Report in which the committee requests to be kept informed of development - Report No 299, June 1995

Case No 1802 (Canada) - Complaint date: 08-OCT-94 - Closed

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INTRODUCTION
A. The complainants' allegations
B. The Government's reply
C. The Committee's conclusions
The Committee's recommendations
Annex

248. In a communication dated 6 October 1994, the Canadian Labour Congress (CLC) submitted a complaint of violation of freedom of association against the Government of Canada (Nova Scotia), on behalf of the National Union of Provincial Government Employees (NUPGE) and the Nova Scotia Government Employees' Union (NSGEU). The Public Services International (PSI) and the International Confederation of Free Trade Unions (ICFTU) expressed their support to the complaint in communications dated respectively 21 October and 14 November 1994.
249. In a communication dated 10 November 1994, the Canadian Association of University Teachers (CAUT) also lodged a complaint on its own behalf and on behalf of the Nova Scotia Confederation of University Faculty Associations (NSCUFA). The CAUT forwarded further information in a communication of 16 December 1994.
250. The federal Government, in a communication of 15 March 1995, transmitted the observations and information from the government of Nova Scotia.
251. Canada has ratified the Freedom of Association and Protection of the Right to Organize Convention, 1948 (No. 87). It has not ratified the Right to Organize and Collective Bargaining Convention, 1949 (No. 98), the Labour Relations (Public Service) Convention, 1978 (No. 151), or the Collective Bargaining Convention, 1981 (No. 154).

A. The complainants' allegations

252. The complaints criticize two pieces of public sector labour relations legislation in Nova Scotia, known as Bill 41 - An Act respecting mandatory unpaid leave in the public sector (hereinafter called Bill 41) and Bill 52 - An Act respecting compensation in the public sector (hereinafter called Bill 52). Bill 41 came into force on 25 November 1993 and Bill 52 was tabled in the legislature of the Province of Nova Scotia on 30 June 1994. For ease of reference, the main provisions of Bills 41 and 52 are reproduced in the annex of this case.
253. The complainants explain that Bill 41 called upon the public sector employees to take unpaid leave equivalent to 2 per cent of their total annual days of work as Bill 52 reduced compensation to all public sector employees by 3 per cent effective 1 November 1994 and froze all wages until 31 October 1997. Persons earning an annual wage of $25,000 or less were exempted from the wage reduction and no person's wage could be reduced to less than $25,000 as a result of Bill 52. According to the complainants, approximately 60,000 public sector workers were included under the provisions of Bill 52.
254. The complainants allege that Bill 52 and Bill 41 represent blatant violations of the fundamental principles established in ILO Conventions Nos. 87, 98, 151 and 154.
255. The complainants state that Bill 52 unilaterally removed many collective bargaining rights from the vast majority of Nova Scotia public sector employees. In particular, the CAUT states that sections 6 to 13 of Bill 52 froze all collective agreements either in force or concluded but still subject to ratification as of 29 April 1994 and extended their term until 1 November 1997; prohibited any first collective agreement from containing a compensation increase, and fixed the expiry date of any such agreement at 1 November 1997; made all amendments to collective agreements, during the freeze period, subject to regulatory approval; prohibited most forms of compensation increase until 1 November 1997 and, where such increases were provided for by a collective agreement, made them of no force or effect; revoked all forms of compensation increase taking effect during the period 20 April 1994 to 30 April 1995; unilaterally reduced the compensation of all public sector employees by 3 per cent; and, finally, removed the right to strike, arbitration or mediation with respect to all modifications to a collective agreement until 1 November 1997. On this last issue, the CAUT explains that, under Nova Scotia legislation, extending the term of collective agreements of public sector employees has the direct effect of suspending their right to collectively bargain, strike, or arbitrate over changes on non-monetary as well as monetary matters.
