Alberta Labour 2023 Annual Report

Alberta has released its 2023 annual report for the part of the government that was at one time called Labour and that relate to Albertans being safe and treated fairly in the workplace.

Fairness at Work Declines

The number of employment standards complaints filed were up by about a third in 2022/23. Complaints tend to reflect a fraction of overall violations; most workers don’t bother reporting things like wage theft.



This is an interesting reversal of a long-term decline in employment standards complaints.



Notably, the time to begin an investigation tripled and the time to resolve a complaint doubled. This has long been a bugbear in the employment standards system. The report asserts this reflects increasing volume and complexity.

The number of complaints investigated with signs of human trafficking jumped from 102 in 2021/22 to 208 in 20223/23.

The number of administrative penalties issued to employers dropped from 3 in 2021/22 to zero in 2022/23.

Safety: Losing the Will to Enforce

Worksite inspections plus re-inspections totalled 13,717 in 2023/23, down 12% from 15,569 in 2021/22. If you look later in the report for some context, this is about 6% fewer inspections/re-inspections than in 2018/19 (14,590), which was the last full year when the NDs were in power. At this rate, the inspection cycle is theoretically about once every 15 years (give or take).



About 80% of inspections were the results of complaints while the remaining 20% were targeting industries with safety problems. There were 1207 proactive inspections in 2022/23 resulting in 1725 orders issued. This is down from 2021/22, with 2100 inspections and 2548 orders. I couldn't find any historical data in this to provide context.

The number of investigations (e.g., of injuries) dropped by 60%, from 2245 in 2018/19 to 888 in 2022/23.

Orders written were up slightly over 2021/22 to 9099. This may be good (more enforcement) or may be bad (more violations occuring)—hard to say. If you look at 2018/19, there were 16,680 orders issued.

Ticketing of violators was down. There were 27 tickets with a total value of $11,280 issued in 2022/23. This is slightly fewer than in 2021/22 (32 tickets, $11,500). This reporting leaves out important context. If you look at 2018/19, there were 479 tickets issued.

Administrative penalties were also down. There were 17 penalties worth $62,025 issued in 2022/23. This is notably fewer than in 2021/22 (37, $314,250).

Convictions were also down, with 2022/23 seeing $1,740,750 in fines assessed. This is down from $1,919,000 in 2021/22. There was no reporting of the number of convictions but a hand count suggests the number is stable the last few years at around (hand-waggle) 10 per year, down from more than 20 in 2018/19.

Injury Rates are Up: Yeah, it’s mostly COVID.

The lost-time claim rate rose for at least the seventh straight year. Much, but not all, of this increase is due to COVID-19 injuries.



The disabling injury rate (lost-time plus modified work) is also up. Again, much but not all of the increase is due to COVID injuries.



The absence of meaningful government protocols related to aerosol spread put responsibility for these COVID-related increases squarely on the shoulders of government.

Interestingly, the absolute number of accepted fatalities is down to 120 (from 136). There is no real analysis of that change. It could be the result of changes in the workforce composition. It could also just be random variation (small numbers tends to be swingy).

Analysis

Overall, it looks like the government continues to lose the will and/or capacity to meaningfully enforce workplace safety rules under the UCP. Not surprisingly, the rate of injury has risen, likely because workplaces are more dangerous.

There has also been an uptick in complaints about employment standards (basically wage theft). This could be caused by more workers knowing to and being willing to come forward. I’d guess, though, that this reflects employers knowing it is open-season on workers under the UCP and, thus, stealing wages more frequently.

-- Bob Barnetson

Six Worries for Workers This Labour Day

This blog was originally posted on the Parkland Institute blog.

What can Alberta workers expect from a United Conservative Party government over the next four years? The UCP’s first term cheapened labour costs for employers. Its 2023 election platform contained few promises related to labour and employment issues beyond the usual nostrums about low taxes creating jobs. We think workers should watch six issues.

1. Low wages, high unemployment, and Inequity

While the number of jobs in Alberta has increased, more job seekers and layoffs mean Alberta’s unemployment rate remains the fifth highest in Canada. For those with jobs, the purchasing power of their average hourly wage has fallen by 4.95% (or about $3,000 per worker) over the past 10 years. Alberta is only one of three provinces to experience this loss.

By October, Alberta’s minimum wage will be the third lowest in the country while Alberta’s cost of living remains among the highest. The UCP is unlikely to raise the minimum wage from 2018’s $15 per hour. This means inflation will further erode the purchasing power of 11.5% of Alberta workers, the majority of whom are women.

Not surprisingly, Alberta also continues to have the highest gender wage gap in Canada. In July of 2023, Alberta women earned 84 cents for every dollar men earned (averaging $31.52 per hour vs. $37.61 per hour). The UCP is unlikely to address this gap.

2. Illusion of low-cost childcare

Under an agreement with the federal government, the UCP has promised to implement $10 per day childcare by 2026 as well as create 70,000 additional spaces. While childcare fees have declined, $10 per day childcare is likely to be a chimera.

In February, the UCP established a cost-control framework for childcare. Government funding will ensure that “core” childcare is provided for $10 per day. But the UCP is encouraging providers to charge fees for “enhanced” childcare, such as food, activities, playground equipment, and better qualified staff. Providers are being told they do not have to spend all of these enhanced fees on the enhanced services (i.e., private providers can pad their profits with these fees).

Since demand for childcare spaces will continue to outstrip supply, parents who decline to pay the enhanced fees (i.e., want $10 per day childcare) may have difficulty securing a space because they reduce the providers’ profits. Further, low wages and limited training and professional development opportunities suggest the goal of 70,000 additional spaces may be wildly optimistic.

3. An Alberta Pension Plan

Alberta has been flirting with the idea of leaving the Canada Pension Plan (CPP) and creating an Alberta Pension Plan (APP) since 2019, putatively to lower premiums. The UCP did not campaign on the APP, likely because more than half of Albertans are opposed to the idea.

