CONTENTS
Thursday 27 June 1996
Labour Union and Employees Association Financial Accountability Act, 1996, Bill 53, Mr Gilchrist / Loi de 1996 sur la responsabilité financière des syndicats et des associations d'employés, projet de loi 53, M. Gilchrist
Ontario Taxpayers Federation
Paul Pagnuelo, executive director
Ontario Federation of Labour
Ross McClellan, director of legislation
Subcommittee report
STANDING COMMITTEE ON GENERAL GOVERNMENT
Chair / Président: Carroll, Jack (Chatham-Kent PC)
Vice-Chair / Vice-Président: Maves, Bart (Niagara Falls PC)
*Carroll, Jack (Chatham-Kent PC)
*Danford, Harry (Hastings-Peterborough PC)
Flaherty, Jim (Durham Centre / -Centre PC)
*Grandmaître, Bernard (Ottawa East / -Est L)
Hardeman, Ernie (Oxford PC)
*Marchese, Rosario (Fort York ND)
*Maves, Bart (Niagara Falls PC)
*Pupatello, Sandra (Windsor-Sandwich L)
*Ross, Lillian (Hamilton West PC)
*Sergio, Mario (Yorkview L)
*Stewart, R. Gary (Peterborough PC)
*Tascona, Joseph N. (Simcoe Centre / -Centre PC)
*Wood, Len (Cochrane North / -Nord ND)
*Young, Terence H. (Halton Centre / Centre PC)
*In attendance / présents
Substitutions present / Membres remplaçants présents:
Bartolucci, Rick (Sudbury L) for Mr Sergio
Gilchrist, Steve (Scarborough East / -Est PC) for Mr Flaherty
Also taking part / Autre participants et participantes:
Shea, Derwyn (High Park-Swansea PC)
Clerk / Greffière: Tonia Grannum
Staff / Personnel:
Avrum Fenson, research officer, Legislative Research Service
Cynthia Smith, director, Legislative Research Service
Michael Wood, legislative counsel
The committee met at 1004 in committee room 1.
LABOUR UNION AND EMPLOYEES ASSOCIATION FINANCIAL ACCOUNTABILITY ACT, 1996 / LOI DE 1996 SUR LA RESPONSABILITÉ FINANCIÈRE DES SYNDICATS ET DES ASSOCIATIONS D'EMPLOYÉS
Consideration of Bill 53, An Act to Promote Full Financial Accountability of Labour Unions and Employees Associations to their Members / Projet de loi 53, Loi visant à promouvoir la responsabilité financière complète des syndicats et des associations d'employés envers leurs membres.
The Chair (Mr Jack Carroll): Our first order of business is to consider the subcommittee report, which you all have a copy of. If there are no questions about the report of the subcommittee held on June 10, I'll have a motion for its adoption. Rosario, you were there. Do you want to read this into the record?
Mr Rosario Marchese (Fort York): "(1) That witnesses appear before the committee.
"(2) That all witnesses are allotted 15-minute time slots.
"(3) That each caucus provide the clerk of the committee with a list of witnesses to be scheduled, by Thursday, June 13, 1996, at 5 pm.
"(4) That clause-by-clause consideration of the bill commence following witness presentations" -- that should be slightly adjusted based on what you were recommending.
"(5) That amendments are delivered to the clerk of the committee by Thursday, June 27, 1996, at 11 am.
"(6) That the researcher provide background information if possible.
"(7) That the Chair and the clerk of the committee have the authority to schedule witnesses."
The Chair: The subcommittee report has been read into the record. Can I have a motion for its adoption, please?
Mr Joseph N. Tascona (Simcoe Centre): I so move.
The Chair: Any discussion?
Mr Marchese: Just a slight change, given what we were just proposing. Item 4 states, "That clause-by-clause consideration of the bill commence following witness presentations."
Clerk of the Committee (Ms Tonia Grannum): That just means after, any time after.
Mr Marchese: Any time after? That's fine.
The Chair: Any other questions? All those in favour? Motion carried.
Right away we're ahead of time here. We've got a few minutes now for some opening comments by the sponsor of the bill, Mr Gilchrist.
Mr Steve Gilchrist (Scarborough East): It's indeed a pleasure to join your committee this morning to say a few things about Bill 53. Much has been said in the House already and I won't repeat myself save and except to go over some of the highlights of the bill, if I may.
I very much believe that this bill is pro-union in the sense that it promotes accountability and will do nothing except improve the status and stature of unions and put to rest once and for all any suggestion that they are not responsible managers of the funds they've been entrusted with by their members.
It is pro-union member. It improves the access of the rank-and-file membership to the most important financial data, and most particularly to the salary levels of the most senior executives, if they exceed $100,000 a year.
In the context of the bill, I don't believe there will be all that many filings which will indicate recipients in excess of $100,000. This, if anything, should compel all members of the Legislature and particularly members of the third party to sponsor this bill. If there are only a handful of union leaders who would be listed as a result of this bill, then I really believe our obligation to the literally hundreds of thousands of union members and the hundreds of other union executive leaders is that they should be allowed full access to this information. Surely if anyone in this province espouses democratic rights, and in particular the rights of the average working man and woman, it would be the third party. In that I agree with them fully and I would certainly ask them to consider carefully to whom our responsibilities lie.
Finally, I would ask all members to consider the positive comments that were made from members of all three parties surrounding the issue of publicly traded companies when the third party brought forward its bill, and the Public Sector Salary Disclosure Act, which was brought forward in December of last year by our government and which has received innumerable positive comments as a result of the publication of the salary listings back in March. In many respects, unions will still not be treated with the same scrutiny with which publicly traded companies are treated, nor should they, but in saying that it must be emphasized that there is a relevant standard of disclosure for unions to meet. This bill I believe sets a fair balance between undue bureaucracy and the legitimate right to know for the union members.
Any specific concerns we can certainly deal with here in committee this morning, but I think on balance this bill is a positive and constructive addition to existing sunshine laws which have been implemented by both the NDP and our current government. It provides full access to information. It supports the principles of democracy and full participation of the membership on which the union movement was founded over 100 years ago. If we all believe in honesty and integrity within the union movement, if we believe that the rights of union members are paramount and if we believe that unions should be treated on the same basis as other key elements of our economy, no better and no worse, then I would respectfully suggest that Bill 53 addresses all of those principles and gives an important new right to the hundreds of thousands of working Ontarians who participate in and contribute to the union movement in this province.
With that, I look forward to the presentations this morning and the chance to discuss the bill further.
The Chair: A couple of minutes for the opposition parties to make some opening comments if they'd like.
Mr Bernard Grandmaître (Ottawa East): We see no problems, Mr Chair. I think we should get on with the witnesses.
Mr Marchese: I have some profound disagreement with the tone of this and what it implies, but what I would prefer to do is to have the deputants speak to this and reserve our comments to later on, clause-by-clause, to make our points with respect to it.
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ONTARIO TAXPAYERS FEDERATION
The Chair: Our first deputant is from the Ontario Taxpayers Federation, Mr Paul Pagnuelo. Welcome, sir. We appreciate your attendance here this morning. You have 15 minutes to use as you see fit. Questions will be at the end if you allow any time for them. The floor is yours, sir.
Mr Paul Pagnuelo: Good morning, Mr Chair and committee members. The Ontario Taxpayers Federation certainly welcomes the opportunity to appear before your committee and to comment on Bill 53.
I think we need to begin by saying that from our perspective financial accountability means being responsible to those who have entrusted money to you. In the case of governments, bureaucrats must be accountable to politicians and the politicians in turn have to be accountable to taxpayers for the tax dollars they spend. If we look at businesses, senior management is accountable to a company's board of directors, and they are in turn accountable to shareholders for the revenue and equity dollars that they spend. Charitable and not-for-profit organizations must be accountable to their supporters for the donations and membership fees that they spend. Likewise, unions and employee associations must be accountable to their rank and file for the dues they spend.