256. Also, the complainants state that the use of legislative power prevents them from taking steps to represent the interests of their members through collective bargaining over the next four years. In the time-frame in which the Government is planning dramatic changes in the employment scheme of the public sector in general, no affected union will be allowed to bargain. With regard to the university sector, the CAUT explains that the Government has imposed these restrictions upon collective bargaining at the same time as it prepares to make major changes to the system of university education in Nova Scotia which will seriously impact upon the terms and conditions of employment of Nova Scotia university academic staff. The changes in question were outlined as proposals in two recent reports: (1) Teacher education in Nova Scotia: An honourable past, an alternative future, a report to the Nova Scotia Council on Higher Education, dated February 1994; and (2) Critical choices: The Nova Scotia university system at a crossroads: Ring paper on higher education, a report by the Nova Scotia Council on Higher Education, dated October 1994. These reports are the first step in a process leading to decisions in the autumn of 1995 on major structural and financial questions with respect to the Nova Scotia higher education system but also require immediate action, without awaiting the outcome of public discussion, to complete a strategy for moving faculty and staff among campuses and collective agreements under specific circumstances of programme closure and rationalization. The CLC states that similar examples could be drawn from the prison and the health-care sectors.
257. The complainants also allege that Bill 41 and Bill 52 clearly show the Government's total disregard and lack of commitment to the consultative process. On 26 April 1994, union and government negotiating teams met to exchange bargaining proposals and set dates for future negotiating sessions. Three days later, the Minister of Finance announced in his budget speech that collective bargaining was to be suspended for three years. According to the complainants, the Government knew well in advance that all negotiations would be futile. As a matter of fact, following the budget address on 29 April 1994, the President of the NSGEU and the President of the Nova Scotia Teachers' Union stated to the Government their willingness to bargain. They wanted to negotiate, without preconditions, about how to achieve restraint targets and still honour the collective bargaining process. However, the Government introduced and passed Bill 52 on 30 June 1994 thereby breaking its word, breaking its legal contracts, and using its legislative muscle as the law-maker to make a mockery of its contractual obligations.
258. The CLC notes that this complaint is its second complaint submitted to the Committee over the last three years. In October 1991, it submitted a complaint against Nova Scotia's Bill 160 - An Act respecting compensation restraint in the public sector, 1991 (hereinafter called Bill 160). Bill 160 imposed a two-year wage freeze on about 44,000 public sector workers in the province and extended the expiry dates of the existing collective agreements for two years (see 286th Report, Case No. 1624, paras. 194 to 229).
259. In conclusion, the complainants allege that Bill 41 and Bill 52 constitute a massive intervention into the process of collective bargaining in the Nova Scotia public sector. They alter and revoke agreed upon collective agreement terms. They unilaterally impose others. They effectively remove the right to strike, to arbitrate, and to pursue any other meaningful means of settling disputes over changes to terms and conditions of employment. They have not been accompanied by adequate safeguards to protect workers' living standards. For instance, while the salaries of public sector employees were reduced by 3 per cent, it appears that Canadian consumer prices, since May 1991, have increased by more than 3 per cent. They immediately follow similar legislative interference in public sector collective bargaining (Bill 160). The Government's action has directly thwarted the freedom of association of Nova Scotia public sector unions and employees and is in total contravention with the principles of freedom of association and the jurisprudence developed by the Committee.

B. The Government's reply

260. The Government, in its communication of 13 March 1995, states that Bill 41 and Bill 52 do not violate ILO Conventions Nos. 87, 98, 151 or 154. Contrary to the allegations of the CLC, they are not unlawful; they are the result of the legitimate exercise of the Government's legislative authority. Furthermore, the three wage control measures implemented between 1991 and 1994 are viewed by the Government as exceptional measures. As stated by the Minister of Finance in the Nova Scotia House of Assembly during the second reading debate on Bill 52: "This legislation reflects neither the ideals nor the values of this Government. What it does reflect is the harsh reality of our province's financial situation. It is the reality that must, for the sake of our children and our future, be confronted now."
261. In other words, the Government considers that Bill 52 and Bill 41 comply with the jurisprudence developed by the Committee. These pieces of legislation are exceptional stabilization measures imposed for compelling reasons of national economic interest, only to the extent necessary and for a reasonable time, accompanied by adequate safeguards to protect workers' living standards.
