Wednesday 28 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
United Steelworkers of America, Local 6600
Mr Denis Dallaire
Mr Robert McKay
United Steelworkers of America, Local 6500
Mr Barry Tooley
Sudbury and District Chamber of Commerce
Mr Bernie Freelandt
Canadian Auto Workers, Local 103
Mr Brian Stevens
Sudbury Area Taxi Owners Association
Mr Kenneth Flinn
Sudbury Women's Centre
Ms Donna Mayer
Sudbury and District Hotel and Motel Association
Mr Richard Clement
Sudbury and District Labour Council
Mr John Filo
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 TobyBarrett (Norfolk PC) for Mr Ouellette
Mr GaryFox (Prince Edward-Lennox-South Hastings / Prince Edward-Lennox-Hastings-Sud PC) for Mr Maves
Mr BillGrimmett (Muskoka-Georgian Bay / Muskoka-Baie-Georgienne PC)
for Mr Tascona
Mr BertJohnson (Perth PC) for Mr Carroll
Mr WayneWettlaufer (Kitchener PC) for Mrs Fisher
Also taking part /Autres participants et participantes:
Ms ShelleyMartel (Sudbury East / -Est ND)
Clerk / Greffièr: Mr Douglas Arnott
Staff / Personnel: Mr Avrum Fenson, research officer, Legislative Research Service
The committee met at 1001 in the Ambassador Hotel, Sudbury.
EMPLOYMENT STANDARDS IMPROVEMENT ACT, 1996 / 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 committee to order on this, our eighth day of hearings on Bill 49, An Act to improve the Employment Standards Act. We're certainly pleased to be here in Sudbury today, our third and final stop in the north. Welcome to all the groups making a presentation.
UNITED STEELWORKERS OF AMERICA, LOCAL 6600
The Chair: Our first group up today is the United Steelworkers of America, Local 6600, Retail Wholesale Canada, Canadian service sector division. Good morning, gentlemen. Just a reminder that we have 30 minutes for you to allocate as you see fit, divided between presentation time or question-and-answer period. Please proceed.
Mr Denis Dallaire: I'd like to thank everyone for the opportunity to be here this morning. The United Steelworkers of America is an international trade union with over 700,000 members throughout Canada, the US, Puerto Rico, the Virgin Islands. More than 170,000 of those members are in Canada.
The Steelworkers is Canada's most diverse private sector union. In 1936, the Steelworkers began organizing employees in the steel industry and grew to become Canada's largest union in containers, chemicals, aluminum, pipe, mills, mines, smelters and other metal industries. The Steelworkers has more recently extended its membership to workers in almost every sector of the economy, including electronics, plastics, rubber, brick, glass, textiles, furniture, warehousing, retail, wholesale, department stores, building service, office and technical jobs, hospital and health care, financial services, professional occupations, dairy, bakery and confectionary, culinary and optical industries, food processing, hotels and restaurants, taxis, security guards, fish plants and many others.
In Ontario, the Steelworkers encompasses two distinct districts: District 6, and its retail, wholesale and department store union, Canadian service sector division. These two districts currently encompass more than 100,000 Ontario members employed in over 500 companies.
We believe that Bill 49 will seriously jeopardize the rights of workers to basic employment protection in Ontario. Premier Harris and Labour Minister Elizabeth Witmer have publicly proclaimed the Bill 49 amendments to be minor changes which amount to mere housekeeping. If the government truly believes this, it should heed labour's warnings and seriously reconsider its position before depriving workers of the minimum standards which currently provide basic employment protection.
These amendments will foster severe labour relations confrontations and diminish access to justice for Ontario workers by stripping unionized workers of legislated minimum workplace standards which resulted from the hard-fought struggles of the Steelworkers, as well as other trade unions, and privatizing the government's responsibility for arbitrating, regulating and enforcing minimum workplace standards, thereby placing this burden on the backs of workers.
These amendments will make it easier for employers to deny their employees the minimum wages and benefits set out in the Employment Standards Act. More simply put, Bill 49 is a gift to unscrupulous Ontario employers, who will view the amendments as an opportunity to gut minimum workplace standards. Employers will realize that the costs and pressures of self-regulation of this new system will force employees to agree to a settlement or compromise of an outstanding claim against their employer, even where the employer has clearly and unconscionably violated the act.
The Steelworkers ask this government to consider the effects of Bill 49 on working people and the labour relations environment in this province. We urge this government to have regard to the implications of Bill 49 and withdraw the proposed legislative changes.
Gutting the Employment Standards Act by contracting out of employment standards: I find that really ludicrous and I'll tell you why. This amendment allows employers to negotiate lower standards for hours of work, overtime pay, public holidays and paid vacation in organized workplaces. Until now, these basic standards were untouchable. Furthermore, no other jurisdiction in Canada allows employers to contract out of the legislated minimum standards protection afforded to workers. This amendment is enough for the Steelworkers to stand in opposition to this bill as a whole.
The intent of the act has always been to impose minimum workplace rules and standards which society deems necessary for all of its members. While parties are free to contract for higher benefits than those contained in the legislation, they are not able to undercut the statutory minima, often referred to as the floor of rights. This amendment will eliminate the floor for hours of work, overtime pay, public holidays and vacation with pay for organized workers. There is no justification for this elimination of basic standards for working people in a society which values the universality of, at least, basic minimum rights.
The central goal of our industrial relations system is to facilitate negotiated settlements between labour and management. This amendment runs directly counter to that end. These new issues will prolong bargaining in all workplaces, but especially where certain employment standards minima may be actually operational within collective agreements, such as in the retail and service sector, security guard industry, taxi industry, and others. Settlements for newly organized unions will be even more difficult in these sectors, where entitlement to overtime pay, public holidays, vacation pay and hours of work will be put in issue.
Disputes will undoubtedly arise where employers try to force unfair working conditions on employees by attempting to bargain tradeoffs with respect to overtime pay, public holidays, severance pay and vacation pay in exchange for, for example, increased hours of work. The position of the Steelworkers is clear and simple: Every employer proposal to increase hours of work in exchange for improvements in other rights will be met with clear and unswerving resistance from its bargaining committees.
The Steelworkers believe that all bargaining agents should negotiate hours of work which will increase workers' choices regarding when and how often they work, reduce on-the-job stress and reduce family/work conflicts, promote safer workplaces and put pressure on employers to hire and train more people.
The proposed amendment requires unions, employers and arbitrators to undertake the difficult task of comparing apples and oranges and determining whether collective agreements comply with subsection 4(3) of the amended act, and provides greater rights in total for hours of work, overtime pay, public holidays, vacation with pay and severance pay when assessed together. This accounting mess is compounded as the parties are being asked to value and compare purely monetary rights such as overtime pay and severance pay, non-monetary rights such as hours of work, and mixed rights for vacation and public holidays.
For example, an employer may propose that employees work a sixth shift every Saturday in exchange for double-time rates on that day. A bargaining agent may not agree that a diminished quality of life can be compensated by more money, and therefore determine that this tradeoff does not result in greater overall benefits to employees. Complex arbitration litigation may result if the proposal is eventually accepted by the bargaining agent. If the bargaining agent does not accept it, the result may be impasses in collective bargaining and bitter and protracted labour disputes.
The fact that there has been no attempt in Bill 49 to address how a negotiated package is to be evaluated suggests that the purpose of this provision is to allow employers to waive minimum standards rather than negotiate greater flexibility in achieving minimum standards.
I would now like to pass it on to Robert McKay, national representative of the retail-wholesale division of the Steelworkers.
Mr Robert McKay: Privatizing enforcement: passing the costs on to unions, which deals with section 20 of the bill, section 64.5 of the act: The government is abdicating its historic function of enforcing the act and forcing it on to the shoulders of organized labour. Bill 49 eliminates recourse by workers to the considerable investigative and enforcement powers of the Ministry of Labour. In its place, unionized employees are required to use the grievance procedure under the collective agreement to enforce their rights under the act. As a result, unions will now bear the burden and cost of investigating, settling or determining complaints of employer breaches through the collective agreement grievance and arbitration procedure. Bill 49 contemplates that an arbitrator, whose costs will be shared by the union and employer, will have all of the powers now exercised by the employment standards officers, referees and adjudicators.
Hardship on unions: The financial, legal and human resource burden of managing every employment standards complaint is staggering. The change from an individual to a union-driven procedure poses a tremendous hardship on unions, which will now bear the burden of investigation and enforcement and their accompanying costs. As well, Bill 49 will require unions to become familiar with the pre-existing and complex jurisprudence under the act, because unions and not individual complainants will be responsible for determining whether to proceed with a complaint.
Refusals by unions to proceed with a complaint may lead to dissension within the bargaining unit. Added pressure to proceed with complaints through the grievance procedure will ultimately tax the resources of the union. The existing duty of fair representation has not in the past required unions to represent employees in respect to employment standards, but Bill 49 expressly contemplates that unions that do not proceed to enforce the act may be faced with complaints concerning fair representation by members.
There is also some ambiguity about when unions will begin to assume responsibility for administering employment standards complaints. As the proposed legislation stands, a union is responsible for enforcing the act after certification and the issuance of notice to bargain a first collective agreement if an employer subsequently enters into a collective agreement. How is it possible for the union, without a collective agreement grievance and arbitration provision in place, to process an employment standards complaint? Is it possible that these complaints will need to be held in abeyance until a first collective agreement is achieved? If a first collective agreement is never achieved and complaints that had been held in abeyance are subsequently referred to the employment standards branch, the delay in filing the complaint with the branch may result in an employee being unable to recover money due to the proposed six-month limitation period for filing complaints and the one-year limitation period for recovering back pay.
The government's minor changes to the act allow it to unfairly pass off the obligation and associated liability involved with administering a public statute on to employees and their unions, when it's the employers who have violated its provisions.
Loss of investigation: Unlike the referee who now adjudicates these matters, unions will not have the benefit of an employment standards officer report and other documents obtained in the course of an ESO investigation. Although the arbitrator will be cloaked with the power of the employment standards officer, the arbitrator will only compel production of relevant documents after convening a hearing and receiving submissions and possible evidence to convince him or her to compel disclosure. In short, the litigation will be difficult and expensive and there will be enormous opportunities for employer counsel to obstruct access to information/evidence. These factors will make it very difficult for unions to enforce and prove claims.
The absence of an investigation stage will be extremely problematic in dealing with successor employer and common employer complaints under the act where pre-hearing production is essential. The information necessary to succeed on such a claim is often solely within the knowledge of the employer. Unions will be forced to file and then proceed to litigate these complaints before an arbitrator in order to compel production and disclosure. Disclosure at this late stage may result in the union finding that there was little basis for the complaint. This would have been apparent much earlier in the process had there been an opportunity for an investigation by an employment standards officer.
Bill 49 is also bad for the unorganized worker, decreasing employer liability and privatizing enforcement. The proposed amendments will affect workers across the province whether covered by collective agreements or employed at non-unionized workplaces. The amendments affecting unorganized workers will seriously diminish their ability to collect unpaid wages and benefits owing by their employer. The effect of these changes will be felt hardest by Ontario's most vulnerable workers. Why is the law allowing employers who violate Ontario's most basic employment standards to benefit in this unconscionable manner?
Limiting employee options by barring both civil and statutory remedies, which deals with sections 19 and 20 of the bill, sections 64.3 and 64.4 of the act: These amendments force employees to choose between pursuing their claim through the more expeditious and cost-effective path of making a claim through the ministry or filing a notoriously lengthy and prohibitively expensive civil suit in the courts. The injustice of the choice which employees are faced with is exacerbated by the proposal that claims made through the ministry are capped at $10,000. In effect, these provisions act in tandem to ensure that the greater the amount of money an employer owes to an employee, the less likely the employee will be to collect the full amount.
Employees who file a complaint under the act will be forced to decide in a two-week period whether to continue under the act or to withdraw their complaint and pursue a civil remedy. Those unaware of their legal rights may be precluded from commencing a civil action unless they obtain the necessary legal advice within the short two-week period. Employees who initiate a civil claim but decide they no longer wish to pursue it do not appear to even have the two-week time limit to change their minds.
Decreasing employer liability by shortening limitation periods: The shortening of limitation periods from two years to six months will have a profound effect on the amount of unpaid wages and benefits employees will be permitted to collect under the act. The shortening of time for the filing of a claim will be particularly detrimental to employees who are unrepresented and unknowledgeable about their rights.
In additional, although employees are prohibited under the act from retaliating against employees who lodge complaints by firing them, as a practical matter this prohibition is ineffective. Most employees realize this. Because they understand that they have little protection against an unscrupulous employer, they do not come forward until they have left their job to complain about violations which occurred during their employment. In the end, workers who fail to file within the six-month time limit for claims through the ministry will be forced to sue civilly in order to seek redress where the employee must bear the significant cost of litigation, since the Ontario legal aid plan no longer covers most employment-related cases. In these circumstances, the reduced limitation period will translate into reduced liability for offending employers at the expense of working people.
Decreasing employer liability, which deals with section 21 of the bill, subsections 65(1.3) to (1.6) of the act: This amendment proposes to arbitrarily cap the maximum amount which can be received through the filing of a complaint with the ministry at $10,000. Employees who want to pursue claims over $10,000 are faced with a difficult choice: resort to costly court procedures or forgo recovering money owed in excess of the $10,000 limit by filing a complaint under the act. Both options diminish the likelihood that an employee will recover the wages and benefits they have already worked for.
The amendment also proposes to impose an arbitrary minimum limit on claims that the ministry will enforce through its officers. If such a limit is set, employees will be forced to go to Small Claims Court to pursue such claims, or simply forgo the wages owed to them. The net effect of imposing a minimum claim limit is likely to be that employees will simply abandon claims for small amounts of money.
Privatizing enforcement: The new law would have private collection agencies assume all powers of collection presently available to the employment standards branch. This change reveals a basic departure from historical public policy regarding the collection of debts owed to workers in Ontario. This amendment will result in many workers no longer receiving 100% of the money recovered from employers. This is because when a collection agency collects less than the total amount owing to an employee pursuant to a compromise or settlement, or the refusal or inability of the employer to pay, Bill 49 will enable the apportioning of the amount among the collector, the employee and the government. In other words, the collector is permitted to take a portion of the minimum wages and benefits owing to the employee.
The number of employees who will end up paying the collection agency out of their own pockets will be great as private collection agencies will pressure employees to accept a compromise or settlement from the employer in order to cut down on the amount of time the agency has spent for collection purposes and to ensure them a guarded fee or disbursement. The new system will also encourage employers to negotiate fiercely with the collection agency in order to reduce their liability under a compromise or settlement. It is clear that it is only workers and not private collection agencies or employers who stand to lose from this amendment.
There are some positive amendments. The Steelworkers support three proposed amendments in Bill 49. Section 8 of the bill, section 28 of the act: Section 8 of the bill provides that entitlement to vacation pay of two weeks per year accrues whether or not the employment was active. To be clear, we do not see this as a statutory improvement, because this change codifies pre-existing jurisprudence of referees.
Section 5 of the bill, subsection 7(4) of the act: Section 5 of the bill requires the employer to pay termination pay within seven days of the employee's termination.
Section 12 of the bill, subsection 42(4) of the act: Section 12 of the bill provides that the calculation of service and length of employment is to explicitly include time on parental and pregnancy leave, thus codifying pre-existing jurisprudence of referees.
The purpose of the act is to impose minimum acceptable workplace rules below which society is not prepared to allow workers to fall. Bill 49 obliterates the concept of an overall minimum package of standards for unionized workers. It dramatically shifts the burden of enforcement on to the shoulders of unions. This shift will undoubtedly cause irreparable harm in unionized workplaces to the functioning of grievance arbitration procedures. It will foster labour relations confrontations in the collective bargaining regime.
For workers without unions, the likely result is that their rights will simply not be enforced.
The bill undermines many of the basic principles on which minimum standards legislation has historically been based. We believe that both organized and unorganized workers will bear the burden of its harsh and unprecedented attack on all of these basic principles. All of which is respectfully submitted.
I'd make one comment, that I was happy to see that the minister recently has at least tabled the area where trade unions have to negotiate minimum workplace rules with regard to hours of work, overtime, public holidays etc. While we're happy to see that that's been tabled, we're not happy to see that we haven't been given very clear assurances that that issue is completely withdrawn, and that's why it still forms a part of our brief.
With regard to page 9 of our brief, and we talked about the ambiguity about unions first beginning to assume responsibility for administering employment standards complaints, I'm currently in the process of waiting for a decision after a lengthy round of collective bargaining. We were certified for the Metropolitan Stores in Marathon, Ontario, in December 1994. We still don't have a collective agreement, and this ambiguity about when unions have a responsibility in terms of administering employment standards complaints certainly creates a large hardship on the employees and on the trade union, because there has been a turnover of employees in that particular store and it's difficult for us to keep up with it. We may not hear about a complaint for a long time after it takes place, and the way the act is written, it's just not fair in terms of restricting the employees and having to bring it forward within a six-month period.
Whether this committee realizes it or not, it's a different world in the workplace, particularly in the sector that I represent, that being retail. I'm referring to page 13 of our brief, where in the second paragraph we've made note that employees are unaware of their civil rights, and we go on to mention in the brief that they're afraid to come forward. That's not at all uncommon in the retail industry. In fact, I represent a group of taxi workers in Thunder Bay, and they only just recently indicated to me that for the last two years they haven't been paid properly and subsequently are wanting to file a complaint through the employment standards branch. To take away their right to be able to go back two years would be really unfair, because it's been the employer who has really capitalized and exploited them and made use of their time. So for them to be denied under this bill the right to be able to go back and collect is most unfair.
Employees in retail, even today under the Employment Standards Act, do tend not to be treated fairly. They currently, in many of the small retail locations don't get vacation pay, don't get statutory holidays. They're told that they have to work on Sundays even though the act gives them some rights. It's difficult enough enforcing what's currently there, and all you're going to do by implementing this particular bill is create even more hardships on those in the retail field, and in fact what they'll do is they'll never become solid citizens. They'll be transient in the business and they'll just move from job to job and from one exploitation to another.
