Ottawa is leading the way on labour
Whether such leadership continues depends on upcoming election’s result
Constitutionally, labour law in Canada is mostly a provincial responsibility, including matters like the minimum wage, collective bargaining, and workplace health and safety. However, an important slice of the economy falls under federal jurisdiction. In industries like banking, interprovincial transportation and telecommunications, the federal government sets the labour rules.
In past decades, Ottawa usually followed the provinces (which are responsible for labour law in around 90 per cent of the economy). An example is the minimum wage: since 1996, the federal government didn’t even have its own minimum wage. Instead, federally regulated industries were subject to the minimum wage in whatever province they operated.
The federal government was thus the tail to the provinces’ dog. It played no role in the recent, important debates that have culminated in large minimum-wage increases in most provinces.
More recently, however, Ottawa has begun to play a more proactive role: setting distinct federal standards on key labour issues, in most cases better than corresponding provincial rules. Apart from offering more protection to workers in federally regulated industries, this trend also pressures the provinces to lift their own game.
On the minimum wage, for example, later this year a distinct $15 federal minimum wage will come into effect — as high or higher than all but one province. It will be adjusted upward annually for inflation. If any province surpasses the federal minimum (like B.C., where the minimum is now $15.20), then the higher rate applies. The new minimum wage passed with this year’s budget implementation bill. It was supported by the NDP (which originally proposed the idea), but opposed by the Conservatives.
Another example of this trend was a 2017 reform to the Canada Labour Code, which governs union-management affairs in federally regulated industries. This change made it simpler for new unions to be certified, so long as more than half of workers in a workplace joined. Since this change, union organizing in federally regulated industries has accelerated notably — such as the successful unionization of WestJet, a longtime antiunion employer. The unionization rate in federally regulated companies is about twice as high as the private-sector average in other sectors; this is another way federal policies are serving as a role model for provincial law.
Whether this federal leadership on labour standards continues obviously depends on the current election. Voters seem particularly attuned to labour issues in the wake of the labour market disruption and hardship experienced during COVID-19. So several proposals have been made to further strengthen federal labour law. Most important is a pledge by both the Liberals and the NDP for up to 10 days of paid sick leave per year in federally regulated industries (up from three days at present).
In contrast, few provinces have any permanent paid sick leave requirements at all. Ontario used to require two days, but the Ford government eliminated that provision as one of its first acts in 2018. Public health experts argue strongly that supporting ill or exposed workers to stay home without financial penalty is vital for limiting the spread of COVID-19 (or future diseases). Federal leadership in this area would set a standard that would help prod the provinces to (belatedly) act.
Other labour law promises include an NDP pledge to raise the federal minimum wage to $20, and Liberal and NDP promises to limit federally regulated employers from using replacement workers (or “scabs”) in strikes and/or lockouts. Meanwhile, although Erin O’Toole likens himself a more worker-friendly Conservative, his platform is very vague about federal labour law. Most notable is his proposal to force large federally regulated companies to put a worker on their board of directors. But without a union to elect that worker and back them up with real bargaining clout, it amounts to tokenism. And given past labour law rollbacks implemented by the Harper government (which he served in cabinet) and most Conservative provincial governments, O’Toole’s pitch is hard to swallow.
The recent willingness of Ottawa to use its limited but strategic foothold in labour law to lift standards has made an important difference: directly to workers in federally regulated industries, and indirectly by setting a higher bar for provincial laws. This election will determine whether that progress continues.