262. The Government goes on explaining in detail the provincial dramatic economic situation over the last four years. In 1991, the Province of Nova Scotia was in a recession which hit before the provincial/federal economies had recovered from the recession of the early 1980s, compounding a downward economic spiral. Sources of revenue had either disappeared, been absorbed by a burgeoning debt load and social programmes, or reduced (as in the case of federal transfer payments to the province), to such an extent that without freeing revenue the province would be unable to maintain delivery of essential services - health, education and social services. The economic situation was reflected in the private sector as well, where private sector bankruptcies rose 129 per cent between 1989 and 1991. In the short term, the Government decided to enact Bill 160 on 13 June 1991.
263. In the long term, the Government indicates that it wished to review its programmes and services considering ways to increase the province's tax base, and reduce borrowing requirements. An essential part of its recovery plan was the Expenditure Control Act, S.N.S. 1993, c.4, whose purpose was to reduce the operating and capital expenditures of the province over the four-year period commencing fiscal year 1994-95. It mandates a 10 per cent reduction in net programme operating expenditures and a 20 per cent reduction in net capital expenditures.
264. The Government explains that Bill 41 resulted from its recovery plan. Effective 1 November 1993 to 31 October 1994, Bill 41 reduced the annual pay of public sector and para-public employees by an amount equivalent to 2 per cent of their annual hours of work, effectively a 2 per cent reduction in their annual pay - but did not apply to employees whose annual salary was $22,000 or less. In exchange, employees received five days' unpaid leave. Salary rates and benefits remained unaffected. In addition, Bill 41 also reduced by 2 per cent the remuneration of elected and appointed public officials and judges of courts and boards (none of whom are subject to collective bargaining) - but with no unpaid leave in exchange and the payments made by the Government for insured services of physicians, pharmacists, dentists, and optometrists.
265. The Government of Nova Scotia notes that as its employees had come out of the two-year wage delay imposed by Bill 160, normal bargaining relations resumed in the province and continued unaffected by Bill 41 except for the mandatory 2 per cent reduction in annual pay. Unfortunately, the Government indicates that the economic crisis continued. As stated by the Minister of Finance, during the second reading debate on Bill 52, Nova Scotia had, at that time, an $8.2 billion net direct debt, for which Nova Scotian taxpayers would pay out $901 million in interest in 1994 (compared to debt charges of $75 million 20 years ago, on a $319 million debt at that time). In a generation, Nova Scotia's debt charges had increased 1,090 per cent; the debt itself had grown 2,457 per cent. That constitutes an average annual growth of debt charges, during that period, of 13.2 per cent, and an average annual growth in debt itself of 17.6 per cent. In 1994, Nova Scotians spent more to service the provincial debt than to educate their children. Within five years, the Minister stated, debt charges would overtake health care as the largest single expenditure of the province if the debt load is not decreased. Faced with these facts, the Government of Nova Scotia had to cut costs drastically. Considering that the control of public sector salaries was the best option to attain its goals, it felt compelled to enact Bill 52.
266. The Government then explains the content and extent of the provisions of Bill 52. It applies to all public sector and para-public employers and employees - including employees of the Government of Nova Scotia and agencies of government, as well as employees of municipalities, municipal agencies, school boards, community colleges, universities, hospitals, homes for special care and housing authorities. It also applies to elected and appointed officials, including politicians and judges, and to physicians, dentists, pharmacists, and optometrists. All compensation plans (defined as collective agreements, contracts of employment, or terms of employment) in effect immediately before 29 April 1994 are continued without change until 1 November 1997, except where changes are permitted. No increases are permitted in the pay rates of employees covered between 29 April 1994 and 31 October 1997 inclusive. Effective 1 November 1994, the pay rates of employees covered are reduced by 3 per cent. Any pay-related calculations, for example the calculation of pension, life insurance, disability plan contributions and benefits, will be based upon the reduced pay rates effective 1 November 1994. This reduction in pay rates does not apply to an employee whose annual pay is $25,000 or less, and no employee's annual pay shall be reduced to less than $25,000 as a result of the wage reduction. In addition, by virtue of the definition of "annual pay", the salary protection for employees with an annual pay of $25,000 or less extends to part-time, job sharing, and seasonal employees whose annual pay for regular hours of work is $25,000 or less, even if the annualized salary rate for their position classification exceeds $25,000.
