Minimum Wage Hike Would Deter Contract Instability, Says Labour

Some 1,200 health workers employed by private firms expect to lose jobs in coming months.

By Andrew MacLeod 7 Mar 2015 |

Andrew MacLeod is The Tyee's Legislative Bureau Chief in Victoria and the author of A Better Place on Earth: The Search for Fairness in Super Unequal British Columbia (Harbour Publishing, April 2015). Find him on Twitter or reach him here.

Raising the province's minimum wage would reduce the incentive for employers to change contractors to save money, British Columbia labour leaders argued this week.

"[Employers] are really doing it to drive down wages and benefits and other provisions in the collective agreement," said Irene Lanzinger, the president of the B.C. Federation of Labour, when asked about the news that some 1,200 B.C. health sector workers employed by private companies expect to lose their jobs in the next few months.

The Hospital Employees' Union, which represents the workers, announced March 2 that the Ahmon Group told more than 240 care aides, nurses, cleaners and dietary workers at Laurel Place care home in Surrey that it will contract out their work starting in June. The workers had signed a first collective agreement in October.

The union added that another company, Aramark, had after 12 years lost its contract to clean hospitals and extended care facilities for Vancouver Coastal Health. The American contractor will be replaced by Compass Group, and the union said about 935 staff will lose their jobs by late September.

The moves are about saving money, not the quality of the service the companies provide, said Bonnie Pearson, the union's secretary-business manager.

"It is really just a business decision about how low we can drive the wages in this environment," she said at the B.C. legislature this week, where she, Lanzinger and a contingent of labour leaders gathered to discuss the minimum wage and other issues with politicians.

The minimum wage has been $10.25 an hour since May 2012. The BC Fed is campaigning for the province to raise it to $15.

'Destabilized' workforce: union

Employers are pushing down already low wages for business reasons, Pearson said. "You have to keep the workforce destabilized to be effective in terms of the wage rates," she said, noting that health care cleaning jobs tend to be held by people who are financially vulnerable.

To fight this destabilization, the union has argued that contracts need stronger successorship language requiring companies that take over contracts to hire the workers who are already doing the jobs.

The provincial Labour Code includes some successorship provisions, but the union notes that in 2002 and 2003 the B.C. government excluded public employers from those requirements.

"We see it all over the private sector as well," said Gavin McGarrigle, the B.C. area director for Unifor, adding such practices drive already vulnerable workers "further into poverty."

Unifor represents janitorial workers who clean Vancouver office towers owned by Cadillac-Fairview, which leases to tenants such as big law firms and mining companies. Last year, the workers managed to bargain a wage of $12 an hour plus benefits, McGarrigle said.

"Cadillac-Fairview, one of the richest corporations in Canada, turned around and went to another contractor at $10.25 an hour," he said. "So these women, and they were probably 80 or 90 per cent women, were driven further into poverty simply because they had bargained slightly above minimum wage."

Jamie Okorofsky, a spokesperson at Cadillac Fairview Corporation Ltd.'s Toronto headquarters, said it is standard practise for the company to conduct a request for proposals when a contract for cleaning services is nearing its end.

"The search for a new firm was conducted in a fair and transparent manner," she said. "We received proposals from fully qualified firms, and after a thorough and rigorous evaluation, we made the decision to award the contract to new providers that could best meet our needs moving forward."

Premier: increases coming, but not to $15

Raising the minimum wage to $15 an hour would help a lot of workers, McGarrigle said. If the province fails to do so, employers will be able to continue pushing down wages, he said. "There's no point [negotiating] if all of a sudden you get knocked back again and again. It's disgraceful."

"If we raised the minimum wage to $15 an hour, there would be less incentive to contract out to reduce wages from $12 to $10.25," Lanzinger said. "Surely Cadillac-Fairview can afford to pay $12 an hour for its cleaning staff."

Premier Christy Clark rejected raising the minimum wage to $15, but said the government is planning to make smaller, predictable increases.

"British Columbia is going to, we believe or we're told, lead the country at three per cent [GDP growth], but the economy is still quite fragile," Clark said. "We need to make sure we're supporting small businesses that are huge job creators."

Clark said one of the first things she did after becoming premier in 2011 was raise the minimum wage, which at that point had been frozen for a decade. "At the time we said we're going to find a more predictable way for it to go up, and we're going to deliver on that."

She declined to say when the details will be announced, but said Shirley Bond, the minister responsible for labour, is working on them.  [Tyee]

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