November 25, 2015

English Edition, No. 20

What Way Forward for Quebec?

For a Negotiated Settlement that Respects the
Demands of Public Sector Workers

What Way Forward for Quebec?
For a Negotiated Settlement that Respects the
Demands of Public Sector Workers

The Common Front's Counter-Proposal
Yes to an Acceptable Negotiated Settlement for Workers!
No to the Provocation of Imposed Special Legislation!

Couillard Government's November 6 "Improved Offer"

What Way Forward for Quebec?

For a Negotiated Settlement that Respects the Demands of Public Sector Workers

Public Sector Workers' Action in Montreal, November 17, 2015 (CSN)

On November 18, the Common Front, which represents more than 400,000 workers in the public sector, put forward a counter-proposal in response to the new "improved" offer from the Treasury Board on November 6 (see article below Couillard Government's November 6 "Improved Offer" for details). The main feature of the union's counter-proposal is a reduction of the Common Front's wage demand in terms of the annual percentage increase, which falls within the same framework and parameters set by the Common Front since the start of negotiations -- to tackle the impoverishment of workers and catch up with the private sector so that the public sector is able to keep its workers and attract others. Although the percentage increases have been reduced, they remain substantially higher than those offered by the government, which actually represent a pay cut when the cost of living increase is factored in.

The President of the Treasury Board immediately declared that the Common Front proposal was unacceptable. It is unacceptable, he said, because it does not comply with the fiscal framework the Couillard government has set and imposed on Quebec, in particular that of a balanced budget as a dogma and increased payments to the major private moneylenders. If the government agreed to negotiate based on the workers' demands it would have no choice but to raise taxes and to further cut public services and social programs, the President of the Treasury Board maintained.

Demonstration in the streets of Montreal, November 17, 2015 (CSN)

This is how all of the Couillard government's solutions impoverish Quebec society in one way or another. Meanwhile, and in the same vein, it is quickening the transfer of an increasingly large part of the social product to private interests, whether through the accelerated payment of the debt or the privatization of public assets, particularly in the healthcare and education sectors. The erosion of working conditions in the public sector is also part of this political agenda. In doing so it is attacking the dignity of labour.

The privatization of healthcare means, amongst other things, that the great technological developments of today will not serve to improve the condition of the entire Quebec population, but instead enrich a tiny minority and offer advanced technologies in specialized fields to an international clientele on a fee basis. Similarly, the privatization of education will also not lead it to greater access to public education for all.

The government has taken a hard line and speaks of fiscal responsibility and balanced budgets only to block any discussion on an alternative regarding the attainment of revenues that are necessary to meet the needs of workers and the people. Ultimately, it is through the use of state power that it intends to impose its will.

In September 2014, a few months after his election, Philippe Couillard travelled to New York to look for investments from U.S. monopolies. In an interview with Bloomberg, he promised them that the Quebec government would ensure that funds would be made available and that he would create opportunities to increase corporate profits.

To attract investment, he promised that the right to public services such as healthcare and education would be seriously limited and the salaries of public sector workers would be lowered, along with the ripple effect this would have on all Quebec workers. He also told them that he would "choose his battles," those which his government is capable of waging without compromise.

When Bloomberg editorialists questioned his government's capacity to control the peoples' movement for their rights, Couillard explained that he intended to wage those battles over which he feels he is capable of mobilizing public opinion on his side by using the dogma of "budgetary constraints" and "defending taxpayers."

This is the battle we are witnessing now, the plan that he presented to investors in New York to reassure them, which he is now applying to deny the rights of workers to adequate working conditions and a decent job, and to go full speed ahead with the neoliberal privatization of public services.

Montreal, November 17, 2015 (FTQ)

Public sector workers and the people of Quebec as a whole, who every day show their support for the workers' struggle against neoliberal austerity, have identified the immediate need to seriously improve workers' conditions, which are the conditions for the delivery of public services. An overworked, underpaid and silenced staff is in no way a guarantee of quality services to which people are entitled. However, this does create a very conducive situation for the development of private services of all kinds.

Those who provide services have the right to negotiate the conditions and wages they consider acceptable for themselves and the services they provide. Their struggle is a contribution to the defense of public services and the construction of a society centered on the human person rather than profit, and their struggle also opens the door to public discussion on how to attain the revenues needed to ensure services now and in the future. It enables the discussion to be taken out of the depressing context of neoliberal concepts that block thinking and have failed to produce societies fit for human beings.

