Thursday 22 August 1996
Employment Standards Improvement Act, 1996, Bill 49, Mrs Witmer / Loi de 1996 sur l'amélioration des normes d'emploi, projet de loi 49, Mme Witmer
London and District Labour Council
London Chamber of Commerce
American Federation of Grain Millers, Local 154
London and District Construction Association
All Canada Collect
Oxford Regional Labour Council
London Hotel and Motel Association
Canadian Union of Public Employees, London and district council
London Regional Advocates Group
Lazarus Community Action Coalition
Chatham and District Labour Council
United Steelworkers of America, southwestern Ontario area council
Michael Klug; Donna Hogg
Canadian Union of Postal Workers, Ontario regional office
London and District Service Workers' Union, Local 220
Canadian Auto Workers, Local 88
Canadian Auto Workers, Local 27
Canadian Auto Workers, Local 1859
St Thomas and District Labour Council
STANDING COMMITTEE ON RESOURCES DEVELOPMENT
Chair / Président: Mr Steve Gilchrist (Scarborough East / -Est PC)
Vice-Chair / Vice-Président: Mrs Barbara Fisher (Bruce PC)
*Mr John R. Baird (Nepean PC)
Mr JackCarroll (Chatham-Kent PC)
*Mr DavidChristopherson (Hamilton Centre / -Centre ND)
*Mr TedChudleigh (Halton North / -Nord PC)
Ms MarilynChurley (Riverdale ND)
*Mr DwightDuncan (Windsor-Walkerville L)
*Mrs BarbaraFisher (Bruce PC)
*Mr SteveGilchrist (Scarborough East / -Est PC)
*Mr PatHoy (Essex-Kent L)
*Mr Jean-MarcLalonde (Prescott and Russell / Prescott et Russell L)
Mr BartMaves (Niagara Falls PC)
Mr BillMurdoch (Grey-Owen Sound PC)
*Mr Jerry J. Ouellette (Oshawa PC)
*Mr Joseph N. Tascona (Simcoe Centre PC)
*In attendance /présents
Substitutions present /Membres remplaçants présents:
Mr John R. O'Toole (Durham East / -Est PC) for Mr Carroll
Mr DerwynShea (High Park-Swansea PC) for Mr Maves
Also taking part /Autres participants et participantes:
Mrs MarionBoyd (London Centre / -Centre ND)
Clerk / Greffièr: Mr Douglas Arnott
Staff / Personnel: Mr Ray McLellan, research officer, Legislative Research Service
The committee met at 0904 in the Radisson Hotel, London.
EMPLOYMENT STANDARDS IMPROVEMENT ACT / LOI DE 1996 SUR L'AMÉLIORATION DES NORMES D'EMPLOI
Consideration of Bill 49, An Act to improve the Employment Standards Act / Projet de loi 49, Loi visant à améliorer la Loi sur les normes d'emploi.
The Chair (Mr Steve Gilchrist): Good morning. I call the meeting to order and on behalf of the committee members say how pleased we are to be in London today for our fourth day of hearings on Bill 49.
LONDON AND DISTRICT LABOUR COUNCIL
The Chair: We have our first group ready to present, the London and District Labour Council. Come forward to the table, please. Good morning. Just as a reminder, we have 20 minutes for you to divide as you see fit between presentation time or question-and-answer period, and I wonder if you might be kind enough to introduce yourselves for the benefit of the Hansard reporter.
Ms Edna Anderson: My name is Edna Anderson. I'm vice-president of the London and District Labour Council.
Ms Carrol Anne Sceviour: Carrol Anne Sceviour, representative of the labour council.
Ms Sandi Ellis: I'm Sandi Ellis, representative of the labour council as well.
Ms Anderson: The London and District Labour Council welcomes the opportunity to present this submission on behalf of the over 2,400 affiliated members of our organization. In addition, we speak on behalf of many unorganized workers in our area who call our office for advice when employers do not follow the law set out in the Employment Standards Act.
We were not surprised when Bill 49, which allegedly made administrative changes, turned out to be another attack on workers, both organized and unorganized.
In addition, we feel that the flexibility it offers simply gives employers more ways to evade compliance with the act, which already has a shameful record of violations and failure to pay assessments owed to workers.
The real statistics from the employment standards working group are as follows:
(1) The time for a claim to be considered by an employment standards officer is nine months.
(2) The percentage of investigated Toronto employers found violating the Employment Standards Act was 94%, based on routine inspections by the ministry, and 71%, based on claims by workers.
(3) Routine inspections and audits in Ontario: The number of companies that had full audits was 21. The percentage of inspected/audited employers found violating the ESA was 81%.
(4) In 1994-95, assessments versus collections in Toronto: The total number of employees in the Ministry of Labour found to be owed money by their employers was 8,298 and the total claims collected was 3,552. The percentage of employees who did not receive money from their employers was 56%. We think that's disgraceful.
Enforcement under a collective agreement: Currently under the ESA, unionized employees have access to the considerable investigative and enforcement powers of the Ministry of Labour. This inexpensive and relatively expeditious method of proceedings has proved useful, particularly in situations of workplace closures and with issues such as severance pay and termination pay.
The Bill 49 changes eliminate recourse by unionized employees to this avenue and instead require that all unionized employees use the grievance procedure under the collective agreement to enforce their legal rights. The union will bear the burden of investigation, enforcement and the accompanying costs. The director can make an exception and allow a complaint under the act where he thinks it's appropriate, but for all practical purposes the enforcement of public legislation would be privatized.
Arbitrators will now have jurisdiction to make rulings that were formerly in the purview of an employment standards officer, a referee or an adjudicator. They will not be limited by the maximum or minimum amounts of the act. However, arbitrators lack the investigative capacity of the ESOs and may not be able to match the consistency of result that the act has had under public enforcement. Most important, employers could argue that as boards of arbitration do not have the critical powers to investigate whether particular activities or schemes were intended to defeat the intent and purposes of the act and its regulations, such cannot be determined. In such circumstances, unionized employees could well be left with no recourse whatsoever. This is particularly evident in cases of related employer or successorship provisions of the act. It's difficult to see how such provisions can be applied when the successor or related employer may well not be a party to the arbitration procedure.
Enforcement for non-unionized employees in sections 19 and 21 of the bill and sections 64.3, 64.4 and subsection 65(1) of the act. With these amendments the Ministry of Labour is proposing to end any enforcement in situations where they consider that violations may be resolved by other means: namely, in the courts. In other words, the amendments would download responsibility for enforcement of minimum standards for non-unionized workers. Employees would be forced to choose between making a complaint to the employment standards branch or filing a civil suit in the courts. Responsibility for enforcement is also downloaded on to non-unionized employees by limiting the amount recoverable through the employment standards to under $10,000.
I found this one difficult to understand, that you could limit the amount of liability, although the debt might be a lot higher. In fact, currently there is no limit on what's recoverable. What an employer owes an employee is generally what he has to pay. That seems like a good way. It's how I have to pay my debts.
An employee who files a claim at the Ministry of Labour for severance and termination pay is precluded from bringing a civil action concerning wrongful dismissal and claiming pay in lieu of notice which exceeds the statutory minimums. The effect of these amendments is that those employees who have chosen the more expeditious and cost-effective path of claiming through the ministry will have to forgo any attempt to obtain additional compensation through the courts. Legal proceedings are notoriously lengthy and prohibitively expensive for many, even though they may be entitled in common law to more than the statutory minimum under the ESA.
Just as in the provisions barring civil remedies in section 64.3, there are mirror provisions in 64.4 precluding an employee who starts a civil action for wrongful dismissal from claiming severance or termination payments under the act. Other provisions are also prohibited under the act once a civil action is started, such as an employer not paying wages owed, failure to comply with successor rights in the contract service sector etc. Employees who initiate a claim but decide they no longer wish to pursue their civil suit don't appear to have even the two weeks' time limit to change their mind. Rather, they appear to have no right at all to reinstitute a complaint under the act.
Maximum claims under section 21 of the bill and subsection 65(1) of the act. The amendments introduce, as noted above, a new statutory maximum amount that an employee may recover by filing a complaint under the act. This maximum of $10,000 would appear to apply to amounts owing in back wages and other money such as vacation, severance and termination pay. There are only a few exceptions, such as for orders awarding wages in respect of violations of the pregnancy and parental leave provisions and unlawful reprisals under the act.
The problem with implementing such a cap is that workers are often owed more than $10,000, even in the most poorly paid sectors of the workforce such as foodservices, garment workers, domestics and others. Indeed, workers who have been deprived of wages for a lengthy period of time are the very employees who will not have the means to hire a lawyer and wait the several years that it will take before their case is settled. In effect, therefore, this provision will encourage the worst employers to violate the most basic standards while at the same time compounding the problems for those workers with meagre resources.
I assisted a friend who is developmentally handicapped to recover wages from an unscrupulous restaurant owner who had hired him to work 35 hours a week for $25 and he could have his lunch there: soup and a sandwich. I haven't included in the brief some of the disgusting tactics that employer used to discourage this fellow from pursuing his rights. In fact, before he knew that I had an official capacity he was really rude to me as well. My friend's claim amounted to less than $300 and took almost a year to resolve.
I can tell you that he would not have been able to pursue that claim without a lot of help and assistance, and even in spite of that he was really terrified the day of the hearing because he was going to have to go and face that man he had worked for. He was nervous about having an adjudicator there and so on.
People who have handicaps of various types are even more disadvantaged by this change in the bill. This chap had a friendly ESA officer plus myself as his case worker helping him; he would never had pursued it otherwise. He didn't realize that employers can't enter into a deal with you that's contrary to the law.
In my opinion, the government should be aggressively pursuing employers who exploit and humiliate workers rather than withdrawing the few sympathetic supports that currently exist.
Regarding the use of private collectors, section 28 of the bill, new section 73 of the act, a fundamental problem with regard to the act has for some time now been the failure to enforce standards. This is no less true with regard to collections. The most frequent reason for the ministry's failure to collect wages assessed against employers has been the employers' refusal to pay. The answer to this problem, according to the proposed amendments, is not to start enforcing the act but rather to absolve the government of responsibility to enforce the act by farming the problem out to a private collection agency.
In addition, the employment standards director can authorize the private collector to charge a fee to the persons who are owed the money. Should the amount of money collected be less than the amount owing to the employee or employees, the regulations will enable the apportioning of the amount among the collector, the employee or employees and the government. Where the settlement is under 75% of the amount owing, the collector is required to obtain the approval of the director, but this still allows the collector incredible leeway, if not outright abuse, with someone else's money.
The danger here is that even persons, like my friend, whose earnings put them below the poverty line and who are owed money under the act could well be required to pay fees to the collector. A minimum-wage worker at $6.85 an hour, for example, could not only receive less money than is owed but also have to pay for it to be collected. Surely this raises ethical questions for the drafters of this bill.
We would suggest that while such an approach may be appropriate in commercial transactions, it's neither morally justified nor appropriate under these circumstances. We want the system of public enforcement to be maintained and improved, not eroded.
The London and District Labour Council is gravely concerned that employees, particularly the most vulnerable, will be pressured to agree to settlements of less than the full amount owing as collectors argue, if only for reasons of expediency, that less is better than nothing. Having at the same time to pay a collector amounts to nothing less than legalized theft.
The limitation periods: Under section 32 of the bill, section 82 of the act, workers who fail to file within this new time limit will have to take their employer to court to seek redress. The burden of cost will also have to be borne by an employee in such circumstances as that the Ontario legal aid plan has been scaled back and no longer covers most employment-related cases. In contrast, the ministry still has two years from the date the complaint is filed to conduct their investigation and a further two years to get the employer to pay moneys owing. In other words, an employee having made a complaint under the act could wait up to four years before receiving their money, and then only the part of it that the collector collects minus the user fee. That the government can rationalize such amendments as facilitating or streamlining procedures is almost beyond comprehension.
In conclusion, I would say there are several positive amendments that the labour council can support. However, in general, these changes impact the most vulnerable people in the workplace: the unorganized. It undermines their already precarious position.
The other thing is that the attempt was made to introduce these changes as if they were really insignificant, just housekeeping changes. We believe they should be included in the overall review so they can be openly debated and discussed. Thank you for your attention.
Mr Pat Hoy (Essex-Kent): We don't have too much time here, but you speak about non-organized persons and the effect this bill will have on them. You've cited an example of the disabled person who was clearly being duped by his employer. Do you think this act will have more significance on the unorganized worker or the organized worker? I'll let you answer that one.
Ms Anderson: I believe it's going to impact both, but certainly unorganized workers are often less aware of their rights than organized workers. They also don't have the support of the elected representatives of their union. I can tell you that when that investigation was done in that particular restaurant, we knew of another woman who was also being exploited in a similar fashion. There was no complaint and the ministry did not investigate the fact that there was another handicapped person working there under similar circumstances.
Mr Hoy: Do you have any recommendation on how to improve the awareness? I know, not necessarily through my riding office but from people I meet in the riding, that there seems to be a lack of awareness, particularly of their rights to severance pay. Do you know how to recommend that we improve that?
Ms Anderson: It certainly appears that when the government wants to educate the public, it does a very good job of it. I think that they can do an equally good job of educating workers, both in unorganized and organized workplaces. Public education is something the government could undertake to make sure that people do know what their rights are. They did it with the Landlord and Tenant Act and they do it with other things they want to promote. I don't see why they couldn't do it with this act as well.
Mr David Christopherson (Hamilton Centre): Thank you for your presentation; I appreciate it. I can tell you that the presentation you've made on behalf of workers in the London area is very similar to what we've heard in Toronto and Hamilton and Kitchener and what I expect we'll continue to hear as we move across the province.
I'd like to take the short time we have to begin exploring an area we haven't yet talked about in any of the locations in any great detail, and it's the paragraph at the bottom of page 5, where you talk about a concern you have about privatizing the collection of money owed from employers. Your concern is that the most vulnerable might "be pressured into agreeing to settlements" -- to use your wording -- "of less than the full amount." There's protection in here that says that no settlements are binding if they're entered into as a result of fraud or coercion. But as Professor Fudge pointed out, that at least shows the government contemplates the fact that this kind of pressure can be brought to bear. Can you just expand a little on what your concern is in terms of the kind of pressure employees might face, particularly the most vulnerable kinds of workers?
Ms Anderson: It boils down to the same reason that people take their cheques to the cheque-cashing Money Mart and pay the 4% or 5% or whatever it is the Money Mart charges to get them cashed -- because they can't get them cashed in a bank without having an account that has more than the cheque is worth in it. There's a real sense that people who are in dire circumstances want the money now. They can't afford to wait, even if it might mean that they would get a better settlement. All the collection agency has to do is say: "We can get it for you Tuesday, but you're only going to get $150. If you wait, you might get $500." It's very clear that there doesn't have to be a lot of coercion to persuade a person with no money that they can get some immediately. I've seen it with the Money Mart cheque-cashing thing; also with people who take their income tax and sell it, discount it with people who will do your income tax and take a percentage as well. We see it all the time with people on low incomes.
Mr Jerry J. Ouellette (Oshawa): Thank you very much for your presentation. I'd like to explore a little different path. You mentioned employers who aren't willing to pay. Do you feel that it would be advantageous if the government would look at shutting down businesses in these cases and thereby putting all the workers out?
Ms Ellis: I don't think it's an issue of shutting down the business and putting all the workers out of work. In many cases, these people who are applying have already left. In fact, Professor Fudge's paper explains that over 90% of them have already left their employment or their employer has gone bankrupt. Those are the people who are seeking redress under the act. Those people already don't have a job, so you're not putting any employee out of work here. But that person who was the employer should not be allowed to go into another business until they have paid their dues to the business they previously owned. We see that happen all the time -- it's opened down the street under another Ontario numbered company and he just keeps doing it and doing it.
Mr Ouellette: So this is just referring to businesses that have gone out of business. What about businesses that are currently operating where we have problems collecting from the employer to pay the employee? Should we shut down that business?
Ms Ellis: Employers who have businesses have assets, and just as we in the Hydro commissions can put a lien against a business to the city for payments, there should be some avenue of recourse for the government to put a lien against the assets of that company to pay the employees what's due to them.
Mr Ouellette: But still keep the businesses open so that we can have employees in there?
Ms Ellis: I would certainly think so. Our job is to keep employees working, it's not to put them out of work, but it is also to keep them working as long as they're getting wages.
Mr Ouellette: Obviously we're having difficulty in that we're only collecting, on average, 25 cents on the dollar. We're making an attempt to recoup up to 75% at least, and then the employee has the ability to say whether they want to bargain on the last 25% with a collector.
Ms Ellis: You have to understand logically that what Edna was talking about is exactly what's going to happen. The director is going to offer certificates to people left, right and centre because the collection agencies, in many cases, and I would think the majority of cases, will not be able to collect over 75%.
Mr Ouellette: We're trying to find a way that we can get employers to pay when it's required. Currently, the system is not working. What we're proposing is another opportunity and I was just asking if you felt that shutting down businesses would resolve the situation.
Ms Ellis: No.
The Chair: Thank you all for taking the time to come and make a presentation before us here today.
LONDON CHAMBER OF COMMERCE
The Chair: Our next group up is the London Chamber of Commerce, Mr Gordon VanderLeek and Mr James Thomas. Good morning, gentlemen.
Mr Gordon VanderLeek: It's a pleasure to be here and bring the position on behalf of the London Chamber of Commerce. I trust that our brief position paper is being or has been circulated to you, so we don't propose to read it -- you may do that at your leisure -- but just highlight a few aspects of it and be available for questions at the conclusion. I'm certainly also pleased that Jim Thomas can be here to assist in the presentation. He will speak to some of the specific provisions of Bill 49.
By way of background, the London Chamber of Commerce, as part of the chamber movement in general, is the largest and most broadly based business organization in London. If you look through our membership, we have individuals who are working out of their home who are members of the chamber as well as some of the city's largest business and service sector organizations. So we feel we come forward today speaking on behalf of a wide variety of businesses.
The chamber members employ nearly 50,000 people in the London and surrounding area, so clearly we take note of any legislative changes to employment standards or to workplace legislation. As indicated in the brief, we have appeared in the past to speak on issues of workplace health and safety, labour relations and also on employment standards. We appreciate the opportunity to be here today.
Looking at the context of the legislation, we support the government's efforts to reform the legislation. If you look to the nature of the working relationship and the employer-employee relationship over the past number of years, there's been significant change. I think that's a given. There's been much that has changed in our society, and the workplace has been no exception. The chamber of commerce supports the effort to bring reform and necessary updating to the legislation. We support the comprehensive review process and the two-stage process, understanding, of course, that we look forward to the second phase of the reform process.
In many instances, and we'll highlight a number of those today, we feel that the legislation as it currently stands, having gone through some piecemeal amendments over the years, is becoming increasingly complex for the business owner and, as we've reported in our report, non-user-friendly.
With that, by way of background, I can perhaps ask Mr Thomas to highlight for the members here the specific aspects of the legislation that we'd like to make commentary on today.
Mr James Thomas: Thanks for the opportunity to appear before the standing committee. Again, we have recently conducted a survey of our membership in the London Chamber of Commerce to see what their concerns are with regard to issues surrounding government programs. The number one thing that comes out in the survey of employers in our area when we talk to them is the amount of red tape and duplication of government effort they encounter as an employer on a regular basis.
So these amendments, which we see as streamlining the process, are indeed welcome by our membership and they make a lot of sense to us. In particular, things like limiting the recovery of money to a six-month period instead of it hanging for a two-year period, as currently exists, over an employer's head makes a lot of sense.
The elimination of duplication of claims I think in particular is an area that's extremely important to employers, particularly small employers who may have made an error, find it incredibly complex to have to go through at least two or three different forums for hearing a complaint. In fact, we see on a regular basis people who may file claims in unionized environments in three different forums. They may file a grievance, they may go to the Employment Standards Act and they may file a small claims action as well just to see where they get the best deal, if you will. So we think reducing the duplication of claims is a very welcome part of the changes to the act.
Extending the appeal process, a second item that we think makes a lot of sense, allows for a longer period for the employer to consider, and the employee if they want to, appealing an employment standards ruling and to perhaps negotiate a settlement or perhaps take the full merits of the case into consideration before deciding to appeal or not to appeal.
Those are the three main areas that I believe are important to our members. While we recognize that there are other parts to the act that have been changed and streamlined, we thought it would be important that we comment on those three areas: the reduction in the duplication of claims, limiting the recovery period and extending the appeal period. So we welcome the government's proposals under Bill 49 in these areas. Gordon, you may want to add a comment.
Mr VanderLeek: Just in conclusion -- we're available for any specific questions that you may have -- we look certainly with interest to the second phase of the reform process and the issues that we anticipate may arise there and we encourage the government to proceed without any undue delay in pursuing the overall reform of the legislation. This is certainly a step in the right direction, as indicated, to avoid duplication, to hopefully reduce the cost that is currently in place for the government to process that, and to place expertise in the appropriate area and to define the rules.
In looking at the changes that are proposed, we trust that they will define the rules under which the employer-employee relationship exists in Ontario, and that if both sides know the rules they're playing with, that bring some certainty to the environment and would also improve the environment for doing business in Ontario generally. Perhaps we can stop at that point and accept any questions.
The Chair: Thank you, gentlemen. That leaves us 12 minutes, four minutes per caucus. We'll start this round with Mr Christopherson, the third party.
Mr Christopherson: Gentlemen, thank you for your presentation. The minister has stated from the outset that Bill 49 is simply minor housekeeping. Do you agree with the minister?
Mr Thomas: If I could comment on that, I think they're not major changes that we're seeing in terms of the things that need to be reconsidered in the employment relationship. If you take a look at the increasing prevalence of home work and the impact on the Employment Standards Act, there are a whole range of things that need to be looked at. There are contradictory areas of the act that need to be reviewed. The issues surrounding overtime need to be given a close look. So I think a more comprehensive review of the Employment Standards Act in general is warranted.
Mr Christopherson: I think that's a yes.
Mr Thomas: Yes.
Mr Christopherson: I note that you make the statement, as have the other chambers of commerce that have made presentations, that you believe the changes do not impact on the act's protection of minimum employment standards, and I'd like to just pursue that a little bit. I would suggest to you that there have been minimum protections that are being taken away under Bill 49, such as the cap of $10,000 where none existed before. Regardless of the rationale for $10,000, the fact is there wasn't a cap before and now there is one; also the fact that there's now going to be a minimum and one will have to cross a minimum threshold before the ministry will follow up on a claim. Both of those are restrictions on rights once held by the employees.
A suggestion that both of those can be remedied by going to the courts now involves employees paying money to hire their own lawyers and perhaps take time off work, which they currently don't have to do under the existing legislation. I have some difficulty understanding how the recognized common sense of the fact that those are rights that are now being taken away reconciles with what you're stating: that there's no impact on the minimum rights that employees now enjoy. I see quite a discrepancy there. Could you explain that, please?
Mr Thomas: I think what we're seeing is a streamlining of the employment standards process, which is valuable to both the rights of an individual to make decisions and understand what decisions they are making in terms of the route of getting redress. I don't see that as a major problem.
Mr Christopherson: But if you had a right to have a problem that you have resolved by a government function, and that function is no longer there and you have to pay out of your own pocket to resolve the same problem, have you not lost a right? Have you not lost something? Because these employees are certainly losing rights that they now have under the existing law with Bill 49.
Mr Thomas: It's a change in the way the rights are applied, yes.
Mr Christopherson: It's a loss. It's costing them more money to get the protection they once had covered by the ministry. Let's keep in mind this is money that employees are owed. This is not some treasure hunt they're after; this is money they've worked for, that they're owed. Now they're going to have to pay money to get that money back with this law, when before they didn't have to. I have trouble understanding how you can suggest that the employees haven't lost something.
Mr Thomas: We view it as a positive change in streamlining the process; that employees have different ways of going at things now. I don't see it as the loss that you're claiming.
Mr Christopherson: With great respect, really, and I mean this very sincerely, I would suggest if the shoe were on the other foot and there were a cost being incurred by business to protect their legitimate rights that they didn't have to incur before, you'd be screaming from one end of this province to the other.
Mr Thomas: I don't have a comment about your comment.
Mr Christopherson: I don't see any further point.
Mr Joseph N. Tascona (Simcoe Centre): I have a couple of questions I want to ask you. The first question is, would you be in favour of electronic filing of orders to pay, including the monetary payment?
Mr VanderLeek: Perhaps I can speak to that. I think in general it's laudable when government legislation keeps pace with the manner in which individuals communicate, and it's clear that in the 1990s the electronic form of communication is one that is becoming more acceptable. Subject to appropriate safeguards for that type of technology, I think it's laudable that the government look to those avenues to streamline the system so that we don't have an archaic system but we have a government system which is efficient and most cost-effective from the perspective of the taxpayer. Certainly if the electronic forum accomplishes that, then we're in favour of that in terms of reducing the cost of government, which ultimately is for the benefit of the members of our society.
Mr Tascona: There's one other area that I want to explore. One of the big problems we have, once the act is enforced, is the collection. Presently, the collection record is about 25 cents on the dollar. There have been some comments in terms of how the collection procedures are done. One suggestion in this legislation is to do it through private collection, but there are other mechanisms that might be considered. One area where they do collections is under WCB with respect to assessments. They use such mechanisms as liens, and they take money out of bank accounts. I'd just like to get your view on whether that would be a method that could be considered and what the business community would think of that in situations where we're dealing with employers that just are not going to pay and they just are refusing.
Mr Thomas: If we currently are experiencing a 25-cents-on-the-dollar recovery rate for claims, anything that we can do to make that more effective makes some sense. I don't have a problem in seeing how that would work, but I would like to take a closer look at it before agreeing to it.
Mr Tascona: WCB has an approach that it uses -- you'd be familiar with that -- in terms of collecting its assessments. That's one method that is used with employers, and it's been accepted practice for many years.
Mr VanderLeek: In terms of additional commentary on that, the chamber has always supported legislation which provides clear rules and clear understandings as to what the rights and obligations of the employer are. If there are moneys that are legitimately disputed but after adjudication are determined to be owing to an employee, then they ought to be paid and the rules ought to be followed. The chamber has always stood for that. Whatever system is in place in the specifics of enforcement brings integrity to the system and bodes well, on a general basis, for saying that in Ontario we play by defined rules and we expect people to live up to those rules on both sides, both employees and employers. So if we have an efficient collection system, presumably that would ensure that there's confidence in the system and confidence in government, and it creates a positive business environment.
The Chair: Moving to the official opposition, Mr Hoy.
Mr Hoy: Thank you for your presentation. You mentioned that you see the necessity of discussing this bill in total and you're waiting for the second phase discussion paper. Do you think it would have been better to discuss this bill and ramifications as it applies to employers and employees all at once, rather than breaking it out in two separate pieces like this, for clarity for both the employer and the employee? There'll be another second round; we don't see the whole package in front of us as to what the government is intending to do.
Mr Thomas: My understanding of the second phase is that they will address some of the substantive issues in the act, that we need to take a look at those as one thing so the administrative issues we're dealing with at this point don't slip by the boards. It's important to get the administration right as well. I see these as more administrative than the real guts of the Employment Standards Act.
Mr VanderLeek: The other thing I would add to that is that we suspect there will be more attention brought to the second phase of the reform process. Perhaps the consultative process would be longer, more parties would be interested in participating in it and it would take a greater amount of time. Having said that, if the government can achieve certain cost savings immediately through administrative change, we applaud that and say that's money we could save now while we continue on the overall reform process. In that sense, the chamber is here today to say that we support the move to make immediate savings in streamlining the process and sending a clear signal to employees and employers that they're serious about reform and are beginning to take action. I think that process is suitable, and we'll deal with the substantive portions in the second phase as a package, to address the issues there.
Mr Hoy: Your comment that there may be more interest in the second phase is probably true, but I want to say that there is no lack of interest in this first phase. Our agenda per day, no matter what city we are in, is quite heavy. The interest is quite pronounced.
You did mention some specifics of what the chamber likes about the bill, in particular the elimination of duplication, the recovery limit at six months and the extended appeal periods. What's your feeling about the $10,000 limit that is proposed, notwithstanding the fact that 96% of the claims are under $10,000? It brings to my mind that the $10,000 limit seems to be misplaced in regard to the fact that 96% of claims are under $10,000 in the first place. It seems to put a restriction, in my mind, on that 4% of persons who might have claims that exceed that amount. Do you have any opinion on the $10,000?
Mr VanderLeek: With regard to the limit itself, we start from the premise, the fact that has been produced by the government, as you've indicated, that we're dealing with claims in excess of $10,000 as being 4% of the caseload. Our general observation would be that those individuals who have that much at stake would be prepared to deal with their claims through the processes that are available, and to that extent we support the government's efforts to direct what we can call its limited resources, because it cannot do everything, to those who are most vulnerable and who need the services the most. It provides some certainty to know that if you're above that amount you can proceed in a certain area.
We'll hopefully streamline the process such that more cases can be processed and more people can be assisted by the staff of the Ministry of Labour as they do the day-to-day work under the legislation. From an administrative perspective, I see the cap as simply providing a definition of where they want to focus their activities, much the way that a business would focus its activities pursuant to a business plan, saying, "We want to help people in these areas the most and focus our efforts." Presumably those who have claims for more than that have the opportunity to seek redress. I certainly don't agree with the position that rights are being taken away. The forum for exercising those rights perhaps is being amended and streamlined and clarified.
The Chair: Thank you both for taking the time to come before us here today. We appreciate it.
AMERICAN FEDERATION OF GRAIN MILLERS, LOCAL 154
The Chair: That leads us to our next presentation, which will be from the American Federation of Grain Millers, Local 154. Good morning.
Mr Pat Blaney: I'd like to thank the committee for having the opportunity to speak this morning. I'd like to do something maybe a little more novel than I've heard so far, and that is to tell a story that has a happy ending, fortunately. It is really the story of our experience, and I'd like to draw some conclusions at the end to illustrate.
My name is Pat Blaney. I'm the president of the American Federation of Grain Millers. We represent 569 hourly employees of the Kellogg Co here in London. The Kellogg Co has been established in our community since the early 1920s. It has gained a reputation as a solid employer, providing excellent wages and benefits, with minimal layoffs and a relatively constructive labour relations environment. In short, it's a fine place to work.
As well, our facility has the distinction as the low-cost producer of ready-to-eat breakfast cereal inside the Kellogg organization. In the last number of years we have established consecutive record profit levels year to year. We are proud of our plant and the wide variety of domestic and export products we produce.
Our history, however, has not always been that promising or as constructive. We believe that in the absence of the specific safeguards established under the Employment Standards Act our business success and working environment would be radically different from what we see today.
Historically, the cereal business has been seasonal in nature. Layoffs for junior employees were significant and longer-term due to the nature of the business. The language in successive collective agreements has evolved around these two premises; that is, the seasonal nature of the cereal business as well as the day-to-day fluctuations of the work.
More than 25 years ago, Kellogg applied for and obtained a permit under subsection 20(1) of the Employment Standards Act. The permit, known as the basic permit, gives the company permission to exceed the hours-of-work limits in the act -- eight hours in a day and 48 hours in a week. Of course, the permit only gives the company permission to ask the employees to work in excess of those hours. The permission can be given in law by either the employee or the employees' agent, in this case the union.
The various collective agreements made reference that under given circumstances employees could be forced -- more commonly known as compulsory overtime -- to work overtime to support operational requirements, and it was generally not abused then.
Throughout the 1970s it was apparent that the nature of the business was changing, becoming less seasonal and requiring an increased need for staffing through the weekends. There was growing concern in the summer months, specifically by junior employees being forced unduly. I think it would be safe to say that most people begrudgingly accepted the reality of the business and that this was going to take place.
However, on February 9, 1982, the company announced plans to construct and develop a massive state-of-the-art cereal facility that would be known as Project 2000, or P2000 as we refer to it here in London. The project was presented as a leap from the traditional cog-and-pulley technology that was in place at the time to a futuristic automated production system that would bring, among other things, a stable scheduling practice that would marginalize the need for forcing, job ownership and job security through better business.
By 1985 it became painfully apparent that our P2000 plant expansion had some significant oversights in developing our technology. There was a real concern by both parties that if we did not get Project 2000 up and flying -- it was referred to as the white elephant or the albatross by some senior officials -- if we did not get it to full production we would be in jeopardy of having the plug pulled on the whole project, and there was some real concern about the long-term viability of the facility at all.
In 1987 the company applied for and obtained an additional permit under subsection 20(2) of the Employment Standards Act. This additional permit permitted the company to exceed the scope of the subsection 20(1) permit. By this point in time, the forcing of employees to work overtime to support the operation had completely gotten out of hand. It had become a common occurrence for the company to default to compulsory overtime, which it believed it had the right to institute, to support the business objectives of the day.
However, before the company utilized the subsection 20(2) permit, it consulted with the union and obtained the union's support. The support was obtained in large measure because the company agreed to ask individual union members whether they were prepared to agree to work overtime. Those who agreed, by signing the form, could then work additional overtime for which the company could ask pursuant to its subsection 20(2) permit.
However, it quickly became apparent that the issuing of the subsection 20(2) permit was not a solution and did little to alleviate the instances of forcing employees to work overtime in general. If anything, the additional permit only allowed the company to short-staff and maintain increasing plant production goals that were captured through scheduling excessive overtime requirements.
The resulting undue stress took its toll on marriages, families, personal relationships and in an increased incidence of substance abuse. A case in point -- and there are many of them from this point in time -- is that on the weekend of June 11, 1988, we had a member who was scheduled to work, against his protest, the Saturday of his wedding. No one really ever expected this fellow to show up, but through the attendance control process we have he was going to be considered AWOL all the same.
Our absenteeism rate was out of control. Employees who were forced to work extra shifts on weekends often would take time off during the week, which in turn would jeopardize the production and create a vacancy which was, more often than not, filled by forcing again. It was a catch-22.
In 1988, our plant morale was at an all-time low. Members were frustrated and exhausted and had had enough. We experienced our first strike in our 50-year history as a labour union. Subsequent to that, union-management labour relationships became rigid and reactionary with little trust or good faith between the parties. The company held tightly to the notion that it had to have the flexibility and security that compulsory overtime provided to meet the business opportunities of the future. As well, it was professed by the company that the new technology now in place, with the associated support training, would eventually reduce the need for excessive overtime.
The reality was quite the reverse. There was continual pressure to drive the business to offset the considerable capital investment in the project. The complexity of the new technology and operation in our facility required far more intensive support training than originally envisioned. Quite simply, it's never-ending and it's perpetual today.
Throughout all the union-management scheduling initiatives and all the joint task force debriefings, forcing of excess hours continued unabated. Every occurrence was explained away as the result of one unforeseen business pressure or another that necessitated the forcing to take place.
In the fall of 1989, the union began what turned out be an arduous process through Mr Mulligan of the employment standards branch of the Ministry of Labour. It was our intent to wrestle from the company both the subsections 20(1) and 20(2) excess-hours permits. We intended through this process to compel the company to sit down and work jointly with the union towards alternatives to the working conditions as they related to forced overtime.