Mr Dallaire: Just in closing, I'm kind of curious as to why we need these cuts and how you justify them. We look at your track record in the last year in governing, and it's just been atrocious. We look at the Bill 40 repeal of the ban on scabs. It has ended an unprecedented period of labour peace in Ontario.
Since the anti-worker Bill 47, Ontario has seen bitter strikes and lockouts. Look at OPSEU and the Great Lakes College and the Ontario Jockey Club. In the first months of 1996, Ontario had already lost more days of work to labour disputes than any other full year under the NDP government.
You have ended successor rights for Ontario government employees, stripping rights enjoyed by all other unionized workers in the province. Gains won by workers can now be scrapped when a public service is privatized.
You have slashed more than 12,000 government jobs. This is causing enormous disruption in vital services and in the lives of workers who devoted their working careers to serving the Ontario public.
In Bill 26, the government also took away pension protection from government workers that is available to all other employees in Ontario.
You have abolished the Workplace Health and Safety Agency, cut back on lab and technical support for health and safety inspectors, rolled back requirements for health and safety training and established a freeze on the minimum wage to be kept in place until the United States and other provinces have overtaken Ontario's previously leading role. The list goes on.
You have planned to eliminate Workers' Compensation Board coverage for many common injuries, giving employers control over benefits and slashing benefit levels for injured workers; refused the NDP demands for public hearings on government's discussion paper which adopted the business agenda for WCB without any effort to address the concerns of labour and injured workers; refused the NDP demands for public hearings on government's discussion paper, which adopted the business agenda for the WCB without any effort to address the concerns of labour and injured workers.
You have tried to ram through far-reaching changes to the Employment Standards Act, the foundation of basic rights of union and non-union workers in Ontario, and announced a review of the Occupational Health and Safety Act; you expect to set the stage for an attack on the right to refuse unsafe work; repealed the NDP's employment equity legislation; cut back pay equity adjustments in the public sector and abolished the proxy method of determining eligibility for pay equity.
You have infringed on the independence of arbitrators by writing into legislation that in cases involving teachers, police, firefighters and hospital workers, the arbitrator must consider the employer's ability to pay, which usually means willingness to pay.
These are all the reasons that we're here today and we urge you to reconsider.
The Chair: Your timing is within 20 seconds of being perfect. Thank you very much for taking the time to make a presentation before us here today. We really do appreciate it.
UNITED STEELWORKERS OF AMERICA, LOCAL 6500
The Chair: That leads us to our next group, the United Steelworkers of America, Local 6500. Good morning and welcome to the committee. Again, we have 30 minutes for you to divide as you see fit between presentation time or questions and answers.
Mr Barry Tooley: Good morning. My name is Barry Tooley. I'm the financial secretary with Local 6500 Steelworkers in Sudbury.
In introducing the Bill 49 amendments on May 13, 1996, Labour Minister Elizabeth Witmer claimed she was making housekeeping amendments to the Employment Standards Act. She described Bill 49 as facilitating "administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures."
The truth is that what was presented as minor technical amendments contained substantive changes, changes which clearly benefit employers and diminish access to justice for both organized and unorganized workers, particularly the most vulnerable in the workforce. These changes will make it easier for employers to cheat their employees and harder for workers to enforce their rights. It strips unionized workers of the historic floor of rights which they have had under Ontario law for decades. This submission is made on behalf of Local 6500, United Steelworkers of America, located in Sudbury and representing workers in the nickel industry with 4,700 members. The following sections of this submission capture our views on the key amendments.
(1) Flexible standards, section 3 of the bill, subsection 4(2) of the act: The bill contains a fundamental change to Ontario labour law by permitting the workplace parties to contract out important minimum standards. Prior to Bill 49, it was illegal for a collective agreement to have any provisions below the minimum standards set out in the Employment Standards Act. Bill 49 allows a collective agreement to override the legal minimum standards concerning severance pay, overtime, public holidays, hours of work and vacation pay if the contract confers greater rights when those matters are assessed together.
This measure erases the historic concept of an overall minimum standard of workplace rights for unionized workers. Employers are now free, for example, to disregard this previous floor of rights and have the opportunity to attempt to trade off such provisions as overtime pay, public holidays, vacation pay and severance pay in exchange for increased hours of work. How is one to weigh or measure whether or not a tradeoff of this kind confers greater rights is left unstated. It will become an issue in its own right.
For example, a retail store owner could ask an employee to cover all hours of a store's operation, say 50 to 60 hours per week. The employer could argue, however, that due to the inclusion of enhanced severance pay and an extra week of vacation, that is, three weeks rather than the minimum two weeks currently spelled out in the Employment Standards Act, that this confers greater rights when assessed together. In short, the parties are being asked to value and compare non-monetary rights (hours of work) with purely monetary rights (overtime pay, severance) and mixed rights (vacation pay, public holidays). Given the inequality of power between employers and employees, including many who are unionized, circumstances in which detrimental tradeoffs are agreed to despite the measurement problems referred to can easily be envisioned.
This proposed amendment, therefore, will allow employers to put more issues on the bargaining table which were formerly part of the floor of legislated rights. It will make settlements more difficult, particularly for newly organized units and small service and retail workforces. It will also 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 can together be argued to exceed the minimum standards.
The potential of this amendment alone to erode people's standard of living should be enough to make the drafters of the amendment rethink, if not radically alter, Bill 49. It is certainly enough to make Local 6500 USWA stand in opposition to the bill as a whole.
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 more acrimonious relations and industrial conflict. What were in the past minimum benefits protected by law will now become permissible subjects for bargaining, arbitration and labour disputes. Further, 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 Ontarians.
The shortsighted may see this rush to the bottom as helping employers to become 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.
I realize that this particular flexibility under the act has been tabled and we have great concern because it's still under review, and that's why we've included our particular concerns on this piece of the legislation. We are very concerned that the flexibility issue may come back at a later time.
(2) Enforcement under a collective agreement, section 20 of the bill, section 64.5 of the act: Currently, under the Employment Standards Act, 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 and termination pay. The Bill 49 changes eliminate recourse by unionized employees to this avenue and instead require all unionized workers to use the grievance procedure under the collective agreement to enforce their legal rights. The union will bear the burden of investigation, enforcement and their accompanying cost.
The director can make an exception and allow a complaint under the act where he thinks it 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 also face 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 concerning fair representation by members. 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 additional 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 minimum amounts of the act. However, arbitrators lack the investigative capacity of the employment standards officers and may not be able to match the consistency of the 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 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.
(3) Enforcement for non-unionized employees: Sections 19 and 21 of the bill, 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 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 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 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 for a lawyer, will have to forgo the relatively more efficient statutory machinery in respect of even those amounts clearly within the purview of an 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 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 provisions bar civil remedies in section 64.3, there are minor 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 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.
(4) Maximum claims, section 21 of the bill, 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 of back wages and other moneys such as vacation, severance and termination pay. There are only two 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 of 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 foodservice, 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 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 who have 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.
(5) Use of private collectors, section 28 of the bill, new section 73 of the act: 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 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 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 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 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 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 for it to be 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 these 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 for unconscionable abuse. Local 6500, United Steelworkers of America 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. 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, section 32 of the bill, section 82 of the act: 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 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 continuing one or there are violations in the case of several employees, is the limitation period extended.
Workers who fail to file within the 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 is 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 the only part of it that the collector collects, minus the user fee. That the government can rationalize such amendments as facilitating administration and streamlining procedures is almost beyond comprehension.
Minor positive amendments: There are several positive amendments in Bill 49. Two are noted. The first concerns vacation entitlements, section 8 of the bill, section 28 of the act. 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 Local 6500, USWA 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 worked 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% of 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 leaves. With the passage of this amendment, the length of an employee's time on leave will be included in calculating length of employment, length of service or seniority for purposes of determining rights under the 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: 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 for minimum standards. As for the unorganized, particularly the most vulnerable in the workforce, Bill 49 is about the race to the bottom. It is about undermining their already precarious existence and as such it 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 made more difficult to obtain; and enforcement of such 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.
The Chair: Thank you. That leaves us one minute per caucus for a brief question or commentary. Mr Lalonde.
Mr Jean-Marc Lalonde (Prescott and Russell): Thank you for your presentation. As I could see with the first group, Local 6600, and yourself, there will be more responsibility given to organized labour groups. You'll be left with more responsibility. Do you think this could result in increasing union fees for union members?
Mr Tooley: I would hazard to guess that if we have to provide some of the government services that have been available in the past, it would be a possibility that we would have to recover more from our members, yes.
Mr Lalonde: It's too bad that your brief is so long, but very interesting. We could take more time to ask you questions. But probably the government preferred this way, having the least number of questions.
The Chair: The questions will move to the third party.
Mr David Christopherson (Hamilton Centre): Thank you very much for your presentation. I only have a minute but I do want to say at the outset that all the presenters today should remember that we're only having these hearings because the government was brought out into the public light kicking and screaming. They didn't want to pass this and include public comment while doing it. They wanted to ram it through by the end of June. The clause about the flexible standards that you are concerned about indeed has been deferred to the broader review. That's again because we forced them out into the public. That would have been law as we sit here now, had we not forced them to come out.
You were questioning that it may possibly be part of a future review. The minister has made it very clear: It is on the table. It's right that you raise that now and we make sure that everyone understands how much will be lost in terms of minimum standards in this province if that's allowed to remain. I want to thank you and your members for your ongoing struggle, not just on behalf of your own members but especially those who don't have benefit of a union like yours and need you to speak out for them.
Mr Ted Chudleigh (Halton North): I was interested in your brief. Thank you very much. You mentioned education and people not understanding their rights under the act and the employees, particularly those who are most vulnerable and quite often those who are not represented by unions, who are abused or taken advantage of by employers.
Over the course of the hearings, it seems that there's a large number of employers who don't understand their duties under the Employment Standards Act, and as well a number of employees. Do you have any suggestions as to how we could improve the education of both employers and employees in these areas?
Mr Tooley: One of the areas we've seen is that the Ontario Federation of Labour has opened up a hotline for workers to report bad bosses. We think that bosses in the province of Ontario are getting the message from the government of the day that it's open for business; it's open to take whatever we can. The race to the bottom is on the way, and we see that workers who are the most vulnerable, as you've said, are going to be affected.
We are greatly concerned about people who don't know their rights -- they're at the mercy of employers who should have some integrity -- that those people are going to be hard done by over the long haul with the kind of legislation that's proposed.
Mr John R. Baird (Nepean): On a point of order, Mr Chair: I understand from the clerk that the next group is not here yet. Given that we've travelled all the way to Sudbury and are most keen to have a dialogue, if Mr Lalonde has any further questions he'd like to ask, we'd be pleased to give unanimous consent to extend this a few minutes per caucus until the next group arrives.
The Chair: Is a representative of the IUOE, Local 793, in attendance? I suggest then that we give another 10 minutes, on the assumption that they're late in arriving, divided equally between the three caucuses.
Mr Bert Johnson (Perth): Maybe you could just ask the presenter if it's all right with him.
The Chair: That's a very good point, Mr Johnson. Would you mind staying for an extra 10 minutes?
Mr Tooley: I certainly have no problem with it.
The Chair: Thank you, sir. We'll give another three and a bit minutes to each caucus, commencing again with the official opposition.
Mr Pat Hoy (Essex-Kent): We appreciate your staying here a little longer. No doubt you have other commitments today. Your presentation and the one prior pointed out a very diverse membership in your union. Specifically, I'm curious about the service industry in the non-organized area, although you do represent a great many people in those areas.
How do you feel this is going to impact on those who are, as we've said this morning, more vulnerable, unorganized as it relates to the route they have to take to acquire moneys over the $10,000 limit? We know that 96% of claims are under $10,000, and it was suggested that those in executive positions and higher wage areas claim over that. But what about those people in the service industry? How does this impact on them as they try to acquire moneys over $10,000?
Mr Tooley: I believe that most of those people or a lot of them, not even being familiar with the labour laws and the Employment Standards Act, are really going to be at a disadvantage because they have no one to speak on their behalf, no one to guide them through. I think that a lot of those people are simply going to give up or they will go by the two-week time limit that's proposed in the changes to the act. They will simply miss the boat and those wages in most cases will never be recovered.
Mr Hoy: Are you aware that one cannot sign away their rights? For instance, if there were a statute that said certain health and safety regulations had to apply and some employer or owner came along and said, "Would you sign this and waive those rights?" that attempt to sign away rights and circumvent a certain statute could not be upheld in court.
Mr Tooley: As we see the proposed changes to the act, when an employer comes to an agreement with his employees, those changes could very well be circumvented and could be agreed on. Especially in a non-unionized workplace, if the workers agree, they're very vulnerable because the employer has the upper hand and their very livelihood depends on agreeing with whatever the employer wants to do. I think there would be cases where that would definitely happen, that those particular companies that really are very unscrupulous in some cases would try to circumvent the law.
Mr Christopherson: I want to pursue the issue I commented on earlier that you focused on in your brief with regard to contracting out of minimum standards. The government seems to be of a mind that there's absolutely nothing bad that could happen to any worker if the union has agreed to a collective agreement that contains lower standards.
First you've already pointed out that any employers who table those with a major union like yours are looking for very serious trouble and they're going to find it, but the fact of the matter is that even your union would have to deal with the give and take of negotiations. Suddenly there would be demands on the table from the employer that otherwise wouldn't even be there, they wouldn't be part of the equation. Certainly for smaller unions or isolated local unions, the fact that they enter into a round of concessionary bargaining where maybe the part of the economy they're in is in trouble -- now the legalized right to use scabs, perhaps the threat of closure or moving the operation somewhere else -- we know that sometimes there are concessions made in collective agreements, and in this case we could see collective agreements that contain clauses that have standards below the floor that now exists in what is commonly called the workers' bill of rights.
That's what we've heard all across the province. Certainly that was my sense of this in my own experience in bargaining. Could you maybe expand on that in terms of how you would see that affecting the Sudbury area negotiations and contracts that you're familiar with?
Mr Tooley: One problem I see that would create a lot of animosity at the bargaining table is that if there were certain standards the employer wanted to put in that were below what would be acceptable, it would give us cause to be out on strike probably for a long time for something that we've already had and enjoyed in the past. It would certainly cause a lot of hardship needlessly, because the floor should not be lifted.
It's there, it's been there for a long time and I don't think the changes are going to help anything in this, particularly workers, whether they have a collective agreement or not.
Mr Christopherson: The cost of arbitrating now, under the Employment Standards Act, will be your responsibility. In your experience, what's the range of costs for an arbitration case for your union?
Mr Tooley: An average, one-day arbitration case for our union probably runs around $8,000.
Mr Christopherson: Some of them go on much longer than one day?
Mr Tooley: Yes. In many cases they're much longer than that, but that's just for a one-day arbitration.
Mr Christopherson: That's now a cost that your membership is going to have bear. One way of looking at it is that they now have a user fee to pay for a service and a right that was once there in law.
Mr Tooley: That's correct.
Mr Baird: Thank you very much for your presentation. I have just one comment to make with respect to section 3 of the bill, which was discussed as being the package of allowing some flexible standards in terms of the Employment Standards Act. I think there were five areas contained in section 3, and the feeling was that to put it forward to the full review that I guess will gather steam and get under way in the fall, that would still require, though, as a package to be at least better than the minimum standard.
We heard, for example, from I believe a CUPE local yesterday. The issue was time off in lieu of overtime. We found some employment standards officers, even if union and management had mutually agreed on a provision -- in some cases it would be against the law and they wouldn't be allowed to do something like that. I guess that was the flexibility we were seeking and would always have required unanimous consent among both workplace parties themselves.
Minister Witmer had listened to representatives both from the business community and the labour community and put that over to the full review so there could be a more thorough discussion of it, and we look forward to that this fall. I know my colleague Mr Barrett had some questions.
Mr Toby Barrett (Norfolk): Mr Tooley, I welcome the opportunity for some questions. Your brief is important. Steelworkers and the steel industry are very significant in my riding, as opposed to the nickel industry.
You mentioned that the United Steelworkers of America, Local 6500, oppose the bill as a whole. During these hearings across northern Ontario we've heard about an Employment Standards Act that became law in 1974 and has undergone numerous reforms by numerous authors and we've ended up with a bit of a jumble. There's been a patchwork created. We're told it's inflexible, it's unwieldy; I feel it's outdated.
You oppose this bill, and I'm just wondering: Your membership is looking at the legislation that exists now. What would you be in favour of, given that things have changed over the years since 1974? What are some positives that we should be trying to work into this bill as our committee input?
Mr Tooley: We'd certainly be in favour of having the anti-scab legislation returned. That has been very detrimental to workers, unions and companies. It's really taken away the ability to bargain in good faith. When we as a union negotiate collective agreements, we don't negotiate agreements that the employer can't live with that are going to put the employer out of business. I think the anti-scab legislation has simply put all the cards back where workers will be forced out.
Instead of having harmonious labour relations in the province it's going to create greater hardship for both employers and employees. There's no real incentive to bargain in good faith when the employer has the ability to have replacement workers come in. I think the experience has been that for every $20-an-hour job out there, there's a worker willing to take that for $18 and another one willing to take that for $14 and all the way right down the scale.
I think the proposed legislation and the changes to the Employment Standards Act are going to go a long way to create that race to the bottom. We certainly believe it's not in the best interests of the province, workers and the economy to have everybody working for minimum wage.
Mr Barrett: Some of those points are probably beyond the capacity of the Employment Standards Act, but I appreciate the input.
The Chair: That takes us beyond our 10 minutes. In the absence of the next presenter, and the clerk has just confirmed that the IUOE will not be appearing here this morning, the committee will take a short recess till 11:30, when the next presenter is scheduled to appear.
The committee recessed from 1113 to 1129.