Withdrawing from the CPP requires three years of notice. The terms of Alberta’s departure are difficult to predict since no jurisdiction has ever left the plan. Departure may constitute a major change in the plan, which would require the approval of 7 of the 10 provinces (representing two-thirds of the population) and the federal government.

There are many unanswered questions about an APP, including its financial stability and likely returns, operating cost, the portability of contributions, and its susceptibility to political meddling. Quebec’s experience with running its own pension plan suggests that doing so does not necessarily result in lower premiums.

4. Public-sector bargaining

In 2019, the UCP gave itself the power to foist secret bargaining mandates on public-sector employers, rendering collective bargaining a fettered and hollow process. All unions eventually settled for wage increases well below inflation, after years of prior wage freezes. Despite the negative impact that uncompetitive wages have on recruitment, retention, and productivity, it is likely the UCP will go back to this well in the hope of further grinding public-sector wages.

It is unclear whether Alberta’s public-sector workers and their unions have the will to meaningfully resist such a tactic. Resistance would require workers to strike and, perhaps, to do so illegally in the face of back-to-work legislation. That is a risky proposition for both workers and their unions’ leadership. That said, only last fall, Ontario’s unions forced the Ford government to walk back legislated contracts through an illegal strike by education workers that looked set to escalate to a general strike.

Public-sector workers are also likely to see further privatization of their jobs, as the UCP did with laundry and laboratory services in health care. The UCP may also provide more public funding to private-sector providers of education and health-care services.

5. Recruitment and Retention

Not surprisingly, declining compensation, childcare shortages, and uncertainty about the CPP have meant some Alberta employers are struggling to recruit and retain workers. The UCP has promised a $1,200 tax credit for workers in fields such as health care, childcare, and the skilled trades who come and work in Alberta for at least a year, and a $3,000 to $10,000 tax credit (spread over multiple years) for new graduates in unspecified fields who stay in Alberta to work.

These promises are essentially an admission that Alberta is not an attractive place to live and work. Neither promise is very significant in monetary terms and, if implemented, they are unlikely to have much impact on worker shortages because of the negative impact of the UCP’s education and health-care agenda. Increasing post-secondary tuition and a defective K-12 curriculum (e.g., “find gravity on a globe”) make Alberta an unattractive place to study or raise children. Ongoing staffing shortages, the unavailability of rural obstetrical care, and the botched privatization of laboratory services suggest the health-care system is also failing.

6. Union Dues and Bill 32

The UCP has promised to fix one of their controversial changes to Alberta’s labour laws (commonly called Bill 32) that accidentally cost community organizations $2.5 million in lost donations from unions. This happened because Bill 32 required unions to get each member to authorize dues deductions for activities beyond collective bargaining and contract administration. This was designed to constrain unions’ abilities to participate in political and advocacy campaigns but also affected donations.

Before the election, many unions quietly decided to simply ignore Bill 32. It will be interesting to watch how (and, indeed, if) the UCP handles enforcement. It may choose to pursue legal action against these unions. Or it may take the position Bill 32 achieved its political goals and ignore widespread non-compliance.

Conclusion

The UCP has a difficult course to navigate over the next four years. Its political goals include low taxes, low wages, a diminished public sector, and increased privatization. None of the outcomes of these goals are attractive to the skilled workers that Alberta requires. Indeed, declining real-dollar wages, failing health-care and education systems, unstable retirement income, and unavailable childcare are likely to impede both worker recruitment and retention.

-- Bob Barnetson, Susan Cake, and Jason Foster

UCP's record on labour issues

 

Alberta Views recent published an article I wrote about the UCP's record on labour issues. The article reprises and extends a chapter I wrote with Susan Cake and Jason Foster in a new book entitled Anger and Angst: Jason Kenney's Legacy and Alberta's Right (which is also worth a look).

The nub is basically that UCP labour policy can be best understood as an effort to shift the cost of labour from employers to workers by grinding wages and working conditions. The effect, particularly on and in Alberta's public-sector has been significant. Since the Alberta View's article is open access, I'll leave it for you to read more if you like.

-- Bob Barnetson

Podcast: Vriend 25 Years On

The Well Endowed Podcast is publishing a series on the 25th Anniversary of the Vriend decision. While sexual orientation had been deemed an analogous ground under s.15 of the Charter, Alberta had refused to include sexual orientation as a prohibited ground in its human rights legislation. This permitted discrimination on the basis of sexual orientation by private actors. In Vriend, the Supreme Court found that this exclusion offended the Charter and should be read into human rights legislation.

Vriend was ground-breaking litigation and this multi-part podcast begins by examining how Canada and Alberta treated members of the LGBTQ2+ community in the decades leading up to 1991 (when Vriend was fire by an Alberta college because of his sexual orientation). The degree of discrimination faced by the LGBTQ2+ detailed in the first episode is, frankly, shocking.

This decision has had significant impacts for labour relations, including the Charter, human rights, immigration, and sex work.

-- Bob Barnetson

How OHS sentences are determined

Many labour-side practitioners assert that the financial penalties levied against employers that violate occupational health and safety rules are so low that they do not serve as a deterrent to future violations by the same or a different employer (basically, they are just the cost of doing business). In some jurisdictions, employers can be subject to modest tickets or administrative penalties for violations. Where an employer has done something serious, they can also be subject to prosecution under OHS legislation. 

Pleading or being found guilty can result in fines being assessed by the court within whatever range is set in the legislation. Section 48 of the Alberta’s OHS Act, for example, sets the maximum penalty for a first-time violation at $500,000 (plus a 20% victim surcharge) and/or not more than six months of imprisonment. (In theory, employers can also be charged under the Westray provisions of the Criminal Code, but that basically never happens. Similarly, jail time for an OHS prosecution is almost never imposed.)