Initially, we were successful in establishing limited restrictions on forced overtime through joint discussions. The parties initiated and developed a "weekend worker" concept that enabled a limited number of employees to work Saturday and Sunday only. This, in itself, would ultimately fulfil the staffing requirements and flexibility needs for a seven-day-a-week operation. As well, we jointly developed the concept of "banked overtime," which allowed employees who volunteered to work overtime to take banked paid time off work at a more convenient time later on.
On December 20, 1990, the parties sat before arbitrator Maureen Saltman to bring to conclusion the precise scope of the contractual language that pertained to the company's ability to force employees to work excess hours. I've enclosed a document there. The decision of the arbitrator, as it pertained to the Employment Standards Act, ultimately compelled the parties to jointly work towards the total elimination of forced overtime by the 1991 negotiations.
Today, we are the envy of our US counterparts, which by the way still work under forced overtime; I should say "struggle" under forced overtime. Our facility has been recognized for numerous achievements from production volumes to exceptional safety standards. We operate seven days per week without forced overtime. Plant absenteeism and lost time are at an all-time low and below the national average. The weekend worker crew has afforded the company the needed flexibility in scheduling production requirements. We continue to work jointly on numerous plant initiatives that are showing tangible results. What would have been considered unthinkable in 1989 has become the norm today. We are very proud of what we have achieved.
We have by no means a perfect working environment, but it's a far cry from what it could have been if we had not had the assistance and safeguards established under the Employment Standards Act. We have managed to set right, for the success of everyone, the deteriorating situation we were unsuccessful in correcting through successive contract negotiations.
In conclusion, subsection 64.5(1) of the act, Bill 49, will effectively dismantle the enforcement authority of the Ministry of Labour that, in our example, helped to turn around a deteriorating situation we alone were unable to. Far too much of the burden and associated cost of policing and enforcement will be saddled on the backs of labour. We're a small union, as unions go. We can't afford this.
There also seems to be some mystique that puts too much reliance on the negotiations process and far too little consideration on the inherent inequalities of the bargaining powers of the parties. I cannot stress enough the importance of standards and the importance of the ministry and its authority to uphold and maintain those standards. In our example, regardless of the process we had to undertake to ensure our rights in the Employment Standards Act, we were assured as citizens of this province, as well as union members, of the same protection through the Employment Standards Act. The act as proposed in 64.5(2) creates two different systems of protection: those that are associated with unions, and everybody else. It's wrong; it's fundamentally wrong.
At its heart, this bill will not promote or foster good labour relations practices. The whole tone of subsections 64.5(1) through (5) has mean-spirited implications to it. As with the grievance procedure that this act will promote, it will by default increase a confrontational environment in the workplace. Leaders in industry, as does Kellogg, recognize the significant role and contribution healthy labour relations play in our ability to compete on a world market -- and we do compete on a world market.
I'm deeply concerned by the long-term impact this legislation will have in impeding the conciliatory environment we have jointly cultivated, along with our business success at Kellogg. You cannot have one without the other.
Finally, one last point that I picked up this morning when I was looking over the bill. I'm puzzled by two phrases -- one phrase, actually, that's in two different spots -- in 64.5(2) and (4), that to the best of my knowledge don't appear anywhere else in the Employment Standards Act. It's a new quote: "including an employee who is not a member of the trade union." They're speaking about the obligation to represent. I couldn't for the life of me imagine how that would ever apply in environments like ours unless we were representing some of the salaried staff. I'm bothered by where we're going with this.
The Chair: That leaves us two minutes for questioning per caucus. We'll start with the government members.
Mrs Barbara Fisher (Bruce): Just as a point of interest, could you please give us some idea of the number of employees in the London division?
Mr Blaney: As I stated, there are 569 hourly employees.
Mrs Fisher: Of those, given your experience of coming through to a happy end because of negotiation, during the course of that time, could you speculate, even, how many employees would have left this place of employment because of the condition that you were talking about?
Mr Blaney: With this expansion, we certainly went through a number of people who retired. If anything, other than through attrition, people weren't leaving.
Mrs Fisher: The reason I'm asking that question is, one of the things you don't mention that has been sort of a highlight, if you will, of the hearings to date is this issue of, once a person leaves, perhaps leaving in fear of other reprisals in the event they come forward with their concerns, we often find that perhaps the person is owed money. Collection is an issue that has been high on the agenda from other participating parties to date. Of those who left voluntarily, would you remember if you were part of the process in making sure those people were paid for any lost wages or outstanding vacation pay or those types of things?
Mr Blaney: As I started to say, Kellogg has been in London a long time. It's a reputable company. I couldn't ever imagine having that situation even arise.
The Chair: That's the time for the government side.
Mr Hoy: Thank you for your presentation. I can understand the fluctuation of the work that might occur at Kellogg, having been a farmer. During the period that you were having this extended overtime for many of your workers, was there any new hiring taking place?
Mr Blaney: There was hiring. Because of the expansion, what was initially considered or envisioned as -- the phrase was a "turnkey operation" that would require far fewer people than were working there at the time. It was very manually intensive originally. It was considered that the population would probably drop -- I'm trying to recall -- probably 25%, but as it turned out, with technology you also need expertise and we were hiring highly skilled people at that time.
Mr Hoy: So there was some hiring, but yet you still had overtime problems.
Mr Blaney: We had a certain number of people who were retiring simply because the window of opportunity was right for them, maybe because of their age, they didn't want to take on the challenge of the new project. It was very sophisticated.
Mr Hoy: The company in question, is it involved in ISO 9000 or any other like program?
Mr Blaney: No, to the best of my knowledge they're not.
Mr Hoy: They're not.
Mr Blaney: They're aware of it; we've discussed it, but no, they're not.
Mr Hoy: Notwithstanding the fact that they're not involved in that, the quality at the plant was maintained, and the quality of the product, probably to their benefit if the answer was yes, even though workers were asked to maybe endure some hardships?
Mr Blaney: I guess you could appreciate, in the food industry, quality is an ongoing issue and it was certainly an issue by the union and the company through this time. A lot of things fall by the wayside. Quality is one of them that has always been monitored and, as I said, is perpetual. There were concerns.
Mr Hoy: Thank you for your presentation.
Mr Christopherson: Thank you, Mr Blaney, for a very helpful presentation.
On page 4 you talk about the fact that -- this is the second-last paragraph on the page -- "The company was holding tight to the notion that it had to have the flexibility and security that compulsory overtime provided." We know that although it's been withdrawn at this time, it's still alive and well to be resurrected later, the notion of being able to contract out of minimum rights.
Then, I jotted down when you said that you're a smaller union and you can't afford this, meaning if you got into that kind of struggle without that protection underneath -- I'd just like to explore that a bit in terms of what you think would happen to either you and your members or a similar situation anywhere in Ontario where that right was now legally available to companies, and what would happen in a case where they start putting on the table serious concessions, not just to the better benefits that you have, but those fundamental rights that are now in the Employment Standards Act, and decided to take you all the way, including a strike, including using scabs, and were going to go for broke. What kind of situation would that put you or maybe a similar union in, if that became the law of the land?
Mr Blaney: Of course, initially, our fears would be that they would financially break us and that is our concern now. Ultimately, I am sure and I can see if legislation like this is pushed forward, you're going to see the positions polarized even more than they tend to be, you're going to see amalgamations of smaller organizations with larger ones and then you are going to have a very polarized work setting. As I said, with the mean-spiritedness that I read that underlies a lot of this act, you're going to have something that is not in the best interests of business and it's not in the best interests of labour.
Mr Christopherson: Is there going to be a lot of confrontation, do you think; lead to confrontation, possibly violence, create real serious problems?
Mr Blaney: It certainly is and we were very close to that in the heyday of this, mainly before we used the act to try and get some semblance of order of what was going on. The company truly believed at the time that it could not survive and there was lots of discussion going on about how irresponsible it was that the union would be trying to destroy this company. The contrary was true. We were trying to work with the company to make sure we could be successful. We recognize what's happening in the world, what's happening in the food industry with free trade and NAFTA, how we sit in North America as an organization, internally as well as externally, and we've thrived based on that.
The Chair: Thank you, Mr Blaney, for coming before us here today. We appreciate it.
LONDON AND DISTRICT CONSTRUCTION ASSOCIATION
The Chair: That takes us to our next group, the London and District Construction Association. Good morning. We have 20 minutes, as you probably heard me say to the last presenter, for you to divide as you see fit between presentation time or question-and-answer period.
Mr Jerry Fassaert: My name is Jerry Fassaert. I'm representing the London and District Construction Association. I'd like to thank you for this opportunity of speaking to the committee this morning.
As I'm sure you're aware, the construction industry has a number of exemptions to parts of the Employment Standards Act relating to hours of work, overtime, termination and severance. I note that Bill 49 addresses mostly administrative changes to the act, and further, that there will be a complete review of the act in the fall. However, it is our impression that all aspects of the act may be reviewed and discussed at this committee, and to that we propose to address the following:
(a) Exemptions for the construction industry found in regulation 327 affecting section 57, part IV and part VI; and
(b) part XIV, subsections 58(2), (3), (4) and clause (6)(e) regarding termination and severance.
The construction industry is unique and different from most static production-oriented industries such as automotive and mining. Our industry employs persons for relatively short periods of time on a particular site or project. When the project is completed or the work available for that particular trade is completed, then employment on that site is terminated. The employee may be laid off or transferred to another site to begin again. Parts of our industry are also seasonal. Although building construction is becoming less and less dependent on the weather due to technology, the part of the industry affecting roadbuilding and sewer and watermain construction is still seasonal to a high degree. Because of this uniqueness in this area of the industry, previous governments have provided exemptions to the act which are required by the industry to remain productive and competitive.
In regulation 327 of the act, you'll note that clause 2(e) exempts the construction industry from section 57 of the act referring to termination and layoff. Regulation 327, clause 4(d), exempts construction from part IV of the act referring to hours of work. Regulation 327, section 15, goes further and extends the hours of work for roadbuilding to 55 hours per week and regulation 327, subsection 16(3), provides up to 50 hours of work per week for the sewer and watermain portion of the industry.
These three exemptions are extremely important to the industry. Due to its structure, normal termination and severance provisions do not work for either the employees or the employer. Due to the seasonal aspect of roadbuilding and sewer and watermain work, it is essential that the exemptions of these areas are continued.
Therefore, we request the continuance of the exemptions for construction as described in regulation 327. We further request that the sewer and watermain industry have the ability to work up to 55 hours per week, the same as the roadbuilding sector. In many cases, these industries work hand in glove and side by side. Fifty-five hours is a minimum requirement for both. This would require a change to regulation 327, subsection 16(3), to indicate 55 hours versus 50 hours.
Our other concern lies in part XIV of the act, specifically subsections 58(2), (3), (4) and clause (6)(e). I've enclosed appendix A, which describes those areas. As I have mentioned, the construction industry is exempt from the termination and severance portions of the act. There have been instances, however, where the construction employees working in fabrication shops have been treated differently from the regular construction employees who may be working on a site. The confusion arises through clause 58(6)(e), which is an exemption for construction employees where same work "at the site thereof." Those employees working at fabrication may or may not work at a site. However, their employment is necessitated by the existence of the project or site. They are equally paid and in many cases are working under the same collective agreements as the outside personnel. However, they are being treated by the enforcement bodies as manufacturing employees, when in fact they are construction employees.
We request that the language in clause 58(6)(e) be altered to reflect the true construction nature of these shop employees.
In summary, we look forward to the proposed complete review of the act in the fall, and again I thank you for the opportunity to bring our concerns to your attention.
The Vice-Chair (Mrs Barbara Fisher): Thank you very much for your presentation. We have just under five minutes per caucus, starting with the official opposition.
Mr Dwight Duncan (Windsor-Walkerville): Thank you for your presentation. You haven't addressed any of the specific amendments that are in Bill 49, but you have raised the question about -- would you have thought it would have been better to have done this all at once, the review of the Employment Standards Act, the entire act? Because it's difficult even to address the concerns you've raised. We haven't had a chance to look at them. We'll certainly keep them in mind as the government proceeds with its discussion paper and eventually with legislation. Do you think it would have been a better project to have done this all at once?
Mr Fassaert: I don't think there's a problem with doing it in this fashion. It gives us a chance to express our concerns now and then there'll be a further review in the fall.
Mr Duncan: You like the notion of having the opportunity to present your views before legislation is drafted?
Mr Fassaert: Yes. I think it gives you an idea of what is going on out there.
Mr Christopherson: Like my colleague from the Liberal caucus, I don't have a lot to comment on, given that it's a fairly focused and specific presentation, and it is the first time this has been raised.
I would be curious -- and I do not at this point know the answer -- should this become a full-blown issue, whether or not it's likely in your opinion that the unions that represent many of your employees would have a different point of view on what you are suggesting, or is this one of those areas where there's a common front and a common interest?
Mr Fassaert: Certainly, I think the union representation would have a different focus. I'm not so sure if the membership would agree with that. Mainly I'm talking about the 55 and 50 hours. There's always a movement afoot in negotiations to reduce the number of hours of work. The reality is, the men now are not working 55 hours, they're working 50 hours, and I'm sure that the ability to work 55 hours would be there and the men would benefit from that, if it was there. Now, the way the construction industry is going, there certainly isn't any room to pay overtime, so the men are working 50 hours only and I think they would appreciate that ability to work those extra five hours. It boils down to an extra hour a day and certainly a lot can be accomplished in that hour.
Mr Christopherson: Are there any women in the industry?
Mr Fassaert: There are -- some. Not a great deal, but all the unions have some women membership.
Mr Christopherson: Then I guess, based on what you've said, it's fair to say that it's likely there would be an equally balanced perspective that would be different than yours on this issue, and if the government decides this will be part of what they look at, in fairness, they the government will need to ensure that both sides of this particular point of view are thoroughly heard and discussed?
Mr Fassaert: I would agree with that.
Mr John O'Toole (Durham East): Thank you very much for your presentation. I just think the freshness of what you've told us this morning, the newness of it is important. It's important because it shows that indeed each sector, as the world of work itself is changing, has unique and specific needs; that sector being the home worker, that sector being the telecommunications worker or indeed the construction worker; each sector has unique and specific circumstances for their working conditions.
We've heard the rhetoric these last few days of hearings, starting on Monday. Gord Wilson addressed this as the big, bad business bill. We think that in fact this bill is an attempt to address those workplace changes that are so essential to be competitive. My question to you, representing the London and District Construction Association, are you prepared to work with the union leadership in this changing world of work and make those adjustments and changes that suit the needs of both the employer and the employee?
Mr Fassaert: I feel that in London there's a very good relationship between management and the unions and I find that the unions certainly have their membership's best interests at heart but are always willing to look at a situation that will improve the competitive nature of the companies that they represent also.
Mr O'Toole: If I refer to a couple of sections here -- and I may even refer to the previous presenter -- where the workplace participants, that is, the leadership and management and union, worked out their differences, they may need mediators or facilitators or arbitrators to do that. If I look at the exemptions that currently exist, which are exemptions that have evolved specifically to recognize the unique nature and needs of the construction industry, they have been developed by some similar process --
Mr Fassaert: That's correct.
Mr O'Toole: -- amendments to the legislation. I think it is negative, listening here to the presenters, that no change -- the status quo -- is acceptable. I think that's Ludditism or putting your head in the sand. The world of work is changing, would you agree?
Mr Fassaert: I do.
Mr O'Toole: The technology is changing, and the act has to be changed to respond to those changing realities.
I appreciate your sector bringing this to our attention. As you've said, part 2 of the hearings is a fuller, broader discussion and more of the meat of the issue than some of the administrative things we're trying to do here to expedite protection for the most vulnerable workers.
The Vice-Chair: The parliamentary assistant would like to speak. There are two minutes left in our time.
Mr John R. Baird (Nepean): Thank you very much for your presentation. I appreciate it.
I just want to put something on the record from yesterday, not involving your presentation though. It was a comment with respect to workers having access to the employment standards office in Kitchener, and I was given a number by a worker that they had trouble getting through to. I was able to reach the employment standards office there. Regrettably, it was the wrong number they had been given. In the phone book the correct number was indicated, but that's something we will certainly take back, to try to see if we can't go even beyond the call of duty to communicate clearly where people can phone for help.
The Vice-Chair: Thank you very much for your presentation this morning.
The Vice-Chair: I would ask the representative from Life*Spin to come forward, please. Good morning and welcome to our hearing process. I'd ask you please for the sake of Hansard to identify yourself and the group you represent.
Mr Andrew Bolter: My name is Andrew Bolter and I represent an organization called Life*Spin. I am director of community development programs at Life*Spin.
I'll give you some background of the organization so you can see the perspective from which we come. Life*Spin stands for Low Income Family Empowerment*Sole-Support Parents Information Network. It's a community-based, non-profit organization which provides information about access to services and meaningful employment for low-income people.
We assist our clients in their dealings with government social service agencies and we aim to gain access to and share and promote the exchange of knowledge of social and community services that are available for individuals and families.
We're committed to creating an environment of trust, respect and self-empowerment within ourselves and our community. We treat all of our clients with respect, dignity and appropriate concern.
We're a front-line organization dealing directly with people who are poor, both the working poor whose numbers seem to us to be increasing and those who find themselves on social assistance. On a daily basis, we deal with fellow Londoners who are finding it impossible to find appropriate shelter, food, clothing, work, and cannot pay their hydro, gas or phone bills, if they can manage to get a phone in the first place. Our clients are people who are in a constant struggle to maintain the basic and fundamental necessities of life.
We are also actively engaged in supporting and assisting community development projects that will tap into the resources and talents of those in the low-income community who cannot utilize their talents, skills and energy because of a lack of opportunity and access to capital to start community-based businesses.
We believe that healthy communities need a truly local economy so that everyone in the community benefits. We believe that the fundamental economic problems in our society are caused by the increased concentration of wealth and not by the poor who seem to have become the scapegoats in this government's agenda.
It's interesting to note that many of our clients are referred directly to us from the constituency offices of local MPPs: Dianne Cunningham, Bob Wood, Bruce Smith and Marion Boyd. The Life*Spin phone number is also provided by the city of London to general welfare applicants during the application process. We see this as an endorsement of our organization by the province and the city of London, and we trust the government funding on which we have relied will continue to come to us so that we continue to assist the constituency offices and the constituents of our local MPPs and help empower the economically disadvantaged in our community.
From our front-line perspective, we see that things are getting worse for the poor in this province. There are more food banks right now than McDonald's restaurants. There are more children living in shelters in Toronto than single males. People are hurting as a direct result of the policies, choices and actions of the Ontario government, not only through the cuts to welfare but also other changes that have a huge and disproportionate impact on the poor and the most disadvantaged. We are seeing changes to workers' compensation, legal aid, the Landlord and Tenant Act -- and rent review is on the table -- removal of subsidies for public transit, deregulation of environmental standards, and today we are here dealing with the Employment Standards Act.
The proposed changes to the Employment Standards Act, on top of these other changes to programs and government services, are going to compound the detrimental impact of recent government actions on the poor. After reviewing the proposed changes to the employment standards legislation, we are at a loss to understand how anyone could imagine that anyone other than the employer is going to benefit from them. Perhaps the Employment Standards Improvement Act should be renamed the Employment Standards Removal Act. This would be a more honest title.
We also do not understand why, if the government is going to review the act and make what are described as comprehensive changes to it in the fall, these housekeeping measures are going ahead. If the government is inviting input into the process for what it terms housekeeping changes, then I trust we will be able to have further input into the hearings on the proposed comprehensive changes.
The fact is, the proposed changes we are addressing today are more than housekeeping; they are fundamental changes. To describe them as housekeeping is misleading. Surely the raison d'être of employment standards is to provide a basic level of expectation in terms of health and safety, minimum wages, maximum hours of work, overtime pay, public holidays, vacations, pregnancy and parental leave, equal pay for equal work, termination notice, severance pay and adjustment measures for pay by employees and employers as to minimum treatment of employees. This protects employees from employers who seek to take advantage of them.
If anything, the employment standards in Ontario have been low compared to the rest of the world. I don't know why we always have to compare ourselves with the US. In many European countries, for instance, there is a minimum annual vacation period of four weeks, and much more protection for employees generally.
I read in yesterday's paper -- actually it was the day before yesterday -- that the government is backing away from making employment standards negotiable under the collective bargaining process; at least it's doing so during this phase of the proposed changes. It would appear that it will be back on the table in the comprehensive round. The whole concept of negotiating employment standards in each workplace can only benefit the employer. The employer is in a position of power. This is especially so when people are desperate for work and especially so in non-unionized situations.
Simply put, employers have the power to hire and fire. The rise of unionism and collective bargaining was a direct result of employees organizing themselves in an attempt to address this imbalance of power and obtain fairly basic standards of employment. Collective bargaining has historically done much to raise the working conditions of unionized and non-unionized employees.
The existing Employment Standards Act provides a modest, minimum level of treatment of employees by business. The courts have interpreted these amounts as minimums and have often awarded much greater monetary amounts than those dictated in the act, especially in the areas of wrongful dismissal and severance. But the existing act has many problems. Much of this is due to a lack of enforcement. Much of the money owed to employees by employers remains unpaid. It takes a long time for an employee to recover moneys owed. However, despite these problems, the act does provide basic standards that all employers must meet.
A critique of some of the proposed changes to the act: I'll start with the maximum and the minimum levels of claim.
There's a $10,000 cap on claims. We disagree with any cap on permissible recoveries of money by an employee. Such a cap will only benefit employers. Even among low-income sectors -- domestic workers or garment workers, for example -- there can be claims in excess of this amount. Why should an employer who steals more than $10,000 from their employees be let off? There is no logic to this. It goes against fundamental concepts of justice and the concept of damages in law.
There should be no limit to the amount claimed. The argument that employees who have claims over $10,000 or under a prescribed minimum can simply take the matter to court won't work. Firstly, who can afford to retain a lawyer and go to court? Certainly a low-income employee cannot. Legal aid will not cover employment law. A low-income employee will be forced basically to forgo their legal rights. It takes years to bring an action to trial in the civil courts of this province. Small Claims Courts will be tied up with litigation on any claims below the prescribed minimum.
Low-income employees will have no choice but to use the mechanisms available in the Employment Standards Act in order to protect themselves. The court is not an option. It is astonishing to us that this government can claim that the changes to the act will promote self-reliance. How can you be self-reliant when you have no access to justice and no means of asserting your rights?
It's interesting to note that while the maximum of $10,000 is intended to be embedded in the act, which makes amendment more cumbersome, any minimums are going to be in the regulations, making it much easier for a government to simply make changes. Perhaps the rationale for this is that it would be easier for the minimums to be gradually increased to take more cases away from the responsibility of the ministry.
Limitation periods are being changed as well, with the proposed changes to them. Bill 49 proposes a six-month period during which a worker can make a complaint for any infraction by the employer of employment standards. Any investigation by the ministry will only go back six months. Money cannot be recovered if it became owing to an employee more than six months before the facts upon which the proceeding or prosecution was first based. This means an employer can breach the standards with impunity, knowing full well that they will be liable only for six months of infractions. The existing two-year complaint period is in line with most civil limitation periods, but these generally start to run when the plaintiff ought to have known the case they have.
Retention of a two-year limitation period is essential, given that while employed there is a huge disincentive to make a complaint against an employer. In the real workplace, employees who make complaints have no protection from the employer against harassment and retribution, so they wait until they have another job or are laid off before they complain. Non-unionized, low-income workers are particularly vulnerable because typically the poor live from paycheque to paycheque and, as stated already, they cannot afford to take their employers to court. Furthermore, as employers are required to keep detailed employment records, it would be relatively easy to work out exactly how much the employee had been ripped off. The limitation period should not be changed to six months.
The provision giving the ministry two years to conduct its investigation and another two years to collect the moneys owing is bizarre. An employee could conceivably wait four years before receiving money that is rightfully theirs. Where is the administrative efficiency in this?
Now I'm going to talk about negotiation of employment standards, because that I think is on the agenda, at least long term.
It is our view that the provision for negotiation of employment standards is based on a misconceived notion that somehow, in order to compete in the so-called global economy, we have to provide a cheap labour pool. The statement by this government that "Ontario is open for business" says it all. "Open for business" means making political choices based on reducing the cost of doing business, thereby maximizing the profits of those corporations and businesses that choose to do business here. It has nothing to do with making our society more just, building communities from within, or ensuring that everyone has a reasonable home, food on the table and a sustainable, decent job.
In a situation where an individual is faced with a choice of work or no work, they are likely to accept working conditions and standards far below what is healthy and fair. Hungry people tend to focus on providing the next meal for themselves and their dependants rather than whether the plant they work in is safe or their health is suffering because of required long hours of employment.
This government has it backwards. We should start with the individual and the community and say, "What kinds of businesses will benefit us, give us a healthy and inclusive society in which everyone benefits from the economy?" That is the way this country developed and grew. Instead, governments are competing with each other in a frenzy of cutting and reducing, downsizing and deregulating so that the transnational corporate moneys that whisk around the globe -- and there's a lot of money -- from bank to bank flow through their own banks. Our provincial government seems to have bought into this frenzy. It's as if there's no debate: We have a global economy, globalization is a fact, and we have to do what other countries are doing. I think that's ridiculous. It closes the debate. The debate should remain open. It's very Chomskyist.
At Life*Spin, we see people caught up by these forces and feeling frightened, out of control and helpless before them. We don't see any signs of hope and opportunity. There are few jobs. Our clients join the ranks of people applying for the few jobs that come available in London. Governments are saying that it's the pressure of the new global market; their hands are tied; we have no choice.
Dignified work can provide dignity, but undignified work cannot. We need clear, non-negotiable minimum employment standards to protect the most vulnerable to prevent any erosion of our already very mediocre employment standards. We must also remember that rights are hollow if they are not enforceable. We have to be able to protect employees who assert their rights against employers who seek to take advantage of them.
We strongly oppose this government's efforts to lower employment standards. Instead the government should focus on ensuring that employers pay the money they owe to workers rather than giving unscrupulous employers the incentive to cheat.
This committee should recommend that Bill 49 be scrapped.
Mr Christopherson: Thank you, Mr Bolter, for an excellent presentation. I'm particularly moved by your reference to the Employment Standards Removal Act. I think that's a great phrase; quite accurate too.
I would also point out to you, when you say that after reviewing the proposed changes to the ESA legislation you're at a loss to understand how anyone could imagine that anyone other than the employer is going to benefit from them, it's interesting that every single chamber of commerce from every community has come in and defended the fact that they don't think there's any loss here to workers, that this maintains the standards that are there.
My question, though, to be specific, is to ask you to comment just a little bit more, because I'm seeing this more and more as a crucial part of this issue: You say on page 10 at the bottom that retention of a two-year limitation is essential given there is a huge disincentive to make a complaint against an employer. "In the real workplace, employees who make complaints have no protection," you go on to say, against employer harassment and retribution. We had a representative from the Kitchener-Waterloo chamber of commerce yesterday say that what this change will do is prevent an employee from "sitting on his can and mulling it over," as if to suggest that somehow there was some game-playing on the part of employees. Would you just expand on why you think this clause is so crucial, especially for the most vulnerable workers?
Mr Bolter: I'm not sure whether that gentleman in the chamber of commerce has ever been an employee of someone else or what kind of background he had in the workforce, but my only comment is that I think, whatever business you're in, if an employee makes a complaint against an employer, human nature being what it is, there's going to be a potential of a breakdown of relationship. Any complaint made under this act is going to be basically a complaint that, "You're ripping me off." People don't like to hear that.
The act, from what I can see, will not provide any protection for an employee who does that. Unless there's some kind of setup in which there are teeth in an enforcement mechanism that will enable an employee to say, "Well, I am being harassed," it's not going to work.
Mr O'Toole: Thank you very much, Andrew, for a very sensitive presentation and appeal this morning. You do justice to the people you're attempting to represent. Just asking a little background, how long have you been in existence?
Mr Bolter: It's been, I believe, five years.
Mr O'Toole: Five years; about the same the NDP were elected. Would you agree that the last five to 10 years have really seen a lot of difficulty? The economy, and I'm not blaming anyone, for a variety of reasons -- well, perhaps you could explain to me: Why has the economy in the last five to 10 years really been in a downward spiral? Is it a world phenomenon? Could you respond to that?
Mr Bolter: I think I'd have to take about 12 hours to answer that question.
Mr O'Toole: Just quick -- you know, we haven't got all day.
Mr Duncan: Mulroney.
Mr Derwyn Shea (High Park-Swansea): Trudeau.
Mr Bolter: I would say it's choices made --
Mr O'Toole: Shouldn't we do something?
Mr Bolter: -- by governments.
Mr O'Toole: Exactly right.
Mr Bolter: This government should pay attention to that.
Mr O'Toole: I think so. As we start our first year of mandate under way, I think you're right to say that we do want people to have jobs and dignity. When I look back to the travesty, and I have five children, the future has been diminished; the future has been spent for them. We've doubled the debt. We paid better benefits than any other province. Did it solve the problem? No. You told us this morning there are more McDonald's, and it's in the last five years. What we're trying to do is change that.
I want you to focus on one part, the limitation period. The realisty is that you can't claim --
The Vice-Chair: Excuse me, Mr O'Toole. I'm sorry; your time has expired. Mr Duncan or a member of the official opposition, please.
Mr Duncan: Do you think taking away workers' rights and hurting the vulnerable is going to make society any better?
Mr Bolter: No.
Mr Duncan: Do you think that the response we've heard from this government is going to solve the problems that the working poor and, more importantly, those who aren't working have?
Mr Bolter: No. I think they're increasing the problems.
Mr Duncan: Do you think we ought to put the rhetoric about what's happened in the last five to 10 years aside and start working together to find solutions for people who have problems in this society?
Mr Bolter: Yes. I think we should stop blaming each other and just get on with it.
Mr Duncan: That's really a good point. You know, the chamber of commerce -- the chambers in different communities have come and said, "Look, we do have to work together here," and a number of union representatives yesterday said that this government's poisoning collective bargaining in this province and poisoning those relationships in the labour markets which we need to be competitive and efficient. Do you think this type of change is going to help make labour relations and the investment climate better in Ontario or do you think it's going to harm the investment climate?
Mr Bolter: I think it's got a potential of creating diversity between unions and management because the collective bargaining process, if it's used for standards, is going to basically open the door to a lot more strikes and more disagreement. You need a clear minimum standard from which you can work.
The Vice-Chair: Thank you, Mr Bolter, for coming forward this morning.
ALL CANADA COLLECT
The Vice-Chair: I would ask that the representative from All Canada Collect come forward, please. Good morning. For the sake of Hansard, I would ask you to introduce yourself.
Mr Gerry Coffin: Thank you very much. My name is Gerry Coffin and my presentation is basically very focused because it is really dealing with one issue, and that is the issue with respect to accounts receivable being turned over to private collection agencies.
I'm here to talk about a specific part of the proposed amendments as they relate to my industry, which is that of the private collection of accounts, and how it will assist the government. I believe that using private collection agencies will solve some of the problems the government is faced with today. You can turn time and effort into more productive and efficient use of existing manpower. Time is money. We're not suggesting the employees are inefficient; we simply say that when it comes to collecting past due accounts we're more efficient due to the fact that we deal with this on a daily basis.
While I'm not a designated spokesman for our industry, I've been an active participant as a collection agency owner for over 25 years and feel that I can speak with a certain amount of firsthand knowledge.
Our industry is one that's very closely regulated by the provincial government. All agencies are bonded, licensed and adhere to strict guidelines, regardless of the size of the agency or the location across the province. Forgive me if I refer to my own company, which is the Associated Credit Bureaus of Ontario. It is simply because I'm more familiar with the policies and the procedures of this group and I play a key part in the decisions and the quality of the service that we as a group of approximately 25 privately owned agencies provide to local businesses in every part of the province.
Collecting accounts is all we do. Generally speaking, there's nothing more inefficient than someone doing something that they're not trained to do or, worse still, having someone do something that they really don't feel comfortable doing. Collecting accounts -- if you don't feel comfortable doing this sort of thing, it really is not very efficient. We surround ourselves with people who are licensed and trained to deal with debtors. They're trained in the techniques of negotiating and finalizing matters as quickly as possible. They're trained to ask for and receive payment in full of all accounts.
Just allow me to list a few reasons why we are successful in our collection efforts.
First of all, there is the psychological effect of the third party being involved; second is the consistent and regular follow-up to ensure continuity; third, knowledge of court rules and procedures as they pertain to collection matters; fourth, ability to negotiate settlements; and fifth, technology to locate assets and realize on same to satisfy any judgements.
Please allow me to address the proposed provisions, specifically subsection 73.0.2(2), which states:
"The director may authorize the collector to collect a reasonable fee or reasonable disbursements or both from each person from whom the collector seeks to collect...the director may impose conditions on the authorization and may determine what constitutes a reasonable fee and reasonable disbursements."
The simple answer to my concern appears to be dealt with in subsection (4) of the same section, which states:
"Clauses 22(a) and (c) of the Collection Agencies Act do not apply with respect to fees authorized under subsection (2)."
My concern is simply this: Section 22 of the Collection Agencies Act states that, "No collection agency or collector shall,
"(a) collect or attempt to collect for a person for whom it acts any money in addition to the amount owing by the debtor;
"(c) receive or make an agreement for the additional payment of any money by a debtor of a creditor for whom the collection agency acts, either on its own account or for the creditor and whether as a charge, cost, expense or otherwise...."
I'd like to share my understanding of the spirit of section 73.0.2 that's before this matter today. In most cases, as we understand it, a portion of the amount outstanding will be trust moneys owed to an employee. The normal practice for a collection agency is to take an account, collect the account, keep an agreed percentage and return the net amount to the client. In this case the client will be the Ministry of Labour, which is in fact assigning a trust receivable. Naturally they would want him or her to receive the full amount.
My concern essentially is this: The two acts are in a possible conflict.
I have made legal consultation and am advised that if this section is passed in its present form, fees may be added. However, he quickly goes on to state that at any time there's any ambiguity in law between acts, the act with restrictions or imperative rights on any individual will prevail.
As a licensed collection agency, we must be aware of detrimental consequences that could arise out of obvious violations. I would therefore request that section 73.0.2 be fine-tuned to simply add, "In all circumstances, the reasonable fee and disbursements, or both, collected from each person from whom the collector seeks to collect shall be deemed to be moneys owing by the debtor and shall not be considered moneys in addition to the amount owing by the debtor."
It is obvious that the intent of the section is to expand the powers of the Collection Agencies Act and to address the problems contained in the act because they have made reference to it in subsection 73.0.2(4). The goal should therefore be to redefine the wording of the act to uncover any difficulties that have to date gone unnoticed.
I would respectfully recommend to this committee that they make the drafting amendments so as to ensure there are no uncertainties in the future. Thank you very much.
The Vice-Chair: I thank you very much. We have just over four minutes per caucus and we'll start this time with the government side and Mr Tascona.
Mr Tascona: Thank you for your presentation. Can you tell me how much training and experience you have in collecting funds?
Mr Coffin: Me personally?
Mr Tascona: Yes.
Mr Coffin: Approximately 35 years.
Mr Tascona: What kind of training did you receive to do that?
