Prospects for Industrial Relations in the Broader Public Sector
Explore the economic changes impacting the Ontario government's fiscal situation and their implications on industrial relations in the public sector. Delve into structural versus cyclical changes, employment environment effects, and potential labor relations system adjustments.
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Prospects for Industrial Relations in the Broader Public Sector John O Grady 1
Four Questions: 1. What are the underlying changes in economic conditions and the fiscal situation of the Ontario government? Are they structural or cyclical? 2
Four Questions: 1. What are the underlying changes in economic conditions and the fiscal situation of the Ontario government? Are they structural or cyclical? 2. If those changes are structural, what are their likely implications for the employment environment in the Broader Public Sector? 3
Four Questions: 1. What are the underlying changes in economic conditions and the fiscal situation of the Ontario government? Are they structural or cyclical? 2. If those changes are structural, what are their likely implications for the employment environment in the Broader Public Sector? 3. Can the expected changes in the employment environment be addressed by the existing labour relations system? 4
Four Questions: 1. What are the underlying changes in economic conditions and the fiscal situation of the Ontario government? Are they structural or cyclical? 2. If those changes are structural, what are their likely implications for the employment environment in the Broader Public Sector? 3. Can those changes in the employment environment be addressed by the existing labour relations system? 4. If changes in the labour relations system are needed, what are the options? 5
Ontario Government: Fiscal Situation $140,000 $130,000 Expenditures $120,000 Revenues $110,000 $100,000 Smillions $90,000 $80,000 $70,000 $60,000 $50,000 6
Ontario: Real GDP Manufacturing, 1997-2011 $105,000 $100,000 Real GDP (Chained $2002) - $Millions $95,000 $90,000 $85,000 $80,000 $75,000 $70,000 $65,000 $60,000 7
Ontario: Real GDP Manufacturing,1997-2011 $105,000 $100,000 Real GDP (Chained $2002) - $Millions $95,000 $90,000 $85,000 $80,000 $75,000 $70,000 $65,000 $60,000 8
Ontario: Real GDP Manufacturing C$ Exchange Rate,1997-2011 $105,000 $1.050 $100,000 $1.000 Real GDP (Chained $2002) - $Millions $95,000 $0.950 Exchange Rate: C$ / US$ $90,000 $0.900 $85,000 $0.850 $80,000 $0.800 $75,000 $0.750 $70,000 $0.700 $65,000 $0.650 $60,000 $0.600 9
Average Annual Increases in Government Spending: 2010-11 to 2017-18 Interest Program Total Budget 7.9% 1.4% 2.0% Drummond 7.1% 0.8% 1.4% 10
Implications for the BPS Employment Environment 1. Employment reductions. 11
Implications for the BPS Employment Environment 1. Employment reductions. 2. Increased public sector employer opposition to restrictions on redeployment rights of public sector managers (seniority, posting). 12
Implications for the BPS Employment Environment 1. Employment reductions. 2. Increased public sector employer opposition to restrictions on redeployment rights of public sector managers (seniority, posting). 3. Increased public sector employer resistance to open-ended pensions and liabilities. 13
Implications for the BPS Employment Environment 1. Employment reductions. 2. Increased public sector employer opposition to restrictions on redeployment rights of public sector managers (seniority, posting). 3. Increased public sector employer resistance to open-ended pensions and liabilities. 4. Increased public sector employer resistance to pattern-based wage determination. 14
Implications for the BPS Employment Environment 1. Employment reductions. 2. Increased public sector employer opposition to restrictions on redeployment rights of public sector managers (seniority, posting). 3. Increased public sector employer resistance to open-ended pensions and liabilities. 4. Increased public sector employer resistance to pattern-based wage determination. 5. Increased attraction to contracting out and divestment and increased opposition to restrictions that impede these. 15
Eras of Restraint 1975 1978: Wage and Price Controls 1981 1982: Public Sector Wage Controls ( 6 and 5 ) 1993 1995: Social Contract wage freeze / 12 Rae Days 1993-94: 2.3% cut 1994-95: 0.8% increase 1995 1999: Harris Cuts: 1996-97: 3.3% cut 1997-98: 0.3% increase 16
Changes in the System 1. More centralized bargaining. 17
Changes in the System 1. More centralized bargaining. 2. Addressing the self-referential bias of public sector arbitration. 18
Changes in the System 1. More centralized bargaining. 2. Addressing the self-referential bias of public sector arbitration. 3. Limited liability for benefits and pensions. 19
Changes in the System 1. More centralized bargaining. 2. Addressing the self-referential bias of public sector arbitration. 3. Limited liability for benefits and pensions. 4. Integration of pension bargaining with wage bargaining. 20
Changes in the System 1. More centralized bargaining. 2. Addressing the self-referential bias of public sector arbitration. 3. Limited liability for benefits and pensions. 4. Integration of pension bargaining with wage bargaining. 5. Greater flexibility on re-deployment (overriding seniority and posting) 6. Fewer impediments to contracting out and divesting. 21
Nominal GDP and Government Fiscal Position: 2001-2011 Average Annual Growth Rate Nominal GDP 3.5% Government Revenues 5.0% Government Expenditures 6.7% 22
