On September 20, 2012, the Liberal government in Ontario
announced an intention to freeze the wages of Ontario's public
service ("OPS") and broader public sector
("BPS") managers and executives as part of a solution to
reduce the province's $14.8 billion deficit. Under new measures
announced by Finance Minister Dwight Duncan, OPS and BPS managers
and executives will be required to accept a wage freeze, including
a freeze on the maximum bonuses that can be provided. Furthermore,
new executives will not be able to earn in excess of $418,000,
which is twice the Premier's salary. All of this comes in
advance of additional measures for rank and file public sector
workers that the Government indicated will be announced "very
THE PROPOSED FREEZE
Under the proposed initiative, there are three broad categories
of freeze initiatives:
Managers in the BPS who receive performance pay will have their
compensation frozen for two years, based on all compensation
included on their T-4 slips.
Managers in the OPS who receive performance pay will have their
compensation frozen for three years.
There will be a permanent "hard cap" on compensation
for new executives. The proposed legislation would cap the
compensation of new executives in the OPS and BPS at $418,000
– twice the Premier's salary. Existing executives
earning more than the proposed cap will have their compensation
grandfathered. Presently, there are 150 executives, mainly in the
hospital, university, and electricity utility industries that earn
more than this amount. The Finance Minister will have the
discretion to approve exceptions if a business case is presented,
such as when an organization has difficulty recruiting
The Government has indicated that if a Manager under-performs
and as a result earns less performance pay than in 2011, the result
could be a reduction in compensation year over year. There may,
however, be limited exceptions where increases are permitted (such
as a mother returning from pregnancy leave).
Unions were quick to denounce these new measures as
WHAT THE FUTURE HOLDS
It is no surprise that in implementing what may amount to
sweeping wage restraint initiatives across the province, the
Government has chosen to start at the top. Finance Minister Duncan
stated that the move was "symbolic", noting that it is
difficult to ask hospital clerks to take pay freezes when their
bosses are not. He was also clear that the wage restraint will be
applied equally, and that measures for other public sector
employees are in the works. In particular, the government has
warned unionized employees that they could face wage freeze
legislation if they do not agree to "hold the line" in
collective bargaining negotiations. All of this suggests that there
is more wage restraint to come.
Ultimately, we will have to wait and see if the headlines and
sound bites are reflected in legislation to follow. We will keep
you apprised of any developments that follow.
Unfortunately, reasonable accommodation for employees in the workplace continues to be the source of significant litigation and even today we continue to see outrageous examples of employers behaving badly.
We are now beginning to see reported cases involving charges and subsequent fines laid against employers for failing to provide information, instruction and supervision to protect a worker from workplace violence.
On October 13, 2016, the Supreme Court of Canada denied leave to appeal an Ontario Court of Appeal decision which ordered an employer to pay a former employee 37 months of salary and benefits following termination.
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