Mr Coffin: I worked with two different finance companies for approximately 15 years. We're licensed; we are required to write an exam to hold a collection agency licence. There's no formal training per se. Most of it is on-the-job training.
Mr Tascona: Do you think that experience helps you do a better job?
Mr Coffin: Oh, definitely it does.
Mr Tascona: Why is that?
Mr Coffin: First of all, we're focused. I guess I use the analogy -- quite frequently people will send their salespeople around to pick up their accounts receivable or to collect on their accounts receivable and there always appears to be a conflict. A person is going in and trying to sell a widget but at the same time is asking to pick up the accounts receivable. Collecting accounts is all we do, and I think that that's the main focus.
Mr Tascona: I find that very interesting because I was with the employment standards officers branch, actually in 1985, and at that time all we were responsible for, and up until 1993, I believe, the officers were only responsible for enforcing the act. But in 1993 the previous government disbanded the collections branch and discharged 10 people from their jobs and turned it over to the employment standards officer.
Mr Coffin: That's my understanding. My understanding is now that the employment standards officers do the actual audit, determine the amount of the claim, and then turn right around and have to come back and try to collect it from the company. Again, it's a matter of which is the most important job that gets the most attention. It's my understanding that the officers are relatively busy doing the audits and going out and handling them case by case, that the collection of accounts sort of becomes a secondary issue, and that they're not really being looked after on a regular basis.
Mr Tascona: Would you believe you need training in collections to be able to do it effectively?
Mr Coffin: Yes, because it becomes a matter of knowing the procedures, knowing the court procedures. It's my understanding that if there is an order made against the company, that order can be converted to an automatic judgement against the shareholders and the directors of the company. It's my understanding that that has not been issued, or has never been issued, that there have been no attempts made to collect from the directors of the company.
Again, the collections are only effective if you understand the procedures of the courts and you can locate assets to attempt to collect this matters.
Mr Shea: That's an interesting response. Your view then is that the current method by which government staff are attempting to collect is not particularly efficient.
Mr Coffin: No, it's not.
Mr Shea: That where there's an attempt and a desire on the part of the government to ensure that a dollar owed is a dollar that should be collected completely and returned to the employee, has not been an objective that's been achieved so far.
Mr Coffin: That's my understanding.
Mr Shea: You believe that the private sector could do that more effectively than government.
Mr Coffin: Yes, I do.
Mr Shea: You have to bear with me for a moment because, on the one hand I have the evidence given that we have government employees who have knowledge of the act; on the other hand, I have the argument that the private sector has training and skill; and in the middle I've got companies that by and large don't want to pay anybody and either go bankrupt or don't want to pay anybody and will stonewall. What would lead me to believe that you could be a better job collecting and dealing with those kinds of companies than government employees?
Mr Coffin: Again, it's part of our tactic, if you want to call it that, for collecting. We're perhaps a little tenacious. We continue on against an individual case.
Mr Shea: You would go after the directors and you would apply other systems than currently are being applied right now.
Mr Coffin: Oh, by all means. Again, it's my understanding that a letter goes out and possibly a phone call goes out to the defaulting company, with no follow-up beyond that point. So, again, it becomes a situation of the squeaky wheel getting the grease. If you don't ask someone and don't chase after people, they are not going to pay. So therefore, yes, we would locate the assets of the directors and the owners of these companies and attempt to collect from them.
Mr Duncan: The official opposition sympathizes with what the government is trying to do; that is, find a better way to collect moneys owing. The two concerns that have been raised in the hearings to date are: the notion that many of the people that you try to collect for go out of business or close down and it becomes legally very difficult; the other concern that's been expressed is the notion that a collection agency could negotiate less than 100% of the wages owing. I wonder how you would address that particular concern. Say you won a tender to do collection, how would you address it? At what point would you suggest to an employee or a group of employees that it's better to settle for 50 cents on the dollar versus 100%? Just give a sense of how you would respond to that.
Mr Coffin: It's happening on a daily basis. Our procedure within my office is to simply take an account in, and once we have the account listed, we are allowed to investigate both that company and that individual. It becomes legal, then, to investigate him and find out what assets he has. Upon completion of the investigation, we obviously are going to ask for the full amount at the outset. But in many cases it does become more prudent to collect 60% or 75% of the total amount now than to wait down the road and take it over a period of time. But it's not a decision that's lightly made, to take 60 cents on the dollar or 80 cents on the dollar, whatever it is; it's on an individual case basis.
Mr Duncan: Just to pursue that line of thinking a little bit, at what point would you decide to recommend, say, 60 cents on the dollar versus going after the directors of a company, assuming it's an incorporated organization?
Mr Coffin: If there are assets from a director, we will not recommend taking a settlement on the company just to make it easy on the company. Again, we deal with this on a daily basis. The problem with most accounts receivable with companies is that they do not have personal guarantees, so you have no attachment other than the limited company. If that limited company already owes well in excess of its assets, there's no point.
Mr Duncan: Just another question too, if I can. My understanding is -- and maybe others around the table, perhaps research, can confirm this -- that a large percentage of those wages that do go uncollected would happen in a situation where you have an unincorporated business or a sole proprietorship. How would you be able to deal with that situation as distinct from, say, an employment standards officer, who today would be the one who has to try to enforce collection?
Mr Coffin: I can only go from what my understanding is, that the employment standards people are telling me that they just don't have the time or the wherewithal to be able to determine exactly what that person has. If the person says, "I don't owe any money," or, "I don't have any assets," the employment standards people basically have to say, "That's it," whereas we would put a full-time person on to investigate that.
Mr Duncan: This is perhaps a bit unfair, and I don't mean to be unfair to you. Could you predict on, say, a percentage basis how much more you could collect on average than the existing system? What could your industry, in terms of percentages, do to improve collections: 10% better, 15%, 20%, 30% better?
Mr Coffin: Again, I'm only going from information that I'm receiving. I believe, quite frankly, that the employment standards business -- and I'm using it because there is the hammer of having the director -- I believe that there could be easily a 25% to 30% increase in the collection.
Mr Christopherson: Thank you, Mr Coffin, for your presentation. Let me say at the outset that I certainly have no qualms or difficulties at all with the role that your corporation plays in our society, and I think that you're entitled to do that, and that has no bearing on the approach that I'm going to take. I just wanted to say that for the record.
Having said that, I would ask, first of all, you do consider yourself to be an expert in the field of collections?
Mr Coffin: Yes, I do.
Mr Christopherson: Would you consider most of your employees, if not all, to be experts in the field of collections?
Mr Coffin: At various stages of training, yes.
Mr Christopherson: Right. When they're fully trained, you'd consider them to be experts?
Mr Coffin: Yes.
Mr Christopherson: If you or any of them were suddenly hired by the provincial government and you were no longer a private sector worker or employee but suddenly a public sector employee, would you lose that expertise?
Mr Coffin: I perhaps wouldn't lose that expertise; I might lose some of my motivation, because we work on production.
Mr Christopherson: Are you suggesting that everyone who is in the public sector is not a professional?
Mr Coffin: No, I'm not suggesting that at all.
Mr Christopherson: Okay, because I would suggest to you that professionalism implies the fact that you don't need to be necessarily paid to do a job that's proper, that you are paid for. If there's good, proper motivation for that and moral reasons, then that should be enough; if it isn't, then that's a problem that an individual would have, not the fact that they're a public sector employee. Is that fair?
Mr Coffin: That's fair.
Mr Christopherson: I'd like to move a little then and talk about an ideal situation, where you'd go to an employer, do what you do best, they throw their arms in the air and say, "Uncle," give 100% of the money owed to the employee, and then on top of that is the penalty the employer has to pay, because they have to pay your fees and cover off other costs, and the employee gets all of their money. Would you say that would be the ideal?
Mr Coffin: That's Utopia, yes.
Mr Christopherson: Right. Now, let's say we're into a situation where we're at an 80% settlement. You get the company to offer 80%. You go to the employee and say, "I think this is the best we're going to get," and you use the judgement that Mr Duncan brought out of you that you would use. I would suggest to you that if you did that, the employee is going to lose something, because once you get under 100%, when the employer offers to make a settlement with you, there's two pieces they have to pay: one is the amount that the employee gets, and then they have to pay the money on top of that to cover your fee, which you're rightfully entitled to, and the profit that's built into that.
Do you not think it's fair to say that some of that money could have gone to the employee if it didn't have to go to you, and if that were part of the service the Ministry of Labour provided then the employee would get maybe 85%, 86% or 90% of their money, you would be providing a professional service and the most vulnerable in our society wouldn't be getting the short end of the stick in this deal?
Mr Coffin: But 80% of something is better than 100% of nothing.
Mr Christopherson: I'm not arguing that point. I'm just saying that if you can get 80% and on top of that the employer is going to pay you your rightful fee, with your rightful profit margin built in, if you didn't have that part of it, that would be money the employer would be giving back to the employee, and instead of an 80% deal it's an 85% deal. Is that fair?
Mr Coffin: That's fair.
Mr Christopherson: If that's fair, then you can understand why unions and people who represent the most vulnerable have a great deal of difficulty with moving to privatization of this service, because it's the employee who's going to lose.
Mr Coffin: Again, I can only go by what I am told, that the people who are actually handling it right now do not have the time to do an effective job.
Mr Christopherson: I wouldn't argue that point. If we really wanted to go after this, I'm just suggesting that the government's alternative of privatizing it is not necessarily the only or the best way to go.
Mr Coffin: I can't comment on that.
Mr Christopherson: You didn't write this law; the government did. By the way, I appreciate the forthrightness of your answers, and I'm sure that if ultimately this is the way it goes -- they have a majority -- that you'll do a professional job. But I would submit on behalf of the NDP that this is not the way to go for the most vulnerable employees in our society. This government is giving them short shrift, and that's wrong.
The Vice-Chair: Thank you, Mr Coffin, for making your thoughts known today at the hearing process.
OXFORD REGIONAL LABOUR COUNCIL
The Vice-Chair: I would ask the representatives from the Oxford Regional Labour Council to come forward, please. Good morning, gentlemen.
Mr Broderick Carey: I'm Broderick Carey, president of the Oxford Regional Labour Council. With me today is Wayne Colbran, the financial secretary for the Oxford Regional Labour Council.
In introducing the Bill 49 amendments on May 13, Minister of Labour Elizabeth Witmer claimed she was making housekeeping amendments to the Employment Standards Act. She described the bill as "facilitating administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures." The reality is that this is not minor housekeeping but major Hoover cleaning with suction force equal to a tornado. These changes will make it easier for an employer to cheat their employees and harder for workers to enforce their rights. It strips unionized workers of their historic floor of rights which they have had under the Ontario law for decades.
This submission is made on behalf of the Oxford Regional Labour Council, located in Oxford county. The Oxford Regional Labour Council has been servicing its affiliates and communities since 1955. At present, we have 27 affiliated unions that administer over 50 collective agreements and represent over 8,000 workers and their families. These workers and the businesses they work in represent an average picture of Ontario's manufacturing and service industries. We are employed in everything from mining of lime and gypsum to foundries, auto parts and assembly, transportation, textiles and retail, and as municipal workers, health care deliverers and workers in the agricultural product sector.
The flexible standards section we'll skip over. I understand the government at this point has backed off temporarily from it, but I want to make it very clear we were against that suggestion on May 13, we're against that suggestion on August 22 and we will continue to be against that suggestion of flexible standards in the future. We will not give in to that and we clearly stand in opposition to that.
Turning to page 5, enforcement under a collective agreement: Currently, under the Employment Standards Act unionized employees have access to considerable investigative and enforcement powers of the Ministry of Labour. This inexpensive and relatively expeditious method of proceeding has been proven useful, particularly in situations of workplace closures and with issues such as severance and termination pay.
The Bill 49 changes eliminate recourse by unionized employees to this avenue and instead require all unionized employees to use the grievance procedure under the collective agreement to enforce their legal rights. The unions will bear the burden of investigation, enforcement and their accompanying costs. The director can make an exception and allow a complaint under the act where he thinks it is appropriate, but for all practical purposes the enforcement of public legislation has been privatized.
Should these amendments pass, the collective agreement will have the Employment Standards Act virtually deemed to be included in it. A union will be faced with the potential of claims against it by dissatisfied members. Although the existing duty of fair representation has not in the past been seen as requiring a trade union to represent employees in respect to employment standards, with this amendment change a union can be faced with complaints by members concerning fair representation. This could well mean that a failure of enforcement will be seen by the labour relations board as constituting a breach of the duty of fair representation. Thus, unions will face both additional obligations and liability costs.
Arbitrators will now have jurisdiction and make rulings that were formerly in the purview of an employment standards officer, a referee or an adjudicator. They will not be limited by the maximum or minium amounts of the act. However, arbitrators lack the investigative capacity of the ESOs and may not be able to match the consistency of result the act has had under public enforcement. Most important, employers could argue that as boards of arbitration do not have the critical powers to investigate whether particular activities or schemes were intended to defeat the intent and the purpose of the act and its regulations, such cannot be determined. In such circumstances, unionized employees could well be left with no recourse whatsoever. This is particularly evident in cases of related-employer or successorship provisions of the act. It is difficult to see how such provisions can be applied when the successor or related employer may well not be party to the arbitration proceeding.
Enforcement for non-unionized employees: With these amendments, the Ministry of Labour is proposing to end any enforcement in situations where it considers violations may be resolved by other means; namely, the courts. In other words, the amendments would download responsibility for the enforcement of minimum standards for non-unionized workers. Employees would be forced to choose between making a complaint to the employment standards branch or filing a civil suit in the courts. Responsibility for enforcement is also downloaded on to non-unionized employees by limiting the amount recoverable through employment standards to under $10,000. Currently, there is no limit on what is recoverable. What an employer owes an employee is generally what he has to pay. An employee who files a claim with the Ministry of Labour for severance or termination pay is precluded from beginning a civil action concerning wrongful dismissal or claiming pay in lieu of notice which exceeds the statutory minimum.
The effect of these amendments is that those employees who have chosen the more expeditious and cost-effective path of claiming through the ministry will have to forgo any attempt to obtain additional compensation through the courts. Legal proceedings are notoriously lengthy and prohibitively expensive for many, even though they may be entitled in common law to more than the statutory minimums under the Employment Standards Act.
An employee who seeks to obtain a remedy in excess of $10,000 and who can afford to wait the several years a civil case will take, and at the same time pay a lawyer, will have to forgo the relatively more efficient statutory machinery in respect of even those amounts clearly within the purview of the employment standards officer.
Employees who file a complaint under the act will have only two weeks to decide whether to continue under the act or withdraw their complaint and pursue the civil remedy. Those unaware of their legal rights may well be excluded from commencing a civil action unless they obtain the necessary legal advice within the short, two-week period.
Just as there are the provisions barring civil remedies in section 64.3, there are mirror provisions in section 64.4 precluding any employee who starts a civil action for wrongful dismissal from claiming severance or termination payments under the act. Other provisions are also prohibited under the act once a civil action has started, such as an employer not paying wages owed and failure to comply with successor rights in the contract service sector. Employees who initiate claims but decide they no longer wish to pursue their civil suit don't appear to have even the two-week time limit to change their mind. Rather, they appear to have no right at all to reinstitute a complaint under the act.
Maximum claims: The amendments introduce, as noted above, a new statutory maximum amount that an employee may recover by filing a complaint under the act. This maximum of $10,000 would appear to apply to amounts owing of back wages and other moneys such as vacation pay, severance or termination pay. There are only a few exceptions, such as for orders awarding wages in respect to violations of the pregnancy and parental leave provisions and unlawful reprisals under the act.
The problem with implementing such a cap is that workers are often owed more than $10,000, even in the most poorly paid sectors of the workforce, such as food service, garment workers, domestics and others. Indeed, workers who have been deprived of their wages for lengthy periods of time are the very employees who will not have the means to hire a lawyer and wait the several years it would take before their case is settled. In effect, therefore, this provision will encourage the worst employers to violate the most basic standards, while at the same time compounding problems for those workers with meagre resources.
This $10,000 limit would have penalized an Oxford county worker of some $20,000 more and let the bad boss off the hook. He was a unionized employee who discovered while on layoff that his employer was using another plant with less senior employees doing the work. While he was on layoff, this same employer was bringing in the spouse and children of a supervisor to work in the plant. Even after going through proper procedures and through the employment standards branch and winning his case, this employer still refuses to pay up. This is a unionized environment. Could you imagine what it would be like for the unorganized to try and get it resolved?
Bill 49 also gives the minister the right to set minimum amounts for claims through regulation. Workers who make a claim below the minimum, which is as yet unknown, will be denied the right to file a complaint or have an investigation. Dependent upon the amount of this minimum, it could well have the effect of an employer keeping his violations under the minimum in any six-month period and thereby avoiding any legal penalty.
Use of private collectors: The proposed amendments intend to privatize the collection agency function of the Ministry of Labour's employment practices branch. This is an important change, providing one of the first looks at the government's actual privatization of a task which has traditionally been public. Private operators will, should these proposals be implemented, have the power to collect amounts owing under the act.
A fundamental problem with regard to the act has for some time now been the failure to enforce standards. This is no less true with regard to collections. The most frequent reason for the ministry's failure to collect wages assessed against an employer has been the employer's refusal to pay. The answer to this problem, according to the proposed amendments, is not to start enforcing the act but rather to absolve the government of the responsibility to enforce the act by farming out the problem to a collection agency.
In addition, the employment standards director can authorize the private collector to charge a fee from persons who owe money. Should the amount of money collected be less than the amount owing to the employee or employees, the regulations will enable the apportioning of the amount to the collector, the employee or employees and the government. Where the settlement is under 75% of the amount owing, the collector is required to obtain the approval of the director. But this still allows the collector incredible leeway, if not outright abuse, with someone else's money. The danger here is that even persons whose earnings put them below the poverty line and who are owed money under the act could well be required to pay fees to the collector. A minimum wage worker at $6.85 per hour, for example, could not only receive less money than what is owed but also have to pay to have it collected. Surely this raises ethical questions for the drafters. We would suggest that while such an approach may be appropriate in commercial transactions, it is neither morally justified nor appropriate in the circumstances. We want the system of public enforcement to be maintained and improved.
This provision will likely lead to employees receiving considerably smaller settlements. As well, they open the door to unconscionable abuse. The Oxford Regional Labour Council is gravely concerned that employees, particularly the most vulnerable, will be pressured to agree to settlements of less than the full amount owing as collectors argue, if only for the reasons of expediency, that less is better than nothing. Having at the same time to pay a collector amounts to nothing less than legalized theft. At the same time, unscrupulous employers will de facto now find their assessments for violations lowered and thus be encouraged to continue their violations of minimum standards.
Limitation periods: The proposed amendments in Bill 49 significantly change a number of time periods in the act. The major change is that employees will be entitled to back pay for a period of only six months from the date the complaint was filed instead of the existing two-year period. This restriction on time will penalize vulnerable workers who often find it necessary to file a complaint only after they have severed their employment relationship either by quitting or by changing employers. This is a substantive restriction, particularly for workers who have been denied their statutory rights for a longer period of time and cannot afford a civil suit. Only in certain circumstances, such as where the breach is a continued one or where there are violations in the case of several employees, is the limitation period extended.
Workers who fail to file within the this new time limit will have to take their employer to court in order to seek redress. The burden of cost will also have to be borne by the employee in such circumstances, as the Ontario legal aid plan has been scaled back and no longer covers most employment-related cases.
In contrast, the ministry still has two years from the day the complaint was filed in order to conduct their investigation and a further two years to get the employer to pay moneys owing. In other words, an employee having made a complaint under the act could wait up to four years before receiving their money, and then only the part of it that the collector gets, minus the user fee. That the government can rationalize such amendments as "facilitating administration" and "streamlining procedures" is almost beyond comprehension.
Minor amendments: There are several positive amendments in Bill 49. Two are noted below. The first concerns vacation entitlements and the second concerns seniority and service during pregnancy and parental leave.
Entitlement to vacation pay is one of the few amendments in Bill 49 that the Oxford Regional Labour Council can support. With the inclusion of this amendment, the act will clearly provide that the vacation entitlement of two weeks per year will accrue whether or not the employee actively works all of this period or was absent due to illness or leave.
A distinction remains between entitlement to time off and entitlement to vacation pay. Vacation pay continues to be based on 4% earnings over the preceding 12 months. Thus, where a leave has resulted in decreased earnings, it may still be reflected in reduced statutory entitlement to vacation pay.
The amendments to seniority and service during pregnancy and parental leave ensure that all employees are credited with benefits and seniority while on such leave. With the passage of this amendment, the length of the employee's time on leave will be included in calculating length of employment, length of service or seniority, for purposes of determining rights under a collective agreement or contract of employment.
The passage of these amendments into legislation would take precedence over contractual language whether or not the contract refers to active employment.
Conclusion: Bill 49, in the government's words, is An Act to improve the Employment Standards Act. Nothing can be further from the truth. Oxford Regional Labour Council believes in basic societal standards in terms of hours of work, overtime pay, vacation pay, severance and public holidays. Bill 49 eliminates the floor for minimum standards. The floor has been eliminated under one foot of the worker, with the other foot on a banana peel.
As for the non-unionized workers, the most vulnerable in the workforce, Bill 49 can be compared to hanging from a greased rope and sliding to the bottom. This bill is about undermining their already precarious existence and as such is totally unacceptable.
As noted in our introduction, these amendments come on the eve of a comprehensive review of the act. The proper procedure would have been to include such changes as part of such a review and not try to pass them off as housekeeping changes. Beyond this, the core of the problem is the nature of the amendments themselves. As our comments already make clear, standards shouldn't be eroded, standards should not be made negotiable, rights shouldn't be made more difficult to obtain and enforcement shouldn't be contracted out and privatized.
The Harris agenda is to shrink the size of government and divest itself of public service. Once again, this government is putting the burden on the poor, most vulnerable and workers to achieve their $10 billion slashed from the budget to pay their wealthy friends a tax break.
Mr Duncan: Thank you for your presentation. It's a very succinct analysis. One area where we have some sympathy with what the government is attempting to do is to streamline the efficiency of operation of the ministry.
My question is this: On page 6 of your brief, in terms of enforcement of non-unionized employees, you spoke about the opportunity to elect to go from civil suit back to employment standards or vice versa. Recognizing that clearly you support the way things have been, would amendments to the bill that would give effect to some sort of second or third opportunity for somebody to elect down the road make those provisions more palatable?
Mr Carey: I can't see any reason why we can't leave it as it is now, where they have the options, and clearly leave it that way.
Mr Christopherson: Thank you for your excellent presentation. On the bottom of page 8, in the very last sentence you say, when you're referring to the cap of $10,000, "...this provision will encourage the worst employers to violate the most basic standards, while at the same time compounding the problems for those workers with meagre resources." The minister said on Monday when we launched these hearings, referring to the $10,000, that those claims often "involve individuals in executive positions." We also heard from the union that represents the employment standards officers. They said in their presentation: "The ministry's reasoning, as noted in the expenditure reduction strategy report 1996-98, is to lower the caseload as `higher-paid' employees would use civil action to collect. The assumption must be, when an employee files a claim in excess of $10,000, they are higher-paid employees. This is not so."
Why do you and the union that represents the workers that actually deal with these cases believe the minister is, to be gentle, "inaccurate" when she says that these are all people in executive positions? What's the reality as you and your colleagues know it?
Mr Wayne Colbran: The reality you can see in that clause that you're talking about is the example that we're giving there. I've been personally involved with this one. This person is owed over $35,000. He's been fighting this thing over a year and a half. The Ontario Labour Relations Board has ruled in his favour and the employer just refuses to pay. This person now is on welfare, and there's no way that somebody on welfare can afford to go through the legal system of the court. Even if he could, it will be another two or three years while this employer just hires himself a lawyer and still refuses to pay. This isn't just an off-the-wall example. This happens all the time.
Mr Baird: Thank you very much for your presentation. I appreciate the time you took to travel from Oxford county to present to us today.
There's just one thing I'd clarify in Mr Christopherson's remarks: He was correct the first time when he said the minister said "often," and then he later said "all." She certainly didn't mean "all"; she said "often," as Mr Christopherson first quoted.
When the employment standards officers came before us I made this comment to them. One of the groups that recommended that we go back to a cap -- there used to be a cap in years past -- was the employment standards officers themselves, who sat on a ministry committee that looked into this issue. It's funny that their union, representing them, came and said that no, they didn't like it, yet the employment standards officers themselves were one group, 50% of the members of a committee, who made the suggestion to the government.
Mr Christopherson: They couldn't respond because they ran out of time. Come on. Be fair.
The Chair: Mr Christopherson, you're out of order.
Mr Baird: That's a fact. The truth remains that they didn't come to speak to me afterwards, and that's what's in the ministry. That's the advice we got.
Mr Christopherson: If I'm allowed on the record, I'll give you that response. How's that?
Mr Baird: You can certainly table it with the committee. That was just a comment, Mr Chair.
The Chair: Thank you both for taking the time to come before us to make a presentation this morning. We certainly appreciate it.
LONDON HOTEL AND MOTEL ASSOCIATION
The Chair: The next group up is the city of London Hotel and Motel Association. Good morning. We have 20 minutes for you to use as you see fit, divided between presentation time or questions and answers.
Mr Chris Vachon: I'd like to start by saying good morning to everyone. My name is Chris Vachon. As mentioned, I represent the London hotel association and I am the general manager of Station Park Inn here in the city of London. I want to thank you and your committee first for allowing us the opportunity to be here today.
Employment standards reform is important, and therefore we support the government's initiative to repair it. Bill 49 is the first stage of this process, and we look forward to the extensive consultation process that will precede the introduction of the second stage of this reform package.
Bill 49, in our estimation and supported by our advisers, does not alter minimum employment standards in Ontario. What the legislation does is make technical changes to the act. These changes are aimed at improving administration and enforcement of employment standards as well as reducing ambiguity and simplifying language. We also see the bill signalling a significant reduction in the government's role in administering and enforcing the act.
The analysis is before you.
Act enforcement through collective agreement. The bill specifies that obligations under the act will be enforceable through collective agreements as if the act were part of a collective agreement. Employees covered by a collective agreement will not be permitted to file complaints under the act without the permission of the director. In essence, the grievance and arbitration procedure will reduce enforcement through the administrative machinery of the act. Powers of arbitration with respect to claims under the act will be expanded to include the powers of employment standards officers, adjudicators or referees under the act.
Parallel proceedings in court and under the act prohibited: The bill prohibits an employee from commencing a wrongful dismissal action in court if he or she files a complaint claiming termination or severance pay under the act. Similarly, where there is an employee complaint under the act for wages owing, breach of building services, successor provisions or the benefit provision of the act, a civil action seeking a remedy for the same matter is prohibited. These restrictions apply even if the amount owing exceeds the maximum for which an order can be made under the act. Civil actions are permitted if the employee withdraws the employment standards complaint within two weeks after filing it.
In parallel to the foregoing restrictions, an employee cannot initiate a complaint under the act for the specified matters if a civil action covering the same matter has been commenced. Effectively, the bill will require employees to choose whether to sue in court or to seek enforcement through the act.
Increasing flexibility for provision of greater benefits in contracts: The bill will make it easier for employers to establish that they have provided greater rights and benefits than are required by the act and thus obtain certain provisions of the act. When a group of collective agreement provisions -- severance pay, hours worked, overtime, public holidays and vacation -- are considered together, rather than separate as in past years, the collective agreement will prevail if it provides superior rights. In addition, statutory regulatory provisions, as well as provisions in oral, expressed or implied contracts, will prevail over employment standards if they confer a greater right than is provided by the employment standard.
Under the section on service during pregnancy and parental leave, the bill requires the length of employee pregnancy or parental leave to be included not only in determining seniority, as required by the current act, but also in determining the length of service for all rights except for the completion of the probationary period. Thus, all rights in the employment contracts that are service-driven will continue to accrue during the leave. All employers should review their contracts of employment to determine the impact this change will have.
Vacations: The present vacation of at least two weeks upon completion of 12 months of employment is amended to apply whether or not the employment was active employment. The pay during the vacation must not be less than 4% of the wages, excluding vacation, earned by the employee in the 12 months for which the vacation is given. This clarifies and simplifies existing provisions in the act.
Maximum amount of orders: Employment standards officers will not be permitted to make an order for an amount greater than $10,000 in respect of one employee, with the exception of orders relating to breach of the pregnancy or parental leave, lie detector, retail business holidays and garnishment provisions, and termination and severance pay in connection with breaches of such provisions. Arbitrators will not be subject to these restrictions. The bill provides for regulations prohibiting officers from issuing orders below the level specified in the regulation.
Collections: The bill sets out mechanisms for directors to use private collection agencies to collect amounts owing under the act. This will provide the ability to contract out a function that is now performed within the ministry. Collectors will be authorized to agree to compromises or settlements of claims if the person to whom the money is owed agrees, provided it is not less than 75%, or such other percentages as may be prescribed, of the money to which the person is entitled, unless the director approves otherwise.
Compromise of right under the act: Compromises and settlements respecting moneys owing under the act will be binding once the money stipulated in the compromise or settlement is paid, unless the arrangement is entered into as a result of fraud or coercion. In the current act, there was very little ability to contract out of the act's requirements. Employment standards officers will be given additional authority to settle complaints without making a prior finding of what wages are owing.
Limitation periods in a prosecution or proceeding under the act: No person will be entitled to recover money that becomes due to the person more than six months before the facts upon which the prosecution or proceeding is based first come to the knowledge of the director, subject to certain exceptions. In the current act, the limitation provided is two years.
Review of orders: An employment standards officer will be deemed to have refused to issue an order if a proceeding is not commenced within two years after the facts upon which the refusal is based first come to the knowledge of the director. Employees may request the review of an order or refusal to issue an order, in writing, within 45 days. The director has the discretion to extend this time limit in certain circumstances. Certain orders may be reviewed by way of a hearing. In the case of the employer, application for a hearing is dependent on paying the wages and administration costs required by the order.
Administrative changes: Complaints under the act will be able to be filed in either written or electronic form. Employment standards officers will be able to obtain copies of documents kept in electronic form. Certain changes concerning the service of documents under the act are also made.
We, the members of the London Hotel and Motel Association, zone 5 of the Ontario Hotel and Motel Association, support Bill 49, as it signals progressive change in employment standards in Ontario. It is not reducing the standards. It should be further emphasized that we are not seeking a reduction in benefits. We are good employers. We want to ensure our employees are treated fairly and receive that which is their due.
Mr Christopherson: Thank you, Mr Vachon, for your presentation. I'm asking a question I don't know the answer to, which is dangerous for politicians, but I don't. What percentage of your industry would you say is unionized?
Mr Vachon: We just joined forces with the Hotel Association of Metropolitan Toronto, bringing us 40 additional major -- international in some cases -- hotels. As it stands right now, being myself the director of membership for the Ontario association, there is approximately 12% right now. The concentration is in Toronto.
Mr Christopherson: So 12% are unionized and the rest are non-union.
Mr Vachon: Yes.
Mr Christopherson: You would agree that if you don't have a collective agreement, the only real protection that you have, the only real bill of rights, is the Employment Standards Act? It's that or nothing.
Mr Vachon: Yes.
Mr Christopherson: I would just then like to pursue with you the notion you put forward that this is not reducing standards to those people who have the Employment Standards Act as their only piece of protection when, as I've raised earlier, there's a cap on how much money people can claim for and the only way they can get beyond that is to pay a lawyer, which means they're out money they wouldn't otherwise be with this bill. There are a lot of other examples; I don't have a lot of time. But I would like to hear a little further how you can square your statement that it's not reducing standards when I can point to you time after time where employees will be net losers as a result of Bill 49. They're out money, and I think in your business that means you lose something.
Mr Vachon: Right. With respect to the question directly, I'm not at liberty to extend the comments on behalf of the association or on behalf of the London Hotel and Motel Association other than what we put forth on a collective agreement and as advised with our lobbyers with Queen's Park. This is our document that we're reading from. I'm sorry. I can't speak of any personal view because of the properties that I've been running, the four in the last 10 years have not been unionized, so I can't directly answer your question.
Mr O'Toole: Thank you very much for your presentation. You should never feel nervous in front of us; we're the ones who are supposed to feel nervous.
But anyway, limitation periods: I just want to give you some background on that for the sake of the record. The evidence is that 85% to 90% of the employment standards claims currently are filed within the six months. Are you aware of that? That's the current status: 85% to 90% are filed within six months. Furthermore, Alberta, Manitoba, Newfoundland and Nova Scotia already have a six-month provision for the limitation period. So we're really trying to harmonize some of the things that currently exist in the Canadian marketplace.
Also on the limitation period, it's very important to pass on to your membership -- much of what you said is very reflective of what we said, but to expand, we need to say that in the case of repeated claims, like failure in overtime payment, it's possible the limitation period can be expanded up to one year. This message doesn't seem to be getting out, and I think it's important for you to pass that on to your membership.
I just ask one last question. Will your organization be participating in part two of the full discussion on the employment standards changes?
Mr Vachon: Yes, and I can say that quite confidently because, again, our lobbyist with Queen's Park is actively pursuing and having the associations that were represented in different municipalities following through the process as well. So to answer your question, are we? We'd like to. Will we? Yes, if the opportunity presents itself.
Mr Duncan: Thank you for your presentation. The official opposition is not unsympathetic to the government's desire to try and improve the efficiency of the act. However, I guess we do differ with you with respect to the reduction of minimum standards. We believe there are clear reductions in minimum standards. Our view is that you can achieve both ends, that number one, you can improve the efficient administration of the act, and number two, do that without impacting directly on minimum standards.
My question to you is this, and I've asked a number of other business organizations this question. The types of businesses in my experience that will actually be impacted by these provisions are a very small percentage. I would assume the vast majority of your members are good employers who probably have never had claims for back wages, or if they have, it's been a very rare circumstance. Given that, why would organizations such as yours be as concerned as you are about some of these issues?
Mr Vachon: I can't speak on behalf of the association. Some of these issues that are before me -- not all of them can I speak directly on, but I know these have been real issues that have been brought up within the city of London and are concerns with the 38 properties we represent as motels and hotels in the city.
The Chair: Thank you for coming before us here this morning and making your presentation. We certainly appreciate it.
CANADIAN UNION OF PUBLIC EMPLOYEES, LONDON AND DISTRICT COUNCIL
The Chair: Which takes us to our last presentation of the morning, the Canadian Union of Public Employees, London council. Good morning again. And again you have your full 20 minutes, even if it takes us over the noon deadline.
Ms Harriet Miller: Good morning. My name is Harriet Miller and I'm here representing the London and district council of the Canadian Union of Public Employees.
I shall say up front the reason why a member of the executive is not here is because they're all gainfully employed out there and cannot get time off for union business. That brings me back to part of the tenet of what the Ontario Federation of Labour and CUPE have talked about, because in downloading, as I see it, in your streamlining process some of the responsibilities to the unions, it's important to realize -- and I'm going to guess that 99% of the union executive members are volunteers. They don't have the time and they certainly don't have the resources.