SUDBURY AND DISTRICT CHAMBER OF COMMERCE
The Chair: I call the meeting back in order. Our next presenters are in attendance, the Sudbury and District Chamber of Commerce. Good morning and welcome to the committee. Just a reminder that we have 30 minutes for you to divide as you see fit between either presentation time or question-and-answer period.
Mr Bernie Freelandt: Thanks very much. I won't take 30 minutes and I hopefully won't answer a whole bunch of questions. The thrust of our presentation today is to endorse the amendments. We will speak to it in a general way.
Mr Chair, ladies and gentlemen of the committee, my name is Bernie Freelandt. I am president of the Sudbury and District Chamber of Commerce. On behalf of approximately 1,000 business representatives, I wish to extend our appreciation to you for allowing me to take this opportunity to present this morning.
The Sudbury and District Chamber of Commerce is one of the largest and most dynamic chambers in northern Ontario, and we've taken a keen interest in representing the views and interests of our membership. Our members are drawn from all areas of the Sudbury region and are engaged in every sector of the economy, from multinationals to the independent owner-operator, thousands of employees to one employee. However, 70% of our members are on the lower end of the scale and don't have a lot of management depth and administrative ability, and that's the largest group we represent here today. We represent the interests of business in this community and we're recognized as the voice of business in this community.
Rather than addressing all of the proposed amendments to the bill, we have chosen to limit our comments to three specific areas: the reduced role of government, collective agreement enforcement, and the flexibility that this new act provides.
The changing role of government is necessary given the climate and the changes in business today. Times are changing and everything that we do has to be reviewed and looked at again. In that frame, in general terms, we applaud the government's action to reduce its role in the administration and enforcement of the act. Simplifying and easing the administrative burdens of compliance, lowering costs and reducing access barriers will create opportunities for improved communications and provide for resource efficiencies, all of which are viewed positively by the business community. We need to avoid duplication and reduce time frames, and we believe these amendments go to that end.
The other area is the duplication through the act and the collective agreements where those exist. The Sudbury chamber supports that where a collective agreement exists, enforcement of the act must be through the grievance and arbitration procedure of the collective agreement rather than through the employment standards branch. We believe this action will force opposing sides to face the issues before them, placing greater responsibility on the parties to reach their own settlement rather than devolving that responsibility to government-appointed adjudicators. Forcing communication and forcing people to talk and resolve their problems is far more efficient than relying on some third party to deal on their behalf.
As government bureaucracies continue to decrease in size, an increasing responsibility will be placed on employers and employees to improve their communications and resolve their disputes, and we believe the amendments will go to that end.
Flexibility is something that is absolutely necessary in our changing world, not just in Sudbury. Everybody tells us we're part of the world economy and global economy. We believe that to be important, and as a consequence, employers and employees must be more flexible. We at the Sudbury chamber endorse the flexibility provided in the amendments to the act where parties can agree to standards other than those imposed as minimums in the Employment Standards Act if they are perceived to benefit both parties. Environmental circumstances, particular business circumstances, cause different standards to be imposed, and if they can be negotiated and settled, why would those not be more important than the ones imposed by the legislation? This opportunity will encourage improved communications, again, and employers and employees will benefit from the increased flexibility.
In conclusion, we congratulate and applaud the government for taking action that supports greater efficiency, flexibility and self-reliance. While we have selected the areas of the act we wished to address, we are hopeful that the remaining improvements not addressed also support these goals.
On behalf of the members of the Sudbury and District Chamber of Commerce, we appreciate this opportunity to make this presentation, and I will answer questions to the degree I can. Thank you very much.
The Chair: Thank you very much. That affords us just over six minutes per caucus for questioning. We'll commence with the third party.
Mr Christopherson: Thank you for your presentation. I note that you state that, and I'm quoting from your document, "This opportunity," meaning the flexibility issue, "will encourage improved communications between employers and employees, increased flexibility and possibilities." If you were here earlier, you heard from other presenters from the labour movement suggesting quite the opposite, that indeed employers tabling any amendments to collective agreements that are below the existing Employment Standards Act will increase the likelihood of strikes, make relations far more acrimonious and indeed create a less inviting environment for investment because of labour strife. How do you reconcile those two different perspectives?
Mr Freelandt: I really think times are changing and people are communicating and are forced to communicate more. The environment you're suggesting is one that we've seen in the past. I think we have to turn the page. Employers and employees will be and have to be more cognizant of changing circumstances and environments and have to communicate and discuss those issues.
I think you will have that kind of circumstance in isolated cases where people can't realize that there's a need to change. There are always people slow off the mark, and those people will lose. Employers and employees alike will not benefit if they take that attitude. I think we are in a new, changing economy and a new, changing environment. Those thoughts are the past and we have to move forward.
Mr Christopherson: I would suggest with great respect that it's not an issue of a particular union being slow off the mark. The business community and this government need to recognize that the labour movement is not about to lie down and let these kinds of minimum standards be taken away. I think it's extremely naïve on your part to believe that somehow by holding your breath and clicking your heels three times and wishing and hoping, suddenly everything's going to be wonderful.
We're hearing all across the province, from every union we've heard from, that this is going to increase the acrimony. I find it upsetting to believe the business community believes that these are somehow going to make things better. I have no doubt that that will be borne out by events to be seen in the future.
The government has contended that these are minor housekeeping changes and that indeed there is no reduction in minimum standards. Do you agree with that?
Mr Freelandt: I think that's probably the result you get from the document, because I think we started at a base, and that base is where the discussions and the negotiations start from. Even to address your earlier comment, I don't think this is going to impair minimum standards. I think it's going to bring those standards in line with the circumstance and the environment that the employer and the employee find themselves in. So it's a base to work from and it allows flexibility now to discuss beyond the act and do different things. So no, I don't think this is going to reduce the minimum standards of the act.
Mr Christopherson: I would ask you to comment, then, on the fact that employees now will have a cap of $10,000 and a minimum threshold as yet unidentified or undesignated whereby the Ministry of Labour will no longer collect for them. They'll have to hire a lawyer, take time off work and go and fight for that money themselves. I would suggest to you that that's a loss to those workers because they're going to be out of pocket money to recoup money they're already owed and money that would ordinarily be fought for them by the ministry.
I would see it very much as if the government were suggesting to you that if someone shoplifted from one of your members' stores or deliberately did some kind of damage, you are now expected to pay for the prosecution and pay for all of the things the justice system now provides. I think you would consider that a loss. Workers are seeing this as a loss. I have a great deal of difficulty understanding how even from a commonsense point of view one could say that workers aren't losing something here.
Mr Freelandt: I think the comment on the collections is the fact that the collections aren't very effective or efficient by the government at this point anyway, so it's got to change.
Mr Christopherson: My point is that the workers are losing something here. Right now, workers have the right to have 100% of their claim, at least to have the ministry go after it. If it's over $10,000, they won't have that right. Whatever the minimum threshold becomes, whether it's $100 or $500 or $1,000 -- we don't know -- the ministry will not go after that money for them. They are going to have to pay out of their pocket to go after money they're already owed to pay for a process that's already provided for by the Ministry of Labour. How can you suggest that's not a loss?
Mr Freelandt: I think the amount over $10,000, they provide for the legal system to kick in. Those amounts are larger and that's where the employee has the opportunity to secure their rights through a different process. This will allow the majority of the claims to be satisfied in a more efficient way.
Mr Christopherson: My point is though that workers have the right now to have all the money that's owed them recouped by the Ministry of Labour, and when that's not there, they've lost something. That's a right that they've lost, and when the minimum threshold kicks in, that's a right they've lost also. In fact, if the limit is at about $200 and you are owed $100, quite frankly, it's not very cost-effective to hire a lawyer to go and fight for $100. Most people are going to let it go, and that means that the bad bosses -- I'm not suggesting you have many of them, but they do exist -- are going to have a field day ripping people off for small amounts of money that they can't in any practical way claim for, and yet right now, under the existing law, that money would be recouped by the Ministry of Labour on their behalf. That won't be there. They've lost something.
Mr Freelandt: Circumstances are changing and I think those are areas of change, and there'll be adjustments, yes.
Mr Chudleigh: Thank you very much for your presentation and for coming in today, Mr Freelandt.
In the area of knowing what the regulations are, I know when I was in the retail business back in the early 1970s, understanding what the regulations were and what the flexibilities were was something you kind of had a half understanding of but didn't really have a clear focus on. I was impressed to hear that you have 1,000 members of the chamber. What would you suggest would be the level of understanding of the Employment Standards Act today among those members? Would it be fairly good or would it be --
Mr Freelandt: I would say it would be pretty poor.
Mr Chudleigh: Is there an area where education could take place? I wonder if an awful lot of the cases that are currently or have been before the employment standards could be avoided through proper education, not only of the employers but also of the employees as to what their rights are and what they might expect.
Mr Freelandt: I think there's no question, because there are a lot of issues that come up. In my real job I deal with many different businesses on a consulting basis, and the employers are quite surprised at the things they are required to do and have no knowledge of, and that does create the conflict with the employees. So I think there are many things. Education of the duties and the requirements under the act would be very important.
I think like many things, though, there is so much that the employer has to understand and learn, not just under the Employment Standards Act but under many of the other legislative provisions, it makes it very difficult for someone who runs a business of five employees to be well versed in all of the areas, this just being one of them. So the simplification and bringing this kind of legislation to a level where the small employer can deal with it in a more meaningful way has to be embraced by the business community.
Look at the trends. The trends are away from larger employers. We've got lots of small businesses. In our chamber, over 70% of them have 10 or fewer employees. What kind of administrative depth can you have in your organization of 10 employees or fewer to deal with all of these things? Then you make a mistake and something is wrong and one of the employees is not handled correctly, it's a nightmare for both parties, no question.
The Chair: Any further questions from government members?
Mr Bert Johnson: I just wanted to know the limit on the Small Claims Court. Is that $6,000?
Mr Freelandt: I believe it is $6,000.
Mr Bert Johnson: So every employee who wanted to collect wouldn't have to go to a lawyer to collect that.
Mr Freelandt: He could go through the Small Claims Court, yes.
The Chair: If there are no other questions, we'll move to the official opposition.
Mr Hoy: Good morning. I appreciate hearing from you today, as well as everyone in the Sudbury area who will be presenting today.
You say in your brief, "As government bureaucracies continue to decrease in size, an increasing responsibility will be placed on employers and employees to improve their communications and resolve their own disputes." You just mentioned that you believe that many employees do not particularly understand all the ramifications of the Employment Standards Act and, as well, you say your membership has a great many employers that have 10 or fewer employees. Along with that, we've heard submissions that workers also do not understand the Employment Standards Act. So we have both employers and employees saying, "We really don't understand this," as events unfold, or prior to that. Don't you think there's a role for government to be that third party, to step back from the downloading that this act would do in putting the onus on employers and employees to the degree that the government wants to do?
Mr Freelandt: There's always a role for government, and I think the way I would like to see things happen in my office -- I have an office where I employ 20 people -- I would like us to communicate and discuss and resolve issues among ourselves rather than have somebody impose on me or someone come in from the outside to talk to me about my problems in my business.
If I can't resolve the problem with my employee, and I am not an unfair employer, then I think that's where this legislation should come in and assist the employee in making sure that he or she is handled properly. But, boy, I'd like to go a long way before I have anybody else in my business.
I think the employee-employer relationship is always better served by working through a compromise and discussing the issue person to person. If you bring in a third party, all of a sudden the barriers go up, and even if I liked the person before, I've got a different feeling about it. If this act goes anywhere towards encouraging that kind of communication, I think that's a real positive thing. In the last resort, if it doesn't work, then yes, you have to have remedies and you have to have the government and legislation to provide assistance to the employee.
Mr Hoy: So there is a role for government, and we have to decide whether smaller government intervention is necessarily better government for all the parties, employers and employees alike. That's what the committee will, in part, deal with here.
You mentioned a different view of an employee who proceeds along and maybe doesn't have this communication that resolves the matter and then has to turn towards government for a resolution. The employees feel that they're intimidated by the opening of a claim against their employer. Many of the employees do not open a claim until after they've left the employ of the employer, so there's this great problem of dealing with the issue of opening claims in the very beginning. You've stated that your view of employees would change, and they're cognizant of that fact with those unscrupulous employers.
We've got a system now where the recovery limit is going to be six months in a claim situation. Non-unionized workers have two weeks to decide whether to work within the act or go to court. The employee is limited by an unknown minimum claim and a $10,000 maximum claim. However, they can go to the courts after that, I agree.
Then we have a situation where a private collector may make settlements as low as 75% of those moneys owed. Then too there is an appeal process, which the government wants to extend from 15 days to 45 days, and in one submission by business it was in order to negotiate in lieu of a settlement.
The whole balance seems to be focused on the employee. The problem, admittedly by the government, has been that the enforcement of this act has not been very good; 25 cents on the dollar has been paid out over some time. But these particular parts of the act seem to have the employee always deciding as to what to do next in certain time lines and within certain monetary limits. The question comes down in the end, for me at least, to the enforcement. The enforcement has not been very good. The act deals in the main with employee decisions. Do you have any suggestion for the committee on how we could improve enforcement and, in my mind, have a little bit of onus shifted over to the employer in regard to this whole act?
Mr Freelandt: Being an employer, I need my employees. I need them to work with me. If I'm not a fair employer, my business is going to suffer. The way I think the business world is unfolding, you've got to be better all the time. This act moves me to think that with better communications I'm going to have better labour relations with my employees.
As a fallback position, where I don't do that job well, I'm going to hurt in my business and I may not be in business very long. A lot of these 10-employee-size businesses will come and go as time goes on. It will be a test of their ability to manage and go forward.
If I'm going to go forward and I don't treat my employees right and I'm still successful and I'm still in business, this act is going to allow for the employee to come back through various means, either through the act itself or through the courts. That's going to cost me time and money and grief, and I'm not going to enjoy that process in any event. In particular, I wouldn't enjoy a court process. I'm going to try to avoid that, so again I'm going to be forced to communicate.
In the end, I believe that if you don't move and we don't turn the page and start communicating and working better, particularly the smaller employers who don't have the time to fight all these battles, we're all going to lose.
I'm not sure that I can answer your question other than the fact that we are turning the page. Labour relations are better. The larger companies are talking in a different language with their unions. I know through the chamber of commerce we're having discussions with various labour representatives in Sudbury to try to do things. I believe that's going to happen in all businesses; if it doesn't, those businesses won't survive, regardless of what kinds of acts are there.
The time frames that these acts are suggesting are quite helpful. Can you imagine that I have an incident and I've got two years that I've got to worry about that incident? Six months is a long time, let alone two years. So I think that the tightening up of some of the time frames is important. It causes the employee, yes, to make a decision and go forward. You don't have forever to make that decision. By the same token, as an employer, I don't have to worry about it forever; I deal with the facts, we get on with it.
Mr Hoy: For employers like yourself, who endeavour to have a good relationship with their employees and have this open line of communication, it's very good. I believe that the large majority of the people that this chamber and other chambers represent are probably exactly the same type of businessman that you are. However, in those cases where it arises that the employer is unscrupulous, we have to design an act that protects the vulnerable and the employees who are victimized.
But I appreciate your comments, and I just want you to realize that we recognize that most of the employers are very good. It's in those cases where the law is being twisted and broken that we have to provide protection for those who are victimized.
The Chair: Thank you, Mr Freelandt, for appearing before us here today. We appreciate your presentation.
That concludes our morning session. The committee stands in recess till 2 o'clock.
The committee recessed from 1155 to 1401.
CANADIAN AUTO WORKERS, LOCAL 103
The Chair: I call the meeting back to order for our afternoon session here on our eighth day of hearings on Bill 49. Our first presenter this afternoon will be CAW Local 103. Good afternoon. Welcome to the committee. Just a reminder that we have 30 minutes for you to use as you see fit, divided between either presentation time or questions and answers.
Mr Brian Stevens: If the chair continues to be this uncomfortable, I probably won't last the 30 minutes. Do you sit in these all day?
Interjection: How would you like to sit in them all day? Aren't they awful?
Mr Stevens: This one here's not bad. Anyway, I thank you very much and I'll put the clock on myself as well. I do appreciate the liberties that you took in returning back a little late from lunch, because it provided me with an opportunity to review the bill for the first time. I went into our MPP's constituency office of late and tried to get a copy and I was unable to. Mr Harris's assistants, in fact, would only provide me with a press release, wouldn't even provide me with the fact sheets, so that's led to some difficulty in preparing my submission. Having said that, I will try my best here.
This submission is made on behalf of the 300 members of CAW Local 103. We represent workers at the Ontario Northland Transportation Commission, both on the railway, which is covered under the federal jurisdiction, and the hotel staff, which is covered under the provincial jurisdiction. We are among the 143,000 CAW members who live and work in Ontario. We welcome this opportunity to appear before this committee to address our very serious concerns about the Employment Standards Improvement Act, more commonly known as Bill 49.
On May 13, 1996, when Labour Minister Elizabeth Witmer introduced Bill 49 amendments, she claimed they were merely housekeeping changes to the Employment Standards Act. Bill 49 was described by the Ministry of Labour press release -- that was the one that I had the opportunity of seeing -- as "facilitating administration and enforcement by reducing ambiguity, simplifying definitions and streamlining procedures." The truth of the matter is that what have been presented as minor technical amendments contain substantive changes which will negatively impact the approximately 5.8 million working people, whether they work in multinational corporations, a unionized workplace or a small employer in Ontario.
The changes will 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 penalties where they violate basic standards and harder for the average working person in Ontario to enforce his or her rights.
This clearly runs counter to the true intent, meaning and purpose of the Employment Standards Act of Ontario, which is the protection of employees. The Employment Standards Act is legislation that exists to attempt to redress the enormous imbalance of power that exists between employers and employees. In fiscal year 1994-95, the Ministry of Labour received 731,289 inquiries -- this is by their numbers -- requesting information or clarification with respect to the Employment Standards Act. During that same period, the number of employees assessed was about 48,050. The dollar amount involved in these assessments was more than $64 million. This amount is employee entitlement for wages which were not paid by their employers.