267. The Government indicates that a board and an administrator shall be appointed by the Governor-in-Council in accordance with the regulations. Questions concerning interpretation or application of Bill 52 may be decided by the Administrator or referred by the Administrator to the Board. A Board decision is final; however, the Board may reconsider, change or revoke a decision if it considers it advisable to do so. The Government states that in these ways it cannot be said that Bill 52 makes no provision for an independent arbitrator.
268. The Government, as conclusive remarks, restates that it has always recognized the importance of collective bargaining both in private and public sectors. Many laws encourage and protect collective bargaining between employers and the unions in the province. Bill 52 is enacted for a reasonable period of time in order to bring the provincial economy back from the brink of devastation. Bill 52 imposes restrictions on the setting of wage rates only to the extent necessary. The Government adds that many activities guaranteed by the freedom of association Conventions are unhampered by Bill 41 and Bill 52. They do not prevent employees or employers from establishing and joining organizations of their own choosing without previous authorization, or from having a first collective agreement. Nor do they prevent organizations from drawing up their constitutions and rules and electing representatives. They do not dissolve employee organizations or take away the right of such organizations to form federations and confederations and affiliate with international organizations of workers and employers.
269. According to the Government, Bill 52 still provides for limited collective bargaining, i.e. in respect of all non-salary terms and conditions of employment, including all benefits (sick leave, vacation time, flexible working hours, pension plans, health and dental benefits, life insurance). The Government states that it had made a conscious choice to protect workers' living standards, especially the most vulnerable workers. For example, Bill 41 exempted from its application persons whose annual pay was $22,000 or less and provided that no annual pay shall be less than $22,000. Likewise, Bill 51 does not apply to employees whose annual salary is $25,000 or less and provides that no employee's annual pay shall be reduced to less than $25,000.
270. Finally, the Government denies the allegations of the complainants' organizations to the effect that the events preceding the enactment of Bill 51 and Bill 42 show a total disregard and lack of governmental commitment to the consultative process. It recalls that a round of province-wide public hearings were completed in the early months of 1992 as a serious 1992 pre-budget consultation on how to deal with the economy. Then, in 1993, when the new government was elected in the province, another round of public consultations was initiated by the Government. The Government indicates that three representatives of workers' organizations participated at this last round table: the regional representative for the CLC, the president of the Nova Scotia Federation of Labour, and the business agent of the Plumbers and Pipefitters Union. Also, both the NSGEU and NSCUFA made submissions. This public consultation was followed by various community meetings. Therefore, the Government submits that Bill 42 and Bill 51 are reasonable stabilization measures taken in a national economic crisis context, which meet the requirements of ILO Conventions and principles.

C. The Committee's conclusions

271. The Committee notes that the present case involves certain restrictions on collective bargaining for public sector workers in the Province of Nova Scotia (Canada) following the introduction in 1993 of Bill 41 - An Act respecting mandatory unpaid leave in the public sector (hereinafter called Bill 41) and the enactment in 1994 of Bill 52 - An Act respecting compensation in the public sector (hereinafter called Bill 52). Bill 41 obliged public servants to take unpaid leave equivalent to 2 per cent of their annual hours of work as Bill 52 imposed on them a wage freeze effective for three years, starting 29 April 1994. Except for employees earning $25,000 or less, Bill 52 also reduced their pay rates by 3 per cent.
