The University of Manitoba knew there could be devastating consequences if it didn’t obey the Pallister government’s orders to freeze wages — right up to firing the president.
The feared repercussions ranged from funding cuts to rejecting programs to even appointing a majority on the board of governors that would remove the president, Gregory Juliano, the university’s associate vice-president of human resources, told a Manitoba Labour Board hearing Wednesday. The U of M Faculty Association has charged the university with unfair labour practices over bargaining last fall that led to a one-year wage freeze ordered by the province and a three-week strike over working conditions.
"We were in danger of having something happen to the university which could be quite damaging," Juliano testified. "It was made quite clear to us that it was an order — not optional — and that the government would take steps not favourable to the university if we did not participate in that mandate."
The province appoints 12 of the 23 members of the university board of governors, Juliano said. "Those people choose our president."
They could also remove the president, as well as make other senior management changes, said Juliano, who pointed out the province has to sign off each time the university adds or removes a program.
Juliano said the university was concerned about the financial impact of ignoring the directive; the operating grant and capital funding were at risk. Of particular concern was $150 million the previous NDP government pledged to the university’s $500-million capital campaign.
University president David Barnard wasn't able to discuss the university's concerns with Premier Brian Pallister, Juliano said.
"The premier never returned his calls — the president and premier never spoke, right up to the conclusion of the strike," he said.
Wednesday, Pallister's office referred requests for comment to Finance Minister Cameron Friesen, whose press secretary, Amy McGuinness, wrote in an email, "It would not be appropriate to comment on a matter that is before the Manitoba Labour Board."
Juliano testified the university was shocked and confused when it called the Education Department, only to learn "they were completely in the dark" about the order to freeze wages.
Juliano told the hearing the government ordered the U of M at the end of September to keep the directive a secret.
"They made it clear this information would not get to the union and would not end up in the press in any way," he said.
The directive to maintain confidentiality was repeated throughout October at both the start and end of meetings with government officials led by Gerry Irving, the province's secretary of the priorities and planning secretariat, he said.
Nevertheless, Juliano said, he tried to hint to the U of M Faculty Association the union’s belief there was little risk of government interference was wrong and a settlement needed to be reached quickly.
Juliano told one bargaining session the university didn’t want to get nine-tenths of the way to a deal and then be told it couldn’t offer any money.
"I was attempting to convey the potential for government interference," he said. "I was trying to alert them to the danger that was there."
The labour board has heard the university did not disclose the wage freeze order to the union until Oct. 27, when the two sides issued a joint statement.
Juliano said the province had ‘reassured’ the university the day before it would announce the freeze publicly, but didn’t.
On Oct. 27, Juliano told the mediator about the freeze order and then immediately informed UMFA.
"This one took the cake. This was one of the hardest things I’ve ever had to convey in negotiations. There were some long faces," but the union blamed the government, not the university, Juliano said.
Juliano said the first contact with the province was a voice mail message left at the end of September by Irving, whom he knew to be the primary contact between the province and university.
At the same time, he said, the Free Press published an article in which Finance Minister Cameron Friesen said public sector salary settlements were more than the province could afford in its quest to control spending.
Juliano said he got a phone call the evening of Sept. 30 from Rick Stevenson, an assistant deputy minister responsible for labour relations, who wanted to know what was happening in bargaining.
"This call on Sept. 30 was the first indication we had that the government was thinking in earnest of some kind of public sector wage controls," Juliano said.
Juliano said the university had earlier spent considerable time internally before offering seven per cent over four years. Juliano argued successfully the best offer should be on the table up front, he said. "I promoted the proposal that we should put on the table something fairly generous."
That was before the Pallister government had made any contact about controlling wages, he testified.
Juliano subsequently learned from Irving and Stevenson the offer had not gone over well with Friesen.
Juliano said the union ultimately went on strike over governance issues, which were foremost in UMFA’s objectives and a higher priority than money. When UMFA went out Nov. 1, it was an artificial deadline, he said. "In my view, we had made some progress."
Juliano will be cross-examined Friday morning by UMFA lawyer Garth Smorang.
The premier and the finance minister have never confirmed any of the reported contact between the government and the university took place.
The wage-control Bill 28 goes to public hearings Monday and Tuesday and will become law by June 1, though it will be retroactive to March 20. It imposes on 120,000 public-sector workers in their next collective bargaining agreements a wage freeze in the first two years, a maximum increase of 0.75 per cent in the third year, and a maximum one per cent in the fourth year.