There were 11 (or maybe 12, see below) convictions in Alberta under the OHS Act in 2022:

• Precision Trenching Inc pled guilty to a 2018 trench collapse fatality and paid a fine of $275k.
• Insituforms Technology Inc pled guilty to a 2019 serious injury and paid a fine of $100k.
• Emcom Services Inc pled guilty to a 2019 serious injury and was fined $86k. (This conviction appears twice on the list, but I think that is an error).
• Amyotte’s Plumbing & Heating Ltd pled guilty to a 2019 fatality and was fined $170k.
• Joseph Ogden pled guilty to a 2019 fatality and was fined $80k.
• Trentwood Ltd pled guilty to a 2020 fatality and was fined $150k.
• The Town of Picture Butte pled guilty to a 2020 serious incident and was ordered to pay $87k in creative sentencing.
• Kikino Metis Settlement pled guilty to a 2020 serious incident and was ordered to pay $8.5k in creative sentencing.
• McCann’s Building Movers Ltd pled guilty to a 2020 fatality and was fine $320k.
• Polytubes 2009 Inc pled guilty to a 2020 serious injury and were ordered to pay $100k in creative sentencing.
• Cross Borders Consulting Ltd pled guilty to a 2020 fatality and was fined $324k.

This is a pretty typical year in terms of numbers and fines. Often employers face multiple charges and, as we saw in 2022, plead out to a single violation and fine.

A recent Saskatchewan Court of King’s Bench sentencing decision following a workplace incident that left a worker paralyzed is helpful in understanding the factors used when the Court’s determine fine levels. The maximum fine available to the judge in Saskatchewan was $1.5 million. Paragraph 12 sets out the factors commonly used to assess penalties.

[10] R v Westfair Foods Ltd., 2005 SKPC 26, 263 Sask R 162 [Westfair Foods] is a seminal case in Saskatchewan for the sentencing of corporations for OHS violations causing injury. At paragraph 38, Whelan J. distilled the essential principles from the case law and academic works as follows:

i. The primary objective of regulatory offences is protection and in the context of occupational health and safety legislation, it is the protection in the workplace of the employee and the general public.

ii. The sentencing principle which best achieves this objective is deterrence and while deterrence may be regarded in its broadest sense and includes specific deterrence, general deterrence is a paramount consideration.

iii. There are numerous factors, which may be taken into account and the weight attributed to each will depend upon the circumstances of each case. The following is not an exhaustive list of factors that may be considered, but they are likely relevant to most occupational health and safety offences:

• the size of the business, including the number of employees, the number of physical locations, its organizational sophistication, and the extent of its activity in the industry or community;
• the scope of the economic activity in issue - the value or magnitude of the venture and any connection between profit and the illegal action;
• the gravity of the offence including the actual and potential harm to the employee and/or the public;
• the degree of risk and extent of the danger and its foreseeability;
• the maximum penalty prescribed by statute;
• the range of fines in the jurisdiction for similar offenders in similar circumstances;
• the ability to pay or potential impact of the fine on the employer's business;
• past diligence in complying with or surpassing industry standards;
• previous offences;
• the degree of fault (culpability) or negligence of the employer;
• the contributory negligence of another party;
• the number of breaches - were they isolated or continued over time;
• employer's response - reparations to victim or family - measures taken and expense incurred so as to prevent a re-occurrence or continued illegal activity, and;
• a prompt admission of responsibility and timely guilty plea.

This decision also helpfully discusses the law on sentencing when government amend legislation to raise fine levels. Paragraph 18 quotes the Nova Scotia Supreme Court’s decision in Hoyeck:

[25] … For Courts to give "the legislative intent its full effect" we cannot be bound to prior sentencing ranges that do not reflect the Legislature's view of the gravity of the offence and society's increased understanding of the severity of the harm arising from the offence (see paras. 108-109). An upward departure from prior precedents is appropriate to arrive at a proportionate sentence.

As set out in Paragraphs 24 and 25, the Saskatchewan judge fined King Stud $126k (effectively one year of net proceeds) to be paid of a time period to be determine later. The range of fines

[24] A total penalty (fine and surcharge) of roughly one year’s net proceeds to the principals of the corporation, with time given to pay, is a proper balancing of all of the factors in this case - including the fact that, other than its early guilty plea, virtually none of the Westfair Foods factors are in King Stud’s favour, and some of them (such as its compliance record before and after this incident) are strongly against it.

[25] Such a fine will be a very significant penalty to the principals of the corporation but should not be so debilitating as to cause the collapse of King Stud. Will it be extremely uncomfortable for them for several years? Undoubtedly; but not nearly so uncomfortable as the rest of Dawson Block’s life will be for him, as a result of their actions or inaction.

It’s hard to know if this fine will cause the employer (which had an appalling safety record before this entirely foreseeable injury) to alter its behaviour or serve as a deterrent to other employers. I’m pretty skeptical. These were bad actors who got busted after the fact for yet another fall protection violation.

An interesting part of the discussion was the court’s efforts to set the fine at a level that served as a deterrent but was not so high that the owners of the corporation just walked away from the corporation (and thus the fine goes unpaid). The impact of limited liability corporations to shield owner-operators from some or all of the consequences of the corporation’s actions is a recurring bugbear for enforcing employment laws.

Perhaps, rather than further raising fine maximums (which seems to have a modest impact on actual fine levels) and perhaps fine minimums, legislatures might consider piercing the corporate veil to hold directors personally liable for unpaid OHS fines?

-- Bob Barnetson

Statutory law versus the collective agreement, a fun example

When we teach HR and LR students about the web of rules that regulate employment, we often focus our attention on the various sources of rules (e.g., common law, statutory law, contracts and collective agreements). This reflects that students need to (1) build a mental framework in order to understand how employment law operates and (2) develop some foundational knowledge of what the rules actually are (e.g., what are the basic rules around firing someone?).

One of the topics that gets glossed over in this sort of introduction is that, sometimes, what the law means (in practice) isn’t clear. Or, at least, an employer and worker/union might have a different interpretation of what the law required or permits. This can reflect legitimate differences of opinion, differing interests, and, sometimes, apparent conflict between rules from different sources of law. In the interests of time (and understanding that a survey course is just an introduction), we tend to wave this complexity aside with “disputes are remitted to an adjudicative body for resolution.”