Organizations with tax-free or charitable status, those which receive government grants or those whose membership fees or dues are tax-deductible are indirectly funded by the taxpayer, and as such they have a responsibility, we believe, to uphold the public trust. When organizations are directly or indirectly funded by taxpayers, in our view the public has a right to know if they're well or poorly managed and where the funding is going.
Under law, unions are given special privileges. They receive tax-free status, tax deduction status and other special statutory advantages. Apart from any direct funding they may receive, unions have a statutory relationship with government from which they benefit greatly, and it is this relationship that we think should make unions accountable to the public and, specifically and more importantly, to their own members.
As you may be aware, there are over 130,000 charitable and not-for-profit organizations in Canada, and it is estimated that they are responsible for a $120-billion-a-year industry, $49 billion of which comes from various levels of government. Despite the fact that many of these groups fill a legitimate place in Canadian society, a picture has emerged which shows a definite need for a major overhaul in how government funds and oversees them, especially the so-called special-interest groups.
Federal Liberal MP John Bryden has been targeting these groups for some time now in an effort to bring some accountability to this sector. To quote John:
"Most special-interest groups are totally or almost totally dependent on government funding, and use government money to lobby the government for more money. Taxpayers' money is often used by the senior staff to pay themselves generous salaries. Government grants are distributed year after year with no scrutiny or accountability."
Bryden has put together a 57-page report documenting a very troubled industry. In many cases, despite being the recipients of government largess and claiming large constituencies, these organizations do not have the support of their constituencies and have become dependent on government financing to further their causes. I'll give you some examples.
Wildlife Habitat Canada raised only $9,601 in private donations in 1993-94, yet federal and provincial governments gave it $2.7 million in grants.
The National Association of Canadians of Origins in India claims to represent over 750,000 Canadians of this heritage, yet according to its annual report it could raise no more than $4,881 in memberships, donations and other revenue. However, over the past 10 years it received $860,400 from the government.
The Smoking and Health Action Foundation didn't receive any financial support from its members in 1992-93 but received $415,000 in federal and provincial grants. The bulk of that, $400,821, was paid out in salaries and benefits to its eight-member staff.
What about political donations? I think many Canadians would be shocked and stunned to hear that the chamber of commerce in Quebec City gave a $650,000 mansion with $150,000 worth of furnishings to Jacques Parizeau when he was Premier of Quebec. The money for the gift was claimed as a 100% business expense deduction.
In a similar vein, the Canadian Labour Congress, the largest union in Canada, has received more than $41 million over the past 10 years from the federal government for labour education. In 1993, the CLC donated $1.5 million to the New Democratic Party, money which in effect was subsidized by taxpayers.
To quote John Bryden again, "It's an incredible distortion of the political composition of the country to have a major political party funded by the government."
The financial affairs of these organizations have been devoid of public scrutiny for too long. The confidentiality provisions of the Income Tax Act and the Access to Information and Privacy Act prevent the public from examining the spending of non-profit organizations. In addition, the Income Tax Act requires that charities use at least 80% of donated revenue on their charitable activities but has no rules regarding grants.
In 1990, the senior assistant secretary of the Treasury Board stated: "When you provide money as a grant, you are specifically saying that you think their organization, be it a business, a volunteer group or whatever, has some noble purpose...you say that the Parliament and the government are prepared to see that money go for their purposes but that you do not care, within the realm of their purposes, how that money will be spent."
As you may know, Bryden introduced two private member's bills in the House of Commons to try to curb the spending. One would require all charitable and non-profit organizations in receipt of public money to declare the remuneration of their directors and senior officers. The other would amend the Income Tax Act so that the general public would have access to Revenue Canada's audits of charities and non-profit organizations.
He also called for an amendment to the Lobbyists Registration Act to end government funding for special-interest advocacy organizations. The amendment would make it against the law for lobby groups to use government funding to lobby governments, and for any other group, not defined as a lobby group, to use over 10% of the money received from government to lobby government.
Unfortunately, the House of Commons prorogued and the bills died. But still, Bryden's work has received widespread support from members of all political parties, and it has most certainly generated debate on the role of special-interest groups in Canadian society.
Obviously, there are many groups falling under the umbrella of special-interest groups that function effectively. The Ontario Taxpayers Federation and our national parent, the Canadian Taxpayers Federation, for example, are both certified not-for-profit organizations. However, both our organizations are funded entirely by memberships and free-will donations and are completely free of any government funding. Our position is that any group which represents a legitimate constituency should be able to depend on its members for support, making government funding unnecessary.
With the Public Sector Salary Disclosure Act, the government of Ontario took a very important first step in improving financial accountability for public sector spending. We certainly applaud Mr Gilchrist for taking the initiative to sponsor this private member's bill which will extend the process of full financial accountability to include labour unions and employee associations.
While this bill is similar to the Public Sector Salary Disclosure Act in terms of salary disclosure, it does go much further by requiring labour unions and employee associations to make available, for inspection by the public, an audited statement of their financial affairs.
That is not to say that we are in disagreement with this extra provision. We think it's an important addition and one which we would consider even more valuable than the salary disclosure component. But what this bill does point out is the deficiency in the Public Sector Salary Disclosure Act.
We believe Bill 53, as drafted, represents a good piece of legislation and one which it would be hard to argue against in respect to the principles of public trust and financial accountability.
While we urge the Legislature to pass the bill in its present form, the Ontario Taxpayers Federation would like to take and use this opportunity to call on the government to introduce additional legislation, legislation which would require all charitable and not-for-profit organizations to make available for public inspection an audited annual statement of their financial affairs. We would also recommend that the condition of receiving a particular level of funding from government before the salary reporting requirement is triggered for corporations, entities or organizations be deleted.
I thank you for the opportunity to comment this morning and would be pleased to answer any questions you may have.
The Chair: Thank you, sir. We've got about two minutes per caucus left for questions, beginning with the official opposition.
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Mr Grandmaître: I fully agree with the presentation. I think it's about time we became more accountable. Not only politicians but every organization should become more accountable to the public. I remember in my days at the municipal level we had two systems of grants at the municipal level: unconditional grants and conditional grants. Municipalities had to respect whatever agreement was signed with the provincial government, with the Ministry of Transportation, for instance -- especially transportation -- and they would look at our books every year, if we qualified for additional dollars, or limit our grants for the following year.
We do live in an age where accountability has become the number one issue and I think we should go ahead with the bill before us. I realize that some organizations may not like the bill, but on the other hand we do have laws in place, the Income Tax Act and the Access to Information and Privacy Act, and I think these laws have to be respected and they can be respected if we accept this bill.
Mr Marchese: Some quick comments. First of all, as far as I know most unions are accountable to the members and there is disclosure. Ross McClellan can perhaps speak to that when he comes. Second, I agree with accountability mechanisms for all organizations, profit or not-for-profit. Do you agree that as much as we should include not-for-profit organizations, we should also look at for-profit organizations?
Mr Pagnuelo: In terms of public disclosure? Right now, you take a look at the accounting guidelines set out in terms of what they must disclose each year. Certainly, your government made the first move in that area in terms of requiring senior executives to report their salaries. Anyone who can argue against full public disclosure is really saying they have something to hide.
Mr Marchese: But you agree that we should include profit and not-for-profit as well in this category. Is that correct?
Mr Pagnuelo: In terms of full public disclosure? Sure.
Mr Marchese: Okay. Second, you talked about how business is accountable to its board of directors. I was thinking very specifically about banks, to whom we give a charter to print money in effect. You deposit your money in the bank, small business deposits in the bank. Ninety per cent of those deposits belong to us; 10% belong to the shareholder. They control $150 billion in Ontario that is largely ours. Do you think the banks are accountable to the money we deposit in those accounts, to the general public?