The Couillard government must not be permitted to impose the dictate of the rich through back-to-work legislation. Where is the public authority that defends the public good? It is the workers who defend the public good in their demands for wages and working conditions in healthcare, education and other social programs.

Support the Public Sector Workers and their Legitimate Demands!
A New Direction for Quebec!

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The Common Front's Counter-Proposal

On November 18, in response to the Quebec government's "improved offer" of November 6th (see article below Couillard Government's November 6 "Improved Offer" for details), the Common Front presented a counter-proposal. Its new proposal, writes the Common Front, presents an amended wage offer that maintains the three principles it put forward at the start of negotiations and which it describes in the following manner: opposing the impoverishment of public sector workers, overcoming the gap between their remuneration and that of other Quebec employees holding comparable jobs, and improving their living conditions by enabling them to benefit from the collective enrichment of Quebec.

The demand is as follows: protection of cost of living based on the Consumer Price Index (CPI), with the guaranteed minimum of 1 % per year; Wage catch-up -- 1 % per year until the overall wage gap, reported by the Institut de la statistique du Québec, is eliminated; Collective enrichment of 0.5 % if the GDP exceeds 1 %. The offer represents an annual increase in remuneration equivalent to 2.5 % per year over 3 years, along with an adjustment if inflation exceeds 1 %. For the year 2015, based on reports by Statistics Canada that inflation was 1.4 %, the increase would therefore be 2.9 %. The Common Front considers that overcoming the gap between their remuneration and that of other Quebec employees should be pursued after the signing of the 3-year collective agreement it wants (the government is offering a 5-year contract). The Common Front's former offer was 4.5 % per year.

With regard to the pension plan, where the government is seeking a number of concessions, the Common Front continues to reject the government's demand to change the age of retirement without penalty from 60 to 62 years including its intention to raise the actuarial penalty from 4 % to 7.2 % annually. The Common Front is proposing to put forward incentives, as opposed to the government's punitive measures, for workers who want to continue working over a longer time period. In that regard, it notes that in 2010 it negotiated a clause whereby workers who wanted to continue to work for a 36th, 37th or even a 38th year (instead of retiring after 35 years of service) had their pensions increased by up to 76 % of their salary earned over the best 5 years. Since that measure obtained results, the Common Front is proposing that the government increase the threshold of that clause to 40 years, thus enabling a worker wanting to work longer, to have their pension increase up to 80 % of their salary over the best five years.

The Common Front is proposing to pursue the technical work with the government on the viability of the RREGOP (Government and Employees Retirement Plan) while noting that the Treasury Board has never shown that the plan, with a capitalization level of 98.4 % based on actuarial valuations, is at risk.

With regard to pay relativity, the Common Front denies the Treasury Board President's claim that work on correcting certain inconsistencies in wage restructuration he wants made a key issue in the present negotiation is the result of joint work carried out with the Common Front. The Common Front notes that it had accepted to undertake work on wage restructuration by first posing the following conditions: that the employer's wage freeze proposal must be withdrawn; that the implementation of the structure must not, under any circumstances, impose a wage freeze or decrease for the members it represents and that the work on pay relativity cannot replace wage increases based on the parameters defined by the unions. In the opinion of the Common Front, the Treasury Board did not respect any of the conditions of its November 6 offer. It is of note that the President of the Treasury Board has recognized that certain salaries could be reduced and that wages at the entry level could be lower than they are at present. He also mentioned that the government was planning on significantly reducing the number of job categories, which would end up having serious repercussions on working conditions. Finally, the Common Front stated that with the aim of making progress in the negotiation, it would suspend the three strike days planned from December 1-3.

"Neither is the Common Front anticipating cancelling its strike days, nor suspending its movement," the press release on its counter-proposal states. "In pointing out to the government that we are ready to suspend certain days initially planned for, we are sending a clear message: if no significant progress is made at the negotiation table over the next hours, the strike movement could move forward as early as next week (...) Martin Coiteux must understand the message: the members of the Common Front are determined to improve their working conditions as well as accessibility, for the entire population, to public services. And the suspension of our strike days could be short lived if no significant progress is made at the negotiation table."