So the reason I am here: I am very interested in women's issues and I think that's primarily why I've been asked to come and speak on behalf of the executive of this council that I have been involved with in the past. So on behalf of hundreds and hundreds of volunteers with CUPE in the London area, I'm happy to be here today.
I do want to tell you, though, because I don't know whether it's been explained to this group, at least at this hearing, that there are 12 or 13 of these councils in Ontario and we are actively involved in this. We're involved in, heaven forbid, the days of protest, and we lobby and we communicate and we get together on issues and share concerns.
First of all, somebody over here, Mr O'Toole, mentioned Gord Wilson's brief. The CUPE brief I know -- did Sid Ryan already present to you? He will be doing so. He will no doubt be going through the whole brief. Because we were not able to get together with the council to pick priority items, which has been suggested by CUPE, I've just taken a few thoughts and concerns out of the brief, although I've done a lot of reading on this myself and have been very interested. But I would not take specific issues without getting direction from the council to do so.
My general comments:
It is the position of the London and district council of the Canadian Union of Public Employees that the employment standards legislation is among the most fundamental pieces of labour legislation for ordinary working people in this province. The purpose of this legislation has been to establish vital minimum standards designed to protect workers from the exploitation handed out by the province's worst employers.
We submit that any amendments to this legislation must enshrine a basic principle of continued improvement in the employment standards of workers so that they may be protected from the excesses of the labour market, and I'm going to make a general comment on that example at the end.
The Minister of Labour has portrayed the changes found in Bill 49, the employment improvement act, as housekeeping amendments that would facilitate administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures. On the contrary, the council is concerned that the amendments are in fact significant changes designed to frustrate the legitimate claims of workers under the act by undermining workers' most basic rights.
Claims under the act will limit the ability of workers to enforce their rights under the law. The method in which an employee may recover from an alleged violation of the act -- do you call it an acronym when you say ESIA? We'll call it "the act" -- is significantly changed to limit the worker's ability to obtain full redress under the law. The substance of what may be claimed has been limited under Bill 49 so as to set a minimum and maximum amount that a claimant may obtain as a result of a violation of the act. Also, the duration of acceptable claims has been shortened in order to reduce the amounts that may be recovered against employers that have violated the law. Together, these changes will reduce the total amount workers may claim from their employers under the act.
Several underlying themes arise throughout the amendments. The Ministry of Labour is attempting to rid itself of the cost and responsibility of enforcing the act. All of the changes designed to channel complaints into the court or grievance arbitration systems seem to help the ministry reduce its budget.
The elimination of a universal floor of rights for unionized workers indicates an effort by the government to erode the general level of employment standards in Ontario. Allowing employers with a bargaining agent the opportunity of setting workplace employment standards will lead some employers to erode current standards, and of this we have no doubt. These changes will encourage unscrupulous employers to realize cost savings by abusing their employees' rights under the act. Given the increased difficulty of enforcement for non-unionized employees, some employers will increasingly disregard the substance of the law designed to protect these employees. This faulty enforcement regime will move unionized employees to insist on workplace concessions. Employers may simply contract out their work to unprincipled employers that do not abide by the law.
How's my time?
The Chair: We have lots of time. We still have 11-and-a-half minutes left.
Ms Miller: All right. I wanted to give you an example of something that's happened that was brought to our council by way of information, which is with one of our employers. In looking to make savings and also make the employees feel good, they said that the top level in a particular bargaining unit really was management. Fine. Okay, that case can be made, as we realize in law. So they made them into the next level up in this particular establishment and then, lo and behold, what they did is they said, "Oh, by the way, we have to cut back in all levels of the operation," and all the people they'd just taken out of the top level of the union and put into the lower level of management, they let them all go. This is what actually happened in the city of London in one of our workplaces.
Most of our employers are fabulous. We hear wonderful, wonderful accolades. But I'm afraid, silly as it may sound, that that $10,000 ceiling -- some employers may just push things to the limit in whatever area of this law, get it over the $10,000 and say: "Whoops, $10,250. You'd better get yourself a lawyer." So I just don't agree at all with the limit on that.
Also, we just had a report from a Jean Read, looking at the Pay Equity Act and changes they're making there. There are significant changes that are going to be suggested.
In Bill 40, which was scuttled by Bill 26 --
Mr Baird: Bill 7.
Ms Miller: Was it? What was 26? Oh, that was the restructuring or whatever.
There was a very important thing in that act that was taken out of Bill 40. This is just to demonstrate my fear with this government. There was a clause in Bill 40 that said that every collective agreement was deemed to have a particular clause, which was, "No employee shall be disciplined or discharged without just cause." That was scrapped. That is extremely significant. What I'm hearing here and seeing in this paperwork is that if we do not keep a mechanism for all citizens of Ontario to have a mechanism within the Ministry of Labour on employment standards, I can see that we may end up with more and more problems, people in litigation, horror stories.
On topic but off topic, there was a gentleman here from Kellogg today, and one very positive thing I remember from that -- I didn't know what the upset was at Kellogg, but out of that period of time there came an employee protection program which was acute stress psychological help. It's ironic that with the stress, they talked about -- people weren't gone, but in effect, they put in place, union and management, a marvellous way of dealing with acute stress, alcoholism and family problems. I don't know specifically if it came around that time, but it appears to me to have been at that point in time.
The government appears to be abdicating its responsibility of ensuring employment standards for all its citizens. We strongly protest any reduction in standards in any laws that have made Ontario one of the model societies, to be the envy of other less fortunate and farsighted jurisdictions.
I think it's ironic, just to say in absolutely closing, that Mike Harris and Ralph Klein, yesterday, with their peers at the first ministers' conference, their idea on medicare was scuttled, because the rest of the country is saying, "Uh-uh, it's not going to be touched; it's universality there." In Ontario, I hope the Conservative Party and Mike Harris in particular look to whom they're supposed to be representing. I know they are of a higher position in status in many ways, but they have to represent the people of this province. And the unions are going to be very happy to be involved at the second phase, I'm sure.
The Chair: That leaves us two minutes per caucus for any comments or questions, and we'll commence with the government members.
Mr Baird: I just have a short comment. I know my colleague from Toronto would like to say a few words.
Just briefly, you mentioned that Sid Ryan spoke to us. I'd just indicate that Mr Ryan met privately with the minister last week about, among other things, the Employment Standards Act and the changes in Bill 49. So I can assure you that she does certainly take the time --
Ms Miller: I notice it said August 19, which was last Monday, so maybe that's --
Mr Baird: Yes. So she has met with him. We are hearing from a good number of CUPE groups and a good number of them were even on the government's list that we wanted to hear from.
Ms Miller: Wonderful.
Mr Baird: I grew up in a CUPE household myself.
Ms Miller: Oh, did you?
Mr Tascona: The one thing we've been finding out throughout the hearings is that the collection process isn't working. We collect about 25 cents on every dollar. We're scratching our heads for methods to ensure that the workers get paid for their work. One of the problems, we found out, is that in excess of 50% of the employers who won't pay is because of financial reasons, and they use the protection of the Bankruptcy Act to get away from their obligations. That's an area we can't control. It's under the federal government's mandate and they've done nothing.
One other area you were looking at is some way of talking about private collections, but there are other measures that can be considered where there have been collections. Do you have any experience with the Occupational Health and Safety Act?
Ms Miller: Yes, I do.
Mr Tascona: Have you ever been involved where an officer -- are you familiar with the powers that they have with respect to shutting down a workplace?
Ms Miller: I certainly am.
Mr Tascona: Now, do you think that those types of powers in terms of a specific type of circumstance -- the employment standards officer's powers are limited to enforcement etc, but in a circumstance, would you believe that having the power to shut down an operation to ensure the collection of wages would be something that would be, on a balance, fair to the employer, fair to society, fair to the workers that are not being able to work, if that in fact was done? Because it's done under health and safety.
Ms Miller: Right.
Mr Tascona: They shut down the operation if they breach the act. What do you think?
Ms Miller: I think that would be a wonderful thing to have in the act, because I think it would make employers realize they have to be accountable and they shouldn't abdicate their responsibilities.
Mr Tascona: But where should it be used? It can't be used all the time. It has to be used in a certain circumstance. Where do you think it should be used?
Ms Miller: I wouldn't have the answer. I know that it has quite a bit to do with the whole bankruptcy law and --
Mr Tascona: Would it be a situation where there's one worker --
The Chair: Thank you, Mr Tascona; sorry.
Ms Miller: I think the government should be involved, should it happen. It shouldn't be an individual worker against the employer, in my personal opinion.
Mr Duncan: Thank you very much for your presentation. In your view, you had indicated by way of example and even said, I think, that most of the employers you deal with are good employers and that a lot of these things won't affect them. One of the arguments that's been made by other labour organizations is that this will in fact impede collective bargaining and the fast resolution of disputes at the bargaining table, particularly if, in the second stage of reform, the government goes ahead with the minimum floors. Would it be the view of CUPE as well that these types of changes to the Employment Standards Act would in fact impede collective bargaining and likely lead to a less stable labour market?
Ms Miller: Absolutely; very, very, very seriously.
The Chair: That takes us to -- oops, we still have Mr Christopherson.
Mr Christopherson: I'll be very brief. You mention in your opening comments that you wanted to see and would be supportive of continued improvements to the Employment Standards Act. Yesterday in Kitchener, we had John Cunningham, who's the president of the United Steelworkers, Local 677, referring to this as the "bad boss" Bill 49, and he said, referring to the government, "You must be Hood Robin, who robs from the poor to legislate to the rich." With that in mind and your statement in mind, how do you feel about the name of this act being An Act to improve the Employment Standards Act, and who do you think it improves it for?
Ms Miller: If there's any improvement at all as it presently sits, I think it's an improvement for the employers. I think it's detrimental to the employees. I think the name makes no sense with it calling it improvement.
The Chair: Thank you, Ms Miller, for taking the time to come before us today. With that, that completes our morning session. The committee stands recessed till 1 o'clock back in this room.
The committee recessed from 1159 to 1309.
LONDON REGIONAL ADVOCATES GROUP
The Chair: Our first group up this afternoon is the London Regional Advocates Group. Good afternoon.
Ms Jayne McKenzie: Good afternoon. I am Jayne McKenzie from OPSEU Local 220, a member of London Regional Advocates Group. With me are Susan Green from WRIST, Workers Repetitive Injury Support Team, and Frank Stilson from LOSH, London Occupational Safety and Health. We are three out of 60 members of the London Regional Advocates Group.
Ms Susan Green: Good afternoon. First off, I would like to thank the New Democratic Party for their diligence in making sure that the vulnerable people of this province had the ability to challenge this piece of legislation for what it is, nothing more than a way for the employers to spit in the faces of their workers. "Open for business" means higher profits and fewer rights. The commonsense government has done nothing for the working people of this province other than reduce their rights with every piece of legislation they turn out. Special-interest groups, basically the voting population, have been ignored in favour of their business buddies, 10% of the population. The tax base that the special-interest groups represent is the majority of taxes paid. The larger corporations have eroded the amount of taxes they pay by continually applying pressure to reduce their taxes and create loopholes. The current commonsense government continues to ignore us by trying to convince us that Bill 49 is good for us, that it will help us.
The London Regional Advocates Group consists of representatives of many diversified groups: unions, injured workers' groups, legal aid groups, occupational health and safety groups, ethnic groups. Our requirement for membership is that there is no fee for service. We have no constitution or bylaws; just dedicated people.
These dedicated people see the vulnerable of our region every day in their jobs and in their volunteer roles. We see what happens when the rules and regulations that are already in place are laughed at by unscrupulous employers. They ignore the current Employment Standards Act. Bill 49 gives them no reason to change; in fact, it gives them more leeway to cheat their employees. After all, just because one employee launches a complaint doesn't mean the rest of the employees will be able to get justice, and just because one employee wins their complaint doesn't mean it sets a precedent with the rest of the employees either. These same employers that cheat on the employment standards are the same employers who defraud the WCB, are lax in health and safety and are generally just all-around bad bosses.
Bill 49 falls short of doing anything to protect the working people of Ontario from these bad bosses; in fact, it does the opposite. It protects these bad bosses by capping the amount the employees can retrieve. It narrows the window in which employees can get what is rightfully theirs. It slams doors on employees making one complaint for the good of all employees.
Yes, the bad bosses will continue to thrive in this commonsense Ontario while their employees will cower in fear of losing their jobs and wait unrealistic time frames to recover what was theirs to begin with. Generally speaking, these people cannot afford the cost of litigation, nor can they afford to be without the money that is owed to them. A day's pay is $54.80, and generally that is exactly what the bad boss is willing to pay -- minimum wage only. That $54.80 begins to put food on the table or a roof over their head. There is no tidy little nest egg for them to fall back on. There is no emergency cash to be had.
The bad boss has already demonstrated that he does not care about the Employment Standards Act by flagrantly ignoring it, so why not fire the bad employee who reported him too? They always have a justifiable reason to get rid of this employee who may have just cost them some of their profit, and with the job market the way it is the employer has no problem filling the vacant spot. Forward with production; on and onwards with profitable deceptions. After all, what have they got to lose?
I perceive the government as being not unlike parents with two children, the workers and the corporate structure. It seems as if the parents are neglecting, abandoning one of the children, the workers, while spoiling the already greedy child. The neglected ones will start to show signs of this abandonment as time progresses, and the effects of these pieces of all this bad legislation or neglectful parenting will come into play.
Ms McKenzie: The Employment Standards Act provides us with minimum wages and conditions of employment. It's our position at the London Regional Advocates Group that Bill 49 erodes the fundamental foundations of these rights of all workers in this province, at least those few currently covered.
One aspect is to reduce the amount of time a worker can file to six months. Mr Stilson will be addressing that. The other is the ministry's abdication of the responsibility of enforcement. The Ministry of Labour is not currently known for its proactive approach either in enforcing the law or in encouraging compliance. The historical response has been to deal with individual complaints on a case-by-case basis. The result has been slow-moving and considered relatively unresponsive.
Rather than grabbing the bull by the horns and dealing with the problems of investigation, compliance and enforcement, Bill 49 recommends abdicating that legal responsibility for enforcement and hiding the problems under a rug. I'd suggest that rug is one woven from regression and privatization. It might be housekeeping, but dirt pushed under the rug doesn't make for a clean house. It always returns and has to be dealt with again.
Since 1995, ministry by ministry, the provincial government has reiterated its position that it only makes the laws, it is not in the enforcement business. I'd ask the committee to consider a comparison between the Employment Standards Act and Highway 401. The laws of the province regulate the speed limit on the 401 to 100 kilometres. Enforcement comes from the police, and they use a variety of methods including, in the past, the controversial photo-radar, found to be highly effective. There is also controversy right now as to whether to increase that speed limit. It's well known and accepted that a vast number of drivers on the 401 reduce their speed to the legal limit when enforcement is there. It's also accepted that when enforcement is inadequate or completely absent, compliance with that maximum 100-kilometre limit diminishes and the average speed easily goes from 100 kilometres to 110 or 120. Without compliance and enforcement on the lanes of the 401, it becomes dangerous at the best of times and at other times life-threatening.
The same can be said of the workplaces in Ontario. They can bear a striking resemblance to the 401. Some employers adhere to the speed limit and travel consistently and steadily in the right-hand lane. Other employers travel without regard or concern for the welfare of others. They speed recklessly through in the passing lane at dangerous rates. An example would be our past-year documented instances when trucking companies disregarded the basic fundamental rules of the road with faulty brakes or tires. These have resulted in lost lives. Had the government or the public called for less enforcement of the rules of the road? No. Cries from the public, and indeed from the government itself, have been for tighter and stricter enforcement of these regulations.
The workers of this province expect no less than the drivers of this province: minimum reasonable standards and standards which are applicable to all across the board; standards legislated, then enforced, by those responsible for the standards. The government has available to it recommendations that would increase and ensure better compliance. One recommendation would be content changes to make the Employment Standards Act more effective. Have all parts of the ESA apply to all workers in the provincial jurisdiction, as opposed to excluding various categories from minimum wage, another list for public holidays, another for hours of work. Apply the law to everyone and let everyone know it. There would be a lot fewer violations of the act.
There are other administrative changes that would make the ESA more effective and efficient. They would be better use of the resources of the ministry and ensure that complaints dealing with both workers and employers would be speedily resolved. They would be spot audits of employers' books with an investigation of all individual complaints, leading to full investigations if any additional violations are found; proactive education and investigation procedures; heavy penalties for employers who do not pay out orders within short or fixed times; mandatory posting of the act in all workplaces, as it is with the Workers' Compensation Act and Occupational Health and Safety Act; shorter time limits on ministry investigations; and education about the Employment Standards Act in all materials and forums for new companies incorporating in Ontario.
Should the provincial government choose to continue with what it is referring to as housekeeping changes, we have one more change that would be in keeping with that, and that would be the suggestion that the Minister of Labour change her title to that of Minister of Corporations.
Mr Frank Stilson: I come here not to speak for myself but to speak for two workers who were killed in London less than four blocks from this room. They are Brad Olson, age 23, and Louis Dupont, age 27. My message goes out to the members of this committee, the Premier of Ontario, the employment standards policymakers, lawyers -- all the people who had a hand in this situation in London. I think there is responsibility directed towards those people.
I talk in terms of hours of work. I spent four days at this inquest with the parents of these two people. His mother, on one of the four days, accounted the hours of work of Brad Olson, and I'll summarize those. He worked from January 1995 until May 15, the day of his death. The total number of days is 126; he worked 122 days. During the month of January, he started on January 9 and worked 21 days, 12 hours a day; he had one day off. In February, he had one day off. So in January and February he worked 44 days without a day off. In March he had one day off and in April he had one day off. In May, he had one day off.
During the proceedings of the inquest the company did not dispute that. The company did not dispute that it did not have a permit for excessive hours over eight hours in a day or 44 in a week. No orders, no charges were laid against this company, right from the top legal people who decide on these issues down to the inspectors who were not responding to anything. The other issue was a health and safety concern. There was no confined-space training. No charges were laid.
This case was brought up on CBC, and the person responsible for laying charges said they would not be laid. To this day, we still do not know why charges were not laid. The death of two people, not injury but deaths, and no charges laid. People are still scratching their heads, "Why did this happen?" when the company admitted it had no permit, it violated the Occupational Health and Safety Act and the Employment Standards Act.
This government wants to lessen those employment standards when under the existing ones people are being killed -- not gipped out of money, not fired for no reason, but killed -- because of the lack of enforcement from the employment standards branch right from the top down to the inspectors. Now, there are good inspectors and there are bad inspectors, but in this case the inspectors just gather the information; it's up to the policy people, the legal people to decide.
What message does this give to employers in this province? That they can kill two people and nothing, no consequence. Kill somebody on Highway 401 and there are consequences. It should be the same. I encourage this committee to ensure standards are enforced and that they are not lessened in any way, or more deaths in this city and in this province will happen.
Mr Hoy: Thank you very much for your presentation, all three sections of it. You seem to be referring to different aspects of this law and other laws. Your analogy with the 401 enforcement is one that all should take note of. However, I would mention that it seems, particularly in the rural areas, I'm hearing that policing is not what it was at one time either. Break-and-enter cases are not investigated. People are told to simply call their insurance company, which costs workers and others more money in terms of premiums and perhaps lack of coverage if they were to have more incidents than one, two or three. There seems to be a downloading of responsibilities by this government to other areas, other aspects of our society. But I appreciate the comments that you made in total.
Mr Christopherson: I also want to thank you for your presentation. I'd like to ask your thoughts as they relate to the most vulnerable in the workplace. I want to keep coming back to that often, because I think that's the crux of this as a recognition that the people who rely on this law the most are the ones that already have the least, the least power, the least access to the levers of power, in our society. The government continues to maintain that the changes they're making are not going to lessen the rights that the most vulnerable have.
In light of the fact that 90% of all the claims are made after people leave the employment of an employer they believe has violated their rights, and given the fact that they will not be allowed now to go back beyond six months, what do you think the circumstances are that employees are facing? What is the world that they're facing on the job that would support the claim that this law leaves those people vulnerable to, first of all, initial action by employers, but also retaliation, regardless of the fact there are laws there that say they shouldn't; the fact that people feel they're vulnerable and they can't afford to take on the boss and they have to make a choice between their rights and their job? Can you give me your experience in this area with vulnerable workers.
Mr Stilson: I think I hear every day that people have to put their jobs on the line. Either they don't enforce health and safety standards or employment standards; they say, "Well, I can't push that, because I'll lose my job." What this legislation or these proposals would do is give a message to employers that they can get away with more, more murder, more killing in the workplace if they were lessened, if they were left to the workplace parties. A lot of people that I see, and these two people that I just mentioned, did not belong to a union. So I think it's going to just lessen the rights and give a message to employers that they can get away with it under the old Employment Standards Act, get away with murder; they're going to get away with it even more and say: "Ah, great, we don't have to do anything now. We don't have to get a permit." That's the message that is given to employers today.
Mr O'Toole: Thank you for your presentation. In all sincerity, Frank, your comments with regard to the untimely and unfortunate deaths of Brad Olson and Louis Dupont, it's regrettable and it proves in very large measure that the standard enforced at that time -- if I understand, the time was January to May 1995?
Mr Stilson: It was May 1995, the deaths.
Mr O'Toole: I would guess that the Employment Standards Act that was in place at that time, being administered by the then government under Mr Christopherson, was not working. They had every duty and responsibility, as we do, to make the proper amendments. Do you agree that there should be some changes to the current standards with respect to not lessening those standards?
Mr Stilson: Certainly I think there should be changes to the standards. But you could have the best standards in the world, but if you have policy people at the top saying on CBC TV that there are going to be no charges laid, then those people should be questioned. The law should definitely be changed, but those people should be questioned or removed from office. Clearly, at the inquest, two lives were taken, the company admitted that they had no permit, that they broke the law, and still nothing happened.
Mr O'Toole: On the 100-kilometres-per-hour comparison, I think there's an excellent analogy there, that people have a responsibility to obey the law. I think that's really all we're trying to do.
The Chair: Thank you, all three of you, for taking the time to come in and make your presentations before us here today.
The Chair: Our next presenter is Ms Susan Smith. Would you come forward, please. I understand Ms Smith may be making some comments or all of her comments in French, and I remind the committee that's to be found on channel 2, canal 2.
Ms Susan Smith: Not all comments in French, but some of them.
The Chair: Good afternoon, and just a reminder that we have 20 minutes for you to divide as you see fit between a presentation time and question-and-answer period.
Mme Smith : Je remercie le greffier du comité propre pour cette opportunité de faire une présentation. Ceci est un autre exemple d'un nom de projet de loi qui ne répond à peu près pas du tout à ce qui se passe dans le projet de loi. Il n'y a qu'une seule amélioration dans ce projet de loi. Je vais passer très peu de temps là-dessus et je vais passer le reste du temps à critiquer ce qui manque là-dedans.
There is one minor positive amendment in this bill; only one. The amendments to seniority and service during pregnancy and parental leave ensure that all employees are credited with benefits and seniority while on such leaves. It's very significant to not see these terms as periods of unemployment; they are terms of leave.
With the passage of this particular amendment, the length of an employee's time on leave will be included in calculating length of employment, length of service or seniority for the purposes of determining rights under a collective agreement or a contract of employment. And the passage of these amendments into legislation would take precedence over contractual language, whether or not the contract refers to active employment. You could do it by regulation instead of waiting for a lengthy period of time.
I'll speak at the very end to the chronology of this bill.
There are substantive parts in this bill that represent the nadir of what you could be doing as legislators, the absolute depths to which you could plumb your efforts in terms of respect for the citizens of the province.
It's my understanding that Pat -- I think her name is Ms Daley or Ms Coursey -- was the last ADM in charge of employment standards, for maintaining employment standards in this government. I'm certainly not familiar with any critique of members of the current government, whether as candidates or as incumbents, that you rose to the occasion to challenge that. It falls within the context of what the government has already done.
Other changes include Bill 7, which is to segregate full- and part-time workers from the same collective bargaining units.
You have a discussion paper on rent increases related to extraordinary operating costs that are not capped, including "utilities." But, of course, you realize Ontario Hydro and London Hydro rates have been frozen.
You've also passed Bill 20 and made changes to the Development Charges Act by regulation, ministerial regulation, whereby charges are now frozen. So with still funding water surcharges, for instance, in this community are still funding new industries, small or large, and even the local development charges monitoring committee regularly acknowledges that where the costs are borne they're borne by users of services, who are residential services.
There's a very high number of renters in this community. There's also a high number of people making very close to minimum wage. It's not a low number of people in this particular urban community.
One of the things that you neglect to do in a so-called improvement of employment standards is you don't remove the freeze that dates all the way back to January 1995 on the minimum wage. If you were looking for fiscal targets or valued savings and linkages, the only thing I could tie it to is a political promise of a stupid tax cut.
I'm sure business would generally approve of a continued freeze, but I don't feel that's your responsibility as a committee on resources development, human resources development for this province.
This community is also affected to a great extent by the health care industry. As there have been recent announcements about the changes to health care and change of delivery, certainly people in the field of home care are not as well protected as they need to be by the current minimum employment standards. And I would suggest some of the limitation periods certainly don't address concerns of a large number of workers in this community.
One of the things that you don't have in this bill is an increase in the number of paid holidays for the province, and that really puzzles me. It seems to me that's one of the obvious places to improve employment standards. I don't think there are too many people who wouldn't think an additional day off is needed in the months of November, possibly January and February. You should be adding at least three public holidays to the Employment Standards Act. It's long overdue.
Other people have mentioned the young men who were killed on the job here in London in May 1995. It was very distressing to sit through the coroner's inquest and hear a manager with the employment standards branch seemingly quite unable to answer the most basic question about enforcement.
I appreciate that it's a priority of the government currently to do a lot of political spinning to get your message out, so in terms of doing more for less, the Ministry of Labour has a desire to do a great number of things less, certainly less things. Asking workplace parties to become more self-reliant in achieving standards; if you're going to do that, then why aren't you raising penalties, implementing real penalties and raising penalties, for non-compliance so that there's an impediment? The ministry will divest itself of services and programs that do not support its refocused core businesses. Maybe you should be going to the public to prove where you already haven't done that.
Finally, I will comment on chronology and timing. You have felt the need to go to the public with this bill, but frankly, it was because you were forced to by the NDP caucus. But you know, it only took you three days to pass the bill that's numbered one before this, Bill 48. And I appreciate Rob Sampson's payoff was a ministerial portfolio, minister for privatization. The amendments that he read in to the exemptions include -- I'll just point out that's another misnamed bill, of course. It eliminates the tax-free allowance.
It's really interesting that a provincial Legislature presumes to redraft federal tax legislation. Rob Sampson's language, which has been taped, which he read in as the amendment to the bill, includes an exemption for an allowance for any other purpose. Presumably that would include extraordinary expenses incurred if there were another legal strike impeding legislators' entrance to the Ontario Legislature. That's an example of an allowance for any other purpose, which now is treated as an income-tax-free allowance used by members of the Legislature. It took three days to pass it.
Of course, one of the government colleagues who had dwelt in that not-quite-purgatory of enjoying preferential income-tax-free treatment of political pay from 1979 to 1993 and only paid regular income tax on his income in 1994, it appeared Mr Vankoughnet had that money burning a hole in his pocket, literally days and hours after Bill 48 was passed, read three times and proclaimed into law by the Lieutenant Governor in less than three days. Think you could do the same in terms of regulatory changes for the one minor improvement that's been made to leave for parental and pregnancy purposes?
I'd like you to actually do some work on the bill on employment standards and improve them.
The Chair: That allows us about two and a half minutes per caucus and we'll commence this time with the third party.
Mrs Marion Boyd (London Centre): Thank you very much for your presentation. I gather that what really irks you most about this particular bill is how it sits in context with other pieces of legislation that the government has passed and that basically what you're trying to do is alert people to the fact that this is a piece of a whole sort of plan which in fact goes through and takes away rights of workers and takes away the rights of individuals in many different ways. You've given us some examples of that.
I was a little surprised that you didn't talk a bit more about Bill 7 in this context, because obviously it was the first bill that really said this is a government that is going to take away the rights that workers have had and is determined to rewrite the balance between employers and employees. The government keeps claiming they're restoring that balance so that it's there, and those who oppose this kind of action say that what has happened is a disruption of this balance.
I gather what you're saying in your discussion of this is that this is just another piece of a larger puzzle which shifts that balance more and more in favour of the employer and puts employees in a much more vulnerable position.
Ms Smith: It does very much so. Bill 7 was passed on Halloween -- "Boo." What's wrong with you people? Bill 7 as a context, as a set piece for what falls in place with Bill 26 -- again, the misnaming of this bill as an improvement to employment standards is an insult to anybody who was educated in the public education system in this province. It's definitely part of a set piece: the changes to workers' compensation that are proposed, the notion of no stress-related injury in the workplace. The reality that a minimum employment standard touches a human being's life in Ontario is something that ought to be awfully seriously contemplated, and then get to work and do your job.
Ms Smith: It is. We're waiting for more.
Mr Baird: Thank you very much for your presentation. You mentioned minimum wage. What amount would you like to see the minimum wage at?
Ms Smith: If you did it by regulation quite quickly I'd be looking for a figure around, say, $9.75 an hour minimum just to get everybody over the -- phased, a short period of time; first change.
Mr Baird: I should say that during the election campaign we indicated that we would freeze the minimum wage. Like it or dislike it, it was certainly up front. It didn't come as a surprise. Do you know what the minimum wage is in comparable jurisdictions, our neighbours: Quebec, Manitoba, Michigan, New York?
Ms Smith: Yes, I do. There is a context, of course. When you look at American jurisdictions you'd look at the dollar, you'd look at the political situation in terms of electoral change. You'd have to keep in mind the woefully inadequate federal minimum wage and the way that that's structured. Certainly with the devolution, or Mr Harris out in Jasper asking for certain areas of jurisdiction, it's pretty frightening.
Manitoba for over a decade, for over a dozen years, has had a minimum 40-hour workweek and an eight-hour day in its employment standards that are rigorously enforced. They've had that for I believe well over 12 years. I believe it's lower in Quebec currently, and they've had a utility cost freeze as well. Among a number of things to be factored in and looked at that are in the purview of the provincial government, you would want to look at those issues.
Mr Baird: I certainly can't think of anyplace within 4,000 kilometres of here where the minimum wage is higher.
Ms Smith: Nor mutual fund investments.
Mr Baird: Some have said they would be happy to see the minimum wage increased, in your case to $9 or $9.80 an hour, even if that meant some people would lose their jobs. If that were the case, would you still support the minimum wage increasing?
Ms Smith: Mr Baird, it's really interesting that you would raise the context of people losing their jobs. I can sit here as someone in my community who's really cognizant of, not so much in my own case, many other people whose work, unremunerated, is a substantial contribution to the economy, to the welfare of the community, to every aspect that touches the communities we live in, their viability, economic viability, livability, quality of life, resources development. If you put your mind in the context of what this committee can stand for in terms of resources development, I really think you would want to contemplate that there is all kinds of work done without remuneration in our communities. It may involve a bit of gender analysis, to be sure, but there's lots of work.
Mr Baird: What about the question, though? I'm very interested to know: If it meant that fewer people would be employed but making, let's say, a 50% higher wage, would that be acceptable?
Ms Smith: I don't accept your premise or analysis at all. I think it's deeply flawed.
Mr Baird: Do you have any economists who could indicate that this wouldn't be the case? I can't think of one.
Ms Smith: Let me point out that if I were going to write a theoretical paper on the privatization of universities, departments of economics would be the first part the private sector could pay for, not the public. I don't need an economist.
Mr Hoy: Thank you very much for your presentation this afternoon. I think that if the committee has economists coming forth, we'll ask them those hard questions, should they be here.
I appreciate very much what you've said today. We seem to have centred around the minimum wage discussion. I want to let you know that 30% of the people in my riding make under $30,000 a year, so it's a very significant portion of the population of the riding of Essex-Kent. As well, I think that many people have come here and are fearful of a reduction in the minimum wage, let alone an increase happening. They're more concerned about possible reductions under this act and they've indicated clearly that the minimum wage provides people in Ontario with a quality of life which is very important to all of us. I think that's a concern of yours, particularly in the earlier part of your presentation.
We must be cognizant that the rich, yes indeed, can afford certain changes that this government is proposing, but I submit that the 30% of my riding is not interested in quick action by the government without any voice on their behalf. I appreciate people like yourself and others who have come in the last four days to speak up on behalf of those persons.
Ms Smith: May I respond very briefly? Mr Hoy, I'm surprised that's the statistic. I would have thought there would be a number somewhat higher than 30% in your riding whose incomes are under $30,000 a year. I think that may be the case, and certainly the notion of a lowering of minimum employment standards, including the minimum wage -- first of all, before you ever contemplate that even by regulation which, I suppose, all other things seeming to be equal and recreational drugs not being involved, it's possible that this government would contemplate doing that. But there would be enough people who read the Globe and Mail who would look for a companion piece of legislation showing a dramatic reduction in direct indemnity, sessional indemnity, for the members.
The Chair: Thank you, Ms Smith. We appreciate your coming before us here this afternoon.
LAZARUS COMMUNITY ACTION COALITION
The Chair: The next presentation will be from the Lazarus Community Action Coalition. Good afternoon.
Ms Jacqueline Thompson: Hi. My name is Jacqueline Thompson. I'm a member of the Lazarus Community Action Coalition and am on the steering committee of the provincial coalition as well as the Ontario Social Safety Network.
"Some persons of a desponding spirit are in great concern about that vast number of poor people who are aged, diseased or maimed, and I have been desired to employ my thoughts, what course may be taken to ease the nation of so grievous an encumbrance. But I am not in the least pain upon that matter, because it is very well known that they are every day dying and rotting by cold and famine, and filth and vermin, as fast as can be reasonably expected. And as to the younger labourers, they are now in almost as hopeful a condition. They cannot get work, and consequently pine away for want of nourishment to a degree that if at any time they are accidentally hired to common labour, they have not the strength to perform it, and thus the country and themselves are happily delivered from the evils to come." That's a quote from Jonathan Swift in 1729 from A Modest Proposal.
The Lazarus Community Action Coalition urges this standing committee to recommend against the proposed changes in the Employment Standards Act. The proposals of the present provincial government under Bill 49 require serious critique, consideration, alterations and clear evaluation criteria before they even begin to meet the reform promises as outlined by the minister and the Premier.
The Lazarus Community Action Coalition requested time to present to the committee today because we care about the people who live here. We care about the quality of life and the working conditions and standards in this province we call home. We are concerned not just for ourselves but also for the future and the conditions of the province we will some day leave behind for our children and our neighbours' children. We believe that as citizens we have a collective responsibility to our community and that the government is intended to protect and uphold the interests and values of the people who live here.
One advantage of being situated in a global economy which is often overlooked in favour of focusing only on the global market is that there are numerous successful examples of leadership and decision-making in the contemporary world beyond the less-than-successful neighbours to the south of our borders. In the global picture, these government proposals undermine our economy, our integrity, our principles and the social responsibility to our citizens. On a local level, as citizens and taxpayers we're appalled and outraged by the implicit and explicit erosion of work standards and the impact these will have on the communities where we live, work and raise our families.