Sometimes, it is worthwhile having a look at a case to see just how this adjudication works. As part of a research project, I came across an interesting arbitration decision from 2009 that is a fun read. The decision is:

Edmonton Space & Science Foundation v Civic Service Union 52, 2009 CanLII 90156 (AB GAA)

You can find the decision on canlii.org by searching the CanLII number (90156). CanLii is an excellent repository of Canadian law.

The basics facts are these:

• A worker was employed at the Edmonton Space and Science Centre and was a part of a union.
• The collective agreement permitted the employer to terminate a worker only when the employer had just cause. This is much more restrictive than the termination provisions set out in the Alberta Employment Standards Code (wherein workers can be sacked for no reason so long as notice is provided).
• The worker resigned, giving a month’s notice. The employer doubted how diligent she would be in performing her duties during the resignation notice period and purported to terminate her with one week’s notice under the Employment Standards Code.
• The worker grieved that the employer had no right to do so, given the collective agreement limited terminations to just-cause scenarios.

So, we have here basically a fight over whether the collective agreement trumps the Employment Standards Code or vice versa. After listening to the evidence and arguments of the parties (including refereeing a preliminary bun fight, where the employer wanted (among other things) to force the worker to narc out which member of the management team leaked that the worker was getting the sack), the arbitrator distilled the matter down into two questions (he listed three slightly different questions, but they are more granular than we care about):

1. Was the griever terminated without just cause by the employer?
2. Can the employer rely upon the Employment Standards Code to override its obligations under the collective agreement?

I won’t spoil the ending, except to say that (1) the employer’s argument was more inventive that I would have guessed (at the beginning of the decision, I laughed aloud at the employer’s position), and (2) the arbitrator does a good job of walking everyone through his thinking about how these two different sources of rights operate in this particular fact situation and how their seeming conflict can be resolved.

This decision is a good example of how employment-law sausage is actually made when the parties can’t agree and when there are multiple sources of rights that may conflict.

-- Bob Barnetson

Alberta guts OHS rules

In late December, my colleagues Jason Foster, Susan Cake and Jared Matsunaga-Turnbull and I wrote about Alberta’s efforts to gut Alberta’s joint health and safety committee rules and undermine workers’ right to refuse unsafe work.

The short of it is that joint committee have fewer duties and fewer powers and are much more creatures of the employer. This will undoubtedly reduce their already limited effectiveness. While it was there, the government also eliminated the requirement for periodic inspections of the workplace, regular meetings of the committee, ongoing training for committee members, and most rights to see information about workplace safety.

The right to refuse dangerous work has also been watered down, with term dangerous work being dropped in favour of the weaker term “undue hazard”. An undue hazards is a hazard that poses a serious and immediate threat to the health and safety of a person. The use of the terms “serious” and “immediate threat” narrow the kinds of danger work that can be refused. Most chemical and biological hazards, for example, do not pose an immediate threat.

The bar on employers’ retaliating for refusals has also been weakened. Previously, the employer could not discriminate against a work for refusing unsafe work. That has been narrowed to a bar on disciplining a worker. Practically, what this means is that an employer can now do things like assign a refuser crappy work or crappy shifts (because that is not discipline) if they refuse unsafe work.

Overall, this is part of the UCP governments efforts to reduce the financial cost to employers of safe workplaces. The negative impact on workers (in terms of injuries and deaths) is simply waved away. About the only good news is that the UCP is likely headed for electoral oblivion in May of 2023 so these changes stand a good chance to being scraped.

-- Bob Barnetson

No evidence paid sick leaves kills jobs

Canada and the US are outliers in historically having no statutory paid sick leave. Alberta’s opposition party has proposed 10 days of leave as a pandemic response measure. This logic of this proposal is basically that paid sick leave would help some sick workers decide to stay home by providing security of employment, income, and benefits. Yesterday, Alberta’s premier called paid sick leave a “job killing” proposal.

A 2010 report by the World Health Organization (in the wake of H1N1) suggests that paid sick leave has benefits that far outweigh its costs in Europe. The benefits include:

• Access promptly medical care and the opportunity to follow treatment recommendations 
• Recuperate more quickly 
• Reduce the health impact on day-to-day functioning 
• Prevent more series illnesses from developing 
• Reduce the spreading of diseases to the workplace and community (p.6).

The costs of paid sick leave are mooted to be greater costs (for the state or employers, depending upon the arrangement), loss of productivity, and the potential for abuse by workers (i.e., taking sick days when not sick).

The WHO report suggests European costs are relatively low (averaging just under 200 Euros per year per capita), and paid sick leave is associated with greater productivity.

A US study examined the effect of sick leave mandates in several US cities and states on the number of private sector jobs. These proposals see workers accrue sick leave over time (kind of like; vacation entitlements). The upshot is that there appears to be effectively no impact on jobs numbers (i.e., sick is not a job-killing policy).

A separate study focused on New York’s employer paid sick leave mandate (which extended sick leave to millions of employees) also suggests paid sick leave is no big deal. 

• Most employers experienced no cost increases and those who did (14%), the majority reports <3% change. 
• More than 91% of employers reported no reduction in hiring
• 97% of employers indicated that they did not reduce hours 
• 98% of employers reported virtually no abuse of sick leave and percentage of no-abuse reported was higher for small businesses. 
• 96% reported either no decline or an increase in productivity.

Basically, modest statutory sick leave provisions are a significant public health boon and can be implemented at virtually no cost. There is no credible evidence I could find in a quick search that paid sick days are “job killing”.

Not providing sick leave, by contrast, is likely to increase in the spread of COVID (as workers come to work sick for fear of losing their jobs or not being able to pay their bills). In this way, Premier Kenney’s unwillingness to consider paid sick leave is a “worker killing” policy.

-- Bob Barnetson

The paradox of small business

I'm not much for podcasts but the Alberta Advantage podcast (basically lefty political economy analysis out of Calgary) is often worth a listen. This episode provides an interesting analysis of the role of small business in society. 

Specifically, the episode examine the valourization of small business and how that is used to run cover for capitalists. For example, when big business advocates for lower wages, they get pilloried as greedy. When small business advocates for lower wages, the conversation is almost always framed around helping "job creators" in the local community stay afloat.