Mr Pagnuelo: I think they are accountable, number one, to their shareholders. In terms of their customers, if they're not accountable to them and if you feel and if I feel as a customer of a financial institution that they're not being accountable to us, my choice is to go next door.
The Chair: Thank you, Mr Marchese.
Mr Marchese: Only two minutes.
The Chair: Two minutes goes by so quickly nowadays.
Mr Gilchrist: I'd like to thank Mr Pagnuelo for coming in and taking the time to make a presentation before us here today. I appreciate your suggestion at the end. In the context of what I'm trying to address in this bill, it would certainly be appropriate to consider a separate bill for other --
Mr Pagnuelo: That's what I'd like to see. We're seen as an organization. We have nothing that we would be fearful of hiding or not disclosing, and we're quite prepared to make our books publicly available and disclose salaries.
Mr Tascona: In the bill under clause 10(1)(a), there's a provision to exempt a labour union or employees from the act. Do you think there's any public interest to have that provision in place?
Mr Pagnuelo: Why would you want to exempt anyone? If you're really looking at full public disclosure, the moment you start building in exemptions, then you start weakening the whole process of accountability. I don't see why one would want an exemption, but perhaps there's a good reason that I'm not aware of.
Mr Terence H. Young (Halton Centre): Were you supporting Mr Marchese's suggestion that for all private companies, the salaries and benefits of their executives be published, all private companies including Becker's stores and small businesses and --
Mr Pagnuelo: No. For anything that's publicly held, that's owned by shareholders, that are trading on public markets, their executives should be accountable to their shareholders.
Mr Young: For the record, Mr Chair, I believe Mr Pagnuelo was misunderstood in what he said before. I think the question from Mr Marchese --
Mr Marchese: Who's speaking for whom?
Mr Young: I'm trying to clarify what was said and what was agreed to.
The Chair: Thank you very much, Mr Pagnuelo. We appreciate your attendance here this morning and your interest in this bill.
ONTARIO FEDERATION OF LABOUR
The Chair: Our next presenter is from the Ontario Federation of Labour, Ross McClellan, the director of legislation. His brief has been pre-circulated. Good morning and welcome to our committee. Fifteen minutes is yours to use as you see fit. Questions would start with the New Democrats, if you allow time for them.
Mr Ross McClellan: On behalf of the 650,000 members of the OFL, we're pleased to present this submission. Let me declare, first of all, that the labour movement fully supports the principle of financial accountability to our members. In fact we fully practise it. In many labour organizations the salary of officers is disclosed as a constitutional requirement. To cite just one example, the constitution of the Ontario Federation of Labour, in articles 6, 7 and 8, states and lists the salaries of its three full-time officers, and for your information, our president, Gord Wilson, is paid $81,100 per annum. I'm aware that the constitution of the United Steelworkers also -- the salary of the officers is set in convention by the membership elected to the convention.
Labour unions are democratic organizations. The officers of the unions, from the shop floor to the senior officers, are elected by secret ballot vote of the membership and, as is the case with all elected officials, including yourselves, they're fully accountable to their constituents for their actions.
I'd like to digress from the brief for a moment. The bill basically does two things: (1) It requires labour unions to make available to the public without charge an annual statement of their assets and liabilities, an audited statement, and (2) an annual record of the names, positions, salaries and benefits of employees who receive more than $100,000 a year. That's the second provision of the bill.
Let me just deal with the first requirement, because I think the bill is based on a fairly considerable misunderstanding of the existing law. I refer you to section 92 of the Labour Relations Act of Ontario, the section entitled "Duty of union to furnish financial statements to members." Section 92(1): "Every trade union shall upon the request of any member furnish the member, without charge, with a copy of the audited financial statement of its affairs to the end of its last fiscal year," and it goes on to detail the requirement.
Subsection (2): "Where a member of a trade union complains that an audited financial statement is inadequate, the board" -- that is, the Ontario Labour Relations Board -- "may inquire into the complaint and the board may order the trade union to prepare another audited financial statement in a form and containing the particulars that the board considers appropriate." In other words, if there's the slightest concern on the part of any member of a labour union, they have the right in law to go to the Ontario Labour Relations Board and not only demand a copy of the financial statements, the audited statements, but they can make an appeal to the board to investigate any matter that they think needs investigation, and the board has the power to so do.
With respect, the provisions of Bill 53 are redundant in this respect, the first purpose of the bill. I would say the enforcement provisions in Bill 53 are incredibly weak in comparison with the very strong enforcement provisions of the Ontario Labour Relations Act.
Dealing with the second part of the bill, which is the salary disclosure provision, I'd just like to raise two very basic questions. The first is with respect now to the salary disclosure provision: What problem is Bill 53 supposed to solve? Before you legislate, please tell us what problem is being solved.
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As Ontario's central labour body, the OFL frequently receives inquiries and complaints from local unions with respect to a host of issues. I've canvassed the Ontario Federation of Labour staff, past and present, and there is not a single recollection of a single complaint from a single person with respect to the issue of the disclosure of the salaries of union officers and staff.
The notion that union salaries are shrouded in secrecy is complete fantasy. It is preposterous to assume that Ontario needs to pass a law to enable union members to view the annual audited statement. As I said, the law already exists. We assert straightforwardly that any and all information about the salary and benefits of union officers and staff is readily available to union members for the asking.
So before the government imposes a new set of bureaucratic red-tape requirements on private member-run organizations, I repeat the question: What problem does Bill 53 solve with respect to salary disclosure?
We challenge the sponsor of the bill and its supporters to identify a single, solitary real person with a real example of salary information denied from a real union.
The second question to be raised here is, why is the labour movement being singled out for special treatment?
The provisions of Bill 53 are unique to the labour movement, even though the sponsor of the bill claims otherwise. Statements made during the second reading debate by government Conservative MPPs to the effect that Bill 53 simply extends the provisions of Bill 26 to the unions are completely false.
During the second reading debate, the member for Scarborough East said: "Bill 53 was inspired by this" -- Bill 26, that's the public salaries disclosure act -- "standard of accountability and, subsequent to the release of the salary information in the public sector, I had no fewer than three close union friends separately question why neither our government nor the NDP has applied the same standard to trade unions and employee associations. I had to admit to them that there was no good reason I could think of why these organizations" -- that is to say unions -- "had been left out" -- of Bill 26 -- "and I committed to attempt to redress that oversight in a private member's bill."
Perhaps the explanation as to why the member could not find a good reason is the fact that these organizations, trade unions, are not left out of the Public Sector Salary Disclosure Act at all. Unions are included in the provisions of Bill 26, in case you didn't know that.
Under Bill 26, a public sector employer, as defined in section 2 of the Public Sector Salary Disclosure Act, whose organization receives governments transfer payments is required to disclose the names of anyone who receives salary and benefits above $100,000 a year. An employer is considered a public sector employer for the purposes of the Public Sector Salary Disclosure Act if his or her organization is currently in receipt of government funding, according to the threshold set out in the bill, of $1 million or an amount equal to 10% of gross revenue above a minimum of $120,000.
Under these specific and limited circumstances non-governmental bodies are required to comply with the disclosure provisions of Bill 26.
I would assume any person reading the Public Sector Salary Disclosure Act would understand that a labour union, which meets the government funding threshold of subsection 2(2), would constitute a public sector body for the purposes of the act and would be required to follow the disclosure provisions. Just to remind you, subsection 2(1) of the Public Sector Salary Disclosure Act defines a public sector employer as a public sector body in clause (k) as "any corporation, entity, person or organization of persons to which the government funding in subsection (2) applies."
To repeat, the labour movement is already fully covered by the provisions of Bill 26. Bill 53 is not a simple extension of the provisions of the Public Sector Salary Disclosure Act at all. Under Bill 53, every labour union is required to comply with the disclosure obligations whether they receive government funds or not.
We submit that this special treatment is discriminatory. It leads to the obvious conclusion that Bill 53 is punitive in its intent and purpose. It leads to the obvious conclusion that the bill is designed to punish the labour movement for its outspoken criticism of the policies of the Harris government.