While there are numerous concerns with the proposed changes, as well as sensible alternatives, time restraints force these to be presented only in written submissions. However, the dismantling and proposed privatization of the collection function of the Ministry of Labour's employment practices branch speaks very clearly about where this government plans to invest our tax dollars. They propose to forgo investing in our communities in favour of seeking only to generate profits for private businesses and private interests. This specific amendment, like the others proposed in Bill 49, can be evaluated on the basis of factual information, economic analysis and social responsibility.
Beginning with the promotional rhetoric, the provincial government offers only factual misinformation. They promised to "focus on the resolution of claims by contracting out the time-consuming and expensive process of collecting money owed to employees by employers." This rhetoric presents the problem as issues of fiscal responsibility and accountability to the vulnerable employees.
Another implied benefit perpetuated by this rhetoric that is unsubstantiated by the ministry's own facts is the myth that a great number of collections are made by the ministry. In fact, the collection department was closed in 1993 and collection duties were reassigned to the employment standards officers. The Ontario Ministry of Labour employment practices branch annual reports from 1985-86 through to 1995-96 show that over the last three years, $280,271,306, more than 79% in assessments against employers, remains uncollected by the ministry.
Furthermore, according to the Ministry of Labour expenditure reduction strategy 1996-98, the ministry intends to further reduce these positions from 150 personnel to 104. Almost one third of the entire remaining department will no longer be available to process claims for vulnerable workers in our province.
One more missing fact is the actual number of claims the ministry promises to focus on resolving. Routine investigations to determine violations have drastically declined from 1,304 in 1980-81 to a mere 21 investigations in 1994-95. The reduced number of employment standards officers ensures that this situation will worsen.
The facts indicate that this system is not working for the benefit of vulnerable workers, and the proposed changes that we see before us today will further reduce the ability to do so. An example in our own community that this failure to protect workers by enforcing and collecting claim assessments of the Employment Standards act has a detrimental effect: In 1989 the Magna corporation closed its Webster's manufacturing plant in London. Webster's and its parent company left workers without the severance and vacation pay dollars they were legally entitled to receive. This left workers in our community without adequate resources to provide for the basic needs of their families. While some of the dollars owed were made available to workers through the publicly funded employee wage protection program, additional publicly funded income assistance programs were required to meet the basic needs of these families. Tax dollars were utilized as a business loan to Magna Corp, a loan that incurs no interest and has no guarantee of repayment. Indeed, the only monetary cost to Magna for assuming use of our tax dollars is up to 10% of the assessment or a $100 administration fee. The loss of these dollars from our community also impacts on local businesses that would have provided services and basic necessities to these families. The hardship created for the families has never been assessed or compensated.
This example leads us to question the economic analysis that presumes shifting responsibility to the private sector will save taxpayers' money. Such a presumption can only be reached by glossing over or simply ignoring the impact analysis as direct savings in one department are subsequently downloaded into other jurisdictions. Closing the collections branch saved the province the wages and administration of one department; however, it directly impacted the number of investigations employment standards officers were able to conduct. This, in turn, reduced the number of potential collections.
Another option that was and is still available is to increase the number of routine investigations and improve the collections of assessments against employers in violation of the law. This would have created more jobs and, hence, a larger tax revenue base.
Secondly, procedures to enforce the Employment Standards Act are currently available under the act. The provincial government can now file certificates of the orders issued against the employers in court. The penalties assessed against employers, even at the $100 minimum per claim over the past three years, will earn revenues of least $4,718,200. The maximum revenues, using the 10% administrative fee, will potentially amount to $20,827,130 for the same time period.
Additionally, when the publicly funded employee wage protection program covers the amounts owing to employees, it should not only be repaid directly by the delinquent employers, it should be treated as an investment of taxpayers' dollars as a business loan that incurs and compounds interest for the duration of the time it remains unpaid. In addition, employers who violate the legislation should be required to pay for the cost of collecting the money owed, over and above the minimal administrative fees.
Not only would the investigations and collections branches become mutually self-sustaining but the enforcement of reasonable sanctions would act as a deterrent and disincentive to further violations by employers and, subsequently, cut through years of accumulated red tape.
These are options that are both fiscally responsible and accountable to vulnerable employees. The folks in this community are aware that there truly is a mechanism available to focus on the resolution of claims, a procedure that is neither time-consuming nor expensive. Common sense is completely lacking in the proposed amendments, which leads us to the third set of criteria against which they should be measured.
Social responsibility: This is perhaps the area of the most reprehensible shortcomings of the proposed amendments. Time restraints force us to limit consideration to one area; however, I am confident that you now have in hand detailed documentation outlining the punitive nature of the other amendments.
Contracting out collections of assessment entitlement to private collection agencies will create the necessity of numerous solutions to deal with a whole new set of difficulties for the vulnerable in our community.
First, private collection agencies exist to generate profits, not to recoup the money employees are legally entitled to receive. The proposed amendments to the act automatically reduce the potential assessment by up to 75% of what the employee is rightfully entitled to receive. In addition to providing additional interest-free business loans to employers, workers are effectively losing 25% of their wage entitlement. This reduction is particularly devastating for unorganized workers who work in low-paid sectors or occupations such as food processing, foodservice, cleaning, telemarketing, domestic workers and homemakers. Many of these workers are women.
Secondly, to date, the Employment Standards Act has ensured conditions and terms of employment that are not subject to negotiations or disputes, including minimum wage levels, overtime pay, paid vacations, severance pay etc. While not particularly abundant, these basic standards maintained an equal playing field upon which employers can compete. Under the proposed amendments, the provincial government is interfering with the free market. As responsible employers who value the tax revenues of high employment in our community and the business it generates locally, we are appalled by the government sanctions to remove the equal standards currently in place.
Finally, the money generated by employment to access basic necessities is reduced under these amendments and must be subsequently replaced by public dollars to care for the needs in our community. The workers have earned their money and they should not be expected, required or coerced to accept anything less. We find it appalling that you would further suggest that low-income workers must rely on the publicly funded court system to access the money that rightfully belongs to them. Not only is the overburdened court system funded by our tax dollars, justice is virtually inaccessible to those who cannot afford legal representation. In addition, we are well aware of the problems created by the interlinking and overlapping barriers that impact differentially on the poor and the vulnerable within our community.
One example is many citizens carry debts which they pay off slowly over the time when they're working. When employers withhold money that rightfully belongs to the employees, it places the workers in jeopardy of losing their credit standing and of being pursued by the same collection agencies to pay off their debts in full immediately. Thus, collection agencies will recoup the total of all outstanding debts as soon as there is any money to claim. In situations where employees cannot access money owed to them, they are effectively forced to rely on income assistance programs to get by. Furthermore, the Ministry of Community and Social Services will also recoup in full all money provided to the family during the time the income should have been available. Because the collection agency has the power to recover all outstanding debts first, the family may be charged huge overpayments by the Ministry of Community and Social Services. This ministry will deem the income received, regardless of the fact the recipient had no access to or control of the claims processed by the collection agency.
There are numerous similar considerations that have not been taken into account in designing these amendments. Indeed, Gerry Coffin for All Canada Collect pointed out this morning that the proposed amendments were not well planned or researched and create conflicts and violations between acts in regard to the legislation governing the collection agencies.
This proposed bill does not protect vulnerable workers; it increases their hardship. This bill does not save taxpayers money; it saves businesses money and threatens to further reduce Ontario's tax revenue base, simply by reducing the potential taxable income of workers. It would be wise to consider facts in the future, such as the fact that corporate taxes only contribute 8% of the total tax revenues. It is hardly fiscally responsible to propose amendments that remove all hope of eliminating some of the deficit and, further, seek to cast the working standards into a status comparable to that of developing nations around the world.
In closing, I would like to remind you that this is the United Nations International Year for the Eradication of Poverty. If nothing more, it should serve to remind you that there are places in the world where minimum employment standards do not exist, where corporations produce goods for great profits in the global market, where folks sell their organs and their daughters to feed their families. The profits generated in these free zones provide what could loosely be defined as jobs and the profits are sucked out of the communities where they were generated. They do not make the communities a better place to live. They do not provide an adequate standard of living for the residents there. In fact, the presence of the profit generators ensures painful deaths and moral degradation.
If that is truly the vision this government has for our province and our people, then why bother putting us through this exercise of consultation? Why not simply abolish all standards today? After all, would it not be more profitable to have children producing goods locally, rather than having to import them all the way from Honduran sweat shops?
The Chair: Thank you. That allows us one minute per caucus for questioning. We'll start with the government.
Mr Tascona: Thank you very much for your presentation. I'm interested, with respect to page 9 of your brief, in your comments on the role that collection agencies play in collecting debts. You seem to be suggesting that the collection agencies have been very efficient in collecting debts involving the Ministry of Community and Social Services.
Ms Thompson: No, currently -- and this is one of the reasons why this stuff needs to be looked at and researched -- debts that are owing to collection agencies are protected under the legislation. They can't take Ministry of Community and Social Services dollars and apply them to debts because they are only for the basic needs of families. Under this legislation, that protection is gone and the families don't get that money to survive and live on. They may go months with no income whatsoever under this legislation. You need to look at that change really carefully before you touch it.
Mr Tascona: We're not looking at that change. You're commenting on the role of collection agencies and you made comments about them. It would appear that they do a fairly efficient job in what they do.
Ms Thompson: So could the ministry if it would do the work.
Mr Tascona: The ministry did do it and it was disbanded in 1993 by the NDP. They laid off 12 employees, effectively terminated them, and we don't do it any more.
Ms Thompson: You're going to lay off one third more employees, according to your strategy. What you need to do is hire one third more and start processing those claims.
Mr Hoy: Thank you for your presentation this afternoon. On page 7 you say, "Contracting out collections of assessment entitlements to private collection agencies" -- and I won't read the rest of it. It seems to me that what we could have in the future if we go the private collecting route is that like cases could be treated very differently from one to the other. One person, under the proposal that the government's put forward, might get 82% of what they were entitled to. Someone with exactly the same case or circumstances might only get 75%. That in itself I think is worrisome. I appreciate your brief this afternoon very much.
There was another group that made a comment that the Ministry of Community and Social Services may be ready to assure that people on workfare will be protected and will be watching over the employment standards --
Ms Thompson: They've already lost all their rights.
Mr Christopherson: Thank you for your presentation. I'd like to just pick up on one sentence in particular, on page 10 at the top, when you said, "In closing, I would like to remind you that this is the United Nations International Year for the Eradication of Poverty." The last presenter talked about this issue in the context of an overall Tory agenda that outright hurts the most vulnerable and the weakest in our society.
We know that the 22% cut in the income of the poorest of the poor in Ontario, the reductions in education transfer payments, the benefit cuts that are coming to WCB disabled workers, and now we've got this bill of rights for workers under attack -- in the context of what the United Nations says, and I'm sure the government has mouthed the words somewhere by one of their ministers about how much they care about this, what is your sense of where we're going to be by the time the mandate of this government ends up in terms of the standard of living of the poorest of the poor and the working poor and the most vulnerable in our society, including this bill?
Ms Thompson: It's clear that they're moving towards a vision of the free zones where the corporate profits are all that matter. The communities where they're generated don't matter whatsoever. The profits leave the communities. The Lazarus Community Action Coalition believes in community and one of the things that we're doing in partnership with organizations around the province through the Ontario social safety network is monitoring the effects on communities of changes such as we're seeing put forward on the table to take to the United Nations. Canada is up for review, specifically since the elimination of CAP and putting in place measures such as workfare. We will be drawing attention globally to the situation that this government is carrying on in this province.
Mr Christopherson: Very good.
The Chair: Thank you for coming before us here today. We appreciate you taking the time.
CHATHAM AND DISTRICT LABOUR COUNCIL
The Chair: That leads us to the Chatham and District Labour Council. We have 20 minutes for you to divide as you see fit.
Mr Buddy Kitchen: Okay. Thanks a lot. As an introduction, the Chatham and District Labour Council welcomes the opportunity to appear before this committee and to address our concerns regarding the Employment Standards Improvement Act, Bill 49. It must be stated at the outset that we believe our concerns about Bill 49 to be serious. The fact that we travelled 130 miles for a 20-minute presentation indicates our desire to be heard. I'd like to also say I'm very glad to see a couple of local politicians here, as opposed to talking to people I don't really know.
The Chatham and District Labour Council is the central labour body for private and public sector unions in the Kent county area. We represent 25 different unions and upwards of 11,000 members from a broad range of services and industries. These include truck manufacturing, auto parts suppliers, hospital and retail sectors, food processing, telecommunications and government services.
On May 13, 1996, when Labour Minister Witmer introduced Bill 49 amendments, she claimed they were only housekeeping changes to the Employment Standards Act. It is our view that what was presented as minor amendments contain substantive changes, changes which clearly benefit employers and diminish access to justice for both organized and unorganized workers.
The proposed changes will make it easier for employers to escape penalty where they violate basic standards and harder for the average working person in Ontario to enforce his or her rights. These amendments strip unionized workers of the basic standards they have built on under Ontario law for decades. Instead, under Bill 49 these basic standards will become additional items to be negotiated at the bargaining table.
We understand, according to a London Free Press article of August 20, 1996, the minister has now temporarily withdrawn a section of the bill centring around flexible standards, which is section 3 of the bill. This will not stop us from commenting on this section.
Although we appreciate the fact that this most controversial amendment will come under closer scrutiny through a comprehensive review of the act, it is our view the reason behind the withdrawal of this section is directly related to two very significant and public events, those being the Ontario Federation of Labour's bad boss hotline and the employment standards violations at the Screaming Tale restaurants in Belleville and Port Hope.
The OFL bad boss hotline was set up in early August as a toll-free line to allow workers to call in if they were experiencing problems at work, and it has generated more public attention and media scrutiny than this government wishes it would. At a time when this government wants to relax employment standards and enforcement, the hotline is receiving over 100 calls per day regarding violations. Calls include tales of employers not paying wages owed, not granting due vacation or statutory holidays, forcing employees to work beyond legislative limits. Other calls include complaints of firing without cause and harassment.
Realizing that this government has laid off a large number of employment standards officers, some employers have resorted to obscene tactics. As this government is shirking its responsibility in protecting vulnerable people in the workplace, the case of the Screaming Tale Restaurant came to light. In this case, the employer refused to pay servers in his establishment the minimum wage required by law. Instead, he said they were volunteer servers and were working for tips only. The official response to these complaints by the ministry was that it would take at least one to two months for the ministry to look into this matter. Complaints of this nature could be handled much faster if the Ministry of Labour would hire back the hundreds of employment standards officers laid off since last year.
The very nature of these violations is the core of the amendments this government would like to introduce. Witness the way employers comply with these present burdensome regulations now.
These are both classic examples of what happens when the provincial government puts blind faith in the goodwill of employers to provide a decent and fair workplace. What you get are bad bosses. These same employers are becoming accustomed to getting anything they want from this government and are feeling untouchable in this deregulated Ontario. They are abusing and exploiting their employees more than ever.
Failing repeal of this entire bill, largely because of the support given by the business community, I urge the minister to at least rename this bill and call it what it actually is, an Employer's Standard Act. As you heard this morning, it would be administered by the Minister of Corporations.
It is our opinion that any amendment to the Employment Standards Act has to recognize the enormous imbalance of power that exists between employers and employees. Accepting this, it then has to be recognized that individual employees, and in particular non-unionized employees, are in an unequal bargaining position in relation to their employers.
Employment standards then must concern the protection of workers. To that end, the Employment Standards Act and any changes must and should continue to institute uniform, fair and reasonable minimum standards to protect the interests of workers who are in an unequal bargaining position in relation to their employer.
The Chatham and District Labour Council sees no way employment standards in Ontario pose a barrier to profitability, competitiveness and economic growth. What they can do is add a degree of stability to local economies by guaranteeing minimum standards in local employment.
This government claims the objective of Bill 49 is to simplify and streamline the enforcement and administration of the Employment Standards Act. It has already been pointed out that there is no problem in doing either now; it's just not being done.
I'd like to talk about some sections of the bill. With regard to the one pertaining to the flexible standards, realizing this is a section which has been withdrawn for future consideration, I would still like to comment. As it stands, this section allows the workplace parties to contract out minimum standards if the total package under the agreement, "assessed together," confers greater rights than the Employment Standards Act. Workplace parties are being asked to compare and value together non-monetary rights such as hours of work with monetary rights such as overtime pay, contingent rights such as severance pay, and mixed rights, which would include such things as vacation and statutory holidays. This is like comparing apples and oranges.
This amendment will make negotiated settlements much harder to achieve and destroys the intent of workers having the benefit of a complete and coherent set of workplace standards governing important aspects of their working conditions. I'll tell you right now, living in Kent county, they just settled one strike in Wallaceburg and there's another one in Tilbury right now. It's just proving to me it's harder and harder to get a collective agreement nowadays without having to go through negotiating what are considered to be basic standards now.
Enforcement for non-unionized employees: These amendments would download responsibility for the enforcement of minimum standards for non-unionized workers to the individual workers themselves, if they choose the courts to recoup what is rightfully owing them. This is time-consuming and costly. They can, however, choose the employment standards branch through a complaint, but are restricted to collect only $10,000 regardless of what is owing. They have a short, two-week window to decide if they would like to continue under the act or withdraw and pursue a civil remedy. They lose recourse if they do not obtain the necessary legal advice by deadline. For an employee, this amendment is both restrictive and punitive. It does not serve the cause of basic justice in the workplace.
Maximum claims: As stated above, $10,000 is the proposed maximum amount an employee may recover by filing a complaint under the act. The problem is that workers are often owed more than this. Workers who are owed this amount would probably not have the financial means to pursue this through the courts and are being forced to accept less than what they are owed. This could encourage the worst employers -- and there are some of them out there -- to violate the most basic standard and profit from it.
The minister will now have the right to set a minimum amount for a claim through regulation. Workers who make a claim below the minimum, which is as yet unknown, will be denied the right to file a complaint or have an investigation. Imagine if the taxpayers of this province asked for the right not to pay their taxes if they were below a certain dollar figure and they got to choose that dollar figure.
Use of private collectors: This amendment will give private collectors the power to collect amounts owing under the act. It is ironic to think the government's solution to its own inability to collect moneys owed because it didn't enforce the act to begin with is to absolve itself of the responsibility and farm the problem to a collection agency. Tom Sawyer could take a lesson in whitewashing here.
Private collectors may be authorized to charge fees. No doubt, these will be passed on so that the individual who receives the money will be getting less than they are owed. Working people need the current system of public enforcement maintained and improved.
Limitation periods: I include this if only to show the hypocrisy of these amendments. Bill 49 changes a number of time periods in the act. The major change is that employees will be entitled to back pay for a period of only six months from the date the complaint was filed, instead of the previous two years. In contrast, the ministry still has two years from the date the complaint is filed to conduct its investigation and a further two years to get the employer to pay moneys owing. In other words, an employee having made a complaint under the act could wait up to four years before receiving only six months' back pay, not the previous two-year amount. Keep in mind that this could be reduced, depending on the amount the private collector collects minus the user fees.
In conclusion, as our comments on some amendments to Bill 49 and our comments addressed in our introduction indicate, no one concerned with basic minimum standards in terms of employment could possibly favour these amendments. Bill 49 is not about the protection of the interests of workers and it does not attempt to remedy the imbalance of power that exists between employer and employee.
As for the unorganized, Bill 49 is about the race to the bottom. It is about this government's effort to strip what little protection they have under the law away from them. It is about this government's openly aligning itself with the employers and the employer associations of this province, yet telling workers it is acting on their behalf. This is unacceptable.
Mr Hoy: Thank you for being here today. I recognize the exact route you probably travelled to get here, very much so, and have always appreciated your attendance at any of the public forums I might have in the riding.
You talked a bit about the bad boss hotline. I assume the answer will be yes, but you say there are 100 calls a day coming in. Is it the OFL's intention to catalogue what type of infractions or complaints are coming in and then eventually make them public, and more particularly to the government?
Mr Kitchen: Actually, they are trying to do that now, but when they set it up they didn't anticipate the number of calls they are getting now and they don't necessarily have the capability at this time. I phoned the OFL for the statistics on Monday. They say that 100 calls a day is a factual number. This highlights some of the things they receive.
Some of the other things they talked about were violations of minimum wage. let's say, for instance, the minimum wage was $1, and for eight hours they would pay them $8. But really, particularly for young kids, to earn their $8 they are having to work 10 hours to get it. On paper they're putting down that they are paying out the minimum wage when in reality they are not.
It's not just the OFL. Our labour council gets an awful lot of phone calls, particularly at this time of year, from people asking if there's anything we can do for them because of employment standards violations. A lot have to do with students and so on, particularly with seasonal work and what could be considered summer employment. So we get a lot of phone calls above and beyond this hotline itself.
Mr Hoy: We've also had submissions -- and I think you're touching on it when you talk about unorganized labour -- that it's a fact that there is a vast percentage of people who currently are unemployed, so the employment market is very good from the employer's standpoint. He has many people to choose from. People are willing to maybe look away from some of these infractions because they desperately need a job. The government has said that it was going to create 725,000 jobs over its mandate. Clearly that figure of almost three quarters of a million jobs would help to improve things vastly. What's your opinion on the government's performance to date in creating these 725,000 jobs?
Mr Kitchen: In Chatham, I'm represented by two different levels of government, provincial and federal, and both of them campaigned on a job creation program. There has been a supposed increase in jobs, and they're a new kind of jobs; they're called net jobs. I don't know really what those are, but both levels of government are taking credit for those, so these 35,000 new net jobs that have been produced in Ontario, is that 17,000 for the provincial and 18,000 for the feds, or are they both claiming the 35,000? I really don't know.
I don't see the jobs. The place I work at, we're into a massive layoff. A few years ago we hired 1,000 people. That was good for the statistics, but now they just laid off 1,200. With that there's the ripple effect through the community also. I don't see it. I have a 21-year-old daughter who has been essentially looking for full-time employment for over two years now and can't find it, so what she's doing is like many students are doing: going back to school.
Mr Christopherson: Buddy, thanks very much for your presentation. Good to see you again.
On page 7, I believe, you talk about the issue of a new minimum amount, a threshold that a worker has to cross in terms of money they're owed before the ministry will respond. In fact, in some documents it's been referred to as preventing nuisance claims, which is of course quite troublesome for those of us who consider every dollar a worker is owed to be a dollar they're entitled to. It's not anybody's nuisance; it's their money and they're bloody well owed it.
I'd like to ask you two questions. One is, given the fact that the government is giving itself the right to set that minimum by regulation, which means in the cabinet room, not on the floor of the Legislature, and one decision of cabinet can move it, do you, on behalf of the people you represent, have a real concern that the long-term plan of this government is to slowly, when no one's watching, move that dollar figure up further and further so that workers lose more and more money that they're entitled to because it falls into that "nuisance" category?
Secondly, in the real world out there that workers face, especially those not covered by a collective agreement, do you see the possibility that if you've got a bad boss -- and that's what we're talking about here, the bad boss -- who is violating the laws anyway, can you see some of them actually sitting down and calculating: "Okay, the minimum is $100 a year. That means I can go after $50 or $75 per employee every six months and they can't touch me"? Do you see that as realistic or is that just a lot of rhetoric?
Could you comment on those two things?
Mr Kitchen: No, I see that as very realistic.
Let me start off by saying I don't like things being done by regulation in the back room. I'm an open and honest person and anything I say will be open and honest and subject to debate, and I'll accept that fact. But the fact of the matter is, to do something by regulation in the back room which affects people and will impact their lifestyle, I don't like that way that government can be done. Yes, I can see that being done, and the impact of it being done that way really penalizes the person being owed.
Again, let's make reference to the concept of taxpaying. If I owe the government some money, they damn well expect me to pay it. They're not going to let me pay a minimum amount. I think they do have the freedom of a dollar or so, that you don't have to pay anything less than a dollar, but if I owe them money, everything they have coming, they expect. I think that should be the way for employees also. With a minimum wage that has been frozen now -- and people will argue it's not at a livable, decent rate -- people who are owed money, had they had to work at a minimum wage rate, yes, every dollar matters and probably every quarter matters in that instance.
I'm trying to think of the second question. Yes, there are bad bosses out there, there's no doubt about it, and I think I gave examples here of what bosses, if left to their druthers, would do. They're violating the existing standards, let alone watered-down standards, now. I think the reason they're doing that is because they understand that employment standards officers have been laid off and there's a possibility that they can get away with it. If they can do it at tougher standards, what are they going to do at lower standards under the same situation? I'm not by any means saying that all employers are bad, but there are bad employers out there.
The Vice-Chair: Thank you very much. Sorry to cut you off, but we're going over on each answer here.
Mr Kitchen: That's fine. I'm used to that.
Mr Ted Chudleigh (Halton North): Thank you very much for your presentation. Your comments on collections, particularly on summer employment and students, interested me. Ten years or maybe 12 years ago I went through that process with my son, who had been stung with unpaid wages on his last week of employment, cutting grass during the summer. We were able to recapture the funds through the employment standards officer.
I guess in the debate we've been having for the last number of days, we keep hearing this term "bad bosses." We heard it yesterday in Kitchener and in Hamilton and in Toronto as well. I don't think anyone in government or out of government, in previous governments or in current governments, will support bad bosses. Certainly the chamber of commerce I think was asked that question in Kitchener or Hamilton and indicated they didn't represent bad bosses.
Mr Kitchen: Then we don't represent bad employees.
Mr Chudleigh: Exactly. I don't think any legitimate organization represents bad employees either.
What the problem gets down to is identifying what a bad boss is, what a bad employee is, and not only identifying them but putting it in words in legislation that has teeth. That's a very, very difficult process.
We've been through the area of trying to collect money through the government in two or three different ways, and none of them seemed to have worked very well. We have never used the system of using professionals to collect it, collection agencies, which is proposed in this piece of legislation, and we are hopeful this will improve the situation in that area.
But in the area of identifying bad bosses, is there anything that you can help us with? What kinds of criteria do you look at? If you were out looking for a job and you if you did have the opportunity of two jobs, what would the criteria be to identify a good boss or a bad boss?
Mr Kitchen: Well, some of it could be reputation. A large turnover of employees could be indicative.
You're saying you're having a hard time collecting money. Just to get back to it, because I don't want to lose this thought, it seems to me this government has introduced -- I don't know whether it's legislation, regulation or they're just at least talking about it -- about recouping money from "deadbeat dads." This is a new thing. It was for a long, long time thought that they couldn't recoup this money, but now this government has found a way of recouping this money.
Mr Chudleigh: Not yet. We're trying.
Mr Kitchen: Yes, but I mean --
Mr Chudleigh: We're trying to do it through the income tax.
Mr Kitchen: Maybe we could do the same thing with moneys owed to employees from --
Mrs Boyd: Their driver's licence.
Mr Kitchen: Yes, take their driver's licence away, or maybe put their picture up at the post office or something along that line.
In one sector of the government you're saying government will recoup this money that's owed, yet in another sector you're saying you can't do it so we want to privatize it. To me that doesn't make sense. You've addressed essentially the same kind of issue in a different ministry, so why not try it here?
The concept of bad bosses might even go beyond dollars and cents. Some of it is you're trying to recognize scruples and morals possibly. We could have got into the same debate when anti-scab legislation was repealed, and I would have argued to you at that time that a reputable employer would not bring in scabs. I would say the same thing: A reputable employer, a reputable boss, would not purposely go out to screw his employees. But the fact of the matter is, there are some out there who are doing it.
You were saying about your son, your child who couldn't recoup their summer wages. I got a call last summer -- and this happened to deal with this college painting, where they go around. It was extremely hard for us to do it. Despite the fact that we didn't have to, we tried to help this individual. Many times the community that they do the work in, the employer is in a different one. I don't know if you know where Chatham is, but when you come from Chatham --
The Vice-Chair: Excuse me, sir.
Mr Kitchen: -- and you find out that it's in Mississauga, that's big-town Ontario compared to us and we get lost in it.
The Vice-Chair: I'm sorry to interrupt. We are about five minutes over now in the whole presentation.
Mr Kitchen: Are we? I was having a lot of fun.
The Vice-Chair: We do appreciate your sharing your thoughts with us today. Thank you very much.
UNITED STEELWORKERS OF AMERICA, SOUTHWESTERN ONTARIO AREA COUNCIL
The Vice-Chair: Could we have the United Steelworkers of America, southwestern Ontario area council, come forward. I'd ask you please, for the sake of Hansard, to introduce yourself to everybody present.
Mr Terry Coleman: Can I just start by saying that I'm slightly hearing-impaired and I'm having a little trouble. I don't know if it's the acoustics in the room. I'd ask anybody that addresses me to speak slowly and clearly, please. And I didn't hear what you said right now.
The Vice-Chair: Okay. I said welcome to the proceedings and would you please introduce yourself to the committee here as well as for the sake of Hansard.
Mr Coleman: My name is Terry Coleman. I'm here representing the southwestern Ontario Steelworkers area council. I want to start out by thanking the resources development committee, on behalf of our 3,500 members, for this opportunity to air our views on Bill 49. We administer 46 collective agreements in almost every sector of the economy in the southwest area.
It is with great trepidation that I come before you confronted with a piece of legislation authored by a government in a modern democracy that would call Bill 49 "An Act to improve the Employment Standards Act." The minister introduced this bill as housekeeping, and yet the potential impact of this bill is so far-reaching that shock waves were felt immediately throughout the province. How could a Minister of Labour, whose duty it is in cabinet to defend workers, be so out of touch with workers' needs?
Section 1, enforcement of the ESA -- or not: Under a collective agreement, in section 20 of the bill, new section 64.5 of the act, the Employment Standards Act can now be considered to be part of that collective agreement. It will then be the union's duty to investigate and enforce the Employment Standards Act through the grievance and arbitration procedures.
This change speaks quite clearly of privatizing enforcement of a public act. We need an open and public debate to see if the people of Ontario want or need their laws administered by a private body with no recourse to investigate, settle or determine claims. The union will not have access to an employment standards officer's report, personnel and employment records, setting the stage for abuse and obstruction by corporate counsel and ultimately ensuring that justice is not served. Considering the costs and liability involved to a small local union for supplying both fair representation and arbitrators' fees, it is out of reach to furnish this service.
If you will recall from my introduction, the southwestern Ontario Steelworkers area council services 3,500 members and administers 46 collective agreements. That means the average unit size is 76 members. A unit of 76 members simply does not have the resources to police the Employment Standards Act. Do we then pretend there's nothing wrong and not proceed? Who is served by this change?
We are of the opinion that privatizing enforcement is folly. In fact, knowing the conditions of employment today, enforcement needs to be given more muscle.
Section 2, enforcement for non-unionized employees -- or not: This is speaking to sections 19 and 20 of the bill, section 32 and section 21. Taken together, these provisions are an unprecedented attack on people least able to defend themselves.
Firstly, they bar civil remedies for an employee to pursue both an employment standards complaint and civil action. Our council finds it ironic and inconsistent that in the field of auto insurance the government would allow new forms of litigation, but in the employee/employer relationship that same government would move to stop civil proceedings.
In any event, litigation is not a real alternative to working people. It is resource-consuming, both time and money, which many people simply don't have. This gets us back to an employment standards action which in lots of cases, although expeditious and inexpensive, is now faced with an unrealistic time limit to decide -- two weeks -- a cap of six months from the time of the claim for moneys owed, a maximum recovery of $10,000, and an as yet undisclosed minimum.
Why does an employer need this kind of power over an employee? The Steelworkers area council feels these provisions are patently unfair and need to be scrapped.
Section 3, private collection agencies -- or not: Section 28 of the bill, new section 73 of the act, speaks of a major departure in the field of labour relations. No longer is the employee/employer relationship seen as a special relationship, but instead treated as an ordinary activity of commerce.
This is shown clearly in the provisions of this bill as regard collection agencies recovering moneys owed to employees. At the present time, a serious problem with the act is the failure to enforce, and collections fall into this category. We feel it is fundamentally wrong to absolve the government of the responsibility to enforce the act. If the collection agency can only recover a partial settlement, that agency can take a recovery fee for its services, a user fee, to supply a poor settlement. This type of provision will likely lead to smaller settlements and open the door to abuse. Collectors will pressure employees to take smaller settlements, providing a break to the employer, and the fee will be collected from the employee, probably the least able to pay.
Unscrupulous employers will find their liabilities lowered, and thus encouraged to continue their violations of minimum standards. This particular provision is a working model of the race-to-the-bottom mentality of today's business community, and so it must be rejected outright. Our council feels that, as in other areas we have commented on, it is only prudent to enforce this important area of collections more vigorously through public enforcement officers.
Section 4, last-minute changes or not (minimum standards): I appreciate the fact that flexible minimum standards have been removed from Bill 49. I also understand that this concept is to be revisited in the near future. Therefore, I feel obligated to comment on this issue. The government takes the position that as a society we no longer desire or need minimum standards in the key areas of the employee-employer relationship.
The Employment Standards Act is about our society's minimum acceptable workplace rules. What has changed to cause these standards to become irrelevant? Is it that all employers have learned a new benevolence that they couldn't find under force of law? We don't think so. We at the Steelworkers area council are of the belief that government, at the behest of business, has decided to abdicate its responsibility to the least fortunate in our society while business reaps the rewards.
The idea that minimum standards of hours of work, overtime pay and severance pay must confer greater rights than those set out in the act when assessed together is unworkable. This becomes an unruly mess when one tries to assess together purely monetary rights (overtime pay and severance), non-monetary rights (hours of work) and mixed rights (vacation pay and public holidays).
The Steelworkers have many agreements with amiable employers in this province that allow for ongoing negotiations during the life of a collective agreement to allow flexibility, as long as minimum standards are met. I fear for those relationships if basic standards are removed. Allowing employers to table what were once minimum standards while negotiating will certainly serve to frustrate in many cases an already difficult situation, we believe to the point of causing unnecessary labour disputes. This of course flies in the face of the goals of the act and does not reflect a commonsense approach.
It is the opinion of the Steelworkers area council that not only do minimum standards have to be retained; they must be improved if we are to build a better society. We ask that flexible standards not be brought back in the comprehensive review of the act.
Some minor positive changes: Vacation entitlement of two weeks per year accrues whether or not the employment was active, codifying pre-existing jurisprudence of referees. Termination pay is now due seven days after termination (section 5 of the bill). The calculation of service and length of employment will explicitly include time on parental and pregnancy leave, again codifying pre-existing jurisprudence. Although these are positive, we question the impact if enforcement is reduced.
Conclusion: We are very strongly opposed to the changes proposed in Bill 49. We fear for the employees of unscrupulous employers, both organized and unorganized. For many, it will mean undermining an already precarious existence. A modern, democratic society cannot afford to wash its hands of these people in the manner prescribed in Bill 49. Enforcement of the Employment Standards Act must not be left to the vagaries of the private sector. We feel that private collection agencies, along with the monetary cap and severe time restraints, serve only the employer's bottom line and the government's wish to withdraw from the solemn duty of protecting its citizens.
For these reasons, the southwestern Ontario Steelworkers area council asks that this bill be withdrawn from the legislative agenda.