The episode also interrogates the actual track record of small businesses with regard to workplace safety and wage theft (spoiler: lousy, often made worse by the precarious employment that they offer). And it explores how the media flips the narrative on things like wage theft by bosses to time theft by workers in order to obscure how shitty some employers are.

Finally, the episode (like most of their episodes) spends a few minutes calling out the provincial NDP for their opportunist boosterism around small business, generally to the detriment of the interests of workers.

-- Bob Barnetson

Why are public-sector employers “good employers”?

Source: D'Arcy Norman, Wikipedia Commons

Last week, I ran across an OHS order directed at the University of Calgary. Apparently, the U of C was found to have violated of s.391 of the OHS Code.

That section is about training workers and harassment and violence:

391. An employer must ensure that workers are trained in

(a) The recognition of violence and harassment.
(b) The policies, procedures and workplace arrangements that the employer has developed and implemented to eliminate or control the hazards of violence and harassment.
(c) The appropriate response to violence and harassment, including procedures for obtaining assistance, and the procedures for reporting, investigating, and documenting incidents of violence and harassment.

These provisions came into effect in June of 2018. The order was issued in September of 2020. I wasn’t able to find out much in terms of details, but we can make some guesses:

1. Likely the U of C hasn’t provided adequate OHS training on these hazards.
2. This order likely stems from a complaint or an injury (since random inspections are basically non-existent in Alberta). 
3. I’d also guess that this violation is likely long-standing (since falling out of compliance once an employer has set up a training system is unlikely).

This is not an issue unique to the U of C. For example, less half of the teachers in recent study by the Alberta Teachers Association indicated they had received training to managing bullying and violence.

My own university failed to provide OHS training, received an order, and then stalled responding for months. The training we were eventually provided was terrible. And a revised training developed by the joint occupational health and training committee has been waiting implementation for more than 6 months.

Widespread violations of health and safety rules by public-sector employers is often hard for people to reconcile. Aren’t public-sector employers “good employers”? I think this dissonance stems from confusing good jobs and good employers.

Public sector workers are more likely than private-sector workers to have good jobs, with decent wages, job security, benefits, pensions. (This isn’t a universal experience in the public sector, but there a definite pattern.)

These good working conditions don’t reflect employer benevolence. Rather, they reflect that unionization is high (~67%) in the public sector and union contracts limit how bad employers can make public-sector jobs.

While most public-sector collective agreements contain some language on OHS, the bulk of the rules flow from the OHS Act and Code (which is effectively unenforced in Alberta). So health and safety is an area where public-sector employers can let their true managerial colours show.

And this generally shows up by ignoring their obligations (because most violations don’t result in a serious injury that would attract government sanction). In this way, public-sector employers save cost (however marginal) on safety. Training is particularly easy to ignore unless, in my experience, there is a joint health and safety committee populated by knowledgeable actors who will push and prod the employer and maybe complain.

-- Bob Barnetson

Bill 32 reduces workers' overtime choice and pay

This blog previous appeared on the Canadian Law of Work Forum.

Alberta is proposing changes to its Employment Standard Code that would permit employers to evade paying overtime (OT) premiums to workers by stripping workers of their right to refuse to participate in overtime averaging agreements. This has the potential to move hundreds of millions of dollars in OT pay from workers’ pockets to employers’ profits.

Background

Like all Canadian jurisdictions, Alberta has set limits on hours of work. In most cases, Alberta restricts work to a 12-hour window (ESC, s.16(1)). Alberta also normally requires that employers pay an overtime premium (1.5 times wage rate) if workers work for more than 8 hours in a day or 44 hour in a week (ESC, s.21). The policy rationale for limiting hours of work and requiring OT premiums centre on ensuring workers’ quality of life, reducing the safety risks associated with worker fatigue, and incentivizing additional hiring.

Alberta also allows employers and workers to enter into overtime averaging agreement (ESA, s.23.1(1)). Averaging agreements allow an employer to average the hours worked by a worker over a period of time when calculating whether the worker has met the weekly OT threshold and is entitled to the OT wage premium. Presently, overtime agreements can specify averaging over a period ranging from one to twelve weeks. Averaging agreements allow for workers and employers to agree to compressed work weeks (e.g., four ten-hour days instead of five eight-hour days) without triggering the OT premiums.

Any overtime paid out at the end of the averaging period is paid at a rate of 1.5 times normal wages. Although the legislation is slightly unclear on this, government policy asserts that time off taken in lieu of OT is paid at straight time. Here is the government’s existing summary of the average agreement device.

Proposed OT Changes in Bill 32

Bill 32 (Restoring Balance in Alberta’s Workplaces Act) was introduced in the legislature in early July. If passed, this bill will make a large number of changes to both the Employment Standards Code and the Labour Relations Code. Relevant to this post, Bill 32 will allow employers to impose OT averaging agreements on workers with two weeks notice (Bill 32, s.1(11)) unless there is a collective agreement in effect. Presently, workers must agree to overtime averaging.

Bill 32 will also increase the period of time over which OT can be averaged from 12 weeks to 52 weeks and do away with the two-year limit to such agreement and loosen the rules around changes in work schedules (which otherwise require 24-hours of notice).

These changes provide employers with oppportunities to evade paying OT premiums. For example, the weekly overtime threshold is 44 hours. If a worker works a 60-hour week (say six 10-hour days), they would normally be eligible for 16 hours of pay at over-time rates. Under an overtime averaging agreement, those 16 hours could be averaged (i.e., spread across) up to 52 weeks (roughly 20 minutes per week). This would spread the OT far enough not to engage the 44-hour weekly OT threshold (the daily OT threshold can be evaded under averaging agreement).

Under such an agreement, a worker could work up to 208 OT hours a year (i.e., more than five extra weeks) and the employer would never have to pay any OT premiums. The changes effectively guarantee that very few, if any, non-union Alberta workers will ever receive overtime pay, unless the employer agrees to pay it as an act of altruism or a job perk. Further, when a worker is entitled to be paid OT under an averaging agreement, that pay may be delayed until the end of the averaging period (now as long as 52 weeks).