In conclusion, we challenge the sponsor of this bill to prove that a problem exists to justify a legislative solution above and beyond the measures already in place, and I refer to the Labour Relations Act on the one hand and Bill 26 on the other.
If it can't be proved there's a problem, we respectfully submit that the union movement not be singled out for special discriminatory treatment. The provisions of Bill 26 already apply and Bill 53 is completely unnecessary unless, of course, the government is willing to follow up on Mr Pagnuelo's suggestion that all corporations with share capital be brought within the ambit of Bill 53. I say, quite frankly, we would support such an initiative. We are fully in support of disclosure provisions as long as they are applied equally throughout the economic sector. If the government is saying that salary disclosure is such an important issue of public policy that all employees and officers of corporations without share capital who earn above $100,000 a year shall have their salaries disclosed, we would be happy to support the bill as amended. Thank you, Mr Chairman.
The Chair: Thank you very much. We've got a short two minutes per caucus for questions, beginning with the New Democrats.
Mr Marchese: Thank you, Mr McClellan, for your presentation. I found it useful and informative. We haven't much time, as you noticed earlier in terms of previous questions we had, but I recall the arguments around the employment equity bill that we introduced and the arguments this group of people on the opposite side made against it. They talked about how employment equity was excessively bureaucratic and incredibly draconian and intrusive. They disagreed with the enforcement mechanism that would fine people if they didn't do things right.
As I read this bill, I find it incredibly bureaucratic, incredibly draconian and intrusive and incredibly tough in terms of enforcement. This act here says, "shall prevail over any other act," in spite of the comments you made about unions already being covered under the Labour Relations Act. Do you have a comment about how we square off some of these contradictions because where it serves them, they can be incredibly bureaucratic and draconian, but where it doesn't serve them, they simply label things draconian, bureaucratic and so on. Do you have a comment on that quickly?
Mr McClellan: Only that there's duplication here. It seems kind of stupid to have to file disclosure information with the Ministry of Labour on the one hand, and then file the same information with the Ministry of Finance. On the one hand, the Ministry of Labour has procedures for enforcing disclosure; on the other, the Ministry of Finance doesn't, except if the union in question is receiving a government transfer payment. Then you're back to square one because if a union is receiving a transfer payment and it meets the threshold of Bill 26, the disclosure requirements apply.
I don't think this is very well-thought-out. I would go back to Mr Pagnuelo's suggestion and I agree with his basic premise that anyone who is receiving a public benefit, whether it's a tax expenditure or a tax write-off or whatever should comply with the disclosure provisions. That leads you to say all corporations with share capital that are publicly traded should be covered by the bill as well, otherwise why are you singling out the labour movement?
Mr Len Wood (Cochrane North): Gilchrist had a dream.
Mr R. Gary Stewart (Peterborough): It says here that the annual audited statement is readily available to all union members. Is that not sent out to all union members on a yearly basis, or do they have to request it?
Mr McClellan: The requirement is, as set out in the Labour Relations Act, that it's available upon request. All unions have annual general meetings, conventions. There's always a report of the treasurer; the treasurer's report contains the audited financial statements the same as any other corporation. So the existing accountability provisions with respect to the audited statements are all set out in law as they are for --
Mr Stewart: Of course, most corporations, sir, do send it out to the shareholders and so on, and I assume that your membership would be classed as shareholders within your --
Mr McClellan: With respect, unions are not incorporated under the incorporations act, they are established under the terms of the Labour Relations Act and are required to comply with --
Mr Stewart: Yes, I appreciate that. I guess my concern is, if I'm a member of a union and I'm paying in all the time, why would I not get a statement on a yearly basis from the corporation or whatever you wish to call it that I contribute to without having to request it only?
Mr Len Wood: Just show up at one of the union meetings.
Mr McClellan: Bill 53 doesn't do that either.
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Mr Young: If a member of a union objects to the pay, the salary and benefits of a union leader, how can they try to effect change, how can they have a voice?
Mr McClellan: They have a much better chance than a minority shareholder.
Mr Young: How do they do that?
The Chair: Thank you very much, Mr Young. Mr Bartolucci.
Mr McClellan: They do it at conventions.
Interjection.
Mr McClellan: That's ridiculous. That's preposterous. They're democratic organizations. They do it the way that any democratic organization --
Interjection.
The Chair: Mr Young, we've moved on. Mr Bartolucci.
Mr Rick Bartolucci (Sudbury): Thanks Mr Chair. I appreciate it. Thank you very much for your presentation. Being a member of a federation, an affiliate, I am a card-carrying union member. When I read the intent of Bill 53 I see the intent as being punitive -- clearly, no question. I have trouble rationalizing what the mover of this bill is trying to suggest.
But let me ask a very simple question, and it's a follow-up to Mr Young's question. There is a process in place in section 92. You might want to explain to Mr Young exactly what happens when someone isn't satisfied with the reporting and outline that there is a very, very significant structure in place for that.
Mr Young: That wasn't my question. I said how can they effect change.
Mr McClellan: Again, I touched on it, and I'd invite the members to read sections 92 and 93 of the Labour Relations Act because they detail an obligation to disclose a right of access to any trade union member to the Ontario Labour Relations Board, so if Mr Pupatello is -- I'm sorry. Mr Bartolucci. My apologies.
Mr Bartolucci: I only wish I was as tall as Mrs Pupatello.
Mr McClellan: I can't see a thing without my glasses.
Mr Stewart: You're too short, Rick.
Mr Grandmaître: And he's got hair on his legs.
Mr McClellan: My apologies, Mr Bartolucci. Any member can take a complaint to the Ontario Labour Relations Board and the Labour Relations Board, if it feels the complaint has merit, will investigate the complaint with the full power and authority of the Ontario Labour Relations Board. They have the power -- it's a judicial power -- to order compliance. So we've empowered the Labour Relations Board as the labour court. We've set out the obligations in the act and we've empowered the board to enforce the act. That has a lot more teeth than the provisions of Bill 53. So before you pass Bill 53, I would invite you to consider the overlapping jurisdiction issues very carefully and also to understand whether universal disclosure is a Pandora's box that the government wants to open.
The Chair: Thank you very much, Mr McClellan.
Mr Grandmaître: Mr Chair? Five seconds.
The Chair: The time is up. We appreciate your apologies to Mr Bartolucci but it's even more important that we apologize to Mrs Pupatello.
Mr McClellan: I'll do that myself.
The Chair: The researcher has some information that's being photocopied. Let's recess until 11 o'clock. The clerk has some amendments that she needs to look over. The amendments in fact are admissible, so she needs some time to do that. We think we have a subcommittee meeting at 11, but we're not exactly sure about that.
Mr Marchese: We have plenty of time to finish this up this afternoon.
The Chair: As scheduled, we will do clause-by-clause beginning at 3:30 this afternoon. We're recessed till 3:30.
Mr Stewart: Mr Chairman, just before we recess I'd like to ask a question, and possibly I'm going to appear very, very stupid, which I'll say before anybody else does. I had no realization that we gave any appreciable amount of money to the union movement -- the government. Can the researcher furnish me with the information as to what the government would give to the union movement on a yearly basis? Is it appropriate to ask that?
Mr Len Wood: Check your income tax form. It's written right on there.
The Chair: I think that's an appropriate question. I don't know whether the information is available or not.
Mr Stewart: I guess my concern is that when I look -- I appreciate we gave some, but I just would like very much to know how much.
Mr Avrum Fenson: Do you want it today?
Mr Stewart: Yes, if that's possible.
The committee recessed from 1046 to 1709.
SUBCOMMITTEE REPORT
The Chair: Before we move into the clause-by-clause discussion of Bill 53, I'd like to report on the report from the subcommittee, which met two or three times today to set the format for how we will go forward in the summertime to do the rent control consultations. I will read this into the record and we can have a motion then have some discussion on it.
