Analysis of Athabasca jobs fight

Current AU President Peter Scott

Over the past two weeks, Athabasca University’s (AU) executive and the United Conservative Government (UCP) have been embroiled in a very public fight over locating jobs in the town of Athabasca. Today, the UCP appeared to slightly soften their stance, offering to negotiate with AU instead of imposing relocation on 500 staff. So what does that actually mean?

Background

AU was (re)located in the town of Athabasca in the mid-1980s, partly to generate jobs in that part of rural Alberta. Over the past 15ish years, the number and portion of AU employees in Athabasca has diminished. This has had a negative economic effect on the town. Community residents (including AU staff members) have repeatedly raised this legitimate issue with AU’s executive and Board and have gotten no where. Consequently, a lobby group formed and raised money to hire a lobbyist to seek intervention by the government.

In late March, Premier Jason Kenney appeared in a town meeting and promised AU jobs would be located in Athabasca. My view is that Kenney was looking for votes in his leadership review and this was an easy issue to make promises on in order to gain support. No one from AU’s Board or exec was invited to the meeting. From what I can tell, they were surprised by the news, since they were in the middle of launching their “near virtual” strategy, whereby most staff could work from home offices wherever they lived.

In early April, AU president Peter Scott told staff that the university was not changing direction. At about the same time, the then Board chair sent the Minister of Advanced Ed a chippy letter saying about the same thing. The government sacked the chair in late May, which should have been a pretty good hint the government was serious. The government also required AU to provide a plan, by June 30, to bring jobs back to town.

AU provided a plan (which staff have not seen). In late July, the government rejected the plan as inadequate. The government then provided a new funding agreement to AU’s Board and demanded a second plan to bring jobs to the community. If AU did not comply by September 30, its government grant (~35% of revenue) would be frozen.

According to the President, the new funding agreement contained a requirement for 65% of staff (about 500 more people) to work on campus by 2025 and a portion of AU’s funding was tied to meeting that performance target. Again, no documents to substantiate this claim were released. And, again, this is a pretty clear sign the government was serious.

Instead of seeking to negotiate some kind of compromise that would address the legitimate issues around jobs in the community, President Scott launched a videotaped attack on the government, calling the government’s proposal “ruinous”. This resulted internet handwringing and bad press for the UCP that pretty much petered out after five or six days. The UCP then announced it would be open to discussions about how AU could address the jobs issue, suggesting moving the executive and administrative staff back to town.

Analysis

The UCP’s proposed relocation of 500 staff to a town of 2800 was never going to happen because (1) there is not enough housing, and (2) there are not enough offices. Given this, this demand is best viewed as the UCP showing its teeth to bring the Board to heel.

In bargaining, you are always thinking of the BATNA (best alternative to a negotiated agreement). The UCP showed AU that AU’s BATNA was way worse than whatever AU might negotiate. Essentially, the government is saying, “If you won’t give us a plan we like, then you can have this, really awful plan.”

For whatever reason, the President of AU decided to go on the offensive and attack the government in public. I get this response on an emotional level. (AU pulls this exact shit on its staff all the time and it is enraging).

But picking a fight with the government doesn’t make much strategic sense. AU hit the public panic button, there was a few days of bad press for the government, and then what? Bad press is not really relevant to a government that is both vindictive and deeply down in the polls.

But what about the government’s overture to AU to re-start negotiations? Isn’t that a victory? Certainly, it is being spun as such by the executive.

But let’s look at where things are actually at. All the government said is it would be open to negotiating and its position remains that jobs (and the university executive) need to come back to the community. This is basically where things were at in June.

Except, and this is important, the government is now holding a financial gun to AU’s head. If AU doesn’t come to some deal that is acceptable to the government by September 30, it can expect the loss of government grants.

If AU’s Board gets too uppity, the government can also just replace them with an administrator under the Post-Secondary Learning Act (likely a current or former bureaucrat and conservative loyalist). The administrator can agree to whatever the government wants and can also sack any university executive types who get in the way.

So, the president has put the Board (i.e., his boss) in the position of having to decide if it wants to look constructive (and bargain) or if it wants to stonewall and look petulant and take the lumps the government is clearly threatening. Early signs are they will bargain, but we’ll see.

So, despite the theatrics of Scott’s video, he’s not improved AU’s bargaining position, he’s used his only weapon (public outrage), and, in doing so, he’s likely further damaged the university’s reputation (enrollments were in free fall even before his outburst).

I don’t really see how he survives this. Picking a fight that led to a potentially “ruinous” conflict with the government instead of either negotiating something or slow-walking until the government changed was just terrible decision-making given the political context.

Possible Resolutions

A sensible approach to this would be for the government and the university to agree to a jobs target (e.g., a number or a percentage) to be achieved by a certain date. AU can then seek to achieve it by incenting current staff to relocate and locating new hires in Athabasca. The government offered to provide resources to facilitate this. This will create a manageable growth in jobs and address local concerns. It will also allow current executive members who don’t want to move to Athabasca to exit at the end of their contracts.

-- Bob Barnetson

Alberta Labour's 2021/22 Annual Report

At the end of June, the government of Alberta dropped the annual reports for all ministries for the year ending March 31, 2022. The Labour report provides a snap-shot of government enforcement of labour laws as well as a hint at some of the outcomes. What the report addresses (and what it omits) is interesting.

For example, last year, the annual report noted that the government was sitting on a report of the minimum wage commission (struck in 2019, reporting in early 2020), The expectation was that this report recommended expanding the existing two-tiered minimum wage and that the government would use this as a pretext for reimplementing a lower wage for some servers.