Bill 32 also compounds 2019 changes to how banked OT is paid out. Under those changes, a worker who enters into an OT banking arrangement (which is notionally voluntary, but practically up to the employer) and wishes to take banked time as time off with pay (instead of being paid out), does so at straight time.

Analysis

The amendments proposed in Bill 32 will enhance employers’ opportunities to avoid paying OT premiums. When the government makes it easier for to require over-time work without paying workers the over-time premium (as it is with Bill 32), the government is effectively transferring money from workers’ pockets to employers’ profits. Statistics Canada data from 2018suggests that there is roughly $3.3 billion in over-time premiums annually.

Rationally, every employer should enter into an OT averaging agreement. Not every employer will be able to do so. Unionized employers will remain subject to whatever their collective agreement says (this covers about 20% of the workforce in Alberta). Other employer may not be sophisticated enough to operate an agreement. There is no credible way to estimate the value of the transfer from workers to employers, but the annual amount is likely to be in the hundreds of millions of dollars.

Minister Copping framed these changes as “expanding choice for workers”in a Calgary Herald op-ed, noting:

…some workers may prefer to work four 10-hour days, instead of five eight-hour days. Then, they could receive three-day weekends. But changes made by the previous NDP government effectively made it difficult for employers to set up these schedules… .

This is the precise spin that conservative governments across the country have used to justify legal rules that permit employers to avoid overtime pay. In this framing, Copping fails to note that (1) under the present system, workers (as a group) have the opportunity to choose (or refuse) flexible schedule, and (2) Bill 32 takes away that choice by vesting decision-making with the employer. He also ignores that employers can manipulate this system to evade paying overtime premiums and that that long shifts increase the risk of injury to workers.

-- Bob Barnetson

Bill 2 grinds wages, complicates payroll, and impedes union drives

This post originally appeared on the Parkland Institute blog on May 28, 2019.

The second bill introduced by Alberta’s new United Conservative Party (UCP) government is An Act to Make Alberta Open for Business. In conjunction with an Order in Council, if passed this act will reduce the minimum wage for many workers under 18, reduce all workers' access to general holiday pay and overtime premiums, and make it harder for workers to unionize.

According to Premier Jason Kenney, these changes are designed to increase employment levels and fairness in the workplace: 

Our government ran on a promise to get Albertans, especially young people, back to work. … With Bill 2 and the youth minimum wage, we are restoring fairness and balance to the workplace and getting 'Help Wanted' signs back in the windows of Alberta businesses.

Minister of Labour Jason Copping asserts these changes will also reduce red tape and increase the employment of minors, saying, 

We need to encourage employers to create opportunities for all workers. These changes would help Alberta's businesses to do just that. We’re bringing back balance, cutting red tape and making it more affordable to hire teens for their first jobs.

An examination of Bill 2 suggests that it will, in fact, yield none of these claimed benefits. Instead, it will reduce workers' income, make payroll administration more complex, and impede workers seeking to join a union.

Youth minimum wage

Effective June 26, the minimum wage for workers under 18 who attend school will drop from $15 per hour to $13 per hour. The government will (somehow) allow employers to immediately reduce the wages for these workers.

During weeks when school is in session, the first 28 hours worked by minors who are in school will be paid at $13 per hour while subsequent hours will be paid at $15 per hour. During weeks when school is not in session (e.g., summer, Christmas, spring break), all hours will be paid at the lower $13 rate.

The premise underlying this 13 percent reduction in the minimum wage is that employers will hire more minors who are in school. It certainly is possible that, given the opportunity to hire minors at $13 per hour or adults at $15 per hour, some employers will hire more minors who are in school. Shifting who gets hired will not, however, change overall employment levels.

I was unable to locate any academic research addressing the impact of reducing the minimum wage for minors. While it is possible that employers will use the savings they realize to hire more workers, this seems unlikely. Hiring is typically driven by demand for a product or service. Reducing wage levels does not increase demand. What we are likely to see is that employers (who are in business to make money) will simply pocket these savings.

What this change does do is significantly increase payroll complexity for employers (particularly small businesses) by requiring them to:

1. know which employees are students,
2. know when each employee’s school is in session or on a break,
3. vary each employee’s hourly wage depending upon hours worked and whether school is in session, and
4. change workers’ wages and payroll calculations when workers turn 18.

This effect seems at odds with the UCP’s election promise to reduce red tape. To avoid the red tape the UCP is creating, some employers may simply cap minors at 28 hours of work per week. Other employers may cope by simply paying all minors $13 an hour in all instances and waiting to see if anyone complains (unfortunately, most minors won't).

The government has also promised to allow employers to quickly reduce the wages of minors who are in school via the provision of notice. This promise directly interferes with employment contracts negotiated between employers and employees in a way that negatively affects the more vulnerable party (i.e., young workers). It is unclear how the government’s requirement for notice would satisfy the usual requirements for a contractual change. Neither Bill 2 nor the associated Order in Council addresses this issue.

Overall, reducing the minimum wage for minors who are in school benefits employers by reducing their labour costs. These savings may be offset by the increasing administrative complexity created by this change. It is unclear how this change would increase overall employment.

General holiday pay

At present, Alberta workers are entitled to nine paid general holidays (often called statutory holidays) immediately after hiring. General holiday pay is complicated, but the basic rules are:

1. To be eligible for holiday pay, your must work your regularly scheduled shifts before and after the holiday as well as on the holiday, if asked.
2. If you do not work the holiday, you get your average daily pay rate (regardless of when the holiday falls).
3. If you do work the holiday you either get 1.5 times your hourly rate for hours worker or your regular rate plus another day off with pay.

Bill 2 proposes adding an additional requirement that you must be employed by the employer for the 30 days preceding the holiday. Bill 2 also proposes that if a holiday falls on a day you do not normally work and you do not work the holiday, you are not entitled to general holiday pay. Essentially, the UCP is adding back in much of the complexity that employers asked the former NDP government to remove.