The Vice-Chair: We have two and a half minutes per caucus, starting with the government side.
Mr Shea: May I ask you to turn to page 2 of your submission and ask if you could give me a brief elaboration on your comment, "enforcement needs to be given more muscle." Can we pursue that for a moment? Perhaps give me some illustrations that you think would be helpful.
Mr Coleman: To be quite frank with you, I think this body in front of me here is represented by all three parties. I've been around in the workplace for 25 years, so every party here has had a crack at being government, and quite frankly, you're all guilty of not protecting the unorganized in particular.
There are home workers, there are -- I can certainly remember all through my career in the workplace. I've had seven jobs in 25 years, three non-unionized and four unionized. I have seen every kind of violation, and I'll tell you right now, in an unorganized workplace you have almost no rights. You can be paid below minimum wage. Quite frankly, every law can be broken, because you have no recourse, if you want to keep working.
Mr Shea: You put your finger on an issue that I know is of real concern to the minister. You have talked about home work, and that's a growing issue. As you may know, the recent city of Toronto planning statistics say one in five people is now working out of their home. That's a real concern reflecting a need to update the Employment Standards Act, so I'm concerned at how you perceive the enforcement being extended into that kind of a setting. I'd like your thoughts on that. How do you do that effectively?
Mr Coleman: Quite frankly, I'm unprepared to answer that. I've looked at it, and I'm quite convinced that what's going on here -- I can't tell you what's going to happen any more than you can in the comprehensive review, but the changes here are certainly not doing anything to help it that I can see.
Mr Shea: Like you, I am as frustrated by the shortness of time to pursue questioning, but unfortunately, that's the rule of the committee. Let me very quickly ask you --
The Vice-Chair: Mr Shea, you just --
Mr Shea: See what I mean?
The Vice-Chair: Sorry about that.
Mr Jean-Marc Lalonde (Prescott and Russell): Terry, were you satisfied with the actual Employment Standards Act?
Mr Coleman: With which one?
Mr Lalonde: The one we have in place at the present time.
Mr Coleman: No.
Mr Lalonde: I believe that the government has decided to let go 45 enforcement officers, but probably instead of letting them go, they should make sure they have proper training and make sure that what was in place was enforced. From what we have seen, and we were told ever since we started the hearings, people seem to be mostly in favour of what was in place, but it seemed to be that the enforcement officers were not properly trained to make sure that they followed the procedures. That is one of them.
The other one, the fact that we are going to go to privatize the collection, one part that I'm not too happy about is the user fee. I really believe at this point that the fact that the employer is entitled to be charged -- or we will be able to claim up to $10,000, and he knows the fact that we are going to a collection agency. He knows he has to pay, and he's going to drag it as long as possible to make sure that this employee doesn't get the full amount. He will be guaranteed 75%. That is the part that I'm really concerned about. The employer will be mad that we had lodged a complaint and he knows that he has to pay, but he's going to drag it as long as possible to make sure that the employee only gets a part of what is coming back to him. Do you feel that the fact that we are going to privatize, there's a danger at that point?
Mr Coleman: From looking at what I can tell of how this would work in practice, I can almost guarantee you that -- you know, I realize collections aren't what they could be right now, but of the ones that are done, they're going to get less now, I think, from the feel I get, from the look of this.
Mr Lalonde: So all the user fees should be charged to the employer, if it is up to $10,000 plus the amount that the collection agency should be getting from the employer?
Mr Coleman: Well, yes. I realize there's probably an ideological difference here in what's going on. As far as privatizing or not, which I use quite a bit in here, it's then kind of flying in the face of doing business in its most economical form. Do we accept a certain tax level in order to have a fair playing field for all, not only employees but employers? Having them pay more on top of that, if it's a good employer, a mistake was made or whatever, they will pay, plus they will pay on top of that.
Mrs Boyd: Terry, thank you for your presentation. I know you're with an international union and that your union represents people all over North America, so you're familiar with the issues that are there in right-to-work states. Although the members of the government are talking very much in terms of being concerned about employees, the reality is the overwhelming thrust of their legislation throughout their term in office so far has been to level the playing field down to the lowest common denominator, which is in fact what they believe is necessary in order to maintain competition. Do you see this kind of action against our minimum standards as really the first step, the thin edge of the wedge, in driving down employment standards and driving down protection for workers so that in fact that lowest common denominator will be closer at hand?
Mr Coleman: Actually, I think I mentioned it in the brief that it was part of the race to the bottom that labour has been talking about for a long time that really came about through the various free trade deals. It is all one big agenda, from my point of view, most certainly.
Mrs Boyd: I would certainly agree with you. I think this is just one little piece in that larger picture of how to in fact increase more and more power for employers, to enable them to call the shots, so they can show that they are able to attract the large profits that are going to impress international corporations. We've certainly seen that in negotiating over a number of years. I know your union has been in a position where in order to maintain jobs at all you have had to make some concessions and that is why the whole issue around minimum standards, that, granted, has been withdrawn for the time being, is really the heart of this change, isn't it, because it can force unions as well as the unorganized into agreeing to that erosion of standards that eventually leads to the lowest common denominator.
Mr Coleman: I've kind of come up with a novel concept lately. Quite seriously, I don't know that labour ever saw a problem with the idea of increased or freer international trade and the old theory of the level playing field, but does there not need to be then a level playing field in labour? We're all saying yes, but are we going to come up or are we going to go down?
Mrs Boyd: The last thing is on the collection issue.
The Vice-Chair: I'm sorry, we've now exceeded the time. Thank you very much for your presentation this afternoon.
Mr Shea: On a point of order, Chair: I want to make a point, just to make sure we're very clear, unless there's something I don't understand, that in fact employers do in fact pay levies.
But I wanted to make sure in the minutes -- we received on our desk a moment ago a letter that is signed by a deputant who appeared just a few minutes ago, indicating in response to a question that, in her opinion, the minimum wage ought to be $9.80 per hour. I have received on my desk, and I assume other members have as well, her attempt to correct the record. She wishes that to show $19.80 per hour as the minimum wage. I want to make sure that is in the record. My record shows that this would then raise the Ontario minimum wage to $41,184 a year, plus the ancillaries above that. I think that should be on the record.
The Vice-Chair: I will accept this as a new submission to the committee to be filed. Thank you very much for bringing it to our attention.
MICHAEL KLUG DONNA HOGG
The Vice-Chair: I would ask that Michael Klug and Donna Hogg come forward, please.
Mr Michael Klug: Thank you. My name is Michael Klug and I'm a lawyer who acts for employees and trade unions here in the London area. I'm here today because I'm concerned about the effect Bill 49 will have on my clients and other workers throughout Ontario and on trade unions in general.
Simply put, Bill 49 is a malicious piece of legislation, and I say "malicious" for a reason. It's not just the unintended consequences of this act that are bad; it's what the actual intent of the legislation is. I defy anybody to look at this piece of legislation and come to any other conclusion but that the intent of the legislation is to take money from the most vulnerable workers in this province and put it in the hands of the worst bosses, the cheats and the con artists who are the worst employers in this province. You've taken the most disreputable bosses and the most desperate employees and you've shifted the power balance radically in favour of the bosses. That's wrong.
I'm not going to spend my time today giving a clause-by-clause critique of this legislation. That's been done by the Ontario Federation of Labour employment standards working group. They've done their job well and I support their conclusions.
I wish to grant the majority of my time to Ms Donna Hogg, whose daughter and some of her co-workers are clients of mine currently. I do this with the hope that in listening to Ms Hogg's story and the story of what her son and daughter have been through, you realize that this legislative gamesmanship you engage in has real effects on real people and that it causes pain to people and that you have to justify what you do under that standard. Why are we doing this to people?
Ms Hogg phoned my office a couple of months ago. She was in a state of great distress and asked me quite simply, "Is there anything that can be done or are we wasting our time with this?" The problems Ms Hogg's daughter had at work are simple. She'd been working since September 1995 without getting paid. She'd been working long hours. Ms Hogg will tell the story. I would ask you to listen to that and to consider in particular how Bill 49 will affect people in Ms Hogg's situation. Without further ado, I turn my remaining time over to Ms Hogg.
Ms Donna Hogg: Good afternoon. Basically, last September 8, my daughter and son, who worked for a local landscape company, and two other employees were offered a deal from the owner, that if they worked from September till April with no pay he would turn over the company to them. They had worked there a total of about 17 to 18 years, my son working there for seven years, my daughter two years and the two other employees three and five years. They had no reason not to believe the owner. He had owned the company for 10 years, he'd always paid them, not holidays or anything, but he'd always paid them. They had no reason not to believe him.
In any case, he laid them off September 8. They worked between 12 and 15 hours a day, seven days a week, until Christmas. They did snowplowing over the winter. This was building up to a future. They had Christmas Day off. But they did do litter runs, they went to the university and did ice runs, things like that, they fixed the equipment, for the whole winter. In February and March, they went out and did sales for this company. They got several sales, good sales. Besides, they still did the snowplowing, sometimes as much as 30 to 40 hours a night and then came home and started all over again. They never had a weekend off, never, since that time, right up until June 28.
In any case, when April came, after they had worked these long hours, basically without pay -- and we had hardship; we really did. We were terribly in debt. No one could help us. We're each of us about $15,000 in debt, and that's at very low money; at times we didn't have money and had to go to the food bank. We're a middle-class family. We have never been on social assistance or anything.
In any case, to get that part done, my daughter-in-law is 39 years old. She had lost her job in Ottawa, at Revenue Canada, a changeover in staff -- it was a subcontract for them -- and she'd been there 17 years. She came down here and started out landscaping at that age, but she enjoyed it. Then, within two years, to have a chance to own a company was great.
He said he didn't care how they got through the winter as long as they got through it. In April, they were still snow shovelling, snowplowing -- long hours. They asked him when it was going to be signed. He said, "We'll wait till the end of April, because you do all April's work." They still had no signed agreement or anything. He said it was against the law. Since that time I found out it wasn't, but he said it was against the law.
In any case, in May they started doing landscaping. There were four of them doing 75 contracts. They worked from 5 o'clock in the morning. I never saw them before 10, 11, sometimes 2 o'clock in the morning. They would work all day. This is seven days a week. They had one day off in May.
They believed this person when he talked to them. None of them had any kind of business experience. They were labourers. They had no idea. He said, "We bill them at the end of April, and then the money comes in the end of May" -- and blah, blah, blah -- "Just hold on; it'll turn out okay."
In the meantime, these people were killing themselves. They would come home, sleep for two hours, get up and go out. There was no break. They asked him for more help. He said, "No, it'll come out of your money." But they weren't getting any money. They got $286 twice in May and two $100 cheques in June. Out of that money, my son paid $270 for gas for the truck, and he's never been reimbursed. One of the other lads paid $162 out of his money -- they have all the receipts still -- for gas. The trucks were brand-new trucks, bought last year. They have bald tires. They have 70,000 miles on the trucks. They have no rear lights. They were stopped by the police and the Ministry of Transportation because a trailer didn't have the right licence on it. He was fined $105. This has gone on and on.
In June they still had not received -- except for that $286 twice and $100 each. They're thinking that this is the Canadian dream, they're going to own this company; they are still believing in this person. Like I said, he is reputable. He has a 10-year company, actually 13, but 10 years where he has done reputable work. My son has worked there for him for seven years.
But during April when they went there, he said, "There's no money for you," slammed the door, "Don't come over to my house." You know what I mean? "You are this. You are wussies. What's the matter?" He's sitting at home; they're working between 100 and 120 hours a week, for nothing. Of course, they couldn't do quality work. What person who has three hours' sleep a night can work those hours? From May 1 until June 28 they had one Sunday off, and they were working 100 to 120 hours a week. They didn't know what to do, because he told them it was illegal, right, and until he signed the papers over to them they would have to follow his rules, so they listened to him. In the meantime, I'm harping on.
On June 28, something happened to one of the tractors. Now, none of the equipment was up to par. They had to sharpen their own blades. One night at 11:30, one of the guys was sharpening the blades in the dark in the shop and got a piece of steel in his eye. He left it in his eye and went home because he was so tired. The next day he had to go to the hospital. He worked all day his fingers holding open his eye because they couldn't get behind schedule. He went to the hospital and he was warned, "Do not tell them you were at work when you did it." So he didn't.
My son had a hydraulic line stick in his finger. He had to go to the hospital. He had to tell them he wasn't working. They cut his finger up. He had surgery to stitch it up because it was very poisonous. These people worked with no unemployment, no nothing, for 10 months.
On June 28, after they were asking questions -- they were getting to be really militant about it. They said, "We're supposed to get a pay at this time. Come on, we're supposed to get a pay at this time." We did go and see a lawyer in May who didn't help us at all. He just told us that he didn't know what he could do. So in June, after this kept carrying on, they flatly refused to work.
We're in such debt -- we owe two months' rent on our house; our phone was going to be cut off; our hydro was going to be cut off -- because we were supposed to get paid in April. In June, we were supposed to get -- and I phoned him and I said: "Listen, you have to help us some way. I'm going to be evicted from my house." He said on the 24th, which was a week later, he would have the money for me. I phoned him on the 24th and he told me, "You and your family are at the least of my list right now." This was June 24. So what happened? I borrowed the money off someone else. But we're in debt. We have nowhere to turn. My children have started working now for a new company.
Anyway, on June 28, one of the tractors broke. He said it was demolished. It was $3,000. They said, "Well, we're so tired." Like, when they staged a work refusal not to work for one day and he promised them the world, they slept the whole time because they were exhausted. They were young, though, so their bodies are pretty resilient. Anyway, on June 28 they broke the tractor. They went there and saw him. He screamed and yelled and punched the truck. This is not normal for him, but he has been like this for the last year, or the last six months, I would say. Anyway, he left. He came back on Tuesday after going away for the weekend, but they worked. He told them what to do with the other tractor. He came back on the Tuesday, wrote out a letter and said that the company has ceased operations.
I tried every member of Parliament, every bank, everywhere to try and get money so that I could get these contracts so that my kids could start a business, but we had no money for a year. Where am I going to get money in two days? That was it; they were out of work. There was no money. There was no nothing. There was no proof. There was nothing. So my daughter went around to some of the contracts and spoke to the people. They said, "We won't pay them," or, "We'll try and hold your money." But this has gone on for almost two months now. We don't know if they're still holding the money. He offered them nothing. He offered my daughter $5,000 and the other guys maybe $200; there was no set amount.
Now, the last contact I had with him, he is still working at some union -- he's working doing landscaping. He still has the same trucks. He still has a lot of union contracts, even a government contract. But he's cutting grass. Where are my kids? They've gone to work for a new company. They had no problem getting a job. My daughter was under a lot of stress. She's had health problems. She's been hospitalized four times during the last two months, and it's all stress.
He phoned three weeks ago and said: "I will give you the receivables from April on, and it's approximately $21,000. You collect it." We went to the labour board, which is where we got Michael, and they said that to put in a claim it will take up to six months, maybe. If he goes bankrupt, the government will give us $2,000 each. We can't wait six months. That day we were leaving and we were reading the paper and we found Michael. We went down there to see him and he said: "They can't treat you like this. They just can't."
That's the way it stands now. We've had no money since last September 8 except for the money I told you. They have all started working at another company now and we don't know what to do.
Mr Klug: Just very briefly, to pick up on how Bill 49 would affect this situation, consider first of all these "minor" changes that will increase the efficiency, as the government puts it, of the act and so on and so forth with respect to limitation periods. This is a claim of unpaid wages that lasts for 10 months, so right off the bat the new section 64.3 would act to basically give this employer four months' free labour: the first four months, bang, off the top. That's a gift from Ms Witmer and Mr Harris to this individual out of the pockets of these individuals.
Ms Hogg: I just forgot one more thing. The total amount of money owed to them is over $100,000. That is not counting holiday pay; that is not counting statutory holidays. They worked from May 1 last year until June 28 this year without a day off, without a holiday, nothing. The labour board says that because it's supposed to be seasonal work -- I don't know where "seasonal" work comes in because they work all summer, and then all winter they do snow shovelling, snowplowing, whatever. It may not be permanent, all the time, but it's a lot of it. They may be out of work one or two months, but that's it.
The amount of money that's owing to them -- this person is just laughing. We just added up the wages. Even if we add them up at minimum wage, they add up to $92,000, with no statutory holidays and no overtime, yet he was allowed to send a letter to his customers to say that the reason he's ceasing operations is because his employees, his co-owners, would not work, that they weren't doing quality work and they were demanding more money. They weren't getting any money, but that was part of it; he was allowed to do that.
If they want to get anything like $3,000, $5,000, I have to go and collect, and the $21,000 is just the money since April. The labour board told us, "Sign anything you want; just get as much money as you can get off him." What good is it if he's going to give me that? What's the labour board going to collect the money on to help us any other way? We owe $17,000 for this little escapade, and that was doing dirt. We did without Christmas, we did without holidays -- my family is in Ottawa -- we did without everything for this, for nothing, yet he's free to do what he wants and he's very arrogant.
I actually think he is mentally unbalanced. He thinks he's God, and he believes it; he honestly believes that they screwed up for 10 months. He does. If he were here he would let you know that he gave them an opportunity and they screwed up, at four people doing 75 properties, including large ones, big two acres of land of government property. It's unbelievable. They didn't know whether they were coming or going. They weren't eating proper food because we didn't have any money, but they were working long hours.
Okay, I'm finished. I just wanted to get that out.
Mr Klug: As was pointed out, the restriction on recovery over $10,000 obviously is going to cut severely into any remedy these employees could receive. What possible rationale is there for this limit of $10,000 in recovery? You're basically saying, "If you rip people off bad enough, you win." It is going to act as an encouragement for employers such as this individual to really go for the gusto and get as much as they can out of these people. Once you're over the $10,000 limit, then you're basically off to the races. I defy anybody to come up with any rationale for why, if there's a violation for more than $10,000 -- sorry, is it more difficult to administer over $10,000? It's just basically a giveaway to the worst employers in the province and it's wrong.
Finally, another issue with the limitation period -- actually, it's not the limitation period. I made reference to section 64 earlier. That's the provision, I believe, which restricts your right to pursue a civil action at the same time as an action before the Employment Standards Act. These employees arguably have an enforceable contract with their employer to get this company that was allegedly promised them in exchange for 10 months of free labour. It is quite arguable under the new legislation that they could not pursue that claim, as well as pursue their rights for a minimum wage under the Employment Standards Act. Again, this is just basically a provision which is a giveaway to employers, and employers who don't need it, quite frankly.
Ms Hogg informed me, and she had some involvement with the company on this level, that the receivables for this company were somewhere around $40,000 a month. As you can perceive, their labour costs were quite minimal during this period.
Ms Hogg: Nothing.
Mr Klug: This notion that he's going out of business and closing up shop -- to recover these funds will not be easy in the best of circumstances. Under Bill 49 or, heaven forbid, whatever is due after Bill 49, it's just going to make it more difficult, if not impossible.
The Chair: Mr Klug, I actually let you go two minutes over our schedule, so we won't have time for questions. Thank you both for coming and appearing before us today. We appreciate it.
Is Tara Macdonald here, please?
Ms Tara Macdonald: I am, and I'd like to extend the extra time, if you'd like to take it.
The Chair: You're waiving your spot completely?
Ms Macdonald: Yes, to this group.
The Chair: It's a tad unusual, but we're slightly behind schedule. I propose that if the group would agree, we could give an extra 10 minutes to these people for questions, if that's appropriate.
Mr Hoy: Thank you very much for donating your spot to these persons today.
We have had a number of people come before us, but not a great number, explaining problems they've personally had with the Employment Standards Act. Yours is a case, it appears to me, that's quite likely going to wind up in court. I don't want to make a lot of comments about particular aspects of that. However, it does appear that we, this committee and eventually the government, are going to have to make certain in Bill 49 that people cannot be victimized by bad bosses.
There have been comments made since Monday, when this committee started, by others that we were racing to the bottom as far as employment standards, wages, time worked etc goes. Then there were references on occasion to Mexico and the perceived lack of standards there: low wages, long hours of work. But when certain trade agreements were signed, I can vividly recall in the press that the President of Mexico wanted his people to come up to the North American standard, not for us to go down to his. I think we have to keep in mind, as we deal with legislation and as the government presents legislation, that we ensure that we protect all citizens. I appreciate very much your coming today.
Ms Hogg: Actually, before we go on, he was a very good boss. I'm not saying he was not. He was an excellent boss for seven years. What changed him around to this I have no idea. He had never given me an NSF cheque, which is common in the landscape business. I think what he did -- this is what I truly believe and I've heard -- is that he never paid the government, so they came down on him and he had to make some kind of arrangement. If he had gone to the employees and said, "The government says I have to pay $80,000 or $100,000," they would have worked for him for free, for nothing, all winter because they cared about him that much. Now they hate him, they really do, for what he's done to them.
Mrs Boyd: I can tell it is a really painful thing for you to have to tell this story publicly. I'm sure there are those who would say that when people don't look into this kind of situation and protect themselves, they deserve to be victimized. I don't believe that. I think this is a very sad tale of someone wanting to take advantage of a situation and of the goodwill of people who want to work and want to be independent. I think their story, although different in kind, is replicated again and again. The most vulnerable employees are employees who are in exactly that position. They want to get ahead, so because of their desire to get ahead and to work and be independent, they are prepared to accept situations which they assume to be temporary in order to move forward with their whole agenda and their whole future. I think it's a very good example that you've given us.
Mr Klug: If I might pick up very quickly on that point, there was a significant factual element to this tale that Donna skipped over. At the time this great offer was made to these employees, "Work for free and you get the company," the alternative was, "You're fired." So there was an element of coercion here.
Mrs Boyd: Exactly. "You're laid off. You're finished."
Ms Hogg: They had worked there for a long time. It wasn't like they had worked there six months or something like that.
Mrs Boyd: But you see, this is exactly what everyone is worried about, particularly with the minimum standards issue in there. If people are allowed to negotiate away their rights because they're under that kind of pressure and that kind of threat, that's exactly the problem.
Just looking at the dollar amounts here, basically even without any of the additional things we're talking about somebody walking away -- even at the minimum $10,000 settlement under the Employment Standards Act as revised -- with $60,000.
Ms Hogg: It's probably much more than that.
Mrs Boyd: Certainly, if they were paid for vacation and so on. I guess what was said before was, this is a huge case of four people being victimized for a huge amount of money. But if you have 100 employees and you victimize each of them for whatever, a dollar, under this minimum claim which is going to be, you also stand to make a great deal of money. This is one of the issues we've got here, that if this act goes through, and I think this is what Mr Klug is trying to point out, it erodes anything that can really be called a minimum labour standard in the province.
Ms Hogg: The unfortunate part of it is that he's offered us $21,000 in receivables, and I think they're going to take it because they are very bitter. It's going to take years or months. He's already spent upwards of God knows how much money during the time, so I think they're just going to take it. They'll collect the money and they'll chalk it up to experience. It's unfortunate, but that's what they're going to do, because they're not going to wait for two or three years for it to go to court.
Mrs Boyd: That's the other issue. Under this act it would go out to a collection agency, and that's exactly the kind offer a collection agency would be trying to get people to make: to settle for less than they are owed in order to get anything. That basically is a really serious element of this.
It was interesting that one of the previous speakers talked about the family support plan as being done in a different way. I think you might be interested to know that that's exactly what's planned in the future for the family support plan, because it's going to go out to privatization as well with the Royal Bank and Unisys. We're going to see exactly the same kind of thing, people being told, "If you want anything, you'd better settle for this amount which is what we're able to collect." I think people have to be really aware that this is just one piece of a big picture which is allowing those who have to take more, and those have little to have very little recourse against them.
Ms Hogg: I knew you would have a good opinion on it because even though I'm not an NDPer, I called every member of Parliament's offices, and you were the only one who called me back. Every one I left a message at, unfortunately, and it's not being, you know --
The Chair: Thank you, Mrs Boyd. Mr O'Toole.
Mr O'Toole: Thank you for telling us a real-life story. I very much appreciate it. It really does bring to light real problems, that people do need to be educated and advised on their rights, and I hope these public hearings are serving that purpose.
Experience is the greatest teacher. It's a sad way to learn it for your children.
You did say, clearly, that you did contact the local MP and MPP?
Ms Hogg: That's correct. Everyone. I was hysterical. I really was. I could not believe it. I was hysterical and I tried to call every member of Parliament. It was holiday time, but I did call every member of Parliament who is in the London area and Mrs Boyd called me back.
Mr O'Toole: I just want to pursue a small technical thing. You have legal advice now and I think you're going about that now in a much more meaningful manner. I'd ask one question of perhaps either you or your lawyer. At the time of that agreement, "agreement" implies to me that there was -- verbal or written is a contract.
Ms Hogg: Verbal between four people and the owner.
Mr O'Toole: There are witnesses, and that I believe can be established as a point of some sort of agreement. As a lawyer, I'm asking really the person whom you are paying to offer you advice to help us work through this. Is there, in your view as a trained professional, a contract when it isn't written?
Mr Klug: I believe there's a strong argument that there is a contract, yes.
Mr O'Toole: That's important to establish, and I would suspect, myself, any person would need to have the deeds and those kinds of documents for whatever properties or entitlements --
Ms Hogg: It's not a problem that way. I think --
Mr Klug: Let him go ahead.
Mr O'Toole: What I'm trying to establish -- for us, the act in itself doesn't really cover individuals making those kinds of side agreements, and in fact the lawyer earlier on may have been of some help.
I just want to point out, though, that there is some opportunity here for you in this act. The act to be read should look at section 32 of Bill 49, and making reference to subsection 82.3(4). In that it says that where an employer continues to violate standards under the act repeatedly over time, a one-year limitation period may apply.
You had a 10-month period, so even in this act, in that limitation period, with your 10 months you still could get the whole amount under the act as far as it applies to a claim. But you would take the legal course; you're entitled to go for more than the $10,000.
I just want to make one small other point on the six-month rule. If we educate people, individuals, not to let these bad employment situations linger -- two years would have become much more complicated. That's what happens. It gets more complicated and more difficult to substantiate some of the abuses, if you will.
Ms Hogg: Does that mean with working this way that the labour board is going to work within a week or two weeks?
Mr O'Toole: I can't, at this point in time -- you still have a period of two years, I believe.
Mr Klug: Just very quickly, the limitation period is still, even in those circumstances, being at least halved. I did note that provision, that there is at least some provision to go back a year before the complaint to look at funds that are available within that period, but it's still a significant reduction from the two-year limitation period that was in effect, and of course you've got the $10,000 ceiling and you've got a choice, one or the other.
Under Bill 49, you would -- whether or not there was a contract is a difficult question, and if unsuccessful, these people would end up with nothing because you don't have that fallback on the Employment Standards Act. That's the problem.
With the cuts -- I can hardly resist -- to legal aid that have been put in place, one has some difficult launching into the type of complex litigation that would be required to establish that these discussions that were being held in some way entailed an enforceable contract or in some way gave rise to some other cause of action, especially given the financial wherewithal of the clients. So it's not just the Employment Standards Act; there are a number of other actions this government has taken that have made it very difficult for these individuals as well.
Mr O'Toole: Thank you very much, and again, we do sympathize with your story.
CANADIAN UNION OF POSTAL WORKERS, OMTARIO REGIONAL OFFICE
The Chair: That would then lead us to the Canadian Union of Postal Workers, Ontario region. Good afternoon.
Ms Elaine McMurray: Good afternoon. My name is Elaine McMurray. I'm the regional education organization officer for the Canadian Union of Postal Workers, Ontario region. Beside me is John Stevenson. He's a union representative out of our office. Our office is in the London area.
First of all, I have to apologize. I will, unfortunately, be reading most of this. However, we felt it very important to give our concerns and our objections to the bill. We are basically a federal union. However, we not only have members who fall under provincial jurisdictions but in fact we just organized the cleaners in the Kitchener post office, and we at one time had the certification for cleaners of Mr Gallant Services in Windsor, Ontario. We are currently on an organizing drive for other cleaners as well which fall under provincial jurisdiction.
Although the majority of our members do fall under federal guidelines and jurisdictions, as I mentioned, we do have some falling out. Previously noted groups plus other workers in delivery- or communications-related fields also respond to provincial laws and regulations, which we are finding out as we go about organizing other groups. Each successful organizing campaign brings in new groups and members under provincial statutes.
When the Honourable Elizabeth Witmer introduced changes to the Employment Standards Act, we, like many other unions in the province, reacted by scrutinizing what was being called "minor" and "housekeeping." We have no faith or trust in the present government in that what it proposes will benefit the workers in Ontario. After reviewing what has been tabled, we see that the end result, after the dust has settled, could be an eventual deterioration in all Ontario workers' standard of living.
As I mentioned before, even though we do fall under federal jurisdiction, we happen to live, eat, breathe, work and buy in the province of Ontario. As well, many of our members have spouses and children who work in Ontario and fall under provincial standards. If you look at Canadian statistics, most Canadian families now have two incomes at least in the family. What affects our families also affects us. If they suffer, we suffer. If they are stressed, we are stressed. If we are stressed, our productivity suffers. If our productivity suffers, our employer gets angry. So overall, not only are we affected, but so is our employer, who happens to be a federal employer. With over 20,000 postal workers in the province of Ontario -- this is one third of Canada Post's total workforce -- I believe Canada Post should be as concerned as we are.
On behalf of the members and the families, as I mentioned earlier, we are opposed to Bill 49. The changes only benefit those individuals who have the money and the cheats of this province.
If you note, a lot of vocabulary is now peppered with corporate terms such as contracting out, outsourcing, downsizing, fiscal responsibility, business plans and tax breaks, to name a few. I realize this may sound rhetorical; however, we do believe one of the corporate terms that should be added to the list, especially as this goes through, is one that we call "legislative boss cheats."
I had planned and hoped to bring members or their spouses to relate their own experiences. Unfortunately, they could not be here. Some are too busy to survive the 1990s pressures, and as I mentioned the cleaners in Kitchener, a lot of them are working right now and we don't have the ability to pull them off the job as easily as perhaps a federal postal worker can be. Some are also busy with two jobs, because a lot of our members are also part-time, which seems to be a trend both in the federal and provincial jurisdictions.
But what has been told to me, and this is from members across our area, which extends from Scarborough to the Golden Horseshoe area or from Windsor to the Owen Sound area, is that they are calling what the OFL, the Ontario Federation of Labour, set up as the bad boss hotline. They are utilizing that line; they are encouraging their families to utilize that line.
The next portion of my brief, though, because this is just the brief introduction, will talk about some reviews on some of the key amendments.
To be blunt, and as has been stated earlier, we are in total agreement with the Ontario Federation of Labour's stand on Bill 49. Members in my region have participated in the calls for action by the Ontario Federation of Labour and will continue to do so. The attacks by the Ontario government on people while at the same time promising sweet tax breaks have allowed the Canadian Union of Postal Workers to mobilize our membership.
Bill 49: On the flexible standards part of the bill, prior to Bill 49 there were basic rights. We noted that. There were rights in Ontario that were quite similar to the basic rights as set out by the Canada Labour Code, which we are more familiar with. Contractual language could not erode the minimum standards as set out by the law. Prior to these housekeeping amendments or proposals that have been suggested, in any negotiations that took place, we, the workers, had a level playing field, which produced in the province of Ontario a higher standard of living than in other provinces.
If Bill 49 continues as is, by allowing the collective language to supersede the basic standards in areas like hours of work, severance pay, overtime, public holidays and vacation pay when a contract "confers greater rights when those matters are assessed together," this disturbs the workers' level playing field. It gives more to the employers; it gives more power to the employers. It disturbs the basic negotiating.
You combine that with the push for tradeoffs, with the legalized use of scabs, who are the underemployed, and it will before the end of the political mandate of the current government erode current minimum protections. That is something that I realize is possible, but in our minds it could be inevitable. We at this point in time have to make known that we oppose any deterioration in minimum standards which leads to a deterioration in the standard of living not only for our members in Ontario or members under provincial jurisdiction, but the members from across the country.
Employers in the past, in addition, have successfully used threats such as plant closures to achieve rollbacks. If there were no minimum rights, workers would be forced to either accept longer hours of work or less time off to keep jobs. With unemployment high -- and this is something we also are affected by, even though we have employment -- plus the fact that more part-time than full-time jobs exist now, not only in Ontario but in Canada, cuts in employment benefits and welfare combined with stricter rules on both UI and welfare place substantial pressure on a worker to keep the job as it is, rather than take any chances in fighting injustices, rather than spending money in trying to get what is rightfully earned by them.
The government, in proposing what is before you, is offering no protection for the workers.
Prior to the NDP government's changes to the labour standards or the labour bill, our cleaners in areas were not covered by successor rights. In the past, we had one company that was able to drag out negotiations till the eve of the expiration of their contract with Canada Post. The purpose of signing a collective agreement becomes meaningless within hours of the ink drying. Where is the protection to the employees?
What happened in this case was the cleaning contractor demanded that the employees provide names, the social insurance numbers of dependants and/or spouses so that moneys earned for overtime work could be paid at straight-time rates. From bitter experience we know that there are bosses out there that are able to manipulate what were labour standards at the time by employing illegal means such as I mentioned above, by forcing people to provide SIN numbers and names of spouses and/or children in order to have a cheque cut directly to them, instead of having a cheque for the overtime payment.
Watering down minimum standards will allow employers to legally do what they have attempted to do illegally in the past. The Canadian Union of Postal Workers sees flexible standards increasing labour disputes. Our cleaners, who are the lowest wage earners in our union, may never see the standard of living improve. With the elimination of successor rights, we could even see their jobs erode. That is very important to us.
Enforcement for the organized workers: Presently, unionized employees have access to the investigative and enforcement powers of the Ministry of Labour. The process has proven to be inexpensive and a relatively expeditious method for unionized employees, their unions and employer. Eliminating this avenue for unionized workers will place a burden on the grievance procedure. Under Bill 49, the Ontario government would successfully transfer costs to unions and to their employer for enforcement.
In addition, we can see a backlog of cases developing that will prolong the length of time before one of our cleaners could achieve a settlement. The Canadian Union of Postal Workers knows what grievance logjams are from bitter experience. We have also been successful in utilizing the grievance arbitration procedure to the tune of millions of dollars in arbitration. One of our locals, the Scarborough local in particular, has successfully won between $10 million and $15 million in moneys for our temporary, casual workers.
We know what it is to utilize the grievance arbitration procedure. We also know what a backlog is. It is appalling for any employer and any government to try to use that to negate the rights of workers.
The cost, though, for a union is high. Approximately $3 million annually is budgeted from the Canadian Union of Postal Workers. As I said, we are a national union. We have about 32,000 to 34,000 members across the country. We budget for that and we have been able, because of that, to be successful in grievance arbitration.
However, even though our union is prepared for this, there are other unions, smaller unions or bargaining groups that are not. We see these amendments as aimed at starving smaller unions into submission, while encouraging members of other unions, such as ourselves perhaps, to take their union to the Ontario Labour Relations Board with complaints of fair representation. We have also been exposed to that as well. Any employer who believes they will escape their share in payment for standards is banking on fool's gold. Unions will be obligated and forced to bargain for more to offset their members' legal costs. The bottom line? Strikes will be lengthy and vicious. When you put somebody's back against the wall, there's no other choice.