272. The Government basically maintains that these measures were necessary in view of the dire economic situation of the province and that they comply with the principles established by the Committee. Before examining the substance of the complaints, the Committee wishes briefly to describe the circumstances in which they were received. Since October 1991, 20 complaints were filed before the Committee against federal and provincial governments in Canada, including 12 lodged by the CLC (Canada, federal, Cases Nos. 1616, 1758, 1800; British Columbia, Case No. 1603; Manitoba, Cases Nos. 1604 and 1715; New Brunswick, Case No. 1605; Nova Scotia, Cases Nos. 1606, 1624 and 1802; Newfoundland, Case No. 1607; Ontario, Case No. 1722; Quebec, Cases Nos. 1733, 1747, 1748, 1749 and 1750; Prince Edward Island, Cases Nos. 1779 and 1801; Yukon, Case No. 1806). All these complaints relate to the postponement, reduction or freezing of public employees' wages and benefits and to restrictions on the right of employees to bargain collectively within these various jurisdictions. The measures are sometimes accompanied by a ban on strikes.
273. The Committee considers that the large number of complaints that have been lodged during the course of the last few years reflect serious and profound difficulties in reaching agreement on the determination of employment conditions in the public service in Canada both at the federal level and in the various provinces. In these circumstances, and in order to find solutions to the problems that have arisen, the Committee suggests that the Government make use of the assistance of the International Labour Office, in particular through an advisory mission.
274. In the present case, the Committee has examined in detail the observations and arguments put forward by the parties. In particular, it has closely examined the explanation and documentation supplied by the Government on the province's fiscal and economic difficulties. Because the 1991 economic stabilization measures were not enough to "turn around the downward economic spiral", the Government considered that the putting into force of Bill 41 and Bill 52 was the best option to improve significantly the situation. The complainant organizations on the other hand alleged that Bill 41 and Bill 52 are repressive pieces of legislation that violate the basic principles of freedom of association. They add that the Government's history since 1991 is of no consultation, despite the ILO's recommendation to this effect (284th and 286th Reports, Cases Nos. 1606 and 1624, paras. 506-548 and 194-229).
275. As has already been mentioned in previous cases (241st Report, Cases Nos. 1172, 1234, 1247 and 1260, para. 113; 284th Report, Case No. 1616, para. 633; and 297th Report, Cases Nos. 1758, 1779 and 1801, paras. 224 and 263), it is not for the Committee to express a view on the soundness of the economic arguments used by the Government to justify its position or on the measures it has adopted (see also the general remarks given in the report of the study mission; 241st Report, Cases Nos. 1172, 1234, 1247 and 1260, paras. 9-13 of the annex). It is however for the Committee to express its view on the question whether, in taking such action, the Government went beyond what the Committee has considered to be acceptable limits that might be placed temporarily on free collective bargaining (241st Report, Case No. 1172, para. 114, and 297th Report, Cases Nos. 1758, 1759 and 1801, paras. 224 and 263).
276. As regards the economic stabilization measures which limit collective bargaining rights, the Committee has acknowledged that when a government, for compelling reasons of national economic interest, and as part of its stabilization policy, considers that pay rates cannot be settled freely through collective bargaining, such a restriction should be imposed as an exceptional measure and only to the extent that is necessary, without exceeding a reasonable period, and it should be accompanied by adequate safeguards to protect workers' living standards, in particular those who are likely to be the most affected (Digest, para. 641; 222nd Report, Case No. 1147, para. 117; 230th Report, Cases Nos. 1171 and 1173, paras. 162 and 573; 284th Report, Cases Nos. 1603, 1604, 1605, 1606, 1607 and 1616, paras. 78, 321, 500, 542, 587 and 635; 286th Report, Case No. 1624, para. 223; 292nd Report, Cases Nos. 1715 and 1722, paras. 187 and 547; and 297th Report, Cases Nos. 1758, 1779 and 1801, paras. 225 and 264). The Committee of Experts has taken the same view (General Survey on Freedom of Association and Collective Bargaining, 1994, para. 260).