It is very difficult to calculate the exact effect of this change. Overall, employers will see a reduction in labour costs and workers will see a reduction in take-home pay. Employers will face additional work and complexity in determining who is entitled to pay for each holiday. Workers with irregular or flexible schedules may be affected more significantly than workers who work a standard work week.

Overtime premiums

Bill 2 also proposes reducing the rate at which banked overtime is paid out. At present, if you work more than 8 hours in a day or 44 hours in a week, you are entitled to be paid at a rate of 1.5 times your normal rate of pay for these overtime hours.

The Employment Standards Code allows employers and employees to enter into overtime banking arrangements, whereby overtime is not immediately paid out. Instead, employees can draw down their banked overtime to take time off with pay at a rate of 1.5 hours off for every hour of overtime worked. If the employee does not draw down the banked time, it is then paid out at the overtime rate.

Overtime banking is often used in industries subject to seasonal fluctuations. Workers bank overtime during a busy period and then draw down this time to maintain their employment (and benefits) during the slow season.

The UCP is proposing that banked overtime taken as time off would be taken at straight time. In effect, employees would lose the overtime premium they are due. While employees could elect to cash out their banked overtime (and get the premium), if they are using overtime to bridge slow seasons (to avoid a layoff), cashing out overtime may trigger a layoff (thereby terminating their benefits).

This change benefits employers by providing them with a way to avoid paying overtime premiums to workers. It is unclear how this would increase workplace fairness or increase employment. Indeed, incentivizing employers to use overtime (by cheapening it) will likely reduce employment levels.

Mandatory certification votes

At present, when workers wish to join a union, a union files an application for certification with the Alberta Labour Relations Board (ALRB). Certification applications must include evidence that at least 40 percent of employees in the proposed bargaining unit support the union's application. If the union provides evidence that more than 65 percent of workers support the union, then the ALRB will certify the union as the bargaining agent for the unit without the need for a vote. This is called card-check certification.

If the union cannot demonstrate greater than 65 percent support, then the ALRB will order a vote of all of the workers in the proposed bargaining unit to determine if the majority of voters support the application.

Bill 2 proposes eliminating card-check certification and requiring mandatory certification votes in all certification applications. The research from across Canada is pretty clear: card-certification results in more applications to join unions and a greater success rate. We have seen this dynamic already take effect in Alberta.

The reason for this effect is that card-check certification eliminates the opportunity for employers to interfere in what should be a free choice by employees. One Canadian study found that 80 percent of employers oppose certification drives, 60 percent do so overtly, and 20 percent take action that is illegal (e.g., threatening or dismissing workers).

Employer interference tends to put a chill on the organizing drive. Research from both British Columbia and Ontario shows that, as soon as the rules switch to mandatory votes, the number and success rate of union drives drops significantly.

Requiring certification votes is often justified as fundamentally democratic, and as a way to prevent union intimidation of workers. Equating certification votes with the electoral process ignores the fact that, when workers cast a vote in a federal or provincial election, the government doesn't spend the campaign period threatening to fire workers if they vote for a different party.

Such claims also ignore that elections and union drives are fundamentally different. Government policies profoundly affect every aspect of our lives and can't be avoided (unless we abandon our country and citizenship). By contrast, the selection of a bargaining agent affects only certain aspects of our employment and the effects (typically higher wages and greater job security) can be avoided by changing jobs.

The idea that mandatory votes prevent the intimidation of workers is misleading. Requiring mandatory votes may prevent (very uncommon) union intimidation of workers, but it does so at the cost of facilitating (very common) employer intimidation of workers.

Eliminating card-check (i.e., requiring votes on every application) will reduce the number of workplaces that are unionized. Because unionized workplaces typically better terms and conditions of employment, reducing the number of workplaces that unionize financial benefits employers and financially penalizes workers.

Analysis

Bill 2 is clearly designed to reduce labour costs for Alberta employers. Bill 2 achieves this by transferring these costs to workers, in the form of reduced compensation. There is no evidence or reason to believe that this transfer of costs will result in an overall increase in employment rates, and the mechanisms set out in Bill 2 will also substantially increase payroll complexity for employers (particularly small businesses).

Eliminating card-check certification increases employers' abilities to interfere in workers' decisions about whether they wish to be represented by a union or not. The result will be fewer successful union drives. This change will clearly decrease fairness in the workplace in order to help employers avoid unions.

At the media conference announcing Bill 2, Premier Kenney stated that additional labour law reform will be introduced in the fall. This may include the introduction of a lower minimum wage for serving staff (following the appointment of a task force), restrictions on how unions can spend dues collected from members, and changes the essential services rules for public-sector unions.

-- Bob Barnetson

UCP platform will drive down wages

This post original appears on the Parkland Institute blog on April 3, 2019.

(NOTE: On April 5, 2019, after this blog was originally published, the United Conservative Party amended its platform, including changes to overtime. The revised platform indicates that the UCP would: “Reverse the change in 2018 that eliminated the option for workers and employers to develop straight time banked hours arrangements (this has no impact on overtime pay).” (p.21). Essentially, the UCP is now proposing that banked OT could be taken as straight time off, instead of at 1.5 times (as is the case now). In this way, the revised UCP proposal reduces the time workers could take off by one-third. Under the amended policy overtime that is paid out instead of taken in lieu would still be paid out at 1.5.)

The United Conservative Party (UCP) election platform contains several planks affecting employment law, labour law, and training. These changes are framed as “bring balance back to Alberta’s labour laws, restore workplace democracy, and incentivize the creation of youth employment” (p. 21). The overall effect of the UCP platform is, however, to directly or indirectly reduce workers’ wages in order to benefit employers.

Employment Law

The UCP platform promises a number of changes to Alberta’s employment laws. Employment laws are the primary source of workplace rights for the 75% of Albertans who are not covered by a collective agreement.

The most significant change is related to over-time (OT) pay. At present, workers who are required to work more than 8 hours in a day or 44 hours in a week must receive 1.5 times their normal pay for this OT work. Over-time pay is designed to dis-incentivize employers from requiring long working hours (which create a fatigue hazard) and, instead, hire more workers.