"Your subcommittee met on June 27, 1996, and recommends the following with respect to the consultation paper on rent control:
"1. That the committee advertise in all English daily newspapers in Ontario and the French-language dailies in Ontario on Monday, July 8, 1996.
"2. That the deadline for witnesses to request to appear before the committee is Monday, July 22, 1996 -- that allows two weeks.
"3. That the deadline for all written submissions to the committee is Friday, August 30, 1996.
"4. That public hearings commence on Monday, August 19, 1996, at 1 pm in Toronto the first week.
"5. That in that first week of hearings the committee meet Monday through Thursday, 1 pm to 9 pm, and Friday, 9 am to 5 pm.
"6. That the committee invite the minister and ministry staff to appear on the first day of hearings on Monday, August 19, for a one-hour briefing, followed by a 30-minute response from each of the opposition caucuses.
"7. That in the second week the committee travel to Thunder Bay, Sault Ste Marie, Ottawa, Peterborough and Hamilton, and in the third week the committee travel to Windsor, London and Kitchener, in accordance with the summer meeting schedule of the House leaders.
"8. That all witnesses are allotted 20-minute time slots.
"9.(a) That three quarters of the time slots available for scheduling of witnesses are to be divided between the three caucuses and to be scheduled from the master lists;
"(b) That the remaining time slots available are to be scheduled from the responses to the advertisement and phone-in requests drawn from the lottery determined by the Chair and the clerk of the committee;
"(c) That in each location that the committee meets, two alternate witnesses are chosen from the lottery, to be contacted in case of cancellations;
"(d) That in the case of cancellation from a caucus witness list, the clerk would contact the caucus for the alternate names.
"10. That the clerk of the committee provide the subcommittee with the list of witnesses who have contacted the Clerk's office by Wednesday, July 24, 1996, at 4 pm.
"11. That each caucus provide the clerk of the committee with their list of witnesses to be scheduled by Friday, July 26, at 4 pm.
"12. That the Chair and the clerk of the committee have been authorized to schedule witnesses commencing Monday, July 29, 1996.
"13. That the researcher provide background information and provide weekly summaries of presentations.
"14. That authorization is given to the clerk in consultation with the Chair and/or subcommittee to deal with any outstanding matters that may arise concerning public hearings, scheduling, travel arrangements and report writing."
I would request that someone move the report.
Mr Derwyn Shea (High Park-Swansea): So moved.
The Chair: Any discussion on the report?
Mr Gilchrist: Mr Chairman, I propose you amend your first section, that advertisements be placed only in those communities where the committee is going to be attending and that an advertisement also be placed on the parliamentary channel, which obviously reaches into every single home in this province that has cable or satellite TV. The precedent is that the standing committee on resources development will be doing just that for the purpose of travelling at exactly the same time on the Employment Standards Act.
Interjection.
The Chair: I guess we always do it on the parliamentary channel.
Mr Gilchrist: But if you go according to the motion you have, it's well over $20,000 expense and the practical reality is that if the committee is not going to a particular town, it begs the question whether it's money well spent on behalf of the taxpayers.
The Chair: Mr Shea, did you want to explain the reasoning?
Mr Shea: I think the reason the subcommittee has said to do it this way is they recognized the cost involved, but we thought it was worth the additional expenditure because we were seeking the widest possible input at this time, and the committee will be as aware as I that we will be drawing on reactions not just personally but also in writing. The parliamentary channel may not be something that people pick up on, but certainly one ad in the paper, which is often done by other committees, is not untoward in this instance, this being a particularly important issue for so many Ontarians. I must say I concur with the decision of the subcommittee.
Mr Gilchrist: We'd be prepared to at least ameliorate it that in a community such as Toronto it be left up to the Chair to place an advertisement in only one English-language newspaper. I don't think a lot is served by -- we have three major papers in this city. I think it should be up to the Chair to select one.
Mr Shea: Is there a precedent for that, Mr Chairman?
The Chair: There's a precedent for doing what Mr Gilchrist suggests. Basically, what we agreed to is there is a standard advertising protocol that the Clerk's office uses and we have agreed to abide by that, since it is a very broad issue.
Mr Shea: I would be comforted to stay within the guidance of the clerk. If there is a precedent that guides us in that regard, I'm comforted by that.
Mr Young: In the Bill 26 hearings, I had a concern with the fact that a number of the delegations that appeared were branches of the same organization. For instance, I think we heard nine times from the Canadian Auto Workers. We heard from the firefighters a number of times. One of the firefighters' spokespersons we were actually going to offer a ride on our bus as we went from town to town to save him gas money because we heard from him so many times. It was the identical, same message in both cases from both groups.
What I wanted to suggest, if it's agreeable to the committee, is that, first, we ask that no organization be allowed to appear more than once: give their submissions in writing, but only be allowed to appear once throughout the hearings.
The second part is that a number of the groups that appeared, I'm questioning their credibility. I won't name any names because it's not necessary for my point, but they appeared to be ad hoc committees that came together, which is their right. But I wondered if we could ask those committees, anyone who comes to appear, to provide a list of their members and tell the committee how their membership has empowered them to give this message. What I'm concerned about is that people come and say they represent a group, and they have not consulted with that group at all. So I'd like to make a motion that the committee make this part of this process, both these suggestions.
The Chair: So you want to add this as another condition, that nobody be allowed to present more than once?
Mr Young: Exactly.
The Chair: And that anybody who does ask to meet as a group give us a list of their membership?
Mr Young: Give us a list of their members and tell us how their membership empowered them to appear with the message they are presenting.
Mr Len Wood: I don't really understand why a motion like this would come forward. We put out advertisements through the radio and newspapers and people come forward, phone in, and the clerk of the committee gets the names. Then the subcommittee decides how many people or how many groups it can put on. It doesn't interest me whether a person is representing himself and his wife or whether he's representing himself and his family or whether he's representing 10 or 15 people. That shouldn't be the concern of the committee. The committee can decide. If 1,000 people say they want to make a presentation and you can only see 500, you fill in the list and that's the way it is.
A motion of this kind, I don't understand why we'd even think of bringing something like that forward on this because, like I say, the subcommittee makes the decision on the presenters, who they are. Who they're representing, whether they've consulted with them, whether they have a decision, I mean, we've seen all kinds of legislation brought forward over the last year that there's been no consultation on whatsoever; it's just a matter of the Premier and a couple of other people saying: "Well, I think it's a good idea. We'll pass it, ram it through."
The Chair: The one thing I didn't say, by the way, was that the subcommittee did agree unanimously with this report. I neglected to mention that.
Mr Marchese: I was about to comment. I'm assuming, for the record, the subcommittee report was proposed.
The Chair: It has been read in and it was moved by Mr Shea.
Mr Marchese: Okay, and then some members are expressing some possible disagreement about what we have decided?
The Chair: Right.
Mr Shea: No: some conditions, additions.
Mr Marchese: Some additions? We had talked about this very issue that he's raising in the subcommittee.
Mr Shea: This is the first time I've heard this. It's just on the floor now.
Mr Marchese: Okay. So do we have a motion that you might read again?
The Chair: Yes, we do. We have a motion made by Mr Young that we add another condition.
Mr Young: Two conditions, actually.
The Chair: Two conditions: that a presenter only be allowed to present once, in one location, and that a group that asks to make a presentation be required to provide us with a list of their membership.
Mr Young: And explain how they have consulted with their membership and that they represent their membership's views.
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Mrs Sandra Pupatello (Windsor-Sandwich): For heaven's sake, that's ridiculous.
Mr Young: You didn't sit on Bill 26.
Mrs Pupatello: Yes, I did. The taxpayers' coalition didn't have to have membership lists here.
Mr Marchese: Give him the list for a second, please.
The Chair: Let's keep to one person at a time.
