The Pallister government will impose a two-year wage freeze on 120,000 public-sector workers as it attempts to wrestle an operating deficit approaching $1 billion.
On Monday, the Progressive Conservatives introduced long-awaited legislation -- first hinted at last fall -- to curb salary costs.
The Public Services Sustainability Act (Bill 28) will not rip up existing government contracts with workers, as some feared, nor will it cut pensions or force public sector employees to take days off without pay. It will be implemented as contracts come up for negotiation.
"I think we’re taking a really balanced approach. I think it’s a respectful approach," Pallister said, adding the PCs wanted to respect the collective bargaining process.
Bill 28 was one of eight bills introduced Monday -- the deadline, under House rules, for tabling legislation the government wants to see passed by June 1. Included among the other bills was one that would increase the current cap on university tuitions, another that would enable municipalities to introduce ride sharing services like Uber, and one that would set some ground rules for the anticipated introduction later this year of a federal bill to legalize marijuana.
The public sector bill would affect not only civil servants, but teachers, nurses, doctors, the employees of Crown corporations and others.
After wage freezes in Year 1 and Year 2, it would cap salary increases in years 3 and 4 at 0.75 per cent and one per cent respectively.
Finance Minister Cameron Friesen said the government wouldn’t rule out other cost-cutting measures in the future.
"It’s a good place to begin," Friesen told reporters. "We are not excluding any conversation in the future that may come up with labour at the table."
The timing of the proposed legislation will affect public-sector workers differently depending on what stage they are in their collective agreements. The four years of wage controls kick in as bargaining agreements expire.
The measure will also be applied to public workers who are not part of a union.
Manitoba Federation of Labour president Kevin Rebeck said unions are very disappointed that Pallister will impose four years of wages restrictions that will cause workers to fall further and further behind rises in the cost of living.
"This bill eliminates bargaining in good faith," Rebeck told reporters. "That’s simply not fair. Look, we’re not impressed with this at all."
NDP labour critic Tom Lindsey said his main issue with the legislation is that it imposes wage freezes -- rather than negotiates them, as was done several years ago under the NDP.
"They still went to the bargaining table and negotiated, and workers bought into it," Lindsey said.
Since the wage restrictions would take time to be fully implemented, it’s difficult to say how much the government will gain over the next year or two.
Pallister estimated that each one per cent increase in public sector wages costs $100 million.
The former NDP government signed a deal shortly before the election with the province’s civil servants that doesn’t expire until 2019. The deal also contains a no-layoff clause. So it will be years before these workers are affected.
"We’ve been handed some poison water," the premier said. "We’ve had some obligations handed to us by the previous government. We’ve had some things done that were not that honourable."
Judges and some other court officials are not covered by the bill, which lets cabinet exempt anyone else whom it chooses.
The bill applies to anyone who works for the province, government agencies — which covers Crown corporations — health organizations, Child and Family Services, school divisions, public universities and members of the legislature.
Pallister has estimated that about 70 per cent — $10 billion out of $13 billion — of provincial spending goes to salaries and benefits.
The 12,000 members of the Manitoba Nurses Union are among 30,000 health-care workers whose collective bargaining agreements expire March 31, the same day the University of Manitoba Faculty Association’s one-year deal ends.
The province’s 15,000 teachers have collective bargaining agreements that don’t end until June 30, 2018, and they call for two 1.5 per cent raises four months apart in the 2017-18 school year.
Pallister first said at his state of the province address in December that there are too many separate bargaining units in health care — 182, the province said. On Monday, Health Minister Kelvin Goertzen moved to reduce that number to less than 50, though there is no deadline.
Goertzen said he does not fear an exodus of doctors whose fees will be frozen once their agreement with the province expires. "I’ve been encouraged by my discussions with doctors," said Goertzen. "This is all about patient care."
Goertzen said he’ll appoint a commissioner to oversee the reduction in health bargaining units.
Pallister and Friesen first revealed their austerity plan late last year when the U of M and UMFA said that provincial officials had ordered them to take a "pause year" and accept a one-year wage freeze. They complied, but not before the union went on strike for three weeks for improvements in working conditions.
The act specifies that if a bargaining unit had a freeze in its deal beginning April 1, 2016, that counts as the first of two years --- it appears to apply only to UMFA and one or two small MGEU bargaining units.