What will the Conservatives' omnibus Bill C-45 mean for workers in Canada?

| December 6, 2012
What will the Conservatives' omnibus Bill C-45 mean for workers in Canada?

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A little more than a month after it was tabled, the federal Conservatives' 443-page omnibus Bill C-45 -- a so-called "budget implementation" bill that amends over 40 pieces of federal legislation -- passed through the House of Commons on Wednesday, after Conservative MPs dutifully voted down every single amendment proposed by the opposition.

For the most part, the bill's changes to laws directly affecting workers are not dramatic, nor have they taken many by surprise. But they are worth noting, especially within the context of the government's broader strategy on labour and employment.

Here's a run down of the main aspects of Bill C-45 that will affect workers and labour relations in Canada:

Poorer pensions for public servants

 New pension rules for the federal public service, which currently employs about 420,000 Canadians, mean that:

-Public service workers hired after 2012 won't reach retirement age until 65 years of age, while current workers will continue to be able to retire at 60 years of age.

-All public servants will be required to cover a greater proportion of their pension costs, moving from their current 37 per cent share to 50 per cent within the next five years.

According to the Public Service Alliance of Canada, these changes will result in the equivalent of a pay cut of about $1,260 a year for a worker earning $45,000.

The creation of a less favourable pension regime for new hires in the federal public service echoes a trend being seen throughout Canada, with employers cutting back on benefits for workers hired after a given date. Unions representing everyone from federal postal workers to Ontario school teachers have staunchly opposed this "two-tier" strategy, but the trend shows no sign of disappearing anytime soon.

Minister takes control of review process for hazardous workplace materials

 Right now, responsibility for making sure dangerous chemicals and other hazardous materials used in workplaces are accompanied by accurate ingredient lists, toxicological information and safety instructions rests with the Hazardous Materials Information Review Commission. Those product labels and safety instructions are what employers rely on for training workers in the safe use of many toxic, corrosive, carcinogenic or otherwise dangerous substances, so it's kind of an important role.

The commission is composed of representatives from labour, employers, chemical suppliers and governments, and it operates at an arm's length from government.

Bill C-45 will dissolve the commission and move its work under the control of the minister of health. The minister will form a council to direct the work of ensuring hazardous product labels and material safety data sheets are compliant with regulations. The council still has to have representatives from labour, employer and industry groups, but the new rules specify that those can be "any organizations ... that the Minister considers appropriate."

For anyone doubting the need for a strong review process (perhaps it's just a convoluted bureaucratic exercise in rubber-stamping product labels and information sheets that are already perfectly good?), here's a sobering thought:

Statistics compiled since 2009 show an alarming and growing trend of hazardous materials suppliers providing unacceptable safety documentation. In 2011-2012, a full 90 per cent of material safety data sheets reviewed by the commission were found to have errors or omissions. That's up from 84 per cent in 2010-2011, and 77 per cent in 2009-2010. (Fortunately, suppliers whose safety data sheets are found non-compliant usually do manage to bring them to compliance after revision orders are made.)

A study released last month showed that Ontario women working in several chemical-intensive industries are have a much higher risk for breast cancer than the rest of the population -- in some cases, a risk nearly five times higher. That should be a reminder of the importance of being very careful with what types of chemicals are used, and how, in workplaces.

But carefulness is too often perceived by the Conservative government as extraneous, business-slowing red tape. So it's hardly a surprise that organizations like the Canadian Labour Congress and the Council of Canadians are expressing worry about a government minister taking charge of the hazardous materials information review regime.

Seamen compensation board goes under ministerial control too

 The Merchant Seaman Compensation Board, an independent board that makes decisions on ship worker's eligibility forbenefits with they're injured on the job, will also be dissolved, with its powers transferred to the labour minister.

Tinkering with rules in Canada Labour Code

 The Canada Labour Code sets out workers' rights in federally-regulated sectors such as banks, telecommunications and interprovincial transportation. Amendments will be made to several sections of the code by Bill C-45, including:

-new formulas for calculating holiday and vacation pay entitlements

-the introduction of time limits to complaints procedures under the act

-inspectors being given greater control over the inspection and complaints process

It doesn't immediately appear that many of these changes will have a dramatic effect on workers. The holiday and vacation pay formulas, for instance, are minor adjustments from the current calculation method.

Some of the new rules regarding complaints are beneficial to workers, while others are less favourable. Employers who lay off workers will now have to pay them their wages owed within 30 days of termination (currently there is no time limit on this). Some workers, on the other hand, may find it harder to file complaints against employers, since they will have to do so within six month of the alleged violation, and may be ordered by inspectors to take certain prescribed steps before their complaints will be considered.

Changes to income tax and pension rules

Workers will now have to pay income taxes under certain circumstances on contributions their employers make towards health benefits and employee profit-sharing plans.

Employees participating in retirement compensation arrangements -- who are by definition higher-income earners whose employers make contributions in excess of the maximum amounts allowed under a registered pension plan -- will now be able to split the income made from these arrangements, attributing part to a spouse, in order to pay lower taxes.

As the Canadian Labour Congress has pointed out, "this is effectively a tax break for wealthy seniors that will have very little benefit for most Canadians."

Bill C-45 also sets federal rules for the creation of pooled registered pensions plans -- a new type of savings vehicle the Conservative government is promoting as the key to retirement security for workers not currently covered by pension plans. Critics dismiss the scheme as being little different from an RRSP, and don't believe many workers would end up participating in it.

"Hiring credit" for small employers

 Small businesses will receive a temporary, partial refund of up to $1,000 on premiums they've paid into Employment Insurance. The government is branding this a "hiring credit" that will encourage employers to create new jobs.

Critics point out that the money small businesses save from the refund will be far less than the additional amount they've had to pay into EI premiums the last two years thanks to rate increases made by the Conservatives, and that businesses will be eligible for the refund regardless of whether they create any new jobs.

Board responsible for setting EI rates suspended

Employment Insurance rates are currently set by the Canada Employment Insurance Financing Board. This board will be suspended and the Act governing it dissolved under Bill C-45. The formula for setting premiums, however, will remain largely unchanged by this move alone, so its is unlikely to have any major impact on EI premium and benefit rates.

The Canadian Labour Congress supports the suspension of the board, which they see as a first step towards establishing a better rate-setting regime controlled by the workers and employers who pay into the system.

 

Lori Theresa Waller is rabble.ca's labour reporter. 

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