Enforcement and the unorganized: If these sections pass, we foresee the responsibility for enforcement of minimum standards for non-union workers being transferred from the Minister of Labour to the courts by way of the "other means" provision; also, the amount that is recoverable being capped at $10,000, whereas currently there is no arbitrary limit.
Plus, if an employee chooses one avenue, such as to claim for severance payments to the ministry, then Bill 49 restricts that employer from bringing civil action for payment in lieu of a wrongful dismissal for additional compensation. We recognize what it says in the act.
What these proposals mean to us is that workers who want to file complaints will have two weeks to decide to choose between taking a chance in civil court or proceeding under the regulations of the act. In other words, if these changes pass, the government will have shifted responsibility from itself to enforce laws to the workers, who will have to decide: door number one, courts, or door number two, the act. If the worker chooses door number one, will they be entitled to legal aid to assist in any legal costs? Will they be able to understand the act if they choose door number two? Many of our cleaners have English as a second language and that provides another impediment. They do not know the laws and if they do not have a union to help explain the laws, then they have double jeopardy. They will not be able to understand what's in front of them. They will not be able to decide door number one or door number two. In that eventuality, they will lose out.
In addition Section 64.4 contains restrictive language in which, once civil action is started, employers are given the bonus of not paying wages owed. From our experience with employers such as Canada Post Corp, we can see them banking the money, collecting interest or counting it as a possible future liability. How does the worker gain from this? Bill 49 punishes the employees, not the employer, for the employers' abuses.
The ceiling on claims: The arbitrary maximum amount of $10,000 seems to apply to amounts owing of back wages and other moneys such as vacation, severance or termination pay.
While the bill notes that violations of the pregnancy and parental leave provisions and unlawful reprisals are excluded, those benefits are insignificant compared to the amounts that other workers will lose with a cap in place. From our experience in dealing with complaints from pregnancy or parental leave provisions, we have also utilized the Human Rights Act in trying to get justice for those members. Not only have we utilized the contract, we've utilized the labour code and we've utilized the Human Rights Act. I can't see any difference in this particular case.
Severance pay owed to a 20-year employee for a plant closure adds up to more than $10,000. Arbitrarily maximum or minimum claims will encourage employers to bank the potential losses, or just to avoid any payments due under any contracts.
Private collectors: Bill 49 recommends that private collectors be used in lieu of the labour employment practices branch. Once again the Ontario government is shifting the burden of governing to the private sector and, on top of it, adding a collection fee. Victims get to pay for trying to obtain what is legally owed to them. This is morally reprehensible.
How can you expect workers, such as our postal cleaners, to afford trying to collect what is rightfully owed them? They don't earn enough -- or are you advocating that people work for free, like the Screaming Tale workers who have been in the newspapers recently, for tips alone?
In conclusion, our brief may lack for examples of victims; however, the Canadian Union of Postal Workers is concerned. Our members are concerned for themselves and for their families. What you propose in the legislation will impede our negotiations with our cleaners on a direct course. The Canadian Union of Postal Workers has a reputation for its militancy. Why force us to deploy what has always been considered by us and by our members as a last resort weapon, and that is strike?
We are also concerned that the Ontario government will set a precedent, not only for other provinces but for the federal government as well. So it may have a direct result on our members such as the cleaners, but it could have an indirect result on future negotiations and future labour standards. For example, we were informed that the Chrétien government had a draft of federal anti-scab legislation prepared which had been shelved into the dead letter office when the Ontario Conservatives repealed the NDP's anti-scab legislation. Whether we are federal workers or not, the Canadian Union of Postal Workers members work in the province of Ontario. Members of our families and our friends work under provincial regulations and laws. If you deny my family a right to minimum standards and justice, you are interfering with my happiness and living standards.
We see no benefits to the proposals under Bill 49. What we foresee if they pass as is are organized workers and their unions being forced into longer, more violent and bitter confrontations. The employers of the unionized sectors will see increased cost, rather than savings. Canada Post Corp, for example, by bitter experience, has spent millions in past labour disputes, and we are still here.
The most vulnerable, the unorganized or the underemployed will never see a better standard of living, which in turn will affect the buying power of the average Ontario citizen. If we do not purchase the goods or services in this province, then businesses will suffer. They will lose. You have to look to the past -- the labour strikes, the labour in the past, the working conditions, the past living standards. Our youth's morale is now low. With no government protection, they face a bleak working life. What affects them also affects us.
The Chair: Thank you, Ms McMurray. I actually let you go over, because I didn't want to interrupt your conclusion there.
Ms McMurray: Sorry.
The Chair: No, that's fine. Thank you both for coming in and submitting a very detailed brief. We appreciate it.
LONDON AND DISTRICT SERVICE WORKERS' UNION, LOCAL 220
The Chair: That leads us then to the London and District Service Workers' Union, Local 220. Welcome to the committee. Again, we have 20 minutes for you to divide as you see fit between presentation or question and answer.
Mr Mike Morin: Thank you. My name is Mike Morin and I'm representing the London and District Service Workers' Union, Local 220, which is an affiliate of the Service Employees International Union. Our local is a composite local. We deal with about 115 employers in a geographic area going east to the Kitchener-Waterloo area, north to Owen Sound, west to Sarnia and south to Lake Erie. SEIU represents about 53,000 employees in Ontario, of which about 27,000 work in 92 hospitals. Local 220 represents workers at 23 hospitals, as well as about 35 nursing homes and 12 or 15 homes for the aged. We also represent people in various community agencies and the public sector generally. Approximately 80% of our members are women.
I just want to read to you from the business plan that accompanied the bill, where Labour Minister Witmer introduced the bill as "administrative housekeeping...facilitating administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures." We find that what are being portrayed as minor changes are actually major structural and procedural changes. I heard one labour lawyer refer to Bill 49 as Bill 7 squared.
These changes will clearly benefit those people with a lot of resources and will hurt people who are low in resources. I think it's a clever act in conjunction with a number of other changes that will put a lot of financial pressure on the organized sector in Ontario, and the unorganized sector will simply be left hanging.
First, I'd like to speak briefly to the impact on the organized workers, in particular the section that forces the negotiation of certain employment standards. My understanding is that Labour Minister Witmer has decided to put this on hold until the fall when a more comprehensive review of the act takes place. We would still like to speak to that, with the hope that maybe it will be permanently shelved.
Before Bill 49 you knew what the standards were out there, and basically unions would build on that. If this act is passed with that particular part in it, then employers can now propose substandard concessions on hours of work, overtime pay, public holidays, vacation pay and severance pay.
I'd like to run through an example and put it in some sort of context. The example I want to look at is overtime pay. Under the guise of flexibility, the employer can propose less than the standard. Presumably, as long as the rest of the collective agreement is valued at more than that, then that's within the law. It's not clear whether we're talking about the collective agreement just on those items or the whole collective agreement. However, to put it in a context, we now are in a period -- I'm looking in particular at the health care sector, where most of our workers are -- where to us this is an open invitation to the employers to put on the table various concessions.
With the overtime one, the employer may simply propose straight time, no time and a half for extra hours. You have to look at the health care sector, where we are experiencing layoffs and the work is becoming more and more part-time. So you have the desperate-for-work worker being pitted against the union, which is trying to maintain historical standards. The effect here is to create conflict between the membership and the union, and of course it will increase conflict between our members and the employer in terms of our members suddenly finding themselves faced with not being paid at a time-and-a-half rate.
How do you evaluate such a tradeoff? Do we do an audit of the amount the employer has saved, from time to time, on simply paying straight wages as opposed to overtime? Are workers going to keep a log and keep track of this amount or are they simply going to be very grateful for having been given some extra hours of work? I think we all know the answer to that question. How is this reducing ambiguity? It's not; it's creating ambiguity.
The other area where both the employer and the union will incur additional costs is in disputes over evaluating whether the substandard working conditions are equal to or less than the collective agreement.
We also have to look at this in terms of other parts of the act, in particular where the onus is now going to be on the union to enforce the employment standards. Many of our workers are in the essential services, which means that they don't have a right to strike. The employers will simply put these proposals on the table because they've got absolutely nothing to lose; there's no lockout or strike here.
These changes, in addition to changes that came out through Bill 26 with respect to the Hospital Labour Disputes Arbitration Act, where arbitrators are now given certain criteria that they must consider, including ability to pay -- so you have a shrinking health care dollar, lots of pressure there -- the combination here is that an arbitrator can award these substandard provisions.
Enforcement under the act, section 20 of the bill: Again, we currently have a system that is relatively inexpensive and expeditious versus going through the grievance arbitration process. I'm not going to go into that much detail there, but for all practical purposes, the enforcement of the public legislation has been privatized.
Should these amendments pass without change, then it will be the responsibility of the union to enforce, police etc. If they have a grievance, it will have to go through the process which structurally opens the door to -- and the act allows for compromise settlements. If the member is not happy with that, then they can go to the Labour Relations Board. Whether they have a case or not doesn't matter that much, because certainly their dues will still have to be used to have staff and/or legal representation there. It creates an added opportunity for chewing up limited resources that the union has.
With respect to the non-organized employees, and in particular we're looking at service workers who often work in foodservice industries, cleaning and so on, where the conditions of work tend to be fairly minimal, I can see employers using the part about negotiating employment standards to discourage their workers from considering getting organized. They may end up with lower standards on individual items than what they had before.
Enforcement: Again, the choice is between the courts or the employment standards branch. Looking at these workers whose conditions are minimal, they will probably tend to opt for the employment standards branch because they can't afford the cost and the wait involved in going through the courts, that in conjunction with the fact that once they choose the employment standards branch they have a limit on the amount they can collect. If we look at that in context, most unorganized workers I believe are not going to file a complaint against their employer until they have either secured other employment or lost their job. By and large here, something could be going on for years and years, but it will only be at the end of that period that they will raise a complaint. This is a gift to a bad employer.
The same can be said for the time limit of six months. In that same context, they would go through the branch because the courts are too expensive. You must also consider the fact that the Ontario legal aid plan has been scaled back and no longer covers most employment cases. We see this as another gift to a bad employer.
The use of private collection agencies: This is opening the door to privatize the collection business as opposed to using public servants. What is particularly disturbing beyond the question of whether this will be more efficient is that it allows for settlements that are less than the moneys owing, and payment of the collection agency can come out of this amount, further reducing the money owing to an aggrieved worker.
The sections dealing with pregnancy and parental leave: We see these as clearly positive amendments which we support. The length of time on parental or pregnancy leave will be used in the calculation of length of employment, length of service, seniority and so on.
I would just like to quickly summarize our conclusions.
Negotiating the employment standards: We see this as clearly favouring the employer by opening up new concessionary possibilities, and in the public sector essential work area there's nothing to lose by putting those back on the table. It will simply inundate the arbitrators with more unresolved issues at the table. We would also like to note that the cost involved with evaluation and so on will be using up very precious health care dollars of the employer to deal with that litigation.
Enforcement under the collective agreement now being in the union's park: Arbitrators cost anywhere from $1,000 to $3,000 a day, and then you have your legal costs on top of that. This is an expensive proposition. It will deplete limited union resources, create some business for the private labour sector and eliminate public jobs. Again, we bring to your attention that precious health care dollars will now be going towards litigation as opposed to maintaining the level of health care service.
Limits on the monetary amount of a claim and on retroactive limit of six months: We feel this clearly favours the employers, especially when you consider that most unorganized employees will not lodge a complaint until they have either decided to give up on the job or found other work.
In conclusion, Local 220 finds that the Harris government is victimizing Ontario's most vulnerable citizens to cater to the wealthiest segments of society. In an attempt to avoid further unrest and conflict for a large majority of Ontario citizens, we encourage that Bill 49 be reconsidered and structured in a manner such that the legislation will achieve a fair balance between the unorganized, the organized and the employers.
Mr Christopherson: I'm glad we've got a minute left. You raised the issue of what would happen in terms of organizing drives and the impact on employers saying to potential union members, "You might end up with a contract that's negotiated below the standards." Conversely, on the issue of the impact on unorganized workers, the minister, on the day that she made the announcement in a scrum outside the House, was asked the question about whether it's possible for a non-union shop to bargain away Christmas or overtime or whatever -- is it possible to change the minimum standards? The answer from the minister was, "I guess there would be that opportunity to make those changes." The reporter asked: "In a non-union shop? How would you go about doing that?" The minister answered: "Obviously that's something we would need to take a look at. Obviously there is the opportunity to make some changes."
What would you think about that in terms of what kind of alternative method for collective thinking or collective action on the part of workers, if they're not organized through a union?
Mr Morin: The example I raised was kind of a ripple effect, where some people may think about organizing and on those particular issues, individual issues could end up substandard. My understanding is this is just the first round and the next round, presumably, they're going to be looking at the individual standards and they'll do what they're going to do there.
Mr Christopherson: I suggest to you that's very frightening in terms of the future of the labour movement if the government institutes some ability in some way -- either that or the minister doesn't know what she's talking about; I'm giving her the benefit of the doubt. But that's quite frightening to think about the government providing some framework for collective action other than through a recognized union and proper bargaining agent. That's very frightening and the labour movement ought to be thinking about that, I would suggest.
Mr Tascona: Just with respect to a couple of matters in your brief; I thank you for your brief. At page 1 you say that in Bill 49, if passed in its present form, it's possible for the employer to propose standards that undercut the minimal standards with respect to a number of matters including severance pay. You may or may not know, but under the current legislation, a union has been given responsibility for negotiating severance pay and in fact, they can contract out of the act to deal with severance pay, and that's been in its present form for a number of years. I'd like to bring that to your attention.
One other area you were mentioning with respect to the enforcement of a collective agreement: Is rights arbitration quicker than the employment standards branch? The present turnaround time for the branch, I understand, is about seven months per claim and there is expedited arbitration under the Labour Relations Act, which is a far quicker process than seven months. I think that may answer your question.
But one other area I want to deal with you on -- because the service workers' union is a sophisticated union, they've been around a long time. My experience is that they've negotiated -- you'll find in collective agreements negotiated provisions that employers have to abide by the health and safety act, employers have to abide by the Human Rights Code, and in fact, I've seen collective agreements where they've had to abide by the Employment Standards Act. So that's something that isn't new and if that's the case in the collective agreement, then the employer, if they did breach the act, it's common for unions to file a grievance and then force them to comply with the standards under the Human Rights Code etc, and the health and safety act. That's not something that is new out there and I would say to yourself, as a service workers' union employee, that's something I would imagine you've dealt with in negotiating and administering collective agreements, that where those provisions exist, you'd enforce them.
Mr Morin: I'll just make a couple of comments. First of all, on the expedited arbitration, you're right, that is a quicker way to get to a hearing; however, to get an award to come down might take another six months or a year. So you may get there faster, but that doesn't mean the decision is down faster.
You're right about the fact that unions can file grievances on violations of the act; that's always been there. However, now we don't have the choice of using an employment standards officer. If we wanted to go that way, we could go that way.
Mr Hoy: My question actually was in regard to what was at the bottom of page 3 in regard to non-organized employees, as well, and you did answer part of that. It seems to me that there's kind of a catch-22 situation going on there for some of these service sector employees. However, there is one place where the Minister of Agriculture and I agree and that is probably where the foodservice-agribusiness sector is going to expand. I do agree with him on that, and that includes the hotel functions etc that you mentioned here. So I did take note of what you said here at the bottom of page 3. I believe that's going to be an expanding employment sector in Ontario. I appreciate your comments.
Mr Morin: Stats Canada certainly shows that particular sector expanding. If you want to go historically back, where manufacturing has been shrinking significantly, that sector has been expanding. The stats show that.
The Chair: Thank you for coming before us here this afternoon and making your presentation.
CANADIAN AUTO WORKERS, LOCAL 88
The Chair: Which leads us to the Canadian Auto Workers, Local 88. Good afternoon. Again, 20 minutes for you to divide. I understand there'll be two different documents you'll be presenting today. Perhaps you'd be kind enough to introduce yourselves for the Hansard reporter.
Mr Brian Daley: My name is Brian Daley. I'm from CAW, Local 88, in Ingersoll and I work at CAMI Automotive.
Mr Paul Brown: I am Paul Brown from CAW, Local 88, in Ingersoll.
Mr Daley: This submission is made on behalf of my local union, CAW Local 88 in Ingersoll, representing over 2,300 members. We have done a brief that will be going through to Toronto. We couldn't handle it all within 20 minutes and we sort of wanted to focus in on a couple of the issues that are in Bill 49 that we've got a grave concern about.
We are quite concerned about proposed changes to the Employment Standards Act and how these changes will affect not only our members but affect every working person in Ontario. One of the many changes we are quite concerned about is the proposal to allow workplace parties to contract out important minimum standards. If this proposal is accepted, it will allow the parties to legally have standards below the minimum standards set out in the act. It will allow a collective agreement to override the legal standards concerning public holidays, severance pay, overtime, vacation pay and hours of work if the contract "confers rights greater when those matters are assessed together."
This measure would allow employers, for example, the opportunity to trade off provisions such as overtime, public holidays, vacation and severance pay in exchange for increased hours of work. How one would weigh or measure whether or not a tradeoff like this confers greater rights is left unstated. That would become an issue in its own right.
The legally specified hours of work are 44 hours, at which time any additional hours are considered overtime hours with overtime pay. For example, let's say a gas station owner, which I once was, wanted an employee to work all hours that the gas station was open, say, 50 to 60 hours a week, without paying overtime. As the owner, could I not argue that due to inclusion of enhanced severance pay and an extra week of vacation -- that is, three weeks rather than the minimum two weeks currently in the Employment Standards Act -- that this confers greater rights when assessed together? Non-monetary rights (hours of work), with purely monetary rights (overtime pay and severance pay), and mixed rights (vacation pay, public holidays), are what parties are being asked to value and compare in this example. We can easily envision circumstances in which detrimental tradeoffs are agreed to, despite the measurement problem referred to, given the inequality of power between employers and employees including many who are unionized.
This will enable employers to roll back long-established, fundamental entitlements such as hours of work, the minimum two weeks of vacation, severance pay and statutory holidays by comparing these takeaways to other unrelated benefits, which together can be argued to exceed the minimum standards.
This amendment alone is enough to make my members stand in opposition to the bill as a whole and we would hope make the drafters of these amendments rethink, if not radically alter, Bill 49 for its potential to erode people's standard of living.
Viewed another way, if the central goal of the industrial relations system has been to facilitate negotiated settlements, this amendment runs counter to such an end. It will not only make settlements more difficult but will result in more acrimonious relations and industrial conflict. What were minimum benefits protected by law will now become permissible subjects for bargaining, arbitration and labour disputes.
If significant erosion in minimum entitlements becomes widespread in the many bargaining units where employees do not have sufficient bargaining strength to resist employer demands, it will indirectly impact on the standard of living and working conditions of all Ontario.
Some might see this as helping employers become more competitive, but the more sane will question whether this makes for higher productivity, better workplace relations, increased consumer purchases or an improved quality of life in Canada's most industrial and populous province.
Just to touch on one of the amendments that would allow unions and companies the right to agree to longer hours of work, I would like to tell you what our experience has been with working 48 hours a week. Our members have been fortunate enough to have negotiated an employee assistance program to help them, as well as the salaried staff, deal with the many problems that affect working people as a whole.
We have found in our workplace that we have an excessive amount of marriage breakups and other personal problems -- drinking, drug abuse etc -- that we attribute to the excessive amount of overtime we have been working. When we first introduced this service to not only my members but also to the salaried employees, the service provider explained that their fee was based on the average user rate for a workplace our size, that being 4% to 5%. What we have found over the last four years is that our usage rate has been around 10% for unionized employees and around 3% to 4% for the salaried staff. The service provider was at a loss to explain why we had such a high usage rate until they were informed that we had been working 10-hour shifts for almost three years straight. They felt that the excessive hours of work would definitely explain why we had such a high usage rate compared to other workplaces. With such a high percentage of workers facing marriage breakups, drinking problems, drug abuse etc when only having to work 48 hours a week, we see no benefit in extending the hours of work longer when in fact we should be looking at a shorter workweek like has been successful in other countries like Germany, Sweden and so forth.
With the unemployment figures constantly around 10%, we would expect the government to be looking at doing the opposite of what is proposed in these amendments, by attacking the unemployment and underemployment problem rather than looking at extending the workweek.
As you can see from the examples given, we have many concerns about the proposed amendments of Bill 49. Rather than taking up the whole 20 minutes, we will be submitting the full text through Toronto, because I'd like Paul Brown to tell you about some of the cases he's had with the act as it is now.
Mr Brown: I'm here basically today not to speak of our members' concerns, as Brian said, and their opposition to Bill 49; basically I'm here to speak on behalf of my spouse, Joann Brown, who is here and who is a little nervous in speaking herself, not that I'm necessarily any less nervous.
Basically, her co-workers and herself have many concerns about Bill 49 as they work in a workplace that does not have a bargaining agent. Joann is and has been working as a hairstylist for the past 14 years. It is rare, if ever, that those in her line of employment enjoy rights and benefits conferred by a collective agreement. The only rights that these workers in this field have and weighed against that of their employer are for the most part the sometimes inadequate minimal standards as laid out under various legislation.
Hairdressing is an industry where the minimum wage is the norm rather than the exception. It is an industry where working with noxious and caustic substances is a daily reality. It is an industry where injuries such as carpel tunnel syndrome due to repetitive high-dexterity work occur all too often. It is an industry whose workforce is made up of some of the most vulnerable in our society, predominantly women, many of whom are single mothers, many who are of varied ethnic origin and visible minorities. It is an industry that all these workers can ill afford to have their currently fragile rights under the Employment Standards Act eroded by the introduction of Bill 49.
I thought I'd share a short story about Joann's experience with the act previously. A couple of years ago we were discussing statutory holidays and how pay arrangements were made for these holidays in our respective workplaces. I was quite frankly shocked to learn that where Joann was employed at that time she was not receiving holiday pay for a majority of the statutory holidays. When I asked her why, she explained to me that her employer had her scheduled on a Tuesday-through-Saturday shift arrangement, with Sundays and Mondays being her days off work. Her employer at that time took the position that since Monday was one of her days off, and that since the majority of statutory holidays fall on a Monday, she and her co-workers with the same shift arrangement weren't entitled to statutory holiday pay at all or a day in lieu of. I was also to learn that this was not only the practice of her then current employer but also of all her employers for the past 12 years.
Since I had some knowledge of the Employment Standards Act in my line of work, I explained to her that she was entitled to holiday pay for these Mondays and had been all along. I then explained that she and her co-workers should confront the employer about the situation and request that it be rectified with appropriate compensation.
What happened at this point I find interesting. Although reluctant, Joann did approach her employer in regard to the situation. Her co-workers, however, were much more apprehensive and decided not to do so. I believe their primary reason for reluctance was due to a fear of their employer taking some sort of reprisal against them for simply asking that their legislative rights be honoured.
When Joann did confront her employer, the employer initially denied that they had any obligation to pay her holiday pay, and it was not until a complaint with the local employment standards officer was launched that an offer of compensation was made.
The reason I share this story with you is that even under the current legislation one can appreciate how difficult and intimidating it is for someone like my spouse and others to make a complaint when they don't have the luxury of a third party to raise their concerns on their behalf.
Bill 49 makes this type of situation and experience all that much more difficult for people like Joann and others like her. Bill 49 allows the Ministry of Labour to prescribe minimum monetary limits on claims. Workers will be obliged to go to Small Claims Court to pursue a claim which falls below that limit. This would probably apply to people in Joann's line of work making minimum wages and not seeking large amounts, but money that is rightfully theirs and very necessary when living under this type of wage.
Bill 49 reduces the time during which a worker may bring a claim to recover money from two years to six months. In Joann's situation, she was entitled to 10 days of pay owed to her. In the same situation under Bill 49, the most redress she might be able to seek is three to four days. Unfortunately, situations such as what Joann went through are all too common, and Bill 49 does nothing in the way of correcting that.
The emphasis on any changes should be directed at educating the public, employees and employers about the requirements of the Employment Standards Act. The Ministry of Labour should provide public education and conduct active outreach regarding the purpose and function of the law.
In British Columbia there is a statutory requirement for the Employment Standards Commission to provide public education. Employees will only be able to enforce their legal rights if they know what they are. Thus, there should be a legislative provision requiring that a summary of the basic standards provided in the Employment Standards Act be posted in each workplace. This presently is the case in British Columbia, and it is also the case with the Occupational Health and Safety Act in Ontario that requires employers to post a summary of employees' rights to health and safety at work in all workplaces.
The focus of the ministry regarding the Employment Standards Act should shift from collection to prevention of violations. An aggressive system of audits would go far to remedy this focus.
The ministry should consider allowing complaints from third parties in order to preserve the anonymity of employees fearing reprisal. The ministry should initiate a much more aggressive policy of prosecuting employers who violate the legislation. Currently, prosecution for violations of the act are exceedingly rare. Repeat offenders should be subject to significant fines.
Finally, although the legislation allows for the reinstatement of employees who have been fired by employers for making a claim, without union representation reinstatement is simply ineffective. In order to deter employers from retaliating against their employees, there needs to be a substantial financial penalty imposed against such employers.
That concludes my submission.
Mr O'Toole: I just wanted to pick up on one small thing. I believe under the current legislation there is an entitlement to apply anonymously. Were you aware of that?
Mr Brown: My understanding was that the complainant would have to launch the complaints.
Mr O'Toole: Well, there is.
Mr Brown: Okay.
Mr O'Toole: It's just a clarification. For your CAW, a very large, researched and well organized union with some 135,000 members, do you feel that the current act is working?
Mr Brown: I certainly think there's room for improvement with the current act, but I do not agree that this bill is the means to getting to those improvements.
Mr O'Toole: Do you see the CAW, Buzz Hargrove and the leadership of the union movement participating in phase 2 of the discussions?
Mr Brown: I think you would have to discuss that with Buzz Hargrove.
Mr O'Toole: Do you have to discuss all decisions locally with the president of the CAW?
Mr Brown: No, absolutely not. We have the independence --
Mr Christopherson: It's not the Ontario cabinet.
Mr O'Toole: Would you participate?
Mr Brown: Yes.
Mr O'Toole: Good. Thank you.
Mr Hoy: I won't ask you what you think other people are thinking. Thank you for your input on the British Columbia experience as far as making people aware. This seems to be a recurring problem, people not knowing what their rights are, particularly in small workplaces and/or unorganized.
It seems to me that when small business men and women go out to start a business, when they find out about real estate, and location, location, location is very important in business, many aspects of the law, they probably do find out what the minimum wage is. It's to their advantage to know that and not pay too much.
It appears that there are many employers and employees who don't know about some of the other statutory parts of the act, so it's very good that we have a recommendation that perhaps the British Columbia experience be used. I appreciate your comments on this.
Mr Christopherson: Thank you both for your presentation. Paul, I want to draw particular attention to the issue you raised around Joann's claim that she was entitled to 10 days, and under the new law she would only be entitled to three or four days.
Consistently since we've started these hearings in Toronto, Hamilton, Kitchener and now here in London, the government and their supporters have said it has to be cut back to six months because these things need to be filed in a timely fashion. In one case a representative from a chamber of commerce said they have to stop employees from sitting on the can and mulling over when they're going to do this, as if there was some kind of game-playing.
I think this is probably the best and clearest example of how workers lose money they're entitled to by that change in law. I assure you I'm going to use that example across the province to show that at the end of the day the government is facilitating theft. That's what it amounts to: stealing money that employees are entitled to because they changed the time frame. It's got absolutely nothing to do with efficiency or workers playing games; it's a matter of being able to collect money they're entitled to. I thank you very much for bringing this forward.
CANADIAN AUTO WORKERS, LOCAL 27
The Chair: That takes us up to the Canadian Auto Workers, Local 27. Good afternoon. You have 20 minutes to use as you see fit.
Mr Jim Reid: Good afternoon. I'm Jim Reid, the recording secretary of Local 27. I thank you for allowing me to make this presentation on behalf of the Canadian Auto Workers, Local 27, London, Ontario. Our amalgamated local comprises 23 different workplaces producing everything from locomotives and light armoured vehicles at General Motors Diesel to transit mixers at London Machinery, auto parts at Siemens, Accuride and Siebe, envelopes at Globe and lightbulbs at Phillips.
I am actively involved as a board member of the Low Income Family Empowerment*Sole-Support Parents Information Network, Life*Spin for short, who made a presentation to this committee previously in the day. I'm presently the program chair of the London Unemployment Help Centre.
Today I'm privileged to be a member of a union where my rights in the workplace are respected only as a result of decades of struggles by workers who fought long and hard for employment standards first established through collective bargaining and later through legislation. This local union that I'm so proud of does not only speak out on behalf of the workers we represent in the London area but also on behalf of those who have no voice with their employer or feel threatened to speak out publicly for fear of reprisals.
I think you've seen some examples of that today. Quite honestly, I don't think you're really hearing from the people whom the changes to the current act will affect. Quite honestly the people, the disenfranchised, the marginally employed will have great reluctance in coming before a public panel in a public place and speaking out against their employer. This is what the role of labour and community groups has to be, with this government especially.
In this community and in this province, many workers are denied the most basic rights enshrined in the Employment Standards Act. I can tell you that as a young worker getting my first full-time job, I was cheated out of my vacation pay and overtime pay by my employer. I made a complaint to the Ministry of Labour, and while I received what was owed me, I soon found myself to be laid off and replaced with another worker. That was 24 years ago. The only thing that's changed is that today we're seeing more deadbeat employers who refuse to pay workers years after orders are issued. Today's reality is that nearly six out of 10 workers will not receive what's owed them.
The answer to this isn't privatization of collection services. Workers will suffer as collection agencies push for a quick settlement and a quicker payment of their own account. Employers will be even more obstinate in avoiding settling up with workers if they feel they can play "let's make a deal" with the private collection agency, using the money owed the worker, with the shameful complicity of this government.
Maintaining the current legislated minimum standards in their entirety will ensure that the increasing numbers of small business employers do not compete solely on the basis of lowering wages and deteriorating job conditions, once again the race to the bottom. This seems to be the agenda of this government: to drag down the standards for working people in this province, to drag them down to the right-to-work states in the southern United States, to drag them down to the maquiladoras in Mexico. To this union, to this local and this community it is totally unacceptable.
The Minister of Labour, Elizabeth Witmer, misleads the public with her claim that Bill 49 is just streamlining the act, encouraging compliance and simplifying administration. She claims Bill 49 is just housekeeping. Bill 49 is more like house-wrecking. It's knocking out the basic floor of rights for unorganized and organized workers.
Bill 49 attacks the most vulnerable workers in this province. It is a vicious attack on women workers, garment and textile industry workers, workers in the hospitality industry, domestic workers and others trying to gain a foothold in today's ever-shrinking job market.
This act is part of the neo-Conservative, Reform Party Harris agenda of redistributing wealth from the marginally employed, the poor and the working class to satisfy the greed of multinational corporations, chamber of commerce leeches and lobbyists and the wealthy in this province who believe that it is their inherent, God-given right to exploit and cheat the workers of Ontario.
If Minister Witmer had her way, we'd all be indentured servants. If you think I'm exaggerating, you only have to refer to the statement she made in the Legislature: "An order to pay from the employment standards branch...could prematurely bring in other creditors. Eliminating the right to be paid would save some small businesses from being forced into bankruptcy."
If I'm working for an employer and receiving no compensation -- as we heard, this is a reality in this community -- who's paying my rent, who's putting food on the table for my family and who's paying my taxes and, with them, your salary?
Extending Minister Witmer's logic even further, more companies would be saved if they didn't have to pay workers at all.
Sadly, as I make this presentation to you today, there are workers not being paid for their labour or being paid less than minimum wage in this city. Some will be employed by legitimate businesses and some by sleazy fly-by-night operators. These are the workers desperate to work at any cost, who line up at the casual labour pool every morning at 4:30 and 5 o'clock. Some of them camp out all night.
Ten years ago, I was one of those workers, finding myself out of work, out of money and out of luck, and desperate to survive. Today, even more workers are in that situation, trying to survive on casual contract, part-time and temporary employment. These are the only jobs that are being created in Tory Ontario.
Mike Harris came out a little while ago claiming that the Tory government had created 35,000 jobs since it had taken over. It's funny. I met a woman who got three of them: one at a fast food restaurant, one cleaning offices at night and a weekend job working in a restaurant. These are the types of jobs that are being created in today's pro-business, pro-corporate Harris Ontario.
The Employment Standards Act does need to be changed, but not to the sole benefit of corporate Ontario and the chamber of commerce. The act does not go far enough to protect workers from unscrupulous employers. Bill 49 emasculates the act even further.
If this government cares at all about the majority of Ontarians who are workers, it will strengthen the act and enforcement of the act in the following ways:
(1) It will allow anonymous complaints.
(2) It will increase penalties for deadbeat employers.
(3) It will require the mandatory posting of the act in all workplaces, as is the case with the Ontario Occupational Health and Safety Act.
(4) It will institute severe penalties for firing a worker trying to enforce the act.
(5) I would encourage this government to reactivate the Ministry of Labour collections department and fund it with fines from employers who do not pay out orders within short, fixed periods of time.
Local 27 of the CAW wants to see the Employment Standards Act improved by providing more effective and efficient ways to enforce the rights for workers, unionized or not.
To conclude, what we will see with Bill 49 is the gap between those with well-paying jobs and those with marginal, low-wage jobs widen. As the polarization of the labour market increases, so does poverty and inequality.
Will obstructing and depriving workers of even the most rudimentary access to workplace justice contribute to economic growth in our economy? Will changes to improve the act contribute equitably to our societal fabric, or does it tear wide open divisions between worker and business owner, union and corporation?
I am speaking to the Conservative members of this panel: In your hearts I think you know what the answer is. When it's time for you to retire from government -- and I hope that time is soon -- and if you're honest and if you care about this province, you will see what damage this government has done to the environment, to the disenfranchised, to the family, to the worker, and your legacy will be one of shame.
That concludes my submission.
Mr Hoy: Thank you very much for your presentation today. You gave a synopsis at the end, on page 4. The mandatory posting of the act in all workplaces seems initially to me to be a very good idea. The act is not well known to very many, as I mentioned to people just prior to you and throughout the hearings, either employers or employees. We've had submissions state that the employer on occasion simply made a mistake and didn't realize it. Of course, there are others who know full well what they're doing and are circumventing the law with total knowledge of what they're doing, but we've had numerous submissions suggesting that there are employers who really honestly have made a mistake. So I think that's a constructive input.
The question of fining employers -- another situation I was involved with involved bankruptcy -- is a very difficult situation. I'm not suggesting that fines are not recommended from time to time. At one time, for pollution, there was a discussion that companies that pollute would be brought to near-bankruptcy. Then it was, "Let's put all of the board of directors in jail," and things of that nature. I think we have to walk very carefully on the fining situation. I agree that when you disobey the law there has to be a penalty, no doubt about it -- don't misunderstand me -- but I think we have to be very careful about the level of fine so that we don't jeopardize other workers, as has been suggested on other days, where you could have everyone out on the street. Clearly, I appreciate your comments here. The fines are a situation that has to be taken very carefully, that we don't harm others because of what we want to do.
