that they provide the public. This approach is needed now more than ever. Trying to elect and rely on favorable governments is a dubious strategy that has not paid off for Canadian public sector unions. We must build a union movement that can constrain the actions of governments of any stripe when it comes to austerity and regressive labor legislation. Kowtowing to NDP governments that may enact labor friendly legislation is not a winning strategy.
The NDP Bind
The federal NDP, in a supply and confidence agreement with the ruling Liberal minority government, have been making noises that workers did not cause and should not have to pay for inflation. The agreement they have reached with the Liberals to provide relief — an “affordability package” that includes pediatric dental care, rent benefits and a tax rebate — is simply a stop gap.
The corrosive effect of inflation is something to be taken seriously and demands bolder action. This is especially true with new federal Conservative leader Pierre Poilievre openly courting working-class voters. The NDP finds itself in a bind of its own creation.
Back in 2011, when the party came closer to winning an election than it ever had before, then leader, the late Jack Layton, was pilloried in the media for questioning the Bank of Canada’s focus on inflation over employment. Within twenty-four hours, Layton had backtracked, stating that he respected the independence of the central bank. Unlike 2011, the NDP is not currently on the verge of power. However, it does have the power to topple the government and force an early election.
Such a tactic is a risky proposition for the party. Previous Liberal minority governments that passed progressive legislation with NDP support have found themselves reelected with majorities — and credit for what have been NDP policies. For this reason, the NDP must strongly differentiate itself from the Liberals.
Ideas like strategic price controls and taxing the wealthy and corporations offer up a different way to fight inflation that does not harm workers. With corporate profits in Canada surging, the time is ripe for the party to take itself out of its comfort zone and advocate for bold, progressive policy.
A real pro-worker plan for this moment would be an uncompromising commitment to full employment. This would allow the NDP to not only contrast itself with the Liberals but to also draw a sharp distinction between and the Conservatives claiming to be fighting for the working class in a right-wing populist register.
Full employment allows workers to leverage labor demand for wage gains. It is a potent policy for reducing inequality. Full employment also reduces racial wage and employment gaps in the labor market, which has been a persistent issue in Canada especially for precarious work. If the NDP wants to adopt a forceful and effective labor strategy, full employment should be its centerpiece.
Talk of the pandemic ending neoliberalism felt shortsighted — capital was always going to reassert itself. As soon as restrictions were lifted and emergency government spending curtailed, this is precisely what happened. The leverage that workers have in the wake of pandemic disruptions has not yet disappeared. Actions taken now could have serious long-term consequences for worker power in Canada. The task ahead is for unions to push the NDP to keep that leverage going and to strengthen it.