Fair Wage Policies – Not a Union / Non-Union Issue
By KATHERINE JACOBS, Director of Research, Ontario Construction Secretariat

The Ontario Construction Secretariat (OCS) recently released a report entitled Impact of Fair Wage Policies on the Construction Industry. This report examined the historical evolution of Fair Wage Policies in Canada and Ontario, and further explored the relationship between fair wage policies and construction costs. The information contained in the report is intended to help dispel some of the misconceptions about fair wages and to provide the necessary information to promote the implementation of modern fair wage policies at the provincial and municipal level.

 

This report was to put to immediate use in assisting the Essex and Kent Building and Construction Trades Council in preparing a deputation to City Council in July of this year. Although Council did not vote in favour of implementing a fair wage policy, they have left the door open by striking a committee to study the issue further. Council was clearly divided on the issue of whether or not a fair wage policy would add to the cost of municipal construction projects and ultimately the vote ended in a tie. Mayor Eddie Francis could have broken the tie by voting in favour of the fair wage motion, but chose not to do so. On a tie vote, a motion is lost. 

Sol Furer, Essex and Kent Building and Construction Trades Council, is somewhat optimistic that the issue will be re-visited by Council before the municipal elections in November. As one of the local councillors remarked, “This is not a union, non-union issue. It’s about fairness. It’s about… making sure people have a level playing field.” 

Making The Case for Fair Wage Policies

1. Fair Wage Policies are a necessary counter-balance to cut-throat competition in the construction industry.
2. Fair Wage Policies support productivity and innovation in the construction industry.
3. Fair Wage Policies encourage the use of more skilled and better qualified labour and thereby support industry and worker investments in skills training and apprenticeship.
4. Contractors that do not invest in apprenticeship and skills development have a cost advantage over contractors that do. (Although governments advocate the expansion of the apprenticeship system and industry investment in skill development, the absence of Fair Wage Policies gives a competitive advantage to employers who do not contribute to the apprenticeship system and who make no direct investment in skills training).
5. Contractors that compete on the basis of cheap labour are notorious for weaker health and safety standards.
6. Contractors that compete on the basis of cheap labour are more likely to cut corners on quality thereby increasing long-run costs.
7. Fair Wage Policies can curtail underground practices and create a level playing field for competitive bidding.
8. Fair Wage Policies are incorrectly criticized for radically inflating costs. The evidence does not support these claims.
9. Fair Wage Policies are not union preference policies. Fair Wage Policies limit competition only from those non-union contractors that base their competitive advantage on cheap wages, independent operators and lower safety standards.
10. Fair Wage Policies protect local employment and thereby increase the benefits to the local economy from construction that is financed by local funds.

 

The OCS report is available online at www.iciconstruction.com or in hard copy by calling (416) 620-5210.