277. As stated above, the Nova Scotia provincial government has intervened on various occasions over the last years (1991, 1993 and 1994) in order to unilaterally determine public sector wages. Economic stabilization measures were alleged to justify these legislative actions. In this context, the Committee considers it useful to refer to the developments included by the Committee of Experts in its most recent General Survey as concerns collective bargaining for workers in the public and parapublic sectors:
- While the principle of autonomy of the parties to collective bargaining is valid as regards public servants covered by the Convention, the special characteristics of the public service described above require some flexibility in its application. Thus, in the view of the Committee, legislative provisions which allow Parliament or the competent budgetary authority to set upper and lower limits for wage negotiations or to establish an overall "budgetary package" within which the parties may negotiate monetary or standard-setting clauses (for example: reduction of working hours or other arrangements, varying wage increases according to levels of remuneration, fixing a timetable for readjustment provisions) or those which give the financial authorities the right to participate in collective bargaining alongside the direct employer are compatible with the Convention, provided they leave a significant role to collective bargaining. It is essential, however, that workers and their organizations be able to participate fully and meaningfully in designing this overall bargaining framework, which implies in particular that they must have access to all the financial, budgetary and other data enabling them to assess the situation on the basis of the facts.
- This is not the case of legislative provisions which, on the grounds of the economic situation of a country, impose unilaterally for example, a specific percentage increase and rule out any possibility of bargaining, in particular by prohibiting the exercise of means of pressure subject to the application of severe sanctions. The Committee is aware that collective bargaining in the public sector "... calls for verification of the available resources in the various public bodies or undertakings, that such resources are dependent upon state budgets and that the period of duration of collective agreements in the public sector does not always coincide with the duration of budgetary laws - a situation which can give rise to difficulties." The Committee therefore takes full account of the serious financial and budgetary difficulties facing governments, particularly during periods of prolonged and widespread economic stagnation. However, it considers that the authorities should give preference as far as possible to collective bargaining in determining the conditions of employment of public servants; where the circumstances rule this out, measures of this kind should be limited in time and protect the standard of living of workers who are the most affected. In other words, a fair and reasonable compromise should be sought between the need to preserve as far as possible the autonomy of the parties to bargaining, on the one hand, and measures which must be taken by governments to overcome their budgetary difficulties, on the other (General Survey, op. cit., paras. 263-264).
278. The Committee draws the Government's attention to the above-mentioned observations. As regards the particulars of this case, the Committee notes that the 3 per cent pay rate reduction and the three-year salary freeze imposed by Bill 52 in 1994 have to be seen in conjunction with another wage restraint measure enacted by Bill 41 in 1993. Furthermore, the Committee recalls that it had already examined two cases of a similar nature following the entry into force, in 1991, of Bill 160 - An Act respecting compensation restraint in the public sector. The latter imposed a two-year wage freeze on about 44,000 public sector workers in the province (284th and 286th Reports, Cases Nos. 1606 and 1624, paras. 506-548 and 194-229). Therefore, in the light of these various legislative interventions over the last four years, the Committee considers that Bill 52 and Bill 41 cannot be defined as exceptional measures and clearly go beyond what the Committee has found to be permissible restrictions on collective bargaining, especially as regards the duration of the period covered.
279. Furthermore, the Committee expresses its concern as it appears that Bill 52 and Bill 41 will have a negative impact on the living standards of the workers concerned and that, except for wages of $25,000 or less, they contain no adequate safeguards in this respect. The Committee also notes that Bill 52 and Bill 41 cancel the terms of already negotiated collective agreements by modifying various provisions dealing with monetary issues. In this regard, it recalls that "interruption of already negotiated contracts is not in conformity with the principles of free collective bargaining because such contracts should be respected" (241st Report, Case No. 1172, para. 97).
280. The Committee deplores that the Government did not give priority to collective bargaining as a means of determining wages of workers in the public sector but that it felt compelled to adopt Bill 52 and Bill 41. The Committee insists that the Government refrain from taking such measures in the future.