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Yes to an Acceptable Negotiated Settlement
for Workers! No to the Provocation of
Imposed Special Legislation!

150,000 public sector workers and their allies demonstrate against the Couillard austerity program on October 3, 2015, in Montreal. (CSN)

The Quebec government presented what it calls its "improved offer" to public sector workers, which for all intents and purposes looks like part of the plan for preparing the groundwork to adopt special legislation. A cap is kept on wages for two out of the five years while an increase of 1 % is allotted to the other three, except that the first 1 % increase is doled out a year earlier. It's still the same 3 % increase over five years, even though workers are demanding a three-year contract with a 4.5 % increase per year. Workers' representatives immediately rejected the offer and announced the continuation of rotating strikes. Treasury Board President Martin Coiteux, who presented the "improved" offer with much fanfare, claims this represents an increase of $1.7 billion more than the original offer and a global increase of 5.3 % over fives years as opposed to 3 %. So the initial offer presented a year ago of:

0 %, 0 %, 1 %, 1 %, 1 %


0 %, 1 %, 1 %, 1 %, 0 %.

Based on Coiteux, by offering the first 1 % increase a year earlier and returning to a wage freeze in the last year, he's making a huge concession to workers.

Whether it's the government's original or "improved" offer, neither contain a cost of living allowance, so both actually represent a reduction in real wages. With an economy more and more centred around the export of resources and the import of manufactured or consumer products, it would be wise to foresee increased inflation in the coming years. What will be the additional cost to workers of a salary freeze in five years, following three years of an "increase" of 1 %, which represents a real decline?

The move is an insult to our intelligence and an attack on the dignity of labour. Workers are right to categorically reject it. An affront to the dignity of labour of those who provide the services we depend on to live is part and parcel of the anti-social offensive and must be condemned.

At every opportunity Premier Couillard keeps saying that negotiations are nearing an end and must be settled in the weeks to come. In short, the ultimatum has been given: capitulation or decree.

To muddy the waters even more, the government added to its "improved offer "the issue of "pay relativity." It demanded that workers agree to include this in the negotiation and gave them a couple of weeks to do so. This involves wage disparities that exist within work categories and is therefore a complex element (see article below), which will take years to resolve. It has potential repercussions not only on wages, but also on job descriptions and their accompanying tasks. It concerns all job categories that exist in the public sector. It is of a magnitude at least as great as wage parity. No public discussion has taken place on the issue and the public remains mostly unaware of the issue. How can the government intervene at the last minute and make this a key element of the negotiation? This appears to be a plan it has prepared in order to continue its restructuring of services for private interests in an underhanded and secretive way by criminalizing the just struggle of the workers, who are specifically fighting in the public space for public services and for adequate conditions for their delivery.

The Couillard government must stop its dirty tricks and negotiate seriously with the workers on the basis of their demands for wages and working conditions, to end the years of erosion of their conditions and so that the sector is able to retain and attract workers.

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Couillard Government's November 6
"Improved Offer"

On November 6, the Treasury Board issued a press release entitled "Negotiations with government employees -- the government increases its offer and makes pay scales more equitable."

What is it all about?

Public sector workers demonstrate in the Lower Saint Lawrence region,
November 12, 2015 (CSN)

The government claims to have added $1.7 billion in new money, including $1.2 billion in its wage offer. According to the government, this new money comes as a result of moving up the first 1% increase by a year. In its calculation method, it not only calculates the amount of the increase, but the combined amount of the increase from one year and that of the increase of the previous year (or the previous two years since there are 3 consecutive increases of 1%). This is an unusual way to present salary increases, which aims to present the government as generous and the workers as unreasonable.

The government also plays with numbers and introduces the issue of pay relativity, which is not presently an issue in these negotiations and which, according to the government's plans, will negatively impact wages and working conditions -- the full scope of which only time will tell.

The fact is that the government's overall offer on salaries has not changed. It is still 3% over five years, with two years of wage freezes and three years of a 1% increase. The government's initial offer was 0% -0% -1% -1% -1% per year for a five-year collective agreement. Its so-called new proposal is 0% -1% -1% -1% -0%. For the workers, this is a major loss that will only exacerbate the difficulty of attracting and retaining workers in the sector.

Based on the unions' estimate the amount of new money represented in a 1% increase is about $400 million.

