EC Group: Economic increases – clarification and context

February 06, 2017

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Many of you have asked us: “Why are there two wage increases in 2016?” The answer is relatively simple. The employer had set a cap on the economic increases it was prepared to grant – specifically, 1.25% per year or 5% over the life of the agreement. Any departure from those figures, often in the form of an additional increment, would have to be justified by the existence of an employee recruitment or retention problem or an internal or external salary relativity problem. A new wrinkle was therefore added this year for groups that do not have these types of problems: a salary adjustment over one or two years to be negotiated between the parties.

For other details, the highlights of the agreement, and the complete text of the agreement, please go back to the EC bargaining page.

At the EC table, we argued that without an additional increment the total economic increase did not sufficiently offset increases in the cost of living. We thus succeeded in obtaining a 1% increase effective June 22, 2016. This will bring the total increase for ECs in 2016 up to slightly more than 2.25% due to the compounding effect, since the date of the 1% salary adjustment precedes the effective date of the annual economic increase of 1.25%. Why in 2016? Because the employer will have to add this 1% to your retroactive pay, putting a bit more money in your pockets.

The EC group stacks up relatively well in comparison to other federal public service groups. Only the groups we came out ahead of by obtaining an additional increment when we last bargained for a collective agreement did better than us this time around (e.g., the MA group). As for the rest of the public service groups that signed tentative agreements, some obtained 1% in 2016 (the FI and PG groups), but the vast majority (all of the PSAC tables, representing nearly 100,000 employees in the PS, AS, CR and other groups) obtained 0.5% in 2016, plus a $650 signing bonus that is not pensionable income and is not to be counted as salary for the purpose of future increases.

The EC bargaining team insisted on the importance of applying any salary adjustment to all levels. In contrast, PIPSC obtained a half-increment of 2% for CO-02s only (the majority of COs being at that level). Our TR bargaining team did quite well, obtaining increases of 0.75% and 0.5% in 2016 and 2017 respectively. We would have liked to get something similar for our EC members, but we were unable to convince the employer to agree to those same increases.

We could have risked going to binding conciliation (arbitration), but there was no guarantee that we would do any better or come out ahead on the non-wage-related issues that remained to be ironed out. “A bird in the hand is worth two in the bush,” as the saying goes. This is why, among other reasons, the bargaining committee and the bargaining team made a majority decision to recommend that the tentative agreement be ratified by the members.

Learning from history

From a historical perspective, a review of salary growth at all levels in the public sector reveals a general diminishing trend in the percentage of wage increases. This can be attributed to a loss of strength in the labour movement and the fact that the employer, because it is also the legislator, is able to enact back-to-work legislation and impose wage settlements. This trend has been very much in evidence in the provincial public services of Quebec, Ontario, Nova Scotia and British Columbia, for example.

In this last round of bargaining, when the time came to justify why the employer was not offering larger increases, Treasury Board insisted on comparing our compensation with what provincial public servants were receiving and not with the compensation received by unionized workers in the private sector. It is important to note that, in deciding on their own salary increases, parliamentarians take into account the average increases granted by the leading unionized private companies in Canada.

To counter the historical trend of public service wages losing ground to inflation in recent decades, the members of CAPE and of all other federal public service unions will have to ask themselves whether choosing the safe path of binding arbitration is the right course of action.

Although arbitration sometimes can be effective in certain situations where a need to make up substantial wage gaps can be demonstrated to an arbitrator (as was the case for the EC group in the previous round of bargaining, when we obtained an additional increment of 3.45%), arbitration is never the preferred dispute settlement mechanism if a group is looking to make specific breakthroughs. For example, if we had opted for binding conciliation in this round, there is no assurance that our important gain on the issue of professional integrity could have been achieved, given that only a few tables representing less than 10,000 public service workers had managed to have this same concession incorporated into an tentative agreemen.

In this context, while it is clear that nobody enjoys the prospect of having to go on strike, it is important for all unions, even unions like CAPE that represent professionals, to ensure they have the means necessary to battle for improved terms and conditions of employment.

TRs walked off the job for two weeks in the 1970s to obtain maternity leave. Members of the FS group took selective strike action for nearly six months in 2013 (the longest federal labour conflict in history) and achieved substantial gains as a result.

These are just some of the many factors to be considered as we prepare for the next round of collective bargaining. This coming fall, we will again be issuing a call for volunteers to participate in the collective bargaining process.