There’s a lot at stake in next week’s Ontario election. The Conservatives have promised to blow up the labour law system, though precisely how they would do so remains unclear. Their policy documents speak in vague terms (‘ending forced unionism’, “allowing employee choice”, etc), and Tim Hudak has sent out confusing
Conservatives Have Big Plans for Labor Law in Ontario
messages, such as his staged announcement that, upon reflection, he’d decided that the Tories would not repeal the Rand Formula (see below). In fact, the Conservatives are not interested in such piddling little issues as the Rand Formula. In the words of Hudak, the Conservative plan for labour law “is a lot bigger and a lot more ambitious than that.” While his claim that 1 new job equals 8 new jobs displays either sloppiness, stupidity, or outright dishonesty, on this point, I believe his promise to fundamentally overhaul labour law. We may want to look to Wisconsin to see what he has in mind.
The Conservative Labour Law Platform
Back in February, Tim Hudak announced that he’d come to understand that banning the “so-called Rand Formula” would not create jobs and save Ontario’s economy, and so he “is not going to change the so-called Rand Formula”. As I noted back then, what Hudak meant by that comment is unclear, since he’d never said explicitely that he was going after the Rand Formula. The Rand Formula is used in common parlance in Ontario to describe Section 47 of the Labour Relations Act. That section says that if a majority of employees vote in a ratification vote to include a contract clause requiring all employees to pay union dues, then the employer must deduct dues and remit them to the union. Although Hudak’s policy papers had promised ‘ending forced unionism’ and referred glowingly to American states where union dues checkoff clauses are prohibited, he had never said specifically that he intended to repeal Section 47. There are other ways to effectively end dues checkoffs, such as by allowing workers to opt out of the collective agreement altogether, so that a dues clause in the agreement would not apply to them.
This may indeed be what the Tories have in mind. There have been suggestions that they intend to blow up the the core concepts in Canadian and American labor law: exclusivity and majoritism. In our legal model since the 1940s, the decision whether to unionize is based on the majority wishes of employees in a ‘bargaining unit’. If a majority want union representation, then the union is legally recognized as the exclusive representative of all the employees. A model based on majoritism means that some employees who would prefer not to be unionized will be, just like in our democratic model, millions of citizens end up being governed by laws and political parties they don’t support. That’s democracy.
But in a Private Members Bill, a Tory backbencher proposed repealing the majority rules system altogether, sort of. Sometimes it would still apply, such as a barrier to a union getting the right to represent any workers at all, but any employee would then be able to opt out of the collective agreement the union bargains at any time and bargain separately with their employer. I’d think this could end up being a nightmare for employers and unions alike. Yet, that Bill does not ‘repeal the Rand Formula’ as such. Rather, it changes the entire system of collective bargaining, rendering the Rand Formula irrelevant. Brian Langille and Joshua Mandryk have deconstructed that Bill.
But Tim Hudak has never publicly endorsed that private members’ Bill, so we don’t know whether that Bill
Wisconsin’s Scott Walker: Is Tim Hudak Plan to Follow Walker’s Lead on Labor Law Reform?
represents the Tories’ plan (though the sponsor of the Bill once said it does). We do know that Hudak spent a lot of time in the U.S. consulting anti-union policy elites about how unions are being crushed by Republicans there. The undisputed spiritual leader of this movement is Scott Walker of Wisconsin. As my friend Paul Secunda of Marquette Law School has explained, Walker’s antiunion law, Wisconsin Act 10, has inspired similar movements in Florida, Indiana, Nevada, Michigan, and Ohio. Is Ontario next?
Act 10: Wisconsin’s Killer Blow to Public Sector Workers
A quick recap of Act 10 is in order. Like Hudak, Walker was elected on a promise to create jobs. Walker promised 250,000 new jobs, compared to Hudak’s silly and discredited 1 million jobs promise. Even at the lower level of 250K, Walker has been mocked for falling far short of his promise. Less than 1/3 of the promised jobs have materialized. In a survey of state governor’s performance on job creation, Wisconsin under Walker ranked 40th out of 45 states measured!
A few key parts of Act 10 have proven to be the killer for public sector unions and workers.
First, the law banned union dues checkoff clauses in collective agreements. The result is that union dues effectively become voluntary payments that unions to need to physically collect each month. Imagine if taxes were voluntary and the government had to physically collect them. Tax revenues would dry up pretty quickly. And so have union revenues. Dues revenues of the Wisconsin State Employees Union have fallen from $6 million to $2 million since the law passed. The obvious purpose of this law is to cut off revenues so that unions are less capable of advocating effectively on behalf of workers. If this works, the benefit of being in the union dissipates and membership drops off.
The Conservatives almost certainly have the same effect in mind–making union dues payment a voluntary choice of workers. That is what I suspect they mean by ‘ending forced unionism’, along with abolishing mandatory union membership clauses (which are far less common than mandatory dues clauses, though important especially in construction). The specific legal model they will deploy to achieve this result is not yet clear, but that’s just details.
Second, the Wisconsin law banned collective bargaining by most public sector unions (police, fire, and paramedics were exempted) over all topics except base wages. However, wages could only be bargained up to the annual rate of inflation. Any amount over that could only be granted if a state-wide referendum approved it, a virtual impossibility. I could see the Tories working in some sort of referendum gimmick like this, suggesting it’s democratic to put public sector wages to the public.
In Ontario, a government could not outright prohibit collective bargaining, because that would run afoul of the Charter. However, the Charter right to collective bargaining is very thin. All it requires is that the public sector employer meet with the union, go through some mediation/conciliation, and engage in ‘meaningful dialogue’ with the union until such time as the bargaining reaches an impasse. At that point, under current Charter jurisprudence, the government can legislate collective bargaining terms. That appears to be the lesson from the Fraser and the Association of Justice Counsel cases. It won’t be too difficult to draft a law that satisfies the very limited freedom of association required by the Charter, and yet still effectively allows the government to impose its will on public sector workers. Just look at the Conservative and Liberal supported Agricultural Employees Protection Act, which the SCC upheld in Fraser. Subject to a dramatic turnaround by the SCC in the pending case from Saskatchewan, it’s within a government’s power to outright prohibit the right to strike or access to independent interest arbitration. In any event, a law that allows workers to opt out of collective agreements, union members, and union dues payment, could very well lead to the death of public sector unions by a thousand cuts over time.
Third, the Wisconsin law requires public sector unions to annually apply for ‘re-certification’. The union is decertified in that vote unless a majority of employees in the bargaining vote to keep the union and the collective agreement. Note that it is not ballots cast, as in most democratic elections. A non-vote counts as a vote against the union. The unfairness of this law was demonstrated in a case where a teachers union won a recertification vote 39-1, but because 40 teachers didn’t vote, the union was decertified! Because of the cost associated with campaigning constantly, and the inherent unfairness of the model, many unions have simply stopped applying for recertification, effectively abandoning their legal recognition, attempting instead to bargain outside of the legislative scheme.
If Wisconsin comes to Ontario after next week’s election, expect a war on the streets similar to those we experienced during the Harris years in the 1990s. And as always, a Conservative government means a temporary windfall for labour lawyers who will test every new law in the tribunals and courts, and labour law professors, who will have endless amounts of new material to write about. For public sector workers of all stripes, expect to experience what your colleagues have gone through in Wisconsin, including most notably wage freezes, wage cuts, and terminations. Fun times ahead, indeed.
Questions for Discussion
Do you think a Hudak majority government would introduce Wisconsin style labor law reforms?
What do you think of these laws?
Do you perceive any Charter issues with any of the proposed laws discussed in this post?