Mr Marchese: That's the purpose of the subcommittee usually, to iron out differences if there are any, and we presumably canvass our members so that we can avoid these kinds of things, so that we don't have a subcommittee meeting that ends up lasting a whole long time. So I'm surprised this comes up.
The issue that he raises is in my view highly bureaucratic and complicated, particularly the second part. The first part I don't mind. I think that one person having to present in several places at the same time is a problem and I don't support a person speaking in Toronto and speaking in Hamilton, wherever, because if we've heard one person speak once, it's enough. That I have no disagreement with. We could probably, through the process of what we've got in terms of names and the fact that we will have all of those lists in front of us, see whether or not the same name might appear again somewhere else, so we can easily deal with that.
But the second part is complicated, where he says we need the group to list its members and then we need to know how their members are -- I'm not sure -- selected or consulted. What a nightmare. Why would anybody ever want to do something like that?
Mr Len Wood: We're in a democracy; we're not in a dictatorship.
Mr Marchese: I'll probably get back on the list after we get some clarification, if any. But I think this is incredibly unnecessary to do and we can and should avoid it. The purpose of the subcommittee is to avoid such things, and this is unnecessarily complicated.
The Chair: Rather than discuss this, because we have some other business to attend to, is anybody opposed to calling for a vote on these two issues?
Mrs Pupatello: Yes.
Mr Marchese: No, no. What vote? No, I'm sorry. I don't know if other members want to speak to it. If they don't want to speak to it, I have more to say.
Mr Mario Sergio (Yorkview): There's a little bit of confusion I understand, but I was told by our member here, Mr Kennedy, that the subcommittee had agreed on everything as was discussed and for me to vote accordingly as if he were to be present. This is exactly what you, Mr Chairman, had told me prior to coming to the meeting.
I frankly am not prepared, let alone that I cannot vote, to sit at committee and support the changes as proposed in recommendation number 1 with respect to the advertising of the hearings. Mr Kennedy must have good reasons as to why he would like to have the number of hearings advertised in different papers and perhaps in different languages.
I certainly do not agree myself that notification be placed only in one English-language newspaper, probably, I would suggest, at the choice of the government. I do not support that and if that is the case, and the committee wishes to go ahead, then I would request the necessary half-hour, whatever that is, to try to get in touch with Mr Kennedy.
Following the guidelines, then it would be the guidelines according to the procedure of the government Legislature and I would like to know what it is prior to the committee voting on it, since there are changes to the former agreement, to the agreement of the subcommittee. I believe that once the subcommittee agrees on something it should not be changed.
The Chair: Just to clarify a point here, the Clerk's office does not have the right to ask a presenter, a person who asks to make a deputation, any information about the makeup of their group, their mandate or anything. So based on that, there's no way we can get at the information that Mr Young was looking for.
Clerk of the Committee: And they don't have to tell us either.
The Chair: And they don't have to tell us even if we could ask them. So there's no way we can get at that.
Mr Young: I will withdraw that part.
The Chair: Okay. So we're dealing with just the one issue about only allowing each deputant to make a presentation in one location. Anybody have any more discussion on that specific issue? Mrs Ross, did you have anything to say on the issue of one opportunity to speak only? The other issue has been withdrawn.
Mrs Lillian Ross (Hamilton West): Yes, I did. On Mr Young's motion?
The Chair: Yes. The other one's been withdrawn, the other part.
Mrs Ross: The second part's been withdrawn?
The Chair: Yes.
Mrs Ross: Oh, okay. Well, I'm pleased with that. I could support the first part, because I think it's good to get as many people involved as we can, but I'm opposed to the second.
Mrs Pupatello: In that first portion, are you suggesting, for example, there might be a Canadian organization, and the provincial counterpart of that group would be considered part of the Canadian and therefore if both were there they could not both be on the list? Or in another example, if there's a provincial organization and then various chapters across Ontario, there's only one across the board that would be allowed to speak on behalf of that community? Is that the intent?
The Chair: I'll ask Mr Young to clarify what he meant.
Mr Young: The example I used was the provincial firefighters' association that we heard from on Bill 26 in a number of different venues. Another one was the Canadian Auto Workers. We heard from them nine times. The NDP had submitted them in those locations, yet all we heard was complaints that we hadn't heard from enough people. Why would we listen to the Canadian Auto Workers nine times when there are others who might have a different view or a different concern? I want to hear from as many groups as possible and not hear repeatedly from the same groups. That was the source of my motion.
Mrs Pupatello: Now that I have that clarification, the point I need to make in that regard is that, depending on what community you live in, the issue of rent control is very different. When you're in Windsor, where there is practically a zero vacancy rate, the issues for tenants in my community are significantly different from Markham, had Markham eventually ended up on the list. So organizations that are representing that group, whether they be part of a provincial organization, especially because the topic is rent control, it is a regional issue -- very much so. So you cannot deny those people an opportunity to speak, because in many cases those tenant organizations represent a huge population that we need to hear from on this bill.
Mr Len Wood: On the same issue, I attended some of the hearings on Bill 26, and in different parts of the province, whichever region you go into, I'm sure we're going to run into the same problems with rent control and tenants' associations. Tenants and landlords in Kapuskasing, for example, are different as night and day than they are in Toronto or in Stratford or some of the other areas.
I know Mr Young says the Canadian Auto Workers came forward nine times. If you go into some areas, you might have the IWA or the CEP which might want to make 20 different presentations, but they're representing 20 different interests. Their interests in Toronto are different than what they are in a northern community or in a southern community. Just because you might see the IWA or the CAW or different tenants' associations or landlords' associations wanting to make presentations, it doesn't mean that their presentations are all going to be the same.
I think it's very unfair that those comments would come out. If we're talking about an individual person making a presentation nine different times in nine different communities, yes, I can understand that, but if you're talking about organizations, as Mr Young was talking about, these organizations are different in different regions all over the province, as they are all over Canada, and their views, coming from different regions, are going to be quite different -- I would say as different as night and day. You could get 100 different views.
The subcommittee is the one that should be looking after that. As far as what the memberships are and all that, I know that he's withdrawn that, but even this motion, I don't think it should stay. I think that should be dealt with within the subcommittee and if there's a problem at committee of the whole, it should go back to the subcommittee again to make a decision on that rather than having motions come up of this kind. I could sit here and talk till midnight, but then Rosario would have to take over at midnight and carry on until 2 o'clock in the morning. I'm sure you don't want to hear that. So I'll give my spot to Rosario right now.
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Mr Shea: I understand what Mr Young is trying to get at and I don't think anybody around here would object to it in its most general sense. But I think the subcommittee has found a very useful and appropriate compromise that respects the process. It identifies the access of all the stakeholders, either through the individual caucuses or through the general list and chosen by lottery. I don't think anything could be more open and more fairly disposed.
It would strike me as being more appropriate that if we suddenly determine that we've got some difficulties, this document also empowers the Chair and the clerk and indeed the subcommittee to meet and talk about it and come back and make some advice to the committee. So I would suggest that what we have before us now is sufficient and that we be mindful of Mr Young's concern and we keep a watching brief on it, but not go any further at this time.
The Chair: Any further comment or can we call the question?
Mr Marchese: I just think it's completely unnecessary. As Mr Shea pointed out, we had talked about it in committee and we thought it was difficult to police this particular matter and that it wasn't useful to have to spend the energy to do that. We then agreed on a process that would have all the parties from the list identify individuals they would want to present and that 25% of that list would come from the general public based on the lottery system. I also feel that from that we would be able to see whether there were duplications of names and possibly deal with that in subcommittee and with you and the clerk.
I'm not sure whether this motion is necessary to do. I certainly don't agree that if we should have a provincial organization or a national organization that has affiliates, to then simply say to those people in those regions, "I'm sorry, we already heard from your national or provincial organization." I don't agree with that. I think in his clarification, Mr Young said, "Yes, we mean that as well." I thought he was referring to individuals, which I don't mind, but I believe we can deal with that through the subcommittee process, the clerk and yourself as the Chair, because no one here, I presume, would want the same individual to speak two or three times. I think that we can take care of that without having to have such a motion.