Certainly there is a demonstrated role for government to level the playing field and prevent those unscrupulous employers from taking unfair advantage of workers in the province. The Employment Standards Act must and should continue to institute uniform, fair and reasonable minimum standards to protect the interests of workers. That is what workers are calling for, not the amendments contained in Bill 49.
So what's wrong with Bill 49?
Although Labour Minister Witmer has recently announced that she will postpone the flexible standards issue until this fall, when the government plans a complete review of the law, this issue remains a large part of this government's agenda.
The proposals contain fundamental changes to the Ontario labour law by permitting workplace parties to contract out important minimum standards and allow management to table bargaining demands that are below the current standards for hours of work, overtime pay, vacation and severance pay. This would be legal if the contract "confers greater rights...when those are assessed together." Apart from the incredible logistical problem of trying to measure monetary against non-monetary items, these minimum standards, by MOL figures again, represent nearly 40% of the contravention by employers in terms of dollar amounts. Therefore, the proposed changes of Bill 49, rather than emphasizing enforcement of the act to protect the employee's entitlement in areas that employers violate the most, will support the offenders in the areas that employees are most vulnerable.
It is not sufficient to say that these proposals will form part of a complete review of the law. The minister should have the courage to withdraw these amendments completely and reinforce this cornerstone of the Employment Standards Act, where workers have the benefit of a complete and coherent set of workplace standards governing each important aspect of their working conditions.
Bill 49 will require unionized employees covered by a collective agreement to use their grievance procedure to enforce their rights under the statute. This amendment is an attack upon what should have been seen as a universal right of action for all workers in Ontario. The Employment Standards Act has traditionally been seen by past governments of all political stripes as a constitutional document of the workplace. It has been crafted by previous governments to provide for universal rights for all workers in the province. Past legislatures have intended that all workers enjoy the benefits of not just the guarantees enunciated in the Employment Standards Act, but also the enforcement mechanisms pertaining to these guarantees, which are the key to the operation of the Employment Standards Act.
This government is proposing to diminish the status of the Employment Standards Act and the public support of employment standards enforcement procedures by cutting off over a third of Ontario's workforce from the benefit of such enforcement procedures. Unionized workers deserve the benefit of the basic administrative and enforcement procedures of the Employment Standards Act as much as any other group or category of workers. The investigation and administrative powers of the employment standards officer have been crucial in seeing that justice is done for our members.
In addition to the investigative and enforcement concerns raised here, the union can also face potential claims against itself by its members. While this already occurs now, this will be dramatically increased with the union faced with complaints concerning fair representation by adding the enforcement of the Employment Standards Act into the grievance procedure. How will the small local unions cope with the offloading of the enforcement of the Employment Standards Act? If this government and the business community are claiming that small business will be the driving force in reviving the economy, this also means that our workplaces will be made up of smaller local unions with minimal resources. Will they be given the power to conduct investigations? Will they be given the power to demand records and documents? Will the employer be responsible for the arbitration costs? We can't see how this proposal will retain the consistency of decisions rendered by the employment standards officers. We fear this will lead to the erosion of the minimum employment standards with no avenue of appeal. Bill 49 does not preserve the appeal procedure which is currently available to both employers and employees.
Bill 49 provides that if a worker wishes to make a claim and use the enforcement mechanisms of the Employment Standards Act, the worker may claim only up to $10,000 as a consequence of the employer's violation, not one dollar more. This limit will oblige workers to go to civil court if they wish to make a claim in excess of $10,000.
Firstly, the cap makes no sense and will lead to pressures from employers to ratchet down the ceiling in the future to get out from under the Employment Standards Act. The ministry's reasoning, as noted in the Expenditure Reduction Strategy Report dated 1996-98, is to lower the caseload as higher-paid employees use civil action to collect. The assumption must be that when an employee files a claim in excess of $10,000, they are a higher-paid employee and can well afford civil action. Well, that's certainly not the case.
Let's take for example a 12-year employee employed at a manufacturing plant business and earning about $33,800 a year. That's $650 a week. They're laid off without notice due to downsizing. The employee is entitled to eight weeks' termination pay in lieu of notice and 12 weeks' severance pay, for a total of 20 weeks. That amounts to about $13,000. Now you are over your $10,000 ceiling. If the employer fails to pay the moneys owed, the employee is now forced to choose between filing a claim with the ministry for $10,000, which results in forfeiting $3,000, or pursuing action through the courts. Civil litigation is both costly and time-consuming, and most lawyers will request a $2,500 retainer, which will probably only get you through the pleadings; it won't even get you into court. The original $13,000 that you had coming to you quickly disappears with this proposal.
What's the incentive for employers to settle up claims before they reach the $10,000 cap? I don't see any. Knowing that civil litigation is more costly, more time-consuming and more complicated for employees than the statutory treatment of an Employment Standards Act claim, some employers will be more apt to get over the $10,000 and force court action.
Only one province in Canada, and that's PEI, has a monetary cap imposed on employee claims, and it is shameful to see this province take such a backward step by denying fairness and justice to such basic worker rights. This clearly is a windfall for employers either way and it should be removed from Bill 49.
Bill 49 also permits the Minister of Labour to proclaim by way of regulation a minimum monetary limit on claims a worker may file. Workers will be obliged to go to Small Claims Court to pursue a claim which falls below the minimum limit. Since the tax dollars of the people of Ontario fund the Small Claims Court system in this province, just as tax dollars fund the operations of the Ministry of Labour, and since the civil court system is more costly and cumbersome than the current ministry system of enforcement, it is impossible to see what savings this government anticipates obtaining by making this regressive move.
Could it be that the government is counting on the intimidation factor of Small Claims Court to convince employees to give up the money they are owed? This will be especially true if the employee is still working for the offending employer. Each time an employee does not pursue a violation of the Employment Standards Act as a result of this provision, the government is facilitating a direct and illegal subsidy to the employer's bottom line.
Bill 49 reduces the time during which a worker may bring a claim to recover money. Under the current act, employees have up to two years to file a complaint for any moneys owing from their employer. Under this bill, employees will now have six months from the date of the complaint. Very few employees file a complaint while still employed, with the exception of pregnancy and parental leave complaints, and that's for obvious reasons: termination of employment or other repercussions.
The Ministry of Labour again stated in the Expenditure Reduction Strategy Report that by reducing the time frame to file a complaint, this would improve the turnaround time on investigating claims. What the ministry should be doing is reversing the downsizing currently going on in the employment standards program and hiring more staff to prepare and file orders to pay. The two-year limit is a must for employees. Most workers will wait until they have moved on to new employment before they pursue violations of the law against their former employer.
Considering that Bill 49 continues to allow the Ministry of Labour up to two years from the time a worker filed a complaint to initiate a proceeding to recover the money owed and an additional two years to attempt to collect the money owed, it's evident that the passage of time associated with the prosecution of a claim is really not a concern with this government.
This amendment leads one to the simple conclusion that the government wants to protect those persons who currently enjoy considerable wealth and power against individual, vulnerable and disadvantaged workers in Ontario by substantially foreclosing on their ability to pursue employers.
Bill 49 proposes that the collection of outstanding orders to pay wages against employers should be turned over to private collection agencies. While we acknowledge that there is a serious failure of the ministry to collect outstanding wages, we suggest one reason, among several, is a lack of resources provided to the Ministry of Labour to do the job that needs to be done.
This committee should know that the employment standards branch did have its own collection unit for a short period of time. The collection unit had been formalized about 1990 and was disbanded in March 1993. The history of collections, as supplied by the OML, are as follows:
In 1987 to 1990, of course employment standards officers act as collectors, and 1990 was the first year that the collection unit came into force. You see a dramatic increase in collections. While these numbers show a successful trend, the collection unit was disbanded.
The first quarter of collections in 1993 was $901,000, which, when projected for a full year, may have realized a collection of more than $3.6 million. The ideal solution regarding the collection function of the employment standards is to reinstitute the collection unit. This would result in a more efficient and expeditious finalization to a claim. The argument in favour of an internal collection unit far outweighs any other proposal. These important legal powers to settle minimum standard claims should never rest in private hands.
Under the current act, an employment standards officer can make a compromise settlement to a claim when both parties agree to the compromise. Bill 49 would allow a private collection agency to settle a debt for less than 100 cents on the dollar if the worker agrees in writing to the settlement. The proposed changes will allow a private collector to apportion a lesser amount of money between the employee, the ministry and the private collector. The proposed changes will allow a private collector, driven by the desire to get their percentage, to coerce the parties into a compromise settlement. These amendments simply ask employees to constantly waive their rights.
We are already dealing with the minimum standard. Why would the government be encouraging employees to waive their legal right to minimum workplace standards? The minimum standards now become the starting point from which to begin to barter a settlement. If the act provides that the employment standards is a minimum only, would allowing less money to be collected not be a violation of the act? Are employees now expected to accept less than the full legal entitlement, that is, the minimum entitlement? Government has a responsibility to enforce its own laws, and no one should profit out of the unconscionable behaviour of employers who violate minimum standards and then refuse to satisfy outstanding orders to pay.
So what must be done? Nothing in Bill 49 addresses the issue of how to encourage employers' compliance with the Employment Standards Act and to prevent violations of the law. There appears to be no concern with maintaining basic societal standards in terms of hours of work, overtime pay, vacation pay, severance pay and public holidays. This bill would eliminate the floor for minimum standards for 5.8 million workers in Ontario.
Steps should be taken to prevent violations of the Employment Standards Act. The public, employees and employers should be educated about the requirements of the act. In British Columbia, for instance, there is a statutory requirement that the Employment Standards Commission provide public education, and that should be adopted here in Ontario. There should be a legislative provision requiring that a summary of the basic standards in the Employment Standards Act be posted in each workplace. This is the current situation with the Occupational Health and Safety Act, and it should be adopted here.
The ministry should accept third-party complaints of violations of the Employment Standards Act. Employees fear reprisals for making claims and should be protected by preserving anonymity. Third-party complaints which establish a prima facie case of violation by the employer should trigger an audit.
The ministry should initiate a much more aggressive policy of prosecuting employers and directors who violate legislation. Currently, prosecutions for violations are exceedingly rare, and therefore there is little to deter an employer or director from either violating the act or refusing to pay an order.
Prosecutions against employers who fire workers who lodge claims under the Employment Standards Act should be pursued. Although the legislation provides 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 employees, there needs to be a substantial financial penalty imposed upon such employers.
As stated earlier the two years for initiating a complaint must remain, but the time limits for initiating an investigation, proceedings and prosecutions under the act need to be tightened. Allowing up to four years to recover wages owed to an employee is simply unacceptable.
The collection unit which was disbanded in 1993 should be reinstated and the Minister of Labour should establish an escalating schedule of administrative charges tied to the length of time and complexity of procedures needed to recover the money owed to employees. Employers who violate the legislation should pay the cost of collecting money owed to employees. This can be done without turning the function over to a private collection agency, which is not directly accountable to public policy.
Ultimately, these amendments come on the eve of a comprehensive review of the act. The proper procedure would have been to include such changes proposed here 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. Employment standards should not be eroded. They should not be made negotiable. It should not be more difficult to obtain and enforce employee rights, and they should not be contracted out or privatized.
With that, I thank you for your time. I believe I have about 13 minutes left. I'd be willing to answer questions.
The Acting Chair (Mr Ted Chudleigh): Thank you, Mr Stevens. I think we have about 10 minutes. We'll have perhaps three-minute rounds of questions. We'll be starting with the government party.
Mr Baird: Thank you very much for your presentation today. We appreciate it.
Just a quick question to start things off: You mentioned that you were looking for copies of the bill and had trouble getting it.
Mr Stevens: Yes.
Mr Baird: When did you make a request to appear before the committee?
Mr Stevens: I made a request to appear before the committee three, four weeks ago, a month ago; the day it first came out, yes.
Mr Baird: You phoned your MPP's office and couldn't get a copy?
Mr Stevens: Yes, I did.
Mr Baird: Could I ask who your MPP is?
Mr Stevens: Mike Harris.
Mr Baird: Mike Harris. Okay, my apologies. The bills are very accessible. We've heard from, I think, 15 CAW locals thus far and haven't had a problem.
Mr Stevens: I was in the office again today to try to get a copy, because it was hinted that there could be changes as well as to methods of payment. It was just unconscionable that the government would be thinking about forcing parties -- so, anyway, I wanted to get a copy of the act. I went into the office in fact today and the assistant in the office would only give me part of the media kit, but would not provide me with the fax sheets; only gave me the press release.
Mr Baird: I could tell you I don't know any single member of provincial Parliament of any party that maintains copies of every single bill in their constituency office.
Mr Christopherson: PA embarrasses Premier.
Mr Baird: We just simply wouldn't have the opportunity to have copies. I don't have copies of Bill 49 in my constituency office.
You mentioned in your argument that the previous government had disbanded the collections branch.
Mr Stevens: Yes.
Mr Baird: They had discharged 10 employees and they just threw those responsibilities on to employment standards officers. We know from the figures, though, that in 1993, the last year they had the collections branch, they were collecting 25 cents on the dollar. I'm embarrassed and not pleased to report to you today that we're still only collecting 25 cents on the dollar. So I guess we know from the NDP's move, when you discharged public servants from undertaking that responsibility, it had no effect. We're still collecting as abysmal a record of earnings as we did when we had 10 more people specifically doing this charge.
I think that puts it on to our shoulders to come up with a clear and specific suggestion to do a better job, because we're not satisfied with the way it currently is, and that is the provisions for bringing collection agencies in, people with a tremendous amount of experience at collecting moneys. Of course, what I call the deadbeat companies would be responsible for collecting those funds. So that's one provision.
I wanted to also note, we do accept anonymous complaints at the ministry. Again, we'd welcome any specific proposals that you could give us to strengthen anti-reprisal measures. That's obviously a very serious offence. I know in Bill 7, our changes to the Ontario Labour Relations Act, we made that the only exception, that the Ontario Labour Relations Board could grant automatic certification to a trade union if, for example, someone was organizing a union and they were fired. So that's obviously very serious for us and we would welcome any ideas you have.
In addition -- just one last point -- you mentioned posting the basic standards of the Employment Standards Act in each workplace. We've heard that in a number of cases and I think it's certainly worth considering, but again, if we have an employer who is only paying someone $3 an hour, I think they're unlikely to post something saying, "We're supposed to pay you $6.85." If there are any other suggestions you have, we'd certainly welcome them.
Mr Hoy: Thank you for your presentation this afternoon. We agree with you when you say that the proper procedure would have been to include these changes proposed under this act with the review that will be going on later. We agree that all aspects of employment standards should be discussed all at once so that we can see the true agenda the government has.
You mentioned enforcement quite a bit and the parliamentary assistant was talking about that as well. You have clearly demonstrated here with your figures that more persons working for the employment standards branch as part of the collection unit, I believe you said, was the best response to collecting moneys for workers. Do you think the collection unit alone will suffice or are you interested in going to a financial penalty on employers as well?
Mr Stevens: I indicated that employers who violate the act should also be responsible for costs for administering the act. I did make a suggestion that perhaps there should be an escalating scale based on the efforts of the officer to resolve the issue and that be imposed against the employer.
Mr Hoy: So you're looking for a mix of both: more collection officers and financial penalties to the employer.
Mr Stevens: Absolutely. There should also be more employment standards officers back in the field.
Mr Hoy: You mentioned the British Columbia experience with public education. Could you tell me what they do there? Do you know specifically what avenues they take to inform both employers and employees?
Mr Stevens: I don't know the specifics, I just know that my colleagues who work at BC Rail, who have come out of provincial jurisdiction, tell me that's the obligation and that they do conduct public sessions on the rights of workers and employers under the Employment Standards Act. Specifically I can't provide you with the details at this moment, but I could forward that to you.
Mr Hoy: Clearly this seems to be an area of great concern. We've had employers or employer representatives say that they don't believe every employer understands their obligations and may honestly just be making errors they're not aware of. As well, we've heard many submissions where employees do not understand their rights. This is particularly disturbing, from my point of view, for the unorganized worker, and the province has a great many in that category, notwithstanding the fact that union employees don't always understand their rights either and then have to go seeking that out. I appreciate your comments.
Mr Stevens: Absolutely. Just a little further on that, having a minimum floor certainly makes negotiating a first collective agreement much easier in the province. If there is some misunderstanding on what the legislation provides, an employment standards officer is readily available, just simply a phone call away, to say: "This is what this provision means. In terms of hours of work, this is exactly what it means." So in terms of trying to create or construct your first collective agreement, the services of the employment standards branch, while you wouldn't think they play much of a role, they do play a very significant role in establishing what the platform is that organized workers can begin to build upon.
Mr Christopherson: Thank you very much for your presentation. I think it's interesting to note that when the minister's parliamentary assistant says that posting the rights and obligations in a public place in the workplace wouldn't make a lot of sense to an employer who is violating the rules anyway, if you had enough employment standards officers going out doing surprise audits, walking through, that's the sort of thing they would pick up on just a casual walk-through, that it's not being done.
The reality is that Bill 49 is directly relating to the layoff of 45 employment standards officers, so the reason they say they can't do it is made that much worse by the fact that this bill allows them to lay off that many people. That's what this is all about: getting rid of employment standards officers, pushing the responsibility on to the employees through the court system, privatizing part of the operation and pushing the rest of it on to the unions to represent the members. All that allows them to lay off employees, which is their desire, to gut the Ministry of Labour.
I want to focus on the issue of the monetary regulation they're bringing in to give themselves the ability to regulate a minimum threshold that an employee has to cross before they can make a claim. We've heard some presenters characterize them as nuisance claims. I'd like to know how you feel about putting that measure in place; and specifically, how do you feel about the fact that they're keeping secret what the minimum amount is going to be?