281. As regards the consultation process, the Committee also notes that general public consultation meetings were held by the Government but is concerned that there appears to have been a very limited number of specific meetings between government representatives and public employees' organizations. The Committee stresses, once again, that where a government seeks to alter bargaining structures in which it acts actually or indirectly as employer, it is particularly important to follow an adequate consultation process, whereby all objectives perceived as being in the overall national interest can be discussed by all parties concerned. Such consultations imply that they be undertaken in good faith and that both partners have all the information necessary to make an informed decision (see Case No. 1606, 284th Report, paras. 506-548).
282. The Committee further notes that the Board established under Bill 52 is primarily a regulatory/administrative board which may, by virtue of section 22, authorize applications for a change in terms of employment subject to the restrictions imposed by Bill 52. The Committee recalls the importance of an independent dispute resolution body not bound by pre-established legislative criteria, in order to gain and retain the confidence of the parties.
283. The Committee insists that the Government allow a full return to normal collective bargaining in the public sector and to keep it informed in this regard. In this context, it urges the Government to take the necessary measures, through consultation with the trade union organizations involved, to strengthen dialogue and exchanges with a view to finding suitable mechanism for settling disputes which could help to prevent the unilateral and statutory imposition of conditions of employment and re-establish a negotiating system which enjoys the utmost confidence of the parties.

The Committee's recommendations

284. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
- (a) Considering that Bill 52 and Bill 41 clearly go beyond what it has considered to be permissible restrictions on collective bargaining, the Committee deplores that the Government did not give priority to collective bargaining as a means of determining wages of workers in the public sector but that it felt compelled to adopt these legislative measures. The Committee insists that the Government will refrain from taking such measures in the future.
- (b) It urges the Government to take the necessary measures, through consultation with the trade union organizations involved, to strengthen dialogue and exchanges with a view to finding suitable mechanism for settling disputes which could help to prevent the unilateral and statutory imposition of conditions of employment and re-establish a negotiating system which enjoys the utmost confidence of the parties.
- (c) In order to facilitate finding solutions to the difficulties in reaching agreements in the public service, the Committee suggests that the Government make use of the assistance of the International Labour Office, in particular through an advisory mission.

Annex

Bill No. 41
An act respecting mandatory unpaid leave in the public sector
Be it enacted by the Governor and Assembly as follows:
1. This Act may be cited as the Public Sector Unpaid Leave Act.
2. In this Act,
...
(f) "compensation plan" means terms of employment in the case of an employee
who does not have a collective agreement;
...
3. (1) This Act applies notwithstanding any collective agreement, compensation
plan, arbitral or other award or decision, or other agreement or arrangement
of any kind.
...
4. This Act is binding on Her Majesty in right of the Province.
5. The Minister has the general supervision and management of this Act.
Part I Public employees
6. (1) This Part applies to:
(a) persons appointed pursuant to the Civil Service Act, other than deputy
ministers;
(b) officers and employees appointed pursuant to the Corrections Act;
(c) persons appointed by the Governor-in-Council to the public service, other
than deputy ministers;
(d) persons employed by a member of the Executive Council, other than
executive or other assistants to the member;
(e) officers and employees of an "agency of government" as defined in the
Auditor General Act other than Sydney Steel Corporation;
(f) officers and staff of the House of Assembly and persons appointed pursuant
to the House of Assembly Act;
(g) employees of a municipality;
(h) employees of an authority, board, commission, agency, corporation or other
organization of a municipality, including a joint or regional body of two or
more municipalities;
(i) employees of a school board;
(j) employees of the Nova Scotia Community College;
(k) employees of a university to which the Universities Assistance Act
applies;
(l) employees of a hospital within the meaning of the Hospitals Act;
(m) employees of a facility that is required to be licensed pursuant to the
Homes for Special Care Act;
(n) employees of a housing authority within the meaning of the Housing Act;
and
(o) employees of a person agency, authority, board, commission, corporation or
organization of a type similar to those listed in clauses (a) to (n) where the
Governor-in-Council declares that this Act applies to those employees.
(2) This part does not apply to a person whose annual pay, as a person
described in subsection (1), is twenty-two thousand dollars or less.
(3) This Part does not apply to a person who is not employed, as described in
subsection (1), before the first day of April 1994.