That report was never released (as far as I can tell). This year, there is literally no mention of the minimum wage. Perhaps the government has given up on the idea given the struggle faced by employers to recruit servers? This, in turn, suggests that the existing minimum wage (stagnant since 2018) may be inadequate.

Or maybe, with three Labour ministers in a year, each worse than the last, the department just lost track of this issue? Anyhow, let's have a look at the various regulatory areas the government reports on.

Employment Standards

Employment standards set out the minimum terms and conditions of work. If your employer screws you, you can file a complaint. Over time, complaint numbers have dropped significantly.



There is, once again, no concrete explanation for this drop. Many things can affect complaint volume, including the number of workers and their expectation that complaining will be beneficial (e.g., result in a net gain, not result in retaliation). A 41.9% reduction in complaints since 2016/17 is pretty significant, especially since employment numbers rebounded during 2021/22.

Overall inquiries by Albertans about Employment Standards are also down. There were 131,189 phone and email inquiries in 2019/20 and only 70,826 in 20221/22 (a 46.0% reduction). Again, no compelling explanation for this change is offered. One possibility is that Alberta workers are decreasingly seeing Employment Standards as a viable way to enforce their rights. The drop since the UCP came to power is particularly striking.

There was an increase in Employment Standards enforcement this year. Instead of one administrative penalty, Alberta issued three penalties, the largest being $1500. The lack of consequences for noncompliance (beyond maybe having to pay some or all of what an employer should have paid in the first place) not only makes Alberta’s Employment Standards laws pretty toothless, but, in fact, economically incentivizes employers to cheat workers because they will likely get away with it.

Occupational Health and Safety

Alberta’s OHS system is designed to reduce workplace injuries and fatalities by educating employers and workers about safe work practices, conducting inspections to ensure compliance, and issuing orders and penalties when employers fail to operate safely.



The bump in inspections in 2020/21 was due almost entirely to additional COVID-related inspections and numbers seem to have returned to historical numbers. Almost 12,000 inspections seems like a lot of inspections, but we need to consider the context.

There were about 155,000 employers registered with the WCB. That undercounts total employers but whatever—this is back of napkin work. If we use 155,000 as a rough proxy for total employers and there were 11,798 inspections, we’re (roughly speaking), looking at a workplace being inspected once every 13 years.

If you did something more fine-grained (e.g., bigger employer pool; controlled for employers getting inspected more than once in a year), that telescopes the inspection cycle out some (maybe once per 15 years, maybe longer). The point, though, is that most worksites will effectively never get inspected.

If workplaces do get inspected, what happens? Mostly likely, if there are violations found, employers just get ordered to remedy them. But the number of compliance orders has dropped by about half since 2018/19 (the last full year of the ND government).



OHS almost never uses the enforcement tools available to it. OHS tickets dropped from 479 tickets in 2018/19 (again, the last year of the NDP government) to 32 this past year (a 93.4% drop). Of the 32 tickets issued in 2021/22, nine went to employers while the rest went to supervisors or workers. The largest ticket to an employer was $575 while the largest ticket to a worker was $230. These values have not changed in recent memory

Interestingly, the number and value of administrative penalties went up significantly this year, especially in dollar value. I don’t know what explains this. Only 11 charges were laid under the OHS Act, compared to 17 the previous year. Fines from prosecutions remained steady at $1.9m, with $1.2m being paid in the form of creative sentences (e.g., donations to community groups).

Effectiveness of Injury Prevention

So is this approach to injury prevention effective? One way to measure prevention effectiveness is to look at injury outcomes (particularly injury rates per 100 person-years worked) over time. Using a rate controls for fluctuations in the population over time and allow us to see patterns.

Alberta uses two main injury rates: lost-time claims and disabling injuries.

• Lost-time claims are accepted are injuries that required time off work beyond the date of injury. These are usually the most serious kinds of injuries. 
• Disabling injuries are accepted injury claims that required time off or modified work duties. 

Both rates are subject to under-reporting issues (i.e., employers pressure workers not to report). Both rates have climbed over time. While, yes, correlation is not causation, rising injury rates is highly suggestive that Alberta’s approach to injury-prevention (particularly declining consequences for operating unsafe workplaces) is not effective.



The government notes that COVID played a significant role in rising disabling injury rates, If COVID-related claims are excluded, the DI rate would be 2.32 in 2020/21 and 2.46 in 2021/22.

Labour Relations

The Alberta Labour Relations Board (ALRB) administers and adjudicates applications and complaints about labour relations. The most interesting datapoint in the annual report is the number of certification applications (i.e., when a union applies to represent a group of workers).

In 2017, the ND government made it easier for workers to unionize by allowing card-check certification. Like every other jurisdiction where this change has been implemented, unionizing efforts increased significantly (because employers are deprived of the opportunity to meddle in the workers’ choice). In 2019, the UCP removed card check and, not surprisingly, certification dropped significantly. There are some confounding factors here (lag effects, COVID in 2020 and rising interest in unions in 2021) that we can’t control for, but that pattern is plain enough.



There are also a couple of interesting things tucked away in the details. There has been a dramatic increase in the number of days it takes for an application to get to hearing. This matters because delay usually benefits one side (almost always the employer).

The Board also continues to lag in rendering a decision in a timely manner. Again, delay tends to benefit employers.



This is partly explained as a function of writing time lost to additional administrative demands related to virtual hearings.

Conclusion

Overall, the administrative performance of Alberta’s labour law regime has declined over time, particularly since the UCP took office. Particularly worrying is the increase in injuries and the decline in certification applications. The underlying issue likely reflects policy directions and/or funding reductions enacted by the UCP.

-- Bob Barnetson