Mr Stevens: I understand there's a consideration of somewhere around $100.
Mr Christopherson: We don't know that for sure.
Mr Stevens: We don't know that for sure; I agree with that.
I represent some workers who handle cash, working in the hotel business. This provision, if it is $100, would actually allow the employer to deduct $50, $60 off their paycheque, and there would be no recourse other than the grievance procedure. But even if it was an unorganized workplace, for those who work in a hotel or restaurant, they could deduct shortages right off their paycheques, which is currently a violation of the act, and it would actually be legal.
Mr Christopherson: Legalizing it.
Mr Stevens: Legalizing the employer's theft of employees' hard-earned money.
Mr Christopherson: Absolutely. Particularly when you link it to the fact that they can only go back six months. We are talking about the bottom feeders of employers. We're hopefully not talking about the majority; we're talking about the worst of the worst. So not only can you deduct an amount that's underneath the threshold, but you can schedule it so you do it once every six months, and it just becomes another way of making a profit off the employee who is being ripped off by that employer. Presenters come forward, and this government continues to maintain that this bill in no way takes away any rights from employees at all, that workers aren't losing on this. I ask you specifically how you respond to people coming forward and the government's contention that this doesn't take away any rights from working people, unionized or non-unionized.
Mr Stevens: Clearly, whoever believes in that message hasn't spent much time in a workplace in Ontario. Whether you're organized or unorganized, the changes to the Employment Standards Act will severely impact all of us in establishing minimum standards, pushing things up, privatizing, forcing court actions. We don't really believe the role of the Employment Standards Act is to force court actions to get moneys owed to workers in the province.
Mr Christopherson: Absolutely.
The Acting Chair: Thank you very much, Mr Stevens. We appreciate your participation and that of CAW Local 103 in the hearings today.
SUDBURY AREA TAXI OWNERS ASSOCIATION
The Acting Chair: We now welcome the Sudbury Area Taxi Owners Association, Kenneth Flinn. Welcome to the resources development committee. We have 30 minutes to spend together. You can start by making a presentation and we'll use up any remaining time with questions.
Mr Kenneth Flinn: I am representing the local taxi association on what is a very large issue for us which has never been properly addressed. Unfortunately I've not looked at the pending bill. The thrust of my presentation basically is to ask for a recognition of the independent contractor status of the taxi driver. Over the years there's never been a definition, and our business has traditionally been on a contract basis. I'll just read from my notes here.
Within the taxi industry we do not have a consistent definition or notion of an independent contractor or taxi driver in regard to the Employment Standards Act.
Taxi operators in Sudbury, as specified in city bylaws, are required to be open 24 hours a day, seven days a week to provide service -- this is from the bylaws of the city of Sudbury -- and we have to maintain and provide that service.
In our realm or dealing with our operators we exercise little or no control. They pretty much are free, as contractors, to drive for any taxi company they wish and whether or not they're going to work; sometimes they're in and sometimes they're not. When their shift starts, when their shift ends, what they do in between -- we have no control. We don't watch them. We don't sit in the back seat of the car 24 hours a day, seven days a week. What he works, where he works, what he wears, the routes to follow for fares, where he goes, how he takes fares, while he's waiting for fares, where he sits -- we don't have any control. We assume he is motivated by the economics of the situation, so he'll position himself for another fare. The driver is required under Revenue Canada to collect the GST, remit it and keep records accordingly.
I have a little package that I gave to everybody. Within that we have a contract where we deal with the driver and we state specifically that he's not an employee, that we do not have an employer-employee relationship and that he is an independent contractor. We recognize that he's required to pay the GST, PST, Revenue Canada, any other applicable taxes, and we have this in place with our driver at the very beginning.
The contract imposes no obligation whatsoever. Basically we have no work schedule and we do not provide direction to the driver. By and large, again it's economically based by virtue of the dispatch function, and the driver basically is renting the car from ourselves.
The contractor-driver determines when and where he's going to drive based a lot of times on weather conditions -- if it's raining out or there's a big snowstorm they're going to be in; the day of the week -- sometimes they just don't want to come in on Sundays because there's not enough business; and the number of vehicles that are on the road. Let's face it, New Year's Eve is a good night to be out there driving a taxi and on a Sunday night in the middle of the summer it's probably not. Drivers pick and choose the times they want to come in.
Basically we're the community operators. As operators we abide by the bylaws of the city of Sudbury. Effectively we're not controlling the drivers, although there are bylaws, and again there's an addendum. You have a copy within your package for the city of Sudbury bylaws that affect taxi drivers. We in effect enforce them because of our licensing arrangements with the city.
Within that package -- there is some legislation happening in the United States where there is a recognition of this particular industry and also of the contractual status of the drivers so that they are recognized as an independent contractor. Under the Labour Standards Act currently they are deemed to be employees and there's an exclusion for overtime and for hours of work. Statutory holidays do not apply to taxi drivers.
In other words, there has been a recognition of some situations inherent within our business, but as we don't record hours and where they go or what they do, I'd say we are still taken to task by the Ministry of Labour in terms of vacation pay, minimum wage and termination pay.
This creates a lot of issues within our industry that there are other jurisdictions within the scope. We're dealing with Revenue Canada. In our case we have letters in there; we've gone to Revenue Canada. They've looked at the way we conduct our business, they've looked at the relationship we have with our drivers and they've said that basically we're on an independent contractor basis. It's the same with WCB. They have a test, as does the Ministry of Finance employer's health tax. They basically have their test as such and have applied it to our organization and have come away with the value that we have an independent contractual arrangement with our people. But the Ministry of Labour does not have that test, nor do they have any application where we can be deemed to be an independent contractor.
The thrust of my presentation is to ask for some recognition of contractor status within the taxi industry, because right now it's just like that pitcher of water that's half filled or it's half empty: Whoever wants to see it any way they want, any time they want, that's the way it is. It's a difficult business if we can't have some definitiveness in it.
Mr Hoy: This is somewhat of a different presentation than I've heard in the last number of days. You say that you're governed by city bylaws. My expectation with the downloading that is involved in Bill 49, as we look at it, is that the government probably likes that idea and would like to let others decide what's best or not in their favour.
The driver rents the car from someone, and the benefit to the driver is the opportunity to make money through fares. The other parties involved -- for instance, you're an owner-operator, not a driver, so you provide the car, the insurance and all other matters like licences on the vehicle and a licence within the Sudbury region.
Mr Flinn: That's correct.
Mr Hoy: You also describe that vacation time and termination pay are a problem under this kind of arrangement or it's difficult to know what is adequate. I guess that's part of your pitcher of water. But within that you have this arrangement where the driver chooses when to work and how long. Isn't it possible that he could take two weeks off?
Mr Flinn: Absolutely. He does.
Mr Hoy: He does or --
Mr Flinn: Most of them do. They take time off and they may not show up on Mondays or they may not show up on Tuesdays. Sometimes they don't show up for two weeks. Within the spectrum of the labour force we have different levels. I have to work in this particular area and field, which is by nature a transient type of business, although we are seeing a real change now with the lack of jobs out there.
We are now starting to find people coming to us who want to be professionals. It's becoming a profession now. It's the change in the economy. We have people who are highly educated coming to us now and looking to drive a taxi. They fill in; they have a job here and they drive a taxi on the side. The appeal for them is that by and large a lot of it is cash business and they get paid daily. We have a contract with them and we pay on a daily basis, so each day they are paid and that's basically how we deal with it. So we don't withhold.
They're renting the car from us. They come in, they pay us for the rental fee and they keep the balance, basically. We buy their accounts receivable from them, which are your authorized charges, your Chargex or your Visa, MasterCard. We purchase that from them and they are paid basically in cash on a daily basis.
Mr Hoy: So if a driver took two weeks off for his purposes, that's vacation time, but you don't keep records of that.
Mr Flinn: We don't keep records, no.
Mr Hoy: You're not really particularly interested.
Mr Flinn: No. As long as we have some consistency in terms of we know that there's going to be a regular -- by and large, you have people who are coming in who rent their cars on a regular basis. They'll tell us, "I'm going to be taking off." That's fine, we'll get somebody else.
Mr Hoy: Your situation is going to be, or similar types of employment arrangements -- my expectation would be that those are going to be discussed in the second phase of the minister's discussions. The government talks about flexible standards. My opinion is that this will arise, and other variable-type work situations will come up at that time too, so I appreciate your advance notice of this variable type of work that goes on here.
The Chair: Moving to the third party, Ms Martel.
Ms Shelley Martel (Sudbury East): Thank you, Mr Flinn, for coming today. The final point that you made with respect to the presentation was that you wanted this committee to consider recognition of the contractor status in the taxi industry. I apologize for this, but I'm not clear. What does that give to you and then what does that mean for the people who drive cabs, who rent those cabs from you? Just so I'm clear on what the division of responsibility and/or benefits will be.
Mr Flinn: I think what we really want is a definition so that we can definitively -- just as we have for Revenue Canada, we have met a test or criteria by virtue of our company that we conduct our business with these drivers on a contractual basis and that we are not subject to minimum wage, we are not subject to 4% vacation pay. That's detrimental against what you're asking, but we have a definition by Revenue Canada. We have one by WCB. We also have one from the employers health tax. We've met their criteria.
We have a letter on file that states, "Yes, you are." I don't have to revisit this every time somebody applies to a labour standards officer or whatever. At least we have a definition and we're all singing from the same hymn book. If I have to make modifications within my business to accommodate that, to meet the criteria, I just want a definition of what is an independent contractor so that we can have that.
Ms Martel: So you'd like to be excluded or included or just one or the other? Either your employees do have the rights and benefits that would pertain to other employees under ESA or they don't.
Mr Flinn: Exactly. We want a definition. Right now, we are just like that.
Ms Martel: What is the value or the legal backing, I guess, of the agreements that you sign with people? What kind of force do these agreements have then with respect to what the benefits of employees are and also with respect to what their responsibilities are back to you as an owner?
Mr Flinn: I don't quite understand what you're --
Mr Christopherson: I think what we're wondering is, there seems to be a legal document here. Neither of us are lawyers, but it looks like a legal document, and we wonder, what sort of legal status does this have and how does that differ from the legal status and definition that you're seeking? This is a contract of employment and it spells out what you expect from them and what they get from you. That seems to be fairly straightforward. I guess what we're unclear on, based on your presentation, is, how much more are you seeking in terms of legal status beyond this, and why?
Mr Flinn: Absolutely none. I think what we want is for it to be recognized by the Ministry of Labour that this is an enforceable contract and that we do have an independent contractor status with our drivers by virtue of that.
Mr Christopherson: Is that not --
Mr Flinn: No, that and a bus ticket downtown on a local bus -- it doesn't do anything.
Mr Christopherson: What about in a court?
Mr Flinn: Not with the labour standards act, but if I go to Revenue Canada, that has weight. They say, "Yes, that's a legal contract and the intent of what you're doing in the business says you are an independent contractor." I go to the WCB, they say the same thing: "Yes, that contract and the way you're conducting your business and the relationship that you have with your drivers says you are dealing with them on an independent contractor basis."
The employer health tax, same thing. You come to the Employment Standards Act, it says they're employees. But wait a minute. We don't record their hours; we don't know where they go. If they want to take off for a four-hour lunch, that's up to them. They're economically driven. We don't direct them. We don't tell them where to go or what to do. "That doesn't matter; you're still an employee." That and a bus ticket will get me downtown on a local bus.
Mr Christopherson: But are you still subject to an employment standards officer coming in and enforcing, and why is that a problem?
Mr Flinn: In what way is it a problem?
Mr Christopherson: If the employment standards officers are determining that your contractors are employees for purposes of interpretation of the legislation, and employment standards officers then follow through based on that, I still fail to understand where the problem is.
Mr Flinn: Every taxi operation right across this province is deemed to be an employer-employee relationship, even though the intent or how this industry has worked for umpteen years has been on an independent contractor basis. We can be held responsible for minimum wage, vacation pay and termination pay for every one of our taxi drivers. We don't even know how many hours they work.
Mr Christopherson: How would you not know? You have to pay them.
Mr Flinn: We don't. They pay us a rental. They rent the car from us.
Mr Christopherson: I see.
Mr Flinn: For a percentage of their revenue.
Mr Christopherson: How does the ministry respond when you make this case? Obviously it's been appealed or presented at higher levels than just a single officer level. Someone must have adjudicated what you're saying versus what an employment standards officer would say and reached a ruling that has a heavier weight. Has that happened?
Mr Flinn: There have been a couple of cases that have determined certain hours, I guess for the purpose of trying to determine these things. But the point is, the intent of this business has been, over umpteen years -- I drove taxi just after high school. The intent has always been that you're an independent contactor, since day one. I don't think any taxi operation in this province, unless you're in a very small community, pays minimum wage. In most cases, if you go to some of the major centres, such as Toronto, you'll find that taxi driving is an entry-level employment situation for a lot of immigrants who are coming into the country. It's an entry-level and it's a way of being an entrepreneur, the self-sufficient entrepreneur. They can create their own business and then economically they move on.
Mr Christopherson: So at the end of the day, these folks are making less than minimum wage.
Mr Flinn: The availability is up to them. If they want to go and have a good snooze for three hours, that's up to them. The aggressive ones want to be sitting outside the front door here.
Mr Baird: I'll go quickly. I think what you said are two things. One is, set an appropriate definition and standard, which is a reason why we're undertaking a complete review of the Employment Standards Act over the next eight months: to be able to recognize the realities of the new workforce. For example, telemarketers aren't covered under the act. We have huge numbers of home-based workers that we didn't have when the act was written in 1974. So I certainly hear you loud and clear.
One of the business people we spoke to in Hamilton -- I think he was a hardware store owner -- said: "I don't care what you to do to regulate me; just tell me what it is. Tell me simply and straightforwardly and be clear and be consistent." I suspect he cared how we regulated him, but the bigger point was, "Just tell me what to do and I'll do it," which we all listened to.
I guess I find it strange -- just in reading the appendices to your presentation, the Workers' Compensation Board writes you: "...it has been determined that the owner-drivers of your company are independent operators...." Revenue Canada writes you: "We are of the opinion that they are employed in insurable employment for the purpose of the Unemployment Insurance Act...." The Ministry of Finance for the employer health tax writes: "...taxi drivers are self-employed independent operators...."
From our end as government, could we not come up with a uniform definition that would not only help us in administering the various payroll taxes and regulations but as well make it as easy as possible for you to administer them, tell you exactly what you're responsible for, be clear and be consistent, just to make it easier for everyone? I think we'd have a much better chance of enforcing regulations if we would just be clear and specific as to what they are. I'll certainly bring this back to the minister for the review when it gets under way. Thank you.
Mr Bill Grimmett (Muskoka-Georgian Bay): Thank you, Mr Flinn. I just have some questions of your inquiry here. I don't have a working knowledge of the details of the Employment Standards Act, but I do have a copy of it here. It seems to me that the problem you're raising would fall under the definition of "employee" in the act. Have you looked into that?
Mr Flinn: That's what we are --
Mr Grimmett: The definition says, "`Employee' includes a person who...receives any instruction or training in the activity, business, work, trade, occupation or profession of the employer...." These people you hire, are they not dispatched?
Mr Flinn: The calls are dispatched. The driver has the option of taking it or not. He's in a queue. In other words, he can take a fare or not take a fare.
Mr Grimmett: Do you not have your company's name on the taxi?
Mr Flinn: We do on our taxi. Yes, that's correct.
Mr Grimmett: Are you going to keep people around driving your taxis who don't take instruction from the dispatcher?
Mr Flinn: We're renting the vehicles out, and it's up to them to determine where or what -- it's economically driven. We don't try to direct them.
Mr Grimmett: If I go to hire a taxi for a trip across Sudbury, I wouldn't call your driver. That would be an independent contract, if I called your driver and said, "Joe, please pick me up." I call your company; you then ask one of these people, who must be under your instruction, to come and pick me up.
Mr Flinn: We put the call over the air and the driver who is in the queue would acknowledge that and then accept that call and go out on that call. If you knew that particular taxi driver and he has a cellular phone in his car and you know him fairly well, you can pick up the phone and phone him directly and ask him: "Joe, would you come and pick me up? I'm going out to the airport." He did so on his own. They do that too.
Mr Grimmett: The bulk of his work would come through direction from your dispatcher.
Mr Flinn: That's correct, yes. There is somewhat of a dependency, even in Toronto. I always find Toronto is probably as open as possible because there are so many flag fares. We don't have that in this particular community because we're more radio-driven. You don't just stand outside waiting for a taxi, because they just don't pop up every minute. In Toronto, it's different. Downtown there, you just walk outside and you just raise your arms and you'll have three cabs right away.
Mr Chudleigh: Not when it's raining.
Mr Grimmett: Are you asking us to change the definition of "employee" under the act?
Mr Flinn: What I would like to see is a clear definition of an independent contractor within the taxi industry. Is he an employee? Let me know. What is the definition of a contractor? Then I can at least work towards having that in place.
Mr Grimmett: Currently, the ministry must consider your taxi drivers to be employees.
Mr Flinn: That's correct.
Mr Grimmett: So you are asking for a redefinition of "employee."
Mr Flinn: Exactly, in relation to the taxi. But Revenue Canada says not; the employer health tax says they're not; the WCB says they're an independent contractor. I have a contract that I try to draw up so that everybody knows where everybody sits and that this is not an employer-employee relationship. Like I said, that and a bus ticket is going to get me downtown on a local bus because it doesn't matter, according to the ministry.
The Chair: Thank you very much for appearing before us here and making your presentation today. We appreciate it.
SUDBURY WOMEN'S CENTRE
The Chair: That leads us to the Sudbury Women's Centre. Good afternoon. Welcome to the committee.
Ms Donna Mayer: Thank you for the opportunity to present to you today on Bill 49, the amendments to the Employment Standards Act. The Sudbury Women's Centre is a resource and referral centre for women. As well, we advocate for equality and women's rights. We also provide a monthly legal clinic for women.