The Chair: The first thing we'll do is deal with the amendment that Mr Young proposed. All in favour of the amendment?
Mr Len Wood: Can we have a written copy so we can study it?
The Chair: It was moved that the subcommittee report be amended to state that a presenter only is allowed to appear in one location.
Mr Len Wood: Can we have a written copy of it so we can study it before we vote?
The Chair: You don't need one.
Mr Len Wood: There should be some thought going into --
The Chair: I think it's a fairly simple --
Mr Len Wood: There should be some thought going into somebody bringing forth a motion here, not something off the top of his head that he just thought of on the spur of the moment. We should have time to study it before we vote on it.
The Chair: I think we've discussed it enough, Mr Wood. All those in favour of the motion? All those opposed? The motion is defeated.
Okay, the balance of the report of the subcommittee, any more discussion on it?
Mr Sergio: I think you should clarify point number 1. As I mentioned before, I have no idea, like my colleague here, with respect to the changes in the advertising procedure.
The Chair: Our plan is not to change from the standard procedure as outlined by the Clerk's office, which is to advertise in a standard number of papers.
Mr Sergio: Is the Clerk's procedure according to clause number 1 here?
The Chair: Yes, it is.
Mr Marchese: I beg your pardon. Sorry. That hasn't changed, has it?
The Chair: No. There are no changes at this point.
On the subcommittee report, all those in favour?
Mrs Pupatello: Sorry, what are you voting on now?
The Chair: On the subcommittee report. Mr Shea moved adoption of the subcommittee report. All those in favour? Opposed? The report is adopted.
Now we get on to our business of clause-by-clause analysis of Bill 53.
Mr Gilchrist: The government House leader has a motion to consider extending the last formal sitting day of the House, which would include committees.
Clerk of the Committee: Not tonight, no.
Mr Gilchrist: Because I asked the question --
Clerk of the Committee: Committees are not authorized to sit. They can only sit up to 6 o'clock. You can ignore the clock if you --
Mr Marchese: Tonia, I'm sorry. I'm having a hard time hearing.
Mr Gilchrist: No, that's fine.
Mr Marchese: This room is a terrible place.
The Chair: Basically, the issue that we're discussing is whether we're empowered to sit beyond 6 o'clock. There seems to be some confusion as to whether we are.
Mr Gilchrist: I'm fine.
The Chair: Basically we sit till 6 o'clock and then we adjourn.
Mr Len Wood: See you in October.
The Chair: That could be a good title for a song.
LABOUR UNION AND EMPLOYEES ASSOCIATION FINANCIAL ACCOUNTABILITY ACT, 1996 / LOI DE 1996 SUR LA RESPONSABILITÉ FINANCIÈRE DES SYNDICATS ET DES ASSOCIATIONS D'EMPLOYÉS
Resuming consideration of Bill 53, An Act to Promote Full Financial Accountability of Labour Unions and Employees Associations to Their Members / Projet de loi 53, Loi visant à promouvoir la responsabilité financière complète des syndicats et des associations d'employés envers leurs membres.
The Chair: We're into clause-by-clause analysis of Bill 53. Everyone has a package of amendments that's been presented to you. We also have, presented by the research branch, some background information that people asked for.
Mr Marchese: Is Mr Fenson going to go through this or is it just all this work for --
The Chair: There's much for him to go through.
Mr Tascona: Read it.
Mr Marchese: I beg your pardon?
Mr Gilchrist: From my understanding, the procedure's quite clear. If the member from the third party wishes to introduce an amendment, he reads it into the record. If there's any discussion, great, and then we call the question.
Mr Marchese: The research person has put this on the table. That's the matter we're dealing with at the moment.
The Chair: Yes. We asked for some background information.
Mr Marchese: Right. Somebody asked for this and it's being laid here. I'm not sure anybody has read it, because this was laid on the table just a short while ago.
Interjection: That's right.
Mr Marchese: It would be useful -- not for the purpose of just delaying this, but wouldn't it be useful for the research person to tell us what's here?
The Chair: If we would like to do that, the question is whether we want to go into that or whether we want to get on with clause-by-clause. I'm easy. I'll do it any way you want. Would you like the research department to tell us what's here?
Mr Marchese: No, I'm making a point. Right? I don't mind going through clause-by-clause and finishing it before 6 o'clock, because I think I can make those arguments before 6. I don't need to delay it any further than that.
But I have a problem. We asked research to come up with a great deal of work here. We may not come back to this if we adjourn today and deal with these amendments and it seems awfully odd that we should have a lot of work and we're not familiar at all with what he's presenting to us. It seems strange.
The Chair: Did you ask for it, Mr Stewart?
Mr Stewart: I asked for it. I don't like it, but I'm satisfied with the report.
Mr Marchese: You said you are satisfied with it?
Mr Stewart: Not with the content of it, but I'm satisfied with the report.
Mrs Pupatello: May I get a synopsis from research, please?
The Chair: Mr Fenson, can you do that, a thumbnail sketch of what's in here?
Mr Fenson: Yes. The large package describes the reporting requirements under the Securities Act which were introduced by regulation in 1993. They changed the requirements so that the individual salaries of identified highly paid officers of corporations that are publicly traded be disclosed and be printed in prospectuses before stocks are distributed and in annual reports and in distributions to shareholders.
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Mr Gilchrist: Excuse me, Mr Chair. Did Mrs Pupatello request a synopsis of the report or the entire bill?
The Chair: A synopsis of the report.
Mr Gilchrist: I'm sorry, but it sounds like the research assistant is giving a background of the NDP's previous attempts at salary disclosure.
The Chair: Mr Gilchrist, he's providing what he was asked to provide.
Mr Gilchrist: There was no request made for a synopsis. Mr Stewart asked only about how much money was paid by government to trade unions.
Mr Stewart: I also asked --
Mr Fenson: I'm sorry. There are two pieces of research I was asked to do for the committee, and I was simply going through --
The Chair: He's now explaining those, as requested by Mrs Pupatello, and that is quite fine for him to do that. Carry on please, sir.
Mrs Pupatello: For clarification, Mr Chair, if it is provided to us, why would we have research go this effort if we're not going to take the time to at least see what the result was? Have I missed something?
The Chair: Excellent question. Carry on, please, Mr Fenson.
Mr Fenson: This memo essentially is just a description of that provision which was brought in by the NDP in 1993 to increase the salary reporting required under the Securities Act, which up to that point had simply been generic and didn't require identification of the individual officers whose salaries were being described.
As I mention in this, it was followed by several private members' bills by Conservative members asking for similar disclosure from unions and the public service. It's just a brief history of events in the House on the subject of salary disclosure in late 1993.
The other memo is the result of a question put to me this morning as to whether provincial money is given to unions --
Interjections.
The Chair: I believe it was a government member who asked these questions. I'd appreciate it if you'd listen to the answer.
Mrs Pupatello: Just before you go on, can we go back to this larger one? The description you have on page 2 with the changes of the regulation, is it now exactly the same kind of regulation change in requirements that would be required of the unions as was brought in in 1993?
Mr Fenson: They're similar. It's not --
Mrs Pupatello: What areas are different? Is that itemized? Maybe you can show me where that is.
Mr Fenson: They're different, in part, because this refers to the kind of compensation given to executives, which includes things like stock options, loans from the corporation, things which are peculiar to the securities industry in the kinds of compensation, or rather to publicly traded companies. Some of the elements simply are not present in the union thing because union executives are not given union stock and so on. To that extent, they're not perfectly parallel.
Mrs Pupatello: But the requirements are similar.