Mr Reid: There is only one thing that a businessman understands, and that's money. That's the only thing that's going to get his attention to get him to stop violating the act. There are employers who continually violate the act. The workers will make a complaint. Quite honestly, years ago I used to hear stories from employers that when an employee would make a complaint to the Ministry of Labour, the Ministry of Labour inspector would come in, issue an order and tell the employer to pay the worker what was owed him, but he would tell the employer, "Get rid of him; he's trouble." This is what happened. This is what the mentality was.
I don't work in the non-union sector; I haven't for the last eight years now. I'm not really aware of what's going on that much in the non-unionized work environment, but I can tell you from my own experience that this was the case. The Ministry of Labour was tilted to one side, was tilted vastly in favour of the employer for many years, and to some extent I think it still is.
The Employment Standards Act provides a series of loopholes for the employer to get out of his obligations, to work around the act. It attacks the most powerless in our society. Bill 49 just exacerbates this situation. It's going to cause more grief, more hardship, more poverty in the community. It attacks the very people this government should be trying to protect: the poorest in our community, the most vulnerable in our community. What it's doing is creating more barriers.
I strongly believe in a strong enforcement policy; not a privatized collection agency but a strong enforcement policy set out by this government. Let's use some language of the Harris government. Let's give the Ministry of Labour the tools to collect the fines, to make the act self-sufficient, to make this collection agency pay for itself. But when an order is issued, many times there's no fine levied against the employer. The employee collects what's owed to him, but there's no penalty imposed on the employer for violating the act in most cases. So who pays for it? The taxpayer pays for it.
Mr Christopherson: Thank you very much for a very impressive presentation. I have a couple of comments and then a question for you.
When you say how proud and privileged you are to be a member of a union where your rights are respected, I've shared that feeling and shared that pride. I think it's important during these hearings to recognize that it was the labour movement that not only brought those rights originally into collective agreements, but that as a result of them being in collective agreements we had legislation that reflected more appropriately what those minimum rights ought to be.
I think you do a great service to the legacy of those earlier leaders when you go on to talk about how this attacks the most vulnerable. You're not sitting there worrying only about yourself; you're making sure you use whatever clout you have in your union to speak out for those who are being hit by this government in a big way.
Women workers were the first example you gave. Our caucus and our party have talked consistently about the fact that women are disproportionately hit by this government's agenda. Examples are the 22% cut to the poorest people in Ontario, the gutting of programs for battered women, the gutting of the pay equity program. It goes on and on. You talked about the garment workers. The submissions we heard in Toronto would bring tears to your eyes when you listen to the circumstances, the sweatshops that mostly women are working in in this province, in this day and age. I think it says a lot about you, your union and other unions that don't have to do this but are coming out to show that leadership.
You've had experience not only as a senior labour leader in your own right but as someone who's faced discrimination in a workplace where you didn't have a union. We still have members of this government and people in the business community who don't believe that exists. They think that's some kind of rhetoric we're all using. Would you, in your own words, just explain a little bit about what it's like in those environments?
Mr Reid: Ministry of Labour statistics will point out that one in three employers violates the act. The restaurant industry is a perfect example of mostly women workers being exploited. The Screaming Tale incident is just one. In this community of London, in some very up-scale restaurants, the owner of the restaurant collects 30% of the tips that the waitresses collect. They pay minimum wage, but they charge for breakage. A lot of times when you've got a customer who just does the old dine-and-dash and runs out the door, the waitress is on the hook for the check. The breakage and the runaway customer -- it's clearly illegal to collect money from the worker. But when she tries to enforce her rights under the act, she's disciplined, and not only disciplined, but most times she's fired. I know personally of my sister; this has happened to her.
What happens is, when you're fired from one place and you go to get another job in that same industry, in the same community, your chances of getting a job are minimal. I have the fortune to work in a larger community with a lot of workers, and maybe we have a little bit of mobility of labour. But what happens when you make a complaint to the employment standards branch when you work in a small town like Exeter or Wingham or Clinton and, all of a sudden, the whole town knows that you made a complaint to the Ministry of Labour? Do you think you're going to get a job for enforcing your minimum rights? Not very likely.
Mr Ouellette: Thank you very much for your presentation. I come from a town that's mostly occupied by CAW workers. During your contract negotiations for the government contract did you not enter into special agreements for that contract with the government? Were there not concessions?
Mr Reid: Which government?
Mr Ouellette: That was for the military.
Mr Reid: You're talking about GM Diesel?
Mr Ouellette: Yes.
Mr Reid: As far as hours of work are concerned? Can you elaborate on what your information is?
Mr Ouellette: I understand, or at least the local members tell me, that there was a considerable number of concessions or negotiations that your local made with that.
Mr Reid: I wasn't party to those negotiations and I have no knowledge of those negotiations, but I can tell you that a lot of what you're alluding to is probably overtime hours, workers working beyond the 48 hours. I know of workers in my local union at that facility who are working seven days a week. For a long time there were workers working seven days a week, for almost 18 months at a stretch.
Mr Ouellette: Do you think they should be allowed to do that?
Mr Reid: No, I don't. I quite honestly don't. Personally I do not agree with that and as a representative of the union I do not agree with that. But that's a huge debate within the local.
What I strongly disagree with is the mandatory aspect of overtime. It does not create jobs. It does not tell the employer, "I have this work that needs to be done, so let's hire and train some workers." What it does is it says, "Take your existing workforce and work them into the ground," and Brian Daley from Local 88 spoke quite eloquently to that, on what the effects are. We see it in our local. We see it with an increase in alcoholism; we see it in an increase in family abuse, in spousal abuse.
Mr Ouellette: You said the local here set a dangerous precedent where the people doing the negotiations for them may be allowing for the same in their local bargaining and there's strong concern from the membership in those areas. So it's quite conflicting --
Mr Reid: If you're talking about overtime, I think the position of most workers is, "If I feel I can fit 56 hours or 60 hours of overtime into my life" -- and I don't know how people can do that -- "then yes, I should be given the freedom and the right and the opportunity to do that." But if I am a worker who is concerned about my community, my family, my own personal wellbeing and consider 40 hours a week enough, or even a little bit more than enough when I look at the overall community and when I look at an overall unemployment rate in this province of over 15% -- the real unemployment rate, not the government's statistics.
Mr Ouellette: Is that not what you negotiate for, for the security to make sure that those options are available so that those who want to work in the union have the ability to work as much overtime as they want, and that those who don't can't?
Mr Reid: If you're talking about General Motors Diesel, what that corporation is doing and what that corporation has done is lobbied this government, has lobbied the minister for a mandatory 10-hour day, for a mandatory 56-hour week, that they would exercise at their whim, that would take away the negotiated --
The Chair: Sorry, Mr Ouellette. We've gone a couple of minutes over here. Sorry to cut you off, both of you, but thank you very much for coming and making a presentation this afternoon.
CANADIAN AUTO WORKERS, LOCAL 1859
The Chair: That takes us up to Canadian Auto Workers, Local 1859. Good afternoon. We have 20 minutes for you to use, divided between the presentation time or questions and answers.
Ms Deb Tviet: Thank you. I am Debbie Tveit from Local 1859 in Tillsonburg. I have been asked to submit this brief. I was just asked to submit it yesterday, so I am kind of a stand-in for the president, who is Ron Roberts.
In introducing the Bill 49 amendments on May 13, Labour Minister Elizabeth Witmer claimed she was making housekeeping amendments to the Employment Standards Act. She also described it as "facilitating administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures."
The truth the way we see it is that minor technical amendments contain substantive changes, changes which clearly benefit employers and diminish access to justice for both the organized and unorganized, and particularly the most vulnerable in our workforce. These changes will make it easier for employers to cheat the employees and harder for workers to enforce their rights. It strips unionized workers of the historic floor of rights that they have had under Ontario law for decades.
This submission is made on behalf of CAW Local 1859. We're located in Tillsonburg and we represent 1,300 workers in the Tillsonburg, Delhi and Simcoe area. All of our workers work for private industry, so we don't have public service in our unit, but all of their lives are affected by public service because all of them have members in their family who work in some form of the public service. Certainly they're concerned with the whole amendment process.
Just to start with the flexible standards, we understand that this has been withdrawn but is to be reviewed later, so we'd like to still be able to comment on this section. This contains a fundamental change to the Ontario labour law and it permits the parties to contract out minimum standards. This is what really worries us. Prior to this it was illegal for collective bargaining to have provisions below minimum standards, so it made it a lot easier for bargaining units because there was a floor. It's going to be a lot more difficult, especially for an amalgamated local like us. Now we have six different bargaining units, so it becomes very difficult when you don't even have a minimum standard for them to work up from.
It also allows the override of legal minimum standards of severance pay, overtime, public holidays, hours of work and vacation pay if the contract confers greater rights when those matters are assessed together. This is scary language to us, because this measure erases the historic concept of an overall minimum standard of workplace rights for unionized workers. Employers are free now, for example, to disregard that floor and to have the opportunity to trade off provisions such as overtime pay, public holidays, vacation pay and severance pay in exchange for increased hours of work. That is a really scary measure.
How one is to measure whether or not a tradeoff of this kind confers greater rights is left unstated. I think that will become an issue in its own right, how you figure out if that is a conferring greater rights. Just to give you an example, a retail owner could ask an employee to cover all hours of the store's operation, 50 to 60 hours a week, and not pay overtime after the legalized 44 hours. The employer could argue that due to the inclusion of an extra week of vacation, three weeks rather than two, this would confer greater rights when assessed together.
This scares us because we have women working in our local who can't even take their two weeks' holidays because they can't afford it because they're making $10 an hour. Quite frankly, they can't take two weeks' vacation on $10 an hour. When you're trying to feed three children and save up enough money for a vacation, it becomes impossible. I can't see how someone working for 50 or 60 hours a week is going to benefit from an extra week's vacation that they probably can't take anyway. So this really scares us.
In short, the parties are being asked to value and compare non-monetary rights -- which is hours of work -- with purely monetary rights -- vacation pay, public holidays etc. Given the inequality of power between employers and employees, including many who are unionized in my own local, circumstances in which detrimental tradeoffs are agreed to despite the measurement problems referred to can easily be envisioned. We can easily see that this is going to be a big problem, not only for people who are unionized but also for some very vulnerable unionized workers. Being unionized doesn't mean you automatically make $24 an hour; I can guarantee you that, coming from our local.
This proposed amendment, therefore, allows employers to put more issues on the bargaining table which were formerly part of the floor of legislated rights. Now you have to bargain almost the whole Employment Standards Act to begin with just to get yourself a floor. It will make settlements more difficult, particularly for newly organized units and small service and retail workforces. It will enable employers to roll back long-established fundamental entitlements, such as hours of work, the minimum two weeks of vacation, severance pay, statutory holidays, by comparing these takeaways to other, unrelated benefits which together can be argued to exceed the minimum standards. This is what really scares us.
The potential of this amendment alone to erode people's standard of living should be enough to make the drafters of the amendments rethink, if not radically alter, Bill 49. It's certainly enough to make Local 1859 stand in opposition to the bill as a whole.
If it's viewed another way, if a central goal of the industrial relations system has been to facilitate negotiated settlements, this amendment runs counter to such an end. It will make settlements more difficult. It will likely result in bitter relationships and industrial conflict, so we certainly can see some hard bargaining to be done and certainly see conflicts end up in a strike situation in order to just win simple, historic rights that always had.
We're seeing that. We are seeing contracts being challenged in our locals for things that are quite sound, and at the bargaining table where there was quite a good relationship over what it meant, and then they're trying to instil it in a different way and it's just not working out through the grievance procedure.
What were in the past minimum benefits protected by law will now become permissible subjects for bargaining units, and employees do not have sufficient bargaining strength to resist employers' demands. It'll indirectly impact on the standard of living and working conditions of all Ontarians. Certainly the short-sighted may see this rush to the bottom as helping employers be competitive, but the more sane would question whether it makes for higher productivity, better workplace relations, increased consumer purchases or an improved quality of life in Canada's most industrious and populous province. We really question what is the end result of this, because if people aren't working and aren't making a decent living in Ontario, how is Ontario's economy going to prosper? We really question that and wonder what the end result is.
On to the next one, enforcement under a collective agreement: Currently, unionized employees have access to the considerable investigative powers of the Ministry of Labour. This inexpensive and relatively expeditious method of proceeding has proved useful, particularly in situations of workplace closures and with issues such as severance and termination pay. Bill 49 changes eliminate recourse by unionized employees to this avenue, and instead require all unionized workers to go through their grievance procedure and to enforce their legal rights that way.
What we see is we're bearing the burden of investigation, of enforcement and the accompanying costs of all that. The director can make an exception and allow a complaint under the act where he thinks it's appropriate, but for all practical purposes the enforcement of public legislation has become privatized. That's the way we see it, that now it's up to us to enforce decades of minimum standards and decades of help getting that enforced.
Certainly I have to agree with some of the speakers before me that what we need is education. A prime example is, my daughter works in a bakery and for two years she was never paid her statutory holidays. The employer had no idea that she had to be paid those. The employer wasn't trying to be nasty about it; she had no idea she was supposed to be paying her. The employers don't know what they're supposed to be doing, let alone the employees, so education certainly needs to happen.
Under this bill, union members would not be allowed to use the Ministry of Labour's enforcement procedures. Instead, their unions would be required to bear the cost of complaints for violations of legislated minimum standards. Any worker who asks the Ministry of Labour to enforce the law would be prohibited from going to court in the same case. Similarly, anyone who files a civil suit would be barred from filing an employment standards claim. By cutting down the number of claims, we see the government as paving the way for chopping 45 enforcement jobs in the Ministry of Labour, and we don't believe that should be done. We don't believe that's the proper way to go and we certainly see that as detrimental to Ontario as a whole.
Arbitrators will now have jurisdiction and make rulings that were formerly in the purview of an employment standards officer, an ESO, a referee or an adjudicator. They will not be limited by the maximum or minimum amounts of the act; however, arbitrators lack the investigative capacity of the ESOs and may not be able to match the consistency of result that the act has had under public enforcement. Most important, employers could argue that boards of arbitration do not have the critical powers to investigate whether particular activities or schemes were intended to defeat the intent and purposes of the act and its regulations and such cannot be determined.
In such circumstances, unionized employees could well be left with no recourse whatsoever. This is particularly evident in cases of related employer or successor provisions of the act. It's difficult to see how such provisions can be applied when the successor or related employer may well not be party to the arbitration process.
The enforcement for non-unionized employees really worries us. At least every family in our local has a non-unionized employee of some form. It becomes very hard for us to ignore, and we don't ignore, the fact that non-unionized employees need help with this act, and we have helped them with the act, trying to explain it, trying to let them know what their rights are. They've come to our local for help, not to me specifically, but we have a person who handles those cases, and certainly, they've been well used over the years.
With these amendments, the Ministry of Labour is proposing to end any enforcement in situations where it considers violations may be resolved by other means, namely, the courts.
In other words, the amendments would download responsibility for the enforcement of minimum standards for non-unionized workers. Employees would be forced to choose between making a complaint to the employment standards branch or filing a civil suit in the courts. Responsibility for enforcement is also downloaded on to non-unionized employees by limiting the amount recoverable through employment standards to under $10,000. Currently there's no limit on what's recoverable. What an employer owes an employee is generally what he has to pay, so an employee who files a claim at the Ministry of Labour for severance and termination pay is precluded from bringing a civil action concerning wrongful dismissal and claiming pay in lieu of notice, which exceeds the statutory minimums.
The effect of these amendments is that those employees who have chosen the more expedient and cost-efficient path of claiming through the ministry will have to forgo any attempt to obtain additional compensation through the court. Legal proceedings are notoriously lengthy and expensive for many, even though they may be entitled in common law to more than the statutory minimum under the ESA.
An employee who seeks to obtain a remedy in excess of $10,000 and who can afford to wait the several years a civil case will take, and at the same time pay for a lawyer, will have to forgo the relatively more efficient statutory machinery in respect for even those amounts clearly within the purview of an employment standards office.
Employees who file a complaint under the act will have only two weeks to decide whether to continue under the act or withdraw their complaint and pursue a civil remedy. Those unaware of their legal rights may well be excluded from commencing a civil action unless they obtain the necessary legal advice within the short two-week period.
Just as the provisions barring civil remedies in section 64.3, there are mirror provisions in section 64.4 precluding an employee who starts a civil action for wrongful dismissal from claiming severance or termination payments under the act. Other provisions are also prohibited under the act once a civil action has started, such as an employer not paying wages owed, failure to comply with the successor rights in the contract service sector etc.
Employees who initiate a claim but decide they no longer wish to pursue their civil suit don't appear to have even the two-week time limit to change their mind; rather, they appear to have no right to reinstitute a complaint under the act.
The next section is the maximum claims. The amendments introduced as noted above, a new statutory maximum amount that an employee may recover by filing a complaint under the act, this maximum of $10,000 would appear to apply to amounts owing of back wages and other moneys such as vacation, severance and termination pay. There are only a few exceptions such as for orders awarding wages in respect of violations of the pregnancy and parental leave provisions and unlawful reprisals under the act.
The problem with implementing such a cap is that workers are often owed more than $10,000 even in the most poorly paid sectors of the workforce such as foodservices, garment workers, domestics and others. Indeed, workers who have been deprived of wages for a lengthy period of time are the very employees who will not have the means to hire a lawyer and wait the several years that it takes before their case is settled. In effect, therefore, this provision will encourage the worst employers to violate the most basic standards while at the same time compounding the problems for those employees with meagre resources.
Bill 49 also gives the minister the right to set out a minimum amount for a claim through regulation. Workers who make a claim below the minimum, which is as yet unknown, will be denied the right to file a complaint or have an investigation. Depending upon the amount of this minimum, it could well have the effect of employers keeping their violations under the minimum in any six-month period and thereby avoiding any legal penalty.
The use of private collectors really scares us because we've seen this happen in non-unionized workplaces already. The proposed amendments intend to privatize the collection function of the Ministry of Labour's employment practices branch. This is an important change, providing one of the first looks at the government's actual privatization of a task which has traditionally been a public task. Private operators will, should these proposals be implemented, have the power to collect amounts owing under the act.
A fundamental problem with regard to the act has for some time now been the failure to enforce standards. This is no less true with regard to collections. The most frequent reason for the ministry's failure to collect wages assessed against employers has been the employers' refusal to pay. The answer to this problem according to the proposed amendments is not to start enforcing the act but rather to absolve the government of the responsibility to enforce the act by farming out the problem to a collection agency. In addition, the employment standards directors can authorize the private collector to charge a fee from persons who owe them money. Should the amount of money collected be less than the amount owing the employee or employees, the regulations will enable the apportioning amount to go to the collector. The employee or employees will have to actually pay the collector for getting their money. It just amazes me.
So where the settlement is under 75% of the amount owing, the collector is required to obtain the approval of the director, but this will still allow collectors incredible leeway and it will create outright abuse with someone else's money. That's what's going to happen. The danger here is that a person whose earnings put them below the poverty line and who is owed money under the act could well be required to pay fees to the collector. A minimum-wage earner at $6.85 per hour, for example, could not only receive less money than owed but also have to pay for it to be collected.
The Chair: Excuse me, Ms Tveit. We're already passed our 20 minutes. If you care to pick sort of the highlights -- I see you have quite a bit left to cover.
Ms Tveit: Yes, I still have some.
The Chair: If you could wrap up in the next minute or two, please.
Ms Tveit: Okay. I'll just skim through the rest. CAW, our local, is gravely concerned that employees, particularly the most vulnerable, will be pressured to agree to settlements less than the full amount owing them just based on making it hurry up, that's all; just based on the fact that they want it to hurry up and get over with, and so they're going to settle for less just to do that. Certainly that will give employers a real boost to have somebody who wants to settle, and give them less.
On the limitations, I'm just going to let you read that. We're really against the whole limitation process. It seems to be a long process at best now, and so to limit it is only going to make it worse. Certainly people deserve back pay for longer than just six months from the date they complain. Sometimes suits take two or three years, and that's really not going to be very effective or very helpful.
We just mention that there are a few minor positive amendments that we like. Two that we note are section 8 of the bill and section 28 of the bill. One is the entitlement of vacation pay: vacation pay is entitled; you're entitled to two weeks per year; it will occur whether or not the employee actively worked or was absent due to an illness. So we do agree that is good.
Also, the seniority and service during pregnancy and prenatal part, we agree that should be, and certainly for women. That's usually the people that hits. Just because through procreation we happen to be the ones who have to miss work, we shouldn't be penalized for this. We do agree that's good.
I'll just conclude. As our comments on the key amendments of Bill 49 indicate, no one concerned with maintaining basic societal standards in terms of hours of work, overtime pay, vacation pay, severance and public holidays can possibly favour these amendments. Bill 49 would eliminate the floor of minimum standards.
As for the unorganized, particularly the most vulnerable in the workforce, Bill 49 is about the race to the bottom. It's about undermining their already precarious existence and as such is totally unacceptable.
As noted in our introduction, these amendments come on the eve of a comprehensive review of the act. The proper procedure would have been to include such changes as part of such a review and not try to pass them off as housekeeping changes. But beyond this, the core of the problem is the nature of the amendments themselves, as our comments already make clear. Standards shouldn't be eroded, shouldn't be made negotiable. Rights shouldn't be contracted out and privatized. All this is taking place as part of the overall Harris agenda to shrink the size of government and divest itself of public services. The bottom line means slashing $10 billion from Ontario's budget in order to pay for the tax break for the wealthy.
We respectfully submit this from Local 1859.
The Chair: Thank you very much for your submission.
ST THOMAS AND DISTRICT LABOUR COUNCIL
The Chair: That leads us to the last presentation of the afternoon, the St Thomas and District Labour Council. Good afternoon. We have 20 minutes for you to divide as you see fit.
Mr Jim Nugent: Thank you very much. I'd just like to say that I saw it was in the papers Monday that the minister has withdrawn one of the amendments, to re-establish it some time in the future. It seems it's a reversal from Bill 7 where at the last minute she introduced amendments to the act. It certainly doesn't give one an air of confidence in the Ministry of Labour in Ontario.
This submission is made on behalf of the St Thomas and District Labour Council, located in the city of St Thomas in the county of Elgin. The St Thomas and District Labour Council represents approximately 4,500 members who are employed in various industries such as manufacturing of cars, suppliers of parts for cars, hospitals, nursing homes, city hall, schools, just to name a few.
The proposed amendments that Labour Minister Elizabeth Witmer is introducing in Bill 49 will create situations where employers can cheat their employees. It will also take away from unionized workers minimum rights they had under the previous Employment Standards Act.
Section 3 of the bill changes the present law by allowing the parties to contract out minimum standards. Prior to this amendment in Bill 49, a collective agreement could not contain anything that was under the minimum standards as set out in the Employment Standards Act. This would include such things as, as everybody knows, public holidays, severance pay, vacation pay, overtime, hours of work etc. Bill 49 now changes this if the collective agreement confers greater rights when those matters are assessed together. That, to me, is a sham.
This proposed amendment takes away from unionized workers minimum rights that have been in place in the Employment Standards Act for years. It will give employers a whole new arsenal of weapons come contract negotiations with their employees. It will open up an avenue in negotiations which has never been there before, and the St Thomas and District Labour Council believes that this can only lead to confrontation at the bargaining table between employers and employees. If the above is what can happen between employers and unionized employees, then we can imagine what will happen between employers and non-unionized employees.
To think what this amendment by itself can do to the lives of workers in the province of Ontario should tell this committee that its recommendation to the Minister of Labour is to drop it immediately. The St Thomas and District Labour Council stands in very strong opposition to this part of the bill.
If the government of Ontario and employers in this province see this as helping them to become more competitive by taking away the dignity of working people by the erosion of the minimum standards, then they must surely live in dreamland because this can only lead to one thing, and that is confrontation between employers and employees.
Under the present Employment Standards Act, unionized employees have access to investigation and enforcement powers of the Ministry of Labour. This has been very helpful to them in such instances as termination pay, severance pay and workplace closures.
Under section 20 of the bill, this avenue would be eliminated and in its place they would have to use the grievance procedure under their collective agreement to enforce their rights. This in turn would have the union bear the cost of the investigation and its enforcement. Let's examine this for a minute.
Suppose, for instance, an employee has a complaint about severance pay. Prior to this proposed amendment -- and this is the way it works in the real world when you're in the unionized factories -- an employee would consult with his union as to why the severance was not paid. Questions would be asked by the union to the employer as to why the severance was not paid. If the answer was not satisfactory, then the employee would be advised by the union to contact an employment standards officer. He or she would do an investigation -- this is the employment standards officer -- of the complaint and make a ruling one way or another as per the evidence they obtain through the investigation, and this has happened in numerous cases that I have dealt with.
The point I make is that this is a very easy process for anybody to understand and do. Also, in most of these cases the employee would have an answer in approximately four to six weeks.
Taking the same scenario, let's now look at what happens under the proposed amendment. The employee goes to the union to ask about his or her severance pay. The union would then approach management and ask them why the employee was not receiving severance pay. Let's assume we have to file a grievance. Going through a grievance procedure could take two to three to four months in this particular case, depending on the evidence we've got to get and the investigation and so forth.
If at the end of the grievance procedure the answer is still that the employee will not receive severance pay, then we have to proceed to arbitration. This means in a lot of cases the union would employ a lawyer to handle this case before an arbitrator. It would have to wait until an arbitrator is selected or appointed. A suitable date would have to be agreed upon and then it would have to be determined as to how many days of hearings would be needed. This process, from the time the grievance was filed to a decision by the arbitrator, could take a year until the employee could get a decision on his claim. Ladies and gentlemen, that's real life. That's real life in arbitration when you're looking at it.
It is quite obvious as to the time differential for a decision to be made between the two processes I've just mentioned.
There are some other aspects a union could face because of this proposed amendment. Let's say a union decides not to file a grievance or that they file a grievance but do not take it to arbitration. They then could face a charge by the employee of failing to represent. This could lead to a case before the Ontario Labour Relations Board dealing with a failure to represent an employee due to a complaint under the Employment Standards Act, which unions have never been charged with before.
We in the St Thomas and District Labour Council view this as another step by the minister to take away rights of unionized workers which have been there under the Employment Standards Act for years.
In sections 19 and 21 of the bill, again we look at another takeaway by the minister. This is where a non-unionized worker would have to choose between filing a complaint to the employment standards branch or filing a civil suit in court. If he files with the employment standards branch, the amount that he or she can recover is limited to $10,000. If he or she is owed more, tough luck, or else you hire a lawyer and take it through a civil suit. What these amendments will do is allow any employer -- I repeat, any employer -- the right to ignore the minimum standards as set out in the previous Employment Standards Act.
Under section 28 of the proposed amendment, the minister is allowing the government to privatize a task which has been done by the public service. The fact is that the Ministry of Labour is notoriously weak at collecting moneys owed to employees from employers. It seems that instead of the ministry enforcing the act to collect these moneys owing, the minister simply contracts this task out to private collection agencies.
It seems to me that the collection agencies will have the power to encourage settlements between workers and their employers. As a result of this, one can only see workers losing money as collection agencies push for quicker settlements and also quicker payment of their own accounts. The St Thomas and District Labour Council is very concerned that with this amendment employees will be pressured into agreeing to lesser settlements and letting employers continue to violate the minimum standards. There is also no guarantee that contracting out collections to the private sector will be a less expensive and more effective mechanism.
There are some amendments in the bill that the St Thomas and District Labour Council can support; that is, that the entitlement of the two weeks per year will accrue whether or not the employee is actively employed all of this period or was absent due to illness or a leave. Another one of note is that the employees will be credited with benefits and seniority while on pregnancy and parental leave.
In conclusion, the St Thomas and District Labour Council implores this committee to go back to the Ministry of Labour and strongly recommend that these amendments to the Employment Standards Act be dropped. This submission is respectfully submitted. My name is Jim Nugent. I'm the president of the St Thomas and District Labour Council.
The Chair: That leaves us two and a half minutes per caucus. I believe this time it starts with the official opposition: Ms Boyd. Sorry. Forgive me.
Mr Baird: We think of you sometimes as the official opposition, in spirit.
Mrs Boyd: Yes, I can understand why.
Thank you, Jim, for your presentation, and particularly for taking us through what it means from a union perspective to go through that grievance and arbitration position. One thing that you haven't said and that many of our presenters haven't talked about is the whole issue of the investigation part of all of this, because of course under the Employment Standards Act, the employment standards officer had the right to look at records. Under your grievance procedure I assume that disclosure is going to be an extraordinarily difficult situation. Could you tell me a little bit about that?
Mr Nugent: As I explained in the submission, when an employee would ask for anything in regard to the Employment Standards Act, it was always the thing that the employee would contact, after there was no agreement with a company or so forth, the employment standards officer. If we're looking at vacation pay or termination or severance pay, then we have to look at records of the employer to determine the amount of moneys owed to that employee. Through the ministry, this was an easy process, because the employer simply didn't refuse to give the ministry anything in the vast majority of cases. So it was a simple process. In any of the plants, all kinds of figures were usually prepared for them and a judgement could be made one way or another at that time as to whether the person was owed and, if so, how much they were owed.
If we're going to a grievance procedure and I say to a company, "Produce the records of this employee," they'll tell me that's the company's records. That's not the union's records; that's the company's records. So it could lead to time and time where we have to file grievances to get the records, to get arbitrators, to make arbitrators rule that we can get records. Meanwhile, the only person being hurt in this is the employee who is standing out on the street or something, who hasn't got any money and who is owed money through the law. That's what happens.
Mrs Boyd: That was certainly my impression, that this inability, through this process suggested, to actually get at those records in any kind of timely fashion is actually one of the biggest impediments to it. I assume the other part of it is the cost scenario for unions, obviously, but also the employer, in terms of the grievance process. That makes it a very costly process. And if you're not unionized, the costly process of going through the civil courts is really prohibitive for virtually anybody, is it not?
Mr Nugent: The cost to unions -- and companies too, I've got to say that; the companies use lawyers too -- for the court and the arbitrator, an approximate cost for a one-day hearing could be $7,000 or $8,000. That's paying your lawyer and the company paying their lawyer and both of you paying the arbitrator. And let me tell you, we don't see too many one-day hearings now. We just did a case which was seven days of hearings. We expect to get a bill in the region of $30,000 for that hearing. That was for a termination -- and we'll win it, by the way.
Mr Baird: Thank you very much for the presentation. I read it as you presented. On page 5 you deal with the collection agencies issue. I read, "As a result of this, one can only see workers losing money as collection agencies push for quicker settlements and also quicker payment of their own accounts."
That's something that actually goes on now within the employment standards branch. That's not something that's going to be new or unique. The last year we have statistics available for was 1994-95, before the last election. Between $3.8 million and $5.2 million of the $16 million that was collected was less the amount that the employee was owed. I believe they should be entitled to 100% and we should do everything possible to assume 100%.
There are some instances, your 24%-odd, where there's a bankruptcy or an insolvency involved. I think workers should get a higher priority than they do now. I know the minister feels very strongly on this and has been in contact with a federal minister to have the federal Bankruptcy Act amended to reflect that greater priority. One of the presenters who presented in Toronto or Hamilton mentioned that workers were actually the ones who had to physically earn that money and that they should be given a much higher priority than they are now. That's certainly something we've been pushing for, as has the minister, but that's something that's not new.
I guess what we feel with respect to collections is that the employment standards officers weren't experts at collections. We've talked to some folks in the collections business, some with maybe 25 or 35 years' experience in the collection business, and it certainly is our hope that they could bring that experience to the benefit of the worker to deliver more money at the end of the day into the worker's pocket. Certainly our goal has got to be 100%, and I don't think we can be satisfied at all unless we're at 100% -- obviously when you set aside the issue of insolvencies and bankruptcies, which we hope to pursue, the changes to the federal statute.
Mr Nugent: Doesn't your bill then say something in the region of 75%? If you claim the bill should be 100%, then you should put that in as 100%, not 75%. If the minister is saying in her mind, "Yes, we need 100% for that worker out there," then why any reference to 75%? Make it the 100%, make it the collection agency and make the damned employer pay for the collection agency.
Mr Baird: We are, in this legislation. That's in the legislation. We are. But if Bob Mackenzie and the NDP government were settling at $5 million less to workers, which is approximately a third less than what they were entitled to of the $16 million they claimed, I would suspect that they were doing the best job they could do for workers, that they weren't delinquent in their responsibilities. We want to see 100% of the money delivered 100% of the time. That's got to be the goal.
But I can tell you that at the Ministry of Labour we're not satisfied with recovering 25 cents on the dollar now. I doubt when this bill passes that we will go from 25 cents to the full dollar in the first week or the first month that we're there, but that's got to be our goal and we've got to do a lot more. The way we're doing it now simply isn't working.
On the resource question, the previous government laid off 10 people in the collections branch and two years later they're still collecting 25 cents on the dollar. So if more people were the way to do it, the money would have gone down. I am of the belief that we'll see more money going into the workers' pockets and we will be held accountable for that with our colleagues on this side of the aisle.
Mr Lalonde: First of all, I wanted to congratulate you for a well-presented brief. I could say that I recognize your concerns and I would be very nervous if I were in your shoes or in the shoes of an unorganized or even organized labour group.
I think a lot of the points that were brought to our attention today should be taken into consideration by the government, especially at a time when we are saying we should be looking at creating 725,000 jobs. The fact that we're looking at extending the regulated hours will not only affect the standard of living of the workers; I think it would eliminate some jobs because it's really just the opposite of what the labour groups are going after at the present time. They're trying to reduce the number of hours to create additional jobs. In this case, we will allow the employers to increase the regulated hours.
I just hope the government will be taking into consideration some of the points that were brought to our attention today, and I would like to thank you very much for your presentation.
The Chair: Thank you on behalf of the committee for appearing before us and making your presentation.
With that, committee members, just one minor housekeeping detail. Earlier today we had a presentation from Miss Susan Smith, and Mr Shea made reference to a submission that Miss Smith has handed to the clerk. However, she'd like it to be considered as an official exhibit or an amendment to the Hansard. Hansard couldn't be corrected itself because both Mr Baird had referred to it and I believe Mr Hoy also made reference to the original presentation. So I'll just read into the record the full text of the submission, addressed to the clerk of the committee:
"I would like to correct on the record of my oral presentation that I misspoke when I responded to a question of parliamentary assistant Mr Baird about my recommendation for the hourly minimum wage.
"I believe I responded, `nine dollars and seventy-five cents an hour.' I believe Mr Baird rounded it up to $9.80 per hour.
"For the record, the figure I recommend for the hourly minimum wage is `nineteen dollars and eighty cents an hour,' that is $19.80.
"Thank you for your attention to this detail.
That will now be included in Hansard in that form.
With that, that concludes our hearings here in London. Our thanks to all those who took the time to make presentations or to listen in.
The committee stands recessed until 9 o'clock tomorrow morning in Windsor.
The committee adjourned at 1740.