The women's centre does not support changes to the Employment Standards Act where they reduce the rights of workers. We are particularly alarmed at the provisions which will have the most effect on vulnerable workers, including non-unionized, part-time and single-wage earners, many of whom, if not most, are women.
Perhaps the most fundamental assault in this bill against workers is the restricted limitation period. We know that 90% of claims of violation of the Employment Standards Act occur after the worker has left the employ of the offender. The main reason for this is fear of repercussions: job loss, harassment, poor shift scheduling and so on.
I am familiar with a case right now where a worker has left a job for another and is waiting until the probationary period of that job has passed before filing a claim with employment standards. The reason is that this worker would go back to the employer who violated the act because it is better to have a bad job than no job at all.
Having another job to go to is a key determinant in the decision as to when to file with employment standards. With the high unemployment rate and the changing job market, now is not the time to restrict the limitation period. If anything, now is the time to extend the limitation period.
The Human Rights Code has a six-month limitation period. At the Sudbury Women's Centre we are very familiar with how restrictive this six-month period is. We are currently working with Mary Ross, who left her job due to harassment because of her sexual orientation.
Fighting for her rights is a new thing for Mary, and she learned the hard way how difficult it is to have her rights enforced. Mary was sent on a wild-goose chase by the Human Rights Commission when they advised her to seek civil remedy. Then she met a lawyer who she believed knew what to do but didn't, and by the time Mary found out how to get her rights enforced the six-month limitation period had just passed.
Mary has since learned how to advocate for herself with the support of the women's centre and the Sudbury All Gay Alliance. She has built the campaign to end employment discrimination. This campaign is still in progress. What we have accomplished is having the Human Rights Commission acknowledge the fact that Mary's case does have merit, that there was evidence of discrimination based on sexual orientation, but unfortunately the six-month limitation period restricts Mary from having her rights enforced.
Six months is simply not enough time for workers to seek and obtain qualified legal advice and ensure that their rights are properly defended. The limitation period must remain at two years or be increased. It is true that with a two-year limitation period employers may have longer to worry about whether or not they will be caught for violating their employees. However, more workers will be able to ensure they will get what is rightfully theirs.
The amendment calling for workers to choose between the courts and the employment standards office to resolve their claim and to make this decision within two weeks is grossly restrictive. This is true particularly given the premise that the fewer claims handled by employment standards, the better.
Low-income people do not have access to the legal system. The Ontario legal aid plan does not cover these cases. Although Small Claims Court is available to people without representation, they do need some guidance and education to be successful there, particularly if the other party has a high-powered lawyer, as employers are inclined to have. In Sudbury our community legal clinic has been on a caseload restriction for over six years. This means they do not handle a wide array of cases, including Small Claims Court matters, and low-income people will be left to fend for themselves.
Access to justice must not be denied. Workers must be able to have their rights enforced by the employment standards office.
It is imperative also that there be no minimum claim limit, and certainly such a limit should not be left to the whim of cabinet through regulation.
We understand and accept that the government must reduce costs. However, we do not believe that women, or any worker, should work for free to help the government reduce costs or to pay for a tax cut to the rich.
Throughout your hearings various minimum levels have been suggested. The $25 minimum suggested by Mr John Baird is a good example. It is has been argued that $25 is not a lot of money and is simply not worth the government's time and money to investigate. In fact, $25 is an enormous amount of money to a sole-support mother working at minimum wage.
Perhaps government members have not been shopping for their own groceries. That may be a task another member of your family does on your behalf. However, if you have had to buy your own tuna lately you will know that $25 does make a difference at the cash register, that $25 will buy you 20 litres of milk. That's nearly a month's worth of milk for a family of four.
For families with low incomes, the $25 could be the difference between going to the food bank and going to the grocery store. The value of that $25 is even more significant now, as women face user fees when they bring their children to the beach, the library, the pharmacy and so on.
The ripple effect of withholding $25 from a low-income woman is not cost-effective for government. Higher poverty means higher costs for government. The government will pay for poverty in increased health care costs, social services costs and, regrettably, law enforcement. If the government wants to recover investigation costs, you should bill the costs to the offenders. The government must not further victimize the victims.
In the matter of maximum claims, any amount owed should be paid. To institute a maximum claim is to institute legalized theft from employees.
Several amendments can be made to the act to actually improve it. Let me give you two: Investigate all employment practices where an employer has been found to be in violation as a result of an investigation of one claim -- the likelihood of other workers in the same workplace suffering the same injustices is quite high; improve access to enforcement by permitting anonymous claims with third-party representation, such as a legal clinic. As well, the current act should be enforced more strictly.
In order to improve workers' knowledge of their rights, additional money should be provided to the community legal clinics in Ontario. Legal clinics are already designed to provide legal education to low-income people. The infrastructure is already in place. However, cutbacks have impeded their abilities in this area; case work takes precedence over legal education.
In order to improve employers' knowledge of their responsibilities, perhaps an intensive training course as a prerequisite to obtaining a business licence or renewing a business licence would help. The training must be mandatory to ensure employers are aware of their responsibilities before they choose to violate them.
In summary, the Sudbury Women's Centre asks that this government committee reject all amendments which reduce the rights of workers. The limitation for claims must not be reduced. There should be no maximum claim limit. There should be no minimum claim limit. There should be no way to contract lower minimum standards.
Once again, thank you for the opportunity to present this submission. I look forward to your questions.
Mr Christopherson: Thank you for your presentation. I think it's fair to say that we've had quite a number of submissions across the province from many delegations concerned about the disproportionate impact of Bill 49 on women. We've made the case throughout these hearings that this is just one more piece of disproportionate, negative impact on women. When we take a look at the 22% cut to the poorest of the poor, in many cases those are families headed up by women. The attack on pay equity, the revoking and repealing of the employment equity legislation, the cutting back of the battered women's programs, now the recent -- and I think in Sudbury here it's an issue too -- the family support program office being closed, all these issues disproportionately affect women, particularly low-income women. I can assure you that we will continue to make that case and try to encourage the government to recognize and be sensitive to the impact this is having, and hopefully at some point maybe it will get through. But we'll continue to raise that time and time again, I assure you.
I want to focus first on the idea of the minimum claim. First of all we've had no real, acceptable rationale for this from the government other than that it's too low to bother with, that it's just not effective government; they can make their own smoke-and-mirrors argument. The fact of the matter is, what it's going to do is say to an awful lot of employees, "Money that you're owed, that you've worked for, that you have coming to you, de facto you're going to have to forfeit it."
If you link this with the six months, it does allow the most unscrupulous of employers to actually schedule what amounts to legalized theft, as long as they stay just under the limit, within a six-month period. Times every employee, that's twice a year, you can be taking significant money out of the pockets of the most vulnerable, and usually it's those who are barely making above minimum wage and have little or no benefits on top of that. That's what we find so insidious about this, that the impact is going to be on those who have the least, and those we have to have these standards for in the first place are being given a licence to "go and do not only what you've been doing, but go do more; we'll make it as easy as possible."
I'd like to believe the government is not doing that deliberately. We'll have to wait and see what the final verdict is on that. But certainly that's the result. This government refuses to admit that. They just gloss over it. I assure you they will today; they've done it in every community we've been in. They just gloss over this issue and they won't come to grips with what this really means. The fact that they won't tell us what the minimum is, by saying, "Well, we're not planning to put in a minimum right now" -- give me a break. If you're not planning to put in a minimum, why would you put in the ability to do it?
The other thing is that once they get a minimum in place, very quietly over the next few years that minimum starts to rise further and further, and more and more people get hurt for more and more money. There's just no rational argument for this. This is money that people are entitled to.
That's the story we have heard across Ontario. Am I painting a picture that's different from what you think the reality will be here in Sudbury?
Ms Mayer: Not at all. You're absolutely right; it is the most vulnerable, people with the least amount of money, who will be most affected by these changes. It's quite in line with the history of what this government has been doing, particularly to women. You're right, we've really had enough, and it's really demoralizing. I just can't express in a very positive way how this affects us.
Mr Christopherson: Well, they speak next. If they've got some good arguments to refute what I have put forward and what you've put forward, this is their opportunity to do that, and I hope they do rather than move on to another subject, because these are the sorts of things that you want to hear about and that other representatives of vulnerable groups want to hear about. Rather than getting off into their philosophical tangents and about streamlining things, let's talk about where the rubber hits the road and how this is going to affect people. If they think this is all a lot of rhetoric they should say so, put it on the record, stand up, look at this individual and make the case that this is all just rhetoric. I'm going to pass the floor and give them the chance to do that right this minute.
Mr Grimmett: I have some questions on the presentation, Ms Mayer. Do you keep statistics in your organization on the number of inquiries you get on this?
Ms Mayer: Mm-hmm.
Mr Grimmett: Would you be able to tell us on an annual basis the number of inquiries you'd get related to employment standards?
Ms Mayer: Specifically on employment standards? I couldn't tell you specifically on employment standards. We would have employment-related incidents.
Mr Grimmett: You're not in the legal department; you have people who work in that department separate from you?
Ms Mayer: It's the women's centre; we've got one staff person. We have a legal clinic. We solicit the support of female lawyers in the community, and they volunteer their time.
Mr Grimmett: Do they do the employment standards work?
Ms Mayer: They do whatever cases come before them. They average eight to 10 cases per month. We only do it one afternoon a month, and that's to complement the current legal aid system, legal clinics, because they don't always have access. They're primarily related to support-and-custody issues.
Mr Grimmett: You've made a suggestion here -- I haven't heard it before; I haven't been on the hearings for the full time -- that employers receive training before they receive a business licence. When you say "business licence," are you talking about the municipally issued vendor's permit?
Ms Mayer: That's a little outside of my area of expertise. I know that it was raised today, how do we see that employers know about their rights. I'm just wondering if we could tie it, link it to whatever business licence they're required to have in order to operate their business so that there's a mandatory requirement there.
Mr Baird: Thank you very much for your presentation. First, thank you for the last page of your presentation. So often in various communities across the province people have said: "We don't like this part of your bill. Just do a better job." What we've been looking for is saying, "Listen, if there's a concern with part of the bill, what would you do to make it better?" We've got some extremely general responses, but we have got a few helpful ones in various testimonies.
The status quo isn't an option for us. We're not satisfied with, for example, the collections rate being only 25 cents on the dollar. But you mentioned on the last page two examples which I think are very earnest and serious attempts to provide suggestions on how specifically we could do it.
On the first one, I can indicate to you that we regularly and often do conduct such practices, but that idea, as far as being a structural one, is certainly one that I'll take back because I think it has great merit.
The second one, with respect to anonymous claims: The ministry does accept anonymous claims at the current time.
Your comment about third party representation: I don't know how that would be handled, but I'm certainly happy to bring that suggestion back too, because those are two very helpful suggestions you made, with certainly that intent, and we do appreciate that.
I guess maybe changes are never easy. If there were easy solutions to them, I'm sure the last two parties would have conducted them over the last number of years, but regrettably they haven't. The backlog of these cases is considerable. It's come down, I understand, around more than 1,200 cases that are over six or nine months old, so we are making some progress. It's not as much progress as we'd like, but we know if we continue to do the same things, we're going to get the same results, and our minister isn't happy with that. She thinks in many areas we can do a better job and we can put our resources into dealing with those most vulnerable workers in society.
You mentioned, as well as my colleague from Hamilton Centre, the issue of the minimum. I guess it is a problematic issue. You quoted a number, $25. It's not a number that I'm proposing or suggesting; it's one that someone brought up as an example. I guess we want to ensure we're making wise use of resources. We could continue doing it now the same way and not make any changes, but that's unacceptable. I guess the question is, if conducting an investigation and issuing the order and so forth were to cost $400 or $500, would it make sense to do that if the issue was $25? We had one presenter who came forward and said, "Listen, I'd sit there with a chequebook and just write people $25 cheques if it was one twenty-fifth the cost of conducting the order." So that's I guess the idea. At the current time there is no intention to put a minimum order, but obviously it's in the legislation and obviously it provides the flexibility to do that. That's plainly --
Mr Christopherson: Does that answer satisfy you?
Mr Baird: That's plainly obvious and that's where we're coming from.
I guess the answer is, if you think we're doing an acceptable job now in many areas -- in many areas we're not. We heard some very, very good testimony from some folks in the city of Toronto talking about the number of immigrant women working in their basements making $2 or $3 an hour in the garment trade. Obviously the act has not worked for them. Obviously we've got to do a better job for them. We've got to put more of our resources to go after those vulnerable workers who are systematically avoided.
My colleague also mentioned that people could break these rules to the minimum dollar amount once every six months. The legislation contains very specific provisions to extend the period from six months if it's a regular and systematic breaking of the regulations. So that's certainly something we'll give some thought to.
Ms Mayer: I think I did say in the presentation that, yes, it is worthwhile spending $400 to get that $25 for a sole-support mother who can buy 20 litres of milk with it and won't have to got to the food bank and won't turn to crime and won't turn to shoplifting.
Mr Baird: I appreciate that. I very much --
Mr Christopherson: Especially when you told them to go out and get the jobs when you cut the social services.
Mr Baird: Do you want more time?
Mr Christopherson: Sure. Will you give it to me?
Mr Baird: We're not suggesting for a moment that that $25 isn't important. The examples you gave are very relevant. I guess the question is that right now there's a huge backlog. There was a huge backlog when my colleagues were in government. They are the ones who disbanded the collection agency. They're the ones who chose to do nothing as opposed to -- if they couldn't do it perfect, they didn't do anything.
Ms Martel: How many staff are you cutting, John?
Mr Baird: We're not cutting any health and safety inspectors like you did. How many health and safety inspectors did you cut?
The Chair: Order.
Mr Baird: How many health and safety inspectors did you cut? Seven per cent. And were there any public hearings about that? Did one single member of the NDP caucus ever rise in the House to discuss that? When you disbanded the collection agency, were there hearings across the province about that? Did you ever discuss that?
Ms Martel: Do you want to tell me how this is going to help garment workers when you make it more flexible?
Mr Baird: Did you ever discuss that? No, there was no consultation. They just did it behind closed doors and in secret. At least we're certainly being upfront about it. You never --
Mr Christopherson: We had to force you to come up to Sudbury.
Ms Martel: When you allow employers to rip them off, it'll be make it more flexible, all right.
The Chair: Order.
Mr Baird: You never --
The Chair: Order, all of you. Order. That includes you, thank you.
Mr Baird: Did your government bring it up in the House, the health and safety inspectors? It never did, because you didn't --
The Chair: Mr Baird, you're out of order.
Mr Baird: We brought it up in the House and you never did, ever. Ever. You never brought it up. You did a bad job.
The Chair: Both of you are cutting into the time of other presenters. Please show some respect to the people who have taken the time to come before us here today. Ms Mayer.
Ms Mayer: In reply, I'd like to say that I don't think the appropriate way to reduce your caseload is by telling people they don't have a case. They're owed this money. That was honest work they did, and if they're owed it, they should be paid it. To cut the welfare rolls the way you did and say that's reducing the caseload is the same idea. It's not reducing the caseload. It's sending the problem to people's own homes, where they take it out on their families, where we'll have increased wife abuse and all kinds of other repercussions from this sort of activity. That's not the way to reduce your caseload.
The Chair: Thank you, Ms Mayer. We appreciate your taking the time to make a presentation before us here today.
That leads us now to the Sudbury and District Hotel and Motel Association.
Mr Hoy: What about the Liberals? We didn't have our full time.
The Chair: Oh, forgive me, Ms Mayer; I was distracted there. Thank you, Mr Hoy. Mr Lalonde.
Mr Lalonde: I'd like to say that I'm really in support of what you mention on page 4 of your brief. Yes, I would fully agree with you to investigate all employment practices where an employer has been found to be in violation. But the problem there will be when we pass this bill is that we might not have the personnel in place, since the government is planning on laying off 45 enforcement officers.
It was mentioned yesterday, and I really support this, that anybody who is caught in default should have his name published so in the future, really, people will think twice before they go for a job at that place and that person will think twice before he goes against the Employment Standards Act.
It was also mentioned that workers should be better educated on the Employment Standards Act. I fully agree with this. At the present time, especially in small communities, the employers don't know much about the Employment Standards Act.
One question I have for you is that this amendment allows employees to negotiate lower standards for hours of work. Do you think this would have an effect on the quality of life of families, especially on women?
Ms Mayer: Absolutely. That's who's often left at home to care for the family. Earlier you heard about suggestions of expanding the workweek. We know that some of the workers at Falconbridge are subjected to shifts that keep them away from their families for a long time. There is an effect on the family, and the burden of looking after things falls unduly on the women and the children.
Mr Lalonde: In my past experience in this, when the employer was asking the employee to do more hours of work, this will increase the sick leave period times, will increase the danger of having more accidents, and when those things happen, less revenues are coming into the family. Especially when the women are involved in the workplace conditions sometimes, due to longer hours they cannot look after their children properly at home, and then it becomes a problem in the community also.
Ms Mayer: Yes, and there's the matter of day care too, and we obviously don't have enough child care available right now.
Mr Hoy: I too want to thank you for your presentation this afternoon. I want to talk a little bit about this $100 minimum and very quickly say that I have some great reservations about the $10,000 maximum. On the $100 minimum, I have persons who come to my constituency office, and some of the stories and the problems that they're facing, the $100 is by degree a lot of money for some of these people.
The government not having said explicitly whether it's going to be $100 or whatever makes me wonder if it isn't going to be higher than that. Why go through all the grief of having people express an opinion that there should not be a minimum if it's only $100? I think they would just erase that $100 figure. So it gives me some cause to wonder if it isn't really going to be higher than that, not to mention that they don't tell us what it is as we go from community to community. So I'm really nervous that it could be much higher than that because, government being as it is, they don't want to suffer a lot of grief for any reason. So I'm worried it could be higher.