The current OT rules allow employers and workers to enter into agreements where OT is “banked”. In practice, employers can impose such “agreements” at their discretion by denying workers OT if they don’t agree to the employer’s terms. Banked OT can then be taken as paid time off or as pay calculated at 1.5 times workers’ normal rate of pay. Employers can deny employees time off in lieu of pay, thus forcing workers to take a pay out.

The UCP indicates it will allow employers to pay out banked over-time hours at “straight” time, instead of at the OT rate. This will allow employers to evade OT premiums by denying worker requests to use banked OT. Instead, employers will be able to simply pay out the OT as straight time. The result will be a significant cost savings for employers, and a significant pay reduction for workers.

For example, a minimum-wage worker (earning $15 per hour) being asked to work five 12-hour shifts, would have gross monthly earnings of $4200 under the current OT rules. Under the UCP proposal, an employer could impose an OT agreement and reduce the worker’s gross earnings to $3600 per month. This nets the employer a $600 savings per worker per month. Consequently, the UCP proposal will encourage employers to work existing workers harder, rather than hiring additional staff.

The UCP has also promised to reduce the earnings of workers who are under the age of 18 to $13/hour (from $15/hour). This plank is intended to incentivize employers to hire young workers. There is no compelling evidence that such a policy would result in employers creating additional jobs for young teens. It may, however, incentivize employers to hire young teens in lieu of older workers (who comprise the vast majority of minimum wage earners in Alberta).

Implementing a lower youth wage benefits employers. For example, assuming a 40-hour work week, an employer who replaces an older worker with someone under 18, will save $320 per worker per month. The UCP also promises to discuss reducing the minimum wage of workers who serve alcohol. This suggests a return to the two-tier minimum-wage for alcohol servers that existed under past Conservative governments.

Finally, the UCP has also promised to replace Alberta’s present laws about farmworker rights. As previously reported, this proposal will deny 70% of paid farmworkers basic employment rights as well as reducing worker access to injury compensation.

Labour Law

At present, Alberta workers are free to decide whether or not they wish to join a union, free from employer interference. If a union has the support of 65% or more of workers, they can apply for immediate certification (this is called card-check certification). If the union has the support of at least 40% but less than 65% of workers, then the Labour Board holds a vote and the majority decides whether or not to unionize. If the employer interferes in the workers’ decision, the Labour Board can automatically certify the union.

The UCP platform promises to eliminate card-check certification and make every union certification application subject to a vote. The delay inherent in mandatory votes gives employers the opportunity to pressure workers into rejecting unionization, and employer intimidation of workers during union drives is commonplace. One Canadian study found that 80% of employers oppose certification drives, 60% do so overtly, and 20% take action that is illegal (e.g., threatening or dismissing workers). Not surprisingly, card-check certification provisions dramatically increase the success rate of union drives.

The UCP platform frames eliminating card-check certifications as “restor[ing] workplace democracy” (p. 21). This attempt to equate certification votes with the electoral process ignores the fact that, when we cast a vote in a federal or provincial election, the government doesn’t spend the campaign period threatening to fire us if we vote for a different party.

Such claims also ignore that elections and union drives are fundamentally different. Government policies profoundly affect every aspect of our lives and can’t be avoided (unless we abandon our country and citizenship). By contrast, the selection of a bargaining agent affects only certain aspects of our employment and the effects (typically higher wages and greater job security) can be avoided by changing jobs.

The UCP platform is silent on two other important changes to Alberta’s labour laws implemented by the Notley government: remedial certification when employers interfere in union drives, and first-contract arbitration when employers stall collective bargaining to try and break new unions.

The UCP platform also promises to continue to require public-sector unions to provide essential services during a work stoppage in order to protect the health, safety or life of others or public order. In many cases, this entails forcing a significant portion of a union’s membership to continue to work. The UCP proposes, however, allowing public-sector employers to hire replacement workers to cover the jobs of those workers that are able to strike. This promise would fundamentally undermine public-sector union’s power to make contractual gains. Unions will probably respond to such a change by resorting to
illegal strikes.

Overall, these platform planks appear designed to reduce workers’ ability to join a union and limit the strike power of public-sector unions. These planks benefit both employers (who typically seek to avoid unions) and a UCP government (which would likely be keen to drive down public-sector wages).

Labour-Market Training

The UCP platform contends there is a need for more apprenticeship training due to retirements among skilled workers. Alberta’s occupational demand and supply model (forecasting to 2025) does not support this assertion. Instead, it predicts a surplus ofworkers in most skilled trades.

Increasing the number of qualified workers will, however, further loosen the labour market, likely driving down wages. While he was the federal Minister of Immigration, Kenney used fears of labour shortages to flood Alberta with temporary foreign workers. This, in turn, meant employers did not have to increase wages or improve working conditions in order to attract workers.

The UCP proposes to “solve” this imaginary skill shortage by expanding trades training opportunities, including for high-school students. This promise ignores that:

• high-school students in Alberta’s current Registered Apprenticeship Program face high levels of injury and low levels of retention, and
• there is high attrition among apprentices, in part because only 1 in 5 employers that use skilled trades people offer apprenticeship opportunities.

Overall, the UCP’s platform attempts to solve a non-problem by increasing training capacity. This approach has been demonstrably ineffective for decades because it ignores the barrier posed by employers’ unwillingness to provide apprentices workplace experience. If successful, the main beneficiary of the UCP’s training planks will be employers, who will be able to pit surplus workers against one another and drive down wages.

Conclusion

The UCP’s claim that it will “bring balance back to Alberta’s labour laws, restore workplace democracy, and incentivize the creation of youth employment” (p. 21) is false. Instead, the UCP’s platform will increase employer profitability by lowering wages.

Specifically, the UCP’s platform will:

• Directly reduce the wages of young workers and workers who are required to work over time.
• Increase employer interference in workers’ decisions about unionization in order to reduce unionization rates and thereby, indirectly, drive down wages.
• Flood the labour market with skilled workers (in response to an imaginary skill shortage) and thereby, indirectly, drive down wages.

-- Bob Barnetson