Mr Fenson: The requirements are similar. I guess the other difference to point out is that this is done specifically to arm prospective purchasers of publicly traded stock with knowledge. It's a securities thing, and there isn't really an exactly corresponding purpose one can point to in unions because it's not a question of protecting purchasers of stock.
Mrs Pupatello: That was this first one. And the second one?
Mr Marchese: On this particular one --
The Chair: On the first one, okay.
Mr Marchese: -- I want to see if this relates at all. Mr Fenson, Ross McClellan came this morning and made a number of arguments. He said:
"Under Bill 26, a public sector employer, as defined in section 2 of the Public Sector Salary Disclosure Act, whose organization receives government transfer payments is required to disclose the names of anyone who receives salary and benefits above $100,000 a year. An employer is considered a public sector employer for the purposes of the Public Sector Salary Disclosure Act if his or her organization is currently in receipt of government funding...of $1 million or an amount equal to 10% of gross revenue above a minimum of $120,000.
"It is only under these specific and limited circumstances that non-governmental bodies are required to comply with the disclosure provisions of Bill 26."
Then he makes other arguments and says that the labour movement is fully covered by the provisions of Bill 26 already, and "Bill 53 is not a simple extension of the provisions of the Public Sector Salary Disclosure Act at all."
Does your research cover this particular matter?
Mr Fenson: It's covered in the same sense that under the statute created by Bill 26, if the government grant is high enough or if it's a high enough proportion of a union's revenue, then it probably would be considered, but that means there are unions which are not covered. I have not had time since I was asked the second question this morning to identify unions which may be brought into the act by virtue of the size of the grant. I'm not even sure there are any direct grants to unions which would bring them under the provisions of Bill 26. It may be that there are no unions which have to report their executive salaries because of Bill 26.
Mr Marchese: He also mentions:
"During the second reading debate the member for Scarborough East said: `Bill 53 was inspired by this [Bill 26] standard of accountability and, subsequent to the release of the salary information in the public sector, I had no fewer than three close union friends separately question why neither our government nor the NDP had applied the same standard to trade unions and employee associations. I had to admit to them there was no good reason I could think of why these organizations had been left out.'"
Mr Fenson: I think the truth is that Bill 26 does not require all unions as a category to disclose. Unions only come in if they are in receipt of grants over a certain threshold. I think most locals would not come under this, and I don't know for certain that any unions have received a grant of the sort that would bring them under Bill 26.
Mr Marchese: Yes, we're not certain of that, but some could be covered and some might not. That's the point.
Mr Fenson: In principle, it's possible. Whether there is I have not had time to ascertain. What I've identified in the shorter memo, in the memo which doesn't have the thick attachments, is that there have been grants to the Ontario Federation of Labour and there has been a large grant to a workers' health centre which is closely allied with the unions, but I don't know if it was given such that any individual union would have money attributed to it. It may and it may not. This question was just put to me this morning.
Mr Young: I had a comment referring to the same report from the Ontario Federation of Labour, on page 4. The researcher might comment. It says, in paragraph 5, "To repeat, the labour movement is fully covered by the provisions of Bill 26 already." I can't imagine what he means by "the labour movement." That is not any kind of corporate entity; it's not any kind of entity at all. It's a term; it's a phrase. Can you comment on that please?
Mr Fenson: My understanding of what that could reasonably be taken to mean is that labour organizations would be required by Bill 26 to disclose the salary of highly paid executives if they are in receipt of either a $1-million grant or a grant which exceeds 10% of their gross revenues. In principle, they're covered, but I'm not sure that in practice it triggers any requirements in unions.
Mr Young: So from your research there is no union or labour movement organization that has to date received this kind of money from the province of Ontario?
Mr Fenson: I can't say that it's not been the case, but I have not ascertained with any certainty that grants --
Mr Young: Because I certainly don't know of any, and that would certainly make untrue that statement, "The labour movement is fully covered by the provisions of Bill 26 already."
Mr Fenson: It's covered in the sense that law-abiding citizens are covered by the Criminal Code, which forbids murder. The law can apply to them.
Mr Marchese: I think the point was that they are covered, not not covered; they are. The question Mr Fenson raises is that -- and I'm not sure whether we did any research -- through the limited research that may have been done we don't know who is in receipt of either $1 million worth of funding and/or an amount equal to 10% of gross revenue. You didn't do that research.
Mr Fenson: I haven't been able to do that during the course of the few hours that I had between the question being put and now.
Mr Marchese: I understand that. So it's quite fair to say that some components of the labour movement are connected?
Mr Fenson: It's possible, but that's all I can say now.
Mr Len Wood: It's impossible for me to sit here quietly and hear Mr Young saying that the Ontario Federation of Labour representative has brought in false information. That was his accusation. In their interpretation, they're saying that Bill 26 has already covered a lot of the areas of the labour movement. When you talk about the labour movement, you're talking about the ordinary working people in this province who pay for membership in whatever body represents them, whether it be teachers or people working in pulp mills or whatever. I'm sure that they did a lot of research on it, and there's been nobody else here to challenge that that statement might be false, so I think it's very unfair for anybody on this committee to accuse a representative in his absence of bringing in false information.
He also went on to explain that disclosure is covered under the Labour Relations Act, that if any individual members and local unions out there want that information, it's available. He went on to point out that there's no reason for this particular bill that is being brought forward whatsoever because all of the salaries are being disclosed.
The Chair: Mr Wood, did you have a question for the researcher? That's basically what we're doing here.
Mr Len Wood: I just wanted to clarify. We have a person sitting on the committee who has said that a representative has brought through false information.
The Chair: I understand that, but we're trying to get some clarification on these issues.
Mr Len Wood: I'm saying that there's no proof here that what Mr Young is saying is reason for him accusing a representative of bringing in false information.
The Chair: Any other questions for the researcher? I might as well waste the last three minutes.
Mr Marchese: Were you here when Ross McClellan made the presentation?
Mr Fenson: I came in just at the end, so I didn't hear it.
Mr Marchese: I was going to ask you for an opinion with respect to what he said around the Ontario relations. If he wasn't here, it would be difficult.
Mrs Pupatello: I don't know the general nature of how it arose, the second paragraph on page 2 of this two-piece, when you talked about the different class of benefits to unions, the purpose of what drove you to look for that. There are other organizations and agencies that have the ability to access similar types of benefits; for example, strike support payments that aren't taxable. There would be other kinds of honoraria with charity organizations that are also not taxable.
Mr Fenson: Oh, absolutely.
Mrs Pupatello: Could you just tell me in general the purpose of you deriving this portion --
Mr Fenson: I was giving just a broad picture of the kind of benefits that were not necessarily peculiar to unions but that unions enjoyed. I wasn't suggesting that they were the only ones whose members and themselves benefit from tax deductions; it was simply trying to give a range of things which might be construed as benefits from the government, that's all.
Mrs Pupatello: That was just in line, in keeping with grants and other benefits specific to government, and you just carried on?
Mr Fenson: That's right, yes.
Mrs Pupatello: I'm just thinking there may have been some other purpose for deriving that kind of information.
Mr Fenson: No, it's not a suggestion that they were unique or special favours.
Mr Marchese: Mr Fenson, are you familiar with the Ontario Labour Relations Act?
Mr Fenson: In part.
Mr Marchese: I thought Ross McClellan -- I was chatting with somebody at the time -- made some other remarks. I think we were talking about the fact that we're covered in terms of audits and/or disclosure; I don't quite recall whether he said that as well.
Mr Fenson: I'd really have to check before I spoke to that. I can't tell you what precisely -- I know there are no salary disclosure requirements, but I would really have to check.
Mr Marchese: But in terms of audited statements, that's something they would be required to do, as Mr McClellan -- but you're not quite sure.
Mr Fenson: I'm really not; I can't speak off the top of my head.
The Chair: From my vantage point, it's 6 o'clock, and failing unanimous agreement to carry on, the committee is adjourned.
The committee adjourned at 1800.