The other point is that the job market being what it is, and that is a poor one, people are willing to do certain things in order to maintain the necessities of life and they're putting up with quite a little bit right now. I think we have to be very careful about minimum standards and these $100 figures such as have been bandied about today.
Ms Mayer: Absolutely. I agree that the fact that they've chosen to establish the minimum by regulation through an order in council suggests that it can move quite easily without actually ever going into the Legislature, and it does leave the door open for any figure to come out. For people who can reach into their pocket and pull out $20 and give it to someone in need -- $20 doesn't sound like a lot. I can't do that. There are lots of people who can't do that, and $20 means getting from this day to that day and it's a lot of money. You just don't realize it unless you're living it.
The Chair: After our first false stop, thank you again, Ms Mayer.
SUDBURY AND DISTRICT HOTEL AND MOTEL ASSOCIATION
The Chair: Now we'll proceed to the Sudbury and District Hotel and Motel Association. Good afternoon. Welcome to the committee. Again, we have 30 minutes for you to divide as you see fit.
Mr Richard Clement: Thank you very much. My name is Richard Clement and I would like to thank you and your committee for the opportunity to appear before you today. I am the president of the Sudbury hotel, motel and restaurant association, which makes me a director of zone 22, which is from the French River to Chapleau, Elliot Lake to Hagar, and including Manitoulin Island. I have one of the largest zones in the province to look after, and I also have 75 members. I had 120 or 130 members before. Now I'm down to 75 due to loss of business and what not. I'm also the director of food and beverage for the Ontario Hotel and Motel Association for all of Ontario.
Employment standards reform is important and therefore we support the government's initiative to fixing it. Bill 49 is the first stage of this process and we look forward to the extensive consultation process that we understand 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 this bill as signalling a significant reduction in the government's role in administering and enforcing the act. Our analysis of the proposed changes is as follows.
The bill specifies that obligations under the act will be enforceable through collective agreements, as if the act were part of the collective agreement. Employees covered by collective agreements will not be permitted to file complaints under the act without the permission of the director. In essence, the grievance and arbitration procedure will replace enforcement through the administrative machinery of the act. Powers of arbitrators with respect to claims under the act will be expanded to include the powers of employment standards officers, adjudicators or referees under the act.
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 an employee files a complaint under the act for wages owing, breach of the building services successor provisions or the benefit provisions 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, however, 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.
The bill will make it easier for employers to establish that they have provided greater rights or benefits than are required by the act and thus obtain exemption from certain provisions of the act. When a group of collective agreement provisions -- severance pay, hours of work, overtime, public holidays and vacations -- are considered together, rather than individually as in the past, the collective agreement will prevail if it provides superior rights. In addition, statutory and regulatory provisions, as well as provisions in oral, express or implied contracts, will prevail over an employment standard if they confer a greater right than is provided by the employment standard.
The bill requires the length of an employee's pregnancy or parental leave to be included not only in determining seniority, as is 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 employment contracts that are service-driven will continue to accrue during the leave. Employers should review their contacts 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 such vacations must not be less than 4% of the wages, excluding vacation pay, earned by the employee in the 12 months for which the vacation is given. This clarifies and simplifies the existing provisions in the act.
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 the breach of the pregnancy or parental leave, lie detector, retail business holiday 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 regulations.
The bill sets out mechanisms for the director 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 that it is not less than 75%, or such other percentage as may be prescribed, of the money to which the person is entitled, unless the director approves otherwise.
Compromises or settlements respecting money 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.
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 came to the knowledge of the director, subject to certain exceptions. In the current act, the limitation period is two years.
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 came to the knowledge of the director. Employees may request a review of an order or a 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 employers, application for a hearing is dependent on paying the wages and administrative costs required by the order.
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.
In conclusion, we support Bill 49, as it signals a progressive change in employment standards in Ontario. It is not reducing minimum standards. We are not, and I want to clarify, seeking a reduction in benefits. We are good employers and want to ensure our employees are treated fairly and receive all that is their due. That's all I have to say about that.
The Chair: Thank you very much. It looks like we've got five minutes for each caucus for questioning. This time it will commence with the government members.
Mr Barrett: Thank you, Mr Clement, for your remarks on behalf of the Sudbury and District Hotel and Motel Association. I suspect you're speaking for the Ontario association as well. Certainly in all of our areas we also see your association, and the businesses that you represent are certainly a part of our ridings.
Earlier today one of the presenters made reference to the fact that our government and business are looking to small business to be the driving force in reviving our economy across Ontario. However, there are barriers to people like yourself to stay in business or to open new businesses and to create jobs. From what we're hearing from small business, one of the barriers is the discouraging collection of rules and regulations and red tape and the amount of time that people like yourself spend on paperwork or the people you need to hire to fill out the forms to meet various government regulations. This kind of red tape is a tax on you and it's a tax on all of us, in a sense.
With this committee, in considering the Employment Standards Act -- and as you've indicated, we are not looking to reduce minimum standards; we are looking to protect employment standards, and not only to protect them but also to enhance employment standards in Ontario. But as we rewrite this legislation, we have to be careful that we don't create more unnecessary bureaucracy in the form of either additional people hired in government or in the paperwork.
From your perspective, can you give us some suggestions of how best to rework this to make this a little more user-friendly, to streamline it? We have to be efficient, just as you do, and we have to come up with the most cost-effective way to run this business. I wonder, from your perspective, have you any suggestions?
Mr Clement: In our industry, we're here to entertain people in more ways than one. We have lodging for them, we have food for them, we have drink for them and we have entertainment in lounges and bars and what not and taverns. Our intent is to hire people to look after people who come in.
I could give you as an example, two weeks ago today we had an ad in the paper to hire 10 people to work in one of our newly renovated bars upstairs. We had 365 applicants answer the call. We had to get five people, including my son -- we're a family-run business here; we're a small business. I saw all the people lined up to be interviewed. I said to myself: "What the hell is going on? There's nobody working? What's the problem here?" Out of those 365 people, I would say there were maybe 80 to 100 who were looking for work -- just to get a job, just to work. The rest of them, I'm sorry to say, I wouldn't hire them. They went through just a normal application for a job.
We have to do something. We like to say that we're the sparkplug in our industry to bring in tourists, to get the people out in these restaurants and taverns and bars and what not to start spending money so we can hire people.
I remember years and years ago -- I've been in this business 29 years -- in this building 29 years -- and I remember people coming to me with their children, young boys and young girls, saying, "Could you give my kid a job?" I'd say, "Sure, what's he doing Saturday?" "He's not doing anything. I want him to make himself a few dollars." I'd say, "Go outside there and rake around the garbage bin and cut some grass over there and do this and do that, and I'll pay you," whatever the wage was then. I used to do that almost every weekend. It wasn't a handout; it was a job. The kid did the job and I said, "I know your dad and I know your mother, and if you don't do a good job, you're going to get a swift kick in the butt," as we used to do with the kids, and their parents wanted me to tell them that.
Now I'm the one who goes out and rakes because I can't afford to have anybody do it. The system, I don't know, seems to be lacking something. There's nobody going out. I don't mean just in my business; I mean in every business in town. There's a shopping centre downtown that's just about empty, and it shouldn't be. Sudbury is a wonderful city. This whole area is mining. If it wasn't for mining in this city we wouldn't have too much business in our industry, because I'm doing a lot of catering right now with mining firms and meetings and what not.
I don't know what the answer is. I don't know every act that I have to follow as a hotel man, but I do know one thing: We are licensed to sell alcohol and rent rooms and all this, and we have such a list of regulations we have to follow through that. I don't usually stick my nose in too much when it comes to the labour part of it. If we have a problem, I'll talk to the person. We have an open door policy. If you've got a problem with your job in our establishment, we'll talk about it and whatever is best for you and best for me, then we'll agree on it. There's no need to go to all ends.
I had some incidents where a person from the Ministry of Labour came to see me and said, "This girl said this and that; what do you say about that?" I said, "Look, that's false." But I did whatever he told me to do. I did it because I figured that's what you're supposed to do when you're in business. You're supposed to listen to the agent who works for the Ministry of Labour, or whether it be for the income tax or GST or PST or anything like that. You just listen. When the inspector comes in, you listen to him. If he tells you to do something, you do it.
That's the way I was brought up in this business, and that's the way I run my business. If you've got a problem, let's talk about it. If it's really serious, there's lies or fraud or whatever, there's theft, then it's a little more serious. Then we'll bring the law into it. Then we'll get our lawyers out and everybody will spend money on something that we shouldn't be spending money on.
We believe in an honest day's work for an honest day's pay; that's all I'm getting at.
Mr Hoy: I appreciate your comments this afternoon. We recognize that most of the business people are good and honest. They have an open door policy, like you do, with their employees. But the concerns, of course, come around the very few who will cause problems, so this act is here before us and we've got to deal with all aspects that have been brought up today and in days past, and there may be other things come up as we go through the rest of these hearings.
It would be wonderful in life if we could reduce ambiguity and simplify the language of legislation, but I don't think that's going to happen. The way society has evolved -- and we have lawyers and courts, those two aspects always there -- I think it's going to be very difficult to draft legislation that is in simple language. However, with some past experience I've had, the brochures and the guidelines that flow from that act can be written in language that people can understand. Let's hope that's what happens here.
The act itself, I expect, and the regulations will look very onerous, but if we can provide information in a step-by-step way to employers and employees so that they understand quite clearly what both their responsibilities are, I think we'll be taking a giant step.
In your association -- not particularly at this facility but across Ontario -- do you have unionized employees and unorganized?
Mr Clement: Yes, we do.
Mr Hoy: The nature of the hotel-motel business, I'm assuming, is that some employees, for instance, might come in at 8 o'clock, do a certain amount of work, leave at 11, maybe come back at 3 o'clock, just for example, and then maybe go home at 6, and that time of thing. The nature of the business would dictate some of that, particularly in maybe the housekeeping staff and the restaurant part.
Mr Clement: Housekeeping in an establishment like mine works from 9 o'clock in the morning until 4 o'clock. If it's really busy, it just takes longer to do. We have about 40 to 45 employees, but they're all on 20 hours a week, 30 hours a week. We don't have anybody steady except for the front desk clerks, who have all the responsibilities of the hotel. As far as the fire act is concerned, we have a 24-hour shift in that aspect.
In our kitchens, for instance, we don't have a passing trade of a million people going by our door every day. Even at lunchtime today, we had two cooks in the back and three waitresses out front. We didn't need them all, but we had them here. We were ready for the committee to go up and have lunch or whatever. These are the types of things that create a lot of loss in our business. When you have over the number of employees, it doesn't work out, especially when it comes to food. But we do have a cook who comes in in the morning, and he agrees to it before he starts; he's told before he starts, "Your hours are from 11 o'clock in the morning till 2, and then you take from then till 4 o'clock off and come back at 4:30 and work till 10 o'clock." So you have to get two people on the shift, unless you have enough work to create another shift in a smaller place like mine. I'm sure in other hotels in bigger cities, they have a full line of people working in and out. The labour cost is expensive.
Mr Hoy: I really don't know, so this is why I'm asking you. The old adage that you should know the answer before you ask is not holding true here.
That same situation, where people might work, let's say, from 11 o'clock in the morning till 1 o'clock and then come back at 3 till 6, or any variable like that, does that exist in a unionized facility as well?
Mr Clement: I wouldn't know.
Mr Hoy: You're not sure of that.
Mr Clement: I'm not sure. Let's say I have four or five waiters and waitresses working upstairs, and if one is working the afternoon shift and wants the night off, they just -- as I said, it's an open-door policy. They say: "Richard, I'd like to switch my shift tonight with the other one if I could. Would that be possible?" And I say, "Okay. If you didn't have any extra time off that you needed, if you have go to a wedding or a rehearsal or something, go ahead." That's how we do it with the open-door policy. It's not like you have to work that and that's it.
Mr Hoy: I would think you're probably finding excellent employees, with 360-some coming for -- what was that opening? One job?
Mr Clement: It's between five and 10 jobs, part-time, of course, because at this time of year a lot of people are moving into town from out of town. I hired a cook the other day -- he's coming to see me Monday -- who's from close to Niagara Falls and is coming up to the university here. He's able to work from 4 o'clock Monday to Friday, weekends as well; any time after 4 o'clock is when he finishes university. He needs the money and he's going to be staying in Sudbury. There's one person I'm looking at.
Mr Hoy: I would think you're going to get quality people with the job market being as flooded as it is, and I think, sadly, that's going to continue for some time. The numbers you quoted are amazing for that kind of thing.
Mr Chudleigh: Thirty thousand new jobs last month.
Mr Hoy: Well, you have 700,000 yet to go, so we'll see. They've only got three years, so we'll see how that happens.
Mr Clement, I appreciated your comments.
Ms Martel: The government says they're on track. I guess he means they're on track for the latest downward revision of the number of jobs to be created announced in the budget, which was about 235,000 or maybe 250,000 versus the 750,000 promised in the Common Sense Revolution.
Anyway, Mr Clement, thank you very much for making your presentation here today. I wanted to ask you a couple of questions. First of all, you indicated support for this piece of legislation on the final page in your conclusion. I'm going to assume, hopefully rightly, that you're indicating support because you see something from this that's going to positively benefit your business, just as the people who are coming here and who are concerned about it are expressing those concerns because they feel it's going to hurt the people they represent. I wonder if you can tell the committee what the benefits are. How are the changes indicated in Bill 49 going to help your particular business here?
Mr Clement: I think it's a matter of simplifying the language. I'm not too well versed in all the different bills we have to adhere to in this business, but I do know that when I have a problem with something with the Ministry of Labour I don't know that much about it, so I get the bookkeeper or one of our office staff, and they say: "Let's get this on the table and find out what's happening. Why is this person doing this?" or "Why are we doing this to this person? What are we supposed to do and how are we going to go about it?"
I find it's too much one against the other. Employees and employers should not be against each other; they should be together and work things out. I know that's a pretty far-fetched statement, but this is where it's at. You have to work together.
Ms Martel: That's a fair comment. I'm just curious about what is it in this bill that you think is going to allow for that greater cooperation between employers and employees to work those kinds of labour issues out?
Mr Clement: To be honest with you, I don't know enough about the bill to give you an answer on that, and I wouldn't want to say anything that I don't know what I'm talking about.
Ms Martel: Fair enough. The government has proposed now to put a cap of $10,000 on money that people can receive when they go to lodge a complaint under the Employment Standards Act. Do you agree with that $10,000 cap the government is putting on?
Mr Clement: I wish I made $10,000 last month. I don't know the answer to that question. You've got to cap it somewhere, I'd say, and if $10,000 is not enough, then get together and do something that's equal for everyone.
Ms Martel: You said you have to cap it somewhere. What I'm trying to get at is that the money we're talking about is money people have worked for. It's not a gift, it's not a gratuity; it's money that's owing to them because they invested their labour in that particular business and, for whatever reason, have not received that money so have had to lodge a complaint in the first case. The concern I have is, if people are owed money, should they not get all of what they are owed back?
Mr Clement: I'd say so. If you worked for me and I owed you $500, then you've got $500 coming to you. There's no reason in the world why I shouldn't give it to you unless there was something there that you didn't -- how did this amount of money come about? What would $10,000 be in reference to? How could someone owe someone $10,000 for doing work for them and they haven't paid them?
Ms Martel: That's part of the problem. We have had a number of cases raised before the committee members -- I wasn't here -- particularly in the garment industry and piecework industry, where people were not paid all the wages owing; they did not receive vacations when they were supposed to; if their employment was terminated they did not receive the money they should have been entitled to under the act for all the years of work and service they provided.
What I'm getting at is the government has decided, for some reason or another, that if people work and are owed money and didn't get that money they are owed from the employer, they can now only claim up to $10,000 of the money they are owed. If they are owed $40,000, they are still only going to get $10,000. What I'm saying to you is, do you agree with what the government has put forward? You said very clearly that you're supportive of the changes here,and one of the changes they want to make is to do just that.
Mr Clement: I'll give you some examples of people coming to work, asking for a job; I interview them and they say, "By the way, I'd like to get paid under the table." I know it goes on in a lot of businesses, and it shouldn't. People who pay people under the table for work they do for them -- I know of an establishment in Sudbury that's now closed that paid all its staff cash money, never collected anything, and then the guy left the country. A girl who worked for him as a waitress contacted the Ministry of Labour. What do you have to stand on? You're working for cash.
You see, that's what I'm saying. You've got to get together on something. You can't have people working for cash money under the table and nobody's paying their dues, nobody's paying anything to the government -- no taxes, nothing -- and this guy ends up with all the money and leaves, and you're sitting there going, "Well, I've got $10,000 coming to me because the guy owed me."
Ms Martel: I don't think we're talking about those kinds of cases, although I'm sure they do exist; none of us would want to see that happen. I'm trying to get at this issue because the government in both cases has set a maximum amount that people can receive and a minimum. They haven't told us what the minimum amount is. What the government says is that if you're someone who believes you have been wronged and you have money owing, there will be a minimum amount of money owed to you, which will be set in the regulation -- it won't even be dealt with by this committee here -- for which you can actually make an application.
For example, if the government says you have to be owing at least $500 before you can make an application to even try and get that money back, then you're stuck if you only are owed $400 or $300 or $200. If people are owed money, regardless of whether it's more than $10,000 or under $500, aren't they entitled to receive money owing to them for the work they did in a legitimate fashion? I don't want to deal with under the table.
Mr Clement: If you worked for me and I owed you money, I should have to pay you. I don't see how anybody can let anything go that far, I really don't.
Ms Martel: I wish there wasn't, but I understand that the committee, in some presentations in Toronto, heard that very clearly from a number of legal clinics that came representing people who in fact were owed those kinds of sums. It's a real problem.
Mr Clement: Like I say, I'm not too well versed in all this bill, but I will say one thing. I can imagine what happens in bigger companies that have thousands of employees and there's a mixup in the workforce and someone is owed money and owed money and it just accumulates and accumulates. The first thing you know, it's, "Now you owe me $40,000." I'd say they should get together. Any form of government should get at it and say: "Look, let's get this before it gets too big. Settle it now."