Below is a representation of the approximate amount of the salary increases as offered by the government in its initial offer.

2015: $0
2016: $0
2017: $400 million
2018: $400 million
2019: $400 million.
Total: $1.2 billion

The government's calculation of its initial offer is very different:

2015: $0
2016: $0
2017: $400 million
2018: $800 million (1% increase over the previous year)
2019: $1.2 billion (1% increase plus two 1% increases over the two previous years)
Total: $2.4 billion

For its improved offer, in which the 1% increase is moved up a year, and according to the same method of calculation, the government calculates a total of $3.6 billion and thus an injection of $1.2 billion of "new money." It is an attempt to present its offer with a magnifying glass to present itself as reasonable and even courageous in a period of budget constraints, while public sector workers, who find themselves in the end with a meager 3% increase over five years, have an irresponsible attitude towards public funds.

The government says it has lifted the wage freeze with its improved offer and thus has taken into consideration the workers' concerns. This is not the case. In the improved offer, the two-year freeze remains in the first and fifth year of the agreement. The government claims that public sector workers received a pay raise in March 2015, the first year of the new agreement. This is not a raise but an adjustment for loss of purchasing power that comes from the previous negotiation and has nothing to do with the current negotiations.

As for the fifth year in the improved offer, in which there is a wage freeze, the government claims that there will be no freeze because workers will receive payments of pay relativity, which brings us to this topic.

Pay Relativity

Several hundred public sector workers in the streets of Sherbrooke,
November 12, 2015 (JF Desroches)

The issue of pay relativity comes from an agreement between the unions and the government that dates from the previous negotiations (2010). It is an assessment of all job categories in the public sector to discern wage disparities (for example with respect to workers' qualifications) and make corrections if necessary. It is an ongoing project that is not part of the negotiation of this agreement as such.

The CSN's definition of pay relativity:

"This consists of comparing all job classes within the same enterprise regardless of gender category. The evaluation process is the same as the one used for pay equity, except that all job classes are evaluated and compared to one another. Salary adjustments, if any, may target job classes that have an internal wage disparity in relation to total employment. Pay relativity does not mean obtaining salary parity with comparable jobs with another employer (in the private sector, another ministry or in another province, for example). It does not stem from the application of a law but is the result of negotiations."

The resolution of issues related to pay relativity is not part of the unions' demands in these negotiations and initial government offers made no mention of it. In effect, the government has just launched this bomb into the negotiations to destabilize the workers and take them by surprise, meanwhile presenting itself as a responsible partner in the negotiations who is making an effort and releasing funds to reach agreement.

Even though the government has not provided details on the corrections it intends to make, it has hinted that it wants to restructure the job categories and reduce the number, which will surely impact not only wages but also the deployment of the workforce and is a key element of the restructuring of how services are delivered. With what has already surfaced, the unions believe that what is on the table will lead to wage cuts for at least 18,000 workers in the sector.

About 35,000 people will no longer achieve the desired maximum wage in current job categories. Additionally, for several job categories the primary levels would be lower than they are now, which is a major attack on young workers and an obstacle to attracting young workers in the public sector.

Pension Plans

The government claims to have made a compromise by softening its position on the pension plan. Of note is that the workers have not submitted demands on the pension plan and do not want it touched. All the government's offers regarding retirement are demands for concessions that will impoverish retired workers and increase the number of workers who take early retirement, which it would appear the government wants as part of its plan to reduce the workforce in the public sector. The offer, or rather the initial government dictate, on the pension plan was focused on the following demands: raising the retirement age for public employees from 60 to 62 years as of January 1, 2017; calculating the pension according to the average salary of their best eight years of work instead of five, and increasing the applicable penalty for taking early retirement from 4% to 7.2% per year.

In its so-called improved offer, the government now proposes to push until 2019 the increase in the retirement age from 60 to 62 years (without actuarial penalty), or 61 years on July 1, 2017 and 62 years on July 1, 2019, and to withdraw its demand to calculate the pension on the average salary of the top eight years instead of five.

Working Conditions

The government is not withdrawing its demands regarding working conditions negotiated at the sectorial tables. The government still seeks to reduce the workforce and increase the workload for those who remain, to increase what it calls the flexibility and the availability of workers, that is to say its ability to move them as it sees fit against all logic regarding the delivery of public services in a calm manner that ensures the people's well-being.

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