Mr Baird: Within six months.
Mr Clement: In whatever time it takes so it doesn't get that far. I mean, I can't see owing anybody $10,000.
Ms Martel: The fact is, people do. I guess you could make the suggestion to the government that it should probably take the caps off, both the minimum and the maximum, so people do get back what they have legitimately worked for and what is legitimately owed to them so that people aren't out of pocket for money they worked for.
The Chair: Thank you very much, Mr Clement, for appearing before us here today and making your presentation.
SUDBURY AND DISTRICT LABOUR COUNCIL
The Chair: That leads us to the Sudbury and District Labour Council. Good afternoon, and welcome to the committee. I'd just remind you that we have 30 minutes for you to divide as you see fit between presentation time or question-and-answer period.
Mr John Filo: Just before I start formally, I want to comment on what my friend Mr Clement mentioned during his question-and-answer period; that is, about his desire that labour-management should not be in an adversarial mode. Let me just review with you the activities that have been going on in Sudbury for a number of years.
Approximately two years ago we had a conference here called Common Ground in which diehard labour leaders such as myself and hardnosed businessmen got together and examined other paradigms in which the labour-management field could be viewed. We had a number of models that seemed very appropriate. I have to say, though, before I begin my presentation, that that type of exploration has been completely negated by your government's attitude towards the union movement and by the way in which it views labour-management relations.
First of all, to begin my presentation, I'd like to warmly welcome you to the north. I hope you enjoy some of the northern hospitality. We're always pleased when you take time away from your families and so on to come here and hear our views. In a sense, northerners often feel isolated because the lines of communication and the lines of travel are so difficult and so arduous. So welcome to Sudbury, and in preface to my remarks I might say that this business of having hearings is an excellent demonstration that you're committed to the principles of democracy. We encourage you to continue that in the future.
I started by looking up the word "improve," and I noted that it's a verb transitive and means "to bring into a more desirable condition." Under normal circumstances I might not be too critical of the language in the title of this bill. I know that euphemisms run rampant in the fields of government and throughout the corporate world. For example, we've all heard: "Mr X has resigned to pursue other personal and professional interests. Because of his knowledge of the company and the industry, however, he has agreed to continue to serve as a paid consultant." The translation for that is, "We fired the bum but we're going to keep him on as a consultant for a while so he'll keep his mouth shut."
We in the trade union movement have become very sceptical because of the language that has been coming from the government, and I believe distrustful of this government's efforts in the labour-management sphere. To a unionist, "flexible" means the playing field is tilted towards the employer. "Minor housekeeping" means that some of the rights and privileges that our grandfathers and grandmothers and fathers and mothers fought for on the picket lines -- yes, and had their heads bloodied for -- half a century ago are about to be scrapped.
The UN development report for 1996 ranks us first among 174 nations, beating out top contenders like the United States and Japan for the fourth time. I submit that the overriding reason for this is because of the manner in which our society in Canada, and particularly in Ontario, has determined an appropriate balance between employers' rights and workers' rights, influenced by the demands of the trade union movement.
I personally come from a very scientific background. My prime degree is in physics; we have a concept there called equilibrium. That's the sort of thing we're always trying to achieve in labour management: a degree of equilibrium, a degree of balance.
That unions are an essential fact in a democracy was more than aptly illustrated by the insistence of the Allies at the end of the Second World War that trade unions and collective bargaining be recognized in the constitutions of Germany and Japan. Some of you are too young to recall that, but I was there. As a condition of rebuilding the economies of those two countries, the recognition of collective bargaining and trade unions had to be in their constitutions. What better guarantee that tyranny and totalitarianism would not return to those countries?
We are surrounded by the effects of pragmatic unionism. In Poland, for example, the efforts of a lowly electrician led to the ultimate downfall of the Berlin Wall and the downfall of the USSR.
So if you think you're toying with something that will easily roll over and play dead, I'll tell you that the strength of people is demonstrated through their unions and we have not yet begun to show our influence and our power in this particular society.
Ontario is still the engine that drives the Canadian economy. Realistically, as Ontario's economy goes, so goes the economy of Canada. Thus, labour-management relations in Ontario exert a Canada-wide effect.
That there's a need to improve the Employment Standards Act has been apparent to the labour movement for years. While well intentioned, it has been a law with many loopholes and exclusions. Compliance has not been encouraged by the ministry and complaints have not been addressed with dispatch. Improvements would recognize the rights of workers and would facilitate the settling of claims, since presumably claims without merit would be dismissed. The current thrust of the bill is to impede and discourage the worker from obtaining what is rightfully due.
It's difficult to see an improvement when Bill 49 requires the employee to choose either to enforce a claim under the employment standards legislation or to sue the employer in the courts, since under the present act an employee can file an employment standards claim and still sue for common law notice entitlement.
The Employment Standards Act presently allows an employee to collect all the money an employer owes for vacation pay, premium for overtime hours etc. Bill 49 will place a cap of $10,000 on most claims that the ministry will enforce. The ministry will be able to publish statistics that the legislation is working. Total dollar claims on employers will have been reduced.
Upon filing a claim with the ministry, an employee will have to make an irreversible decision within two weeks to pursue the claim under the Employment Standards Act or withdraw it and sue through the courts.
Bill 49 will certainly improve the lot of private collection agencies. Settlements will be negotiated at substantial discounts to close the accounts and to provide the agency its commission.
There are many administrative changes that could be made that would make the Employment Standards Act more effective and efficient and that would more closely approach an ideal of justice between employer and employee.
Individual complaints should automatically trigger an audit of the entire employer's workforce. Complaints could be anonymous or could be third-party complaints. Compulsory education campaigns could be initiated in industries with bad track records as employers. Punitive assessments must be levied against repeat and continuing offenders. Time limits that favour the employee rather than the non-compliant employer and the settling of claims in a timely manner would rationalize the deficiencies in the act. Workers who elect to enforce the act should be afforded protection through the imposition of meaningful penalties to employers who seek to resolve these complaints by firing the worker.
In Ontario, all workers should be covered by the act. The exclusion of significant numbers is a licence to those employers to abuse the relationship they have with their employees.
It should not be possible for an employer to avoid liability through the device of contractor and subcontractor.
It's fair to say, I believe, that Bill 49 is not an improvement to working people. It improves the lot of the employer who would countenance no justice for the employee and would allow the employer to exploit the employee by removing those protections that currently exist.
Perhaps this committee will, in its report, state, "Modifications are under way to correct certain minor difficulties in Bill 49." The translation of that is, "We dumped the whole idea and are starting over with the objective of enforcing the rights of hard-working employees who are being mercilessly exploited by unscrupulous employers."
The checks and balances which have contributed to fashioning the enviable society in which we live and work will be seriously eroded with the enactment of this present legislation.
The Chair: That has allowed us six minutes for questioning per caucus, and the questioning this time will commence with the official opposition.
Mr Hoy: Thank you for your presentation. I noticed quite directly that you talked about the Second World War, trade unions and collective bargaining. Those were difficult years. I can recall my grandmother, who was in Europe at the time -- I think she was about 16 -- saying that when she walked home at night she had a potato in her pocket, and if she'd been caught with that, she probably would have been shot. It simply was quite a different era.
On the issue of $10,000 cap on claims, the government tells us -- and we have no reason not to believe this particular fact -- that 96% of the claims are under $10,000 now, so for me, it makes it difficult to understand why they want to cap it there. However, 4% of the claims are above $10,000, and it was suggested that those claims would come from executive persons, people higher up on the income scale. That argument probably has some validity, but we have also heard from others that even those making the minimum wage could, on occasion, have claims over $10,000.
I think it would be good to know from the government what percentage of the total dollars collected comes from that 4% as compared to the total dollars collected at the 96% rate. I agree with you. I have great difficulty with the $10,000 cap. I also have difficulty with the minimum threshold where one can make a claim. Do you have any opinion about this notion that people claiming above $10,000 would necessarily be of executive employment or very much higher on the income scale?
Mr Filo: If I may, this is a very imperfect analogy, but if we look at the way in which income and wealth is distributed in our society and we take the top 4% of all income in the world, that includes not only the 358 billionaires we have but several thousand millionaires. For example, I read just the other day that if you averaged the amount of wealth a billionaire has that presently exists in the world, it would equal the income of two cities like the city of Toronto. So when you talk about 4% of the claims being above there, the dollar value may in fact be equivalent to the 96% who are below it.
And why should we deal with percentages? If a person is owed money, that is a debt. People of honour have always paid their debts, and the government should not say that people of honour should have their debts limited to just $10,000.
Mr Hoy: Thank you for that. I think we're thinking along the same lines there.
The translation you give in the second-last paragraph is, "We dump the whole idea and start over," as it pertains to Bill 49. As opposition, we've asked the government to do that. We've asked them to put this particular bill and other discussions that will come and flow as it pertains to employee-employer relations all in one package. They decided not to do that, so here we have Bill 49 before us, and I don't expect they're going to give up on it either. But our role of course will be to suggest to the government ways of modifying it, as you say in the sentence prior to that.
Mr Filo: As a spokesperson for the labour movement, I want to thank whoever it is in this committee who has influenced the government to modify some of the legislation, modify the proposal.
Ms Martel: Let me just pick up from that point. One of the things the minister did on the first day the hearings opened was to table a particularly contentious and controversial section of the bill which allowed employers to negotiate, in essence, lower standards and contract out minimum standards around hours of work, overtime pay, public holidays, paid vacation etc. That little bit of business will be tabled for the larger package of "reform," although I use that term loosely, that the government is going to bring back, I suspect, some time this fall.
While you didn't address that issue in your brief, Mr Filo, I wonder if you would like to make some comments on that particular piece of the legislation which has been tabled for the moment. I expect we're going to see it again in another form in a different bill, but it's going to come back, and the minister made that very clear. What it will do in essence is to allow employers, supposedly in consultation with their employees, to negotiate a settlement that might actually go below the floor that is now the basic rights we have for workers in the province. Do you have any conclusions you want to come to about how that would work in a unionized environment and how it might work in a non-unionized environment when the employer sits down to bargain with his or her employees?
Mr Filo: I think that for the bulk of the trade unions that exist in Ontario and in Canada there wouldn't be that much of a problem. However, with legislation like that enacted, it would allow the unions to exploit their people to the same degree that it allows the employers to exploit their employees. What it does, by removing those things and allowing what is termed as "flexibility" in it, is ensuring that weak unions will be brought to their knees.
I don't believe we should have two sets of rules. We seem to have in our society, for the people who are at the top of our pecking order in our hierarchy, a different set of rules for their behaviour than we have for working people. I think that's being exhibited in some of the proceedings we're watching on the Somalia affair, for example. Quite frankly, working people don't agree with that. We think there should be one standard, one set of rules for everybody and that they should be fair and should be arrived at through a democratic process of consultation, but that once you have set those standards, those standards should be applicable to all.
Ms Martel: One other question, Mr Filo. On the first page in the second paragraph you said, "We in the trade union movement are sceptical about the government's language, particularly language used in the labour-management sphere." I wonder if you want to explain to this committee why that has come about.
Mr Filo: In the trade union movement our biggest source of effort is to enforce the collective agreement. Every word in the collective agreement has very, very specific meanings. Collective agreements do not take liberty with language in the way, obviously, the government takes liberty with it, because everything is subject to an interpretation. You can't use the public relations approach to the way in which you structure a collective agreement. I note that "to improve the Employment Standards Act" is in the title. You would not use language like that when you're drafting a collective agreement or you'd be in big trouble.
The pendulum has swung to the point where language is now being used the way George Orwell suggested it would be used. In his book 1984 he talked about doublethink and doublespeak, where the meaning of a word is diametrically opposite to the meaning that is trying to be sold to the audience.
The Chair: Moving to the government --
Mr Christopherson: Do we have any more time?
The Chair: Thirty seconds.
Mr Christopherson: Great. I'll take it. I just wanted to point out that you raised an issue that I don't think has come up yet anywhere that I can recall. You talk about the fact that as a result of the cap on the $10,000 -- and I would suggest a few other things they're doing too, in terms of offloading responsibilities on to unions, putting the minimum threshold in and other things, the time frames being reduced -- they, the government, "will be able to publish statistics that the legislation is working. Total claims" -- total dollar claims -- "on employers will have been reduced."
I think that's an interesting point. Speaking of Orwellian doublespeak, they are masters at it. I suspect you're right, and wouldn't mind your expanding on that a bit in terms of where you think they will go with that. Do you see it as part of a re-election plan? I think you're the first one to raise it.
Mr Filo: There's a perfect analogy with the social benefits act: When they came in and changed the rules on who qualifies for welfare, they were able to say that X number of people fell off the welfare rolls. It's a shell game; there's no substance to it. The people were disqualified from welfare. They were not looked after. Some of those people obviously turned to crime and turned to drugs and so on really from their frustrating position. We see the exact thing happening here. It's a beautiful PR ploy but lacking real substantive value.
Mr Christopherson: Excellent presentation. Thank you.
Mr Baird: You're someone after Mr Christopherson's heart in pointing out one of his favourite expressions, the Orwellian doublespeak line.
I want to thank you for your presentation. You mentioned, "Individual complaints would automatically trigger an audit of the entire employer's workforce." That's something that is done now, but I'll certainly take that suggestion back and see if it's done as comprehensively as possible. It certainly is done now.
For example, there was a rather big example of that with the Screaming Tale Restaurant in eastern Ontario where we received a number of complaints. One of the first was, I think, from my colleague the member for Scarborough East. It did trigger an audit of the entire workforce, and their audit obviously was going on for far more than one individual.
The question I'd ask is with respect to unions taking on the administration function in terms of the Employment Standards Act. We heard from a fellow yesterday -- a number of people, actually; one yesterday, though, in Sault Ste Marie, Mark Klym. He was or is an Algoma Steel worker, and what he said was that unions are capable of taking care of their members in terms of the administration of the act. We also heard from a fellow, I believe from CUPE Local 87, in Thunder Bay on August 26. Albeit in the public sector, as I'd be the first to admit, he said in response to me telling him that our claims collection at the Ministry of Labour was 25%, he looked us straight in the eye and said, "A hundred per cent; that's what I collect, 100%."
How many current Employment Standards Act cases would arise from, let's say, the workforce you're most acquainted with, and how many would the union take care of and how many would be referred directly to the employment standards office?
Mr Filo: I can't answer that to your satisfaction because I work in an area -- I'm a professor in a community college, and in that work environment I can't ever recall having an Employment Standards Act case. I can't provide you with statistics.
However, let me go back to one of the things you said, that a complaint triggers an entire audit. One of the problems -- and this may not be a problem in your area but in our area -- is the fact that the people who are in the Ministry of Labour have always been virtually understaffed and they have not been able to perform the duties that one would have required of them. We see an attrition in their numbers even now as we speak -- there are people losing their jobs or being transferred elsewhere and so on -- so we see the enforcement function as deteriorating.
Mr Wayne Wettlaufer (Kitchener): Thank you, Mr Filo, for coming, and thank you for your welcome to the north. It's very interesting. You said you feel isolated up here. There are many of us who live near Toronto who wish we were a little more isolated. We get the pollution our way.
Mr Filo: Have you ever been bitten by a blackfly?
Mr Wettlaufer: Yes, I sure have.
You state on your second page, "Improvements would recognize the rights of workers and would facilitate the settling of claims, since presumably claims without merit would be dismissed."
I come from a family where my dad was a labourer and I do have a great deal of sympathy for the labourer. I would agree that we have to make improvements. Do you feel that 25% of the claims being paid is acceptable?
Mr Filo: In view of what the labour leader from Thunder Bay said, that 100% of the claims he goes after are paid, 25% does not seem to me to be an acceptable amount.
Mr Wettlaufer: Twenty-five per cent is what has been and what is presently being satisfied. Would you say that 75% would be acceptable?
Mr Filo: Let's start with a number that I would say would be acceptable: 100%. When you take it from there, any deviation from the 100% figure should give us cause for concern, because obviously either somebody is mistaken about what's due them or somebody is not fulfilling their obligation.
Mr Wettlaufer: I would like to see 100% satisfied, but I would also like to see any improvement in what is presently being satisfied. I feel that 25% is totally unacceptable. It is also immoral. That is one of the things this legislation is designed to enact, is some improvement.
Also, I think the $10,000 limit and the six-month limitation period will go a long way to satisfying that.
Any time you urge someone to speed up the complaint process, it will also assist in the settlement process because we then rely more on recent memory and facts than distant memory and what could be misleading.
I also question why the unions seem to be so upset with this legislation. Would you not feel that if the unions can demonstrate that they are helping the workers more, it would assist in their recruiting drives?
Mr Filo: Have I stopped beating my wife? Is that the question?
Mr Wettlaufer: No. I didn't use that analogy.
Mr Filo: Look, unions help their members considerably. We don't need any sort of construct to show to our members that we work for them. It happens every day. If you sat in my office for a couple of days, you'd see the breadth and scope of the help we offer our union members. The big problem is that many union members who have never had any difficulties, who have never accessed the union, are simply unaware of what can be done for them. But those who have know we work for them, and we've never had any problem in our recruitment drives in the area in which I've worked.
Mr Wettlaufer: That's interesting, because Mr Samuelson from the Ontario Federation of Labour told me outside this morning that it would assist the unions in their recruiting drives.
Mr Filo: It would assist them in what?
Mr Wettlaufer: This legislation could assist them because of the influence that the unions could demonstrate they possess.
Mr Filo: It sounds like a comment taken out of context to me.
The Chair: Thank you, Mr Filo. We appreciate the time you took to prepare and make your presentation before us here today.
Mr Filo: Thanks very much, and I wish you good luck in your deliberations.
The Chair: That concludes the presentations scheduled for Sudbury. The committee stands recessed until 9 o'clock in Ottawa tomorrow.
The committee adjourned at 1627.