7. (1) Every employee shall take unpaid leave equivalent to two per cent of
the employee's annual hours of work rounded to the nearest half shift or
annual days of work rounded to the nearest half day, as the case may be.
(2) In the case of an employee of a university to which the Universities
Assistance Act applies, other than the Nova Scotia Agricultural College or the
Nova Scotia Teachers College:
(a) the period of unpaid leave required by subsection (1) shall be adjusted
such that the compensation that would have been paid, but for this Act, in
respect of the period of unpaid leave for all employees, to whom subsection
(1) applies, of the university equals the amount of the reduction determined
pursuant to the Schedule to this Act; and
(b) no employee shall be required to take more unpaid leave than that required
by subsection (1) without regard to this subsection.
(3) In the case of an employee whose reduction in compensation pursuant to
subsection (1) of section 11 is reduced by subsection (2) of that section, the
period of unpaid leave required by subsection (1) of this section shall be
adjusted by the same proportion as the reduction in compensation pursuant to
subsection (1) of section 11 is reduced by subsection (2) of that section.
(4) Notwithstanding subsection (1), where a person is employed, as described
in subsection (1) of section 6, for only part of the period from the first day
of November 1993, to the thirty-first day of March 1994, inclusive, the annual
hours of work or annual days of work are, for the purpose of subsection (1),
that proportion of the annual hours of work or annual days of work,
respectively, that the part of the period worked is to be the whole period.
...
13. (1) The grants, transfers, subsidies and other payments paid by Her
Majesty in right of the Province to a body that is:
(a) an "agency of government" as defined in the Auditor General Act;
(b) a municipality;
(c) an authority, board, commission, agency, corporation or other organization
thereof including a joint or regional body of two or more municipalities;
(d) a school board;
(e) a university to which the Universities Assistance Act applies;
(f) a hospital within the meaning of the Hospitals Act; or
(g) a facility that is required to be licensed pursuant to the Homes for
Special Care Act,
shall be reduced by two per cent of the body's annual regular payroll for the
current fiscal year for persons to whom this Act applies.
...
Part II
Elected and appointed officials and members of courts
14. This Part applies to:
(a) members of the Executive Council and the executive and other assistants to
the members;
(b) members of the House of Assembly;
(c) the mayor or warden and aldermen or councillors of a city, incorporated
town or municipality of a county or district;
(d) village commissioners;
(e) members of a service commission;
(f) members of a school board;
(g) deputy ministers;
(h) judges of the Provincial Court and judges of the Family Court;
(i) adjudicators of the Small Claims Court;
(j) members of regional assessment appeal courts; and
(k) members of an agency, board, commission, committee or body who are
appointed by the Governor-in-Council or by a member of the Executive Council.
15. (1) The remuneration of a person to whom this Part applies shall be
reduced by two per cent for the current fiscal year.
...
Part III
Medical services
18. This Part applies to payments for insured services provided by physicians,
dentists, pharmacists and optometrists.
19. (1) The total payments for the insured services provided by physicians, as
agreed to by Her Majesty in right of the Province and the Medical Society of
Nova Scotia, is reduced by two per cent for the current fiscal year.
(2) The reduction required by subsection (1) shall be recovered by a reduction
of two per cent of the total payments for the current fiscal year in the total
payments for the period from the first day of November, 1993, to the
thirty-first day of October, 1994, inclusive.
20. (1) Every tariff of fees or other system of payment for insured services
provided by a pharmacist, dentist or optometrist is reduced by two per cent
for the current fiscal year.
(2) The reduction required by subsection (1) shall be recovered by a two per
cent reduction in every tariff of fees or other system of payment for the
period from the first day of November, 1993, to the thirty-first day of
October, 1994, inclusive.
Part IV
General
...
22. (1) The Governor-in-Council may make regulations:
(a) determining whether the Act applies to a person, agency, authority, board,
commission, corporation or organization refereed to in clause (o) of
subsection (1) of section 6 and, in such case, determining the date by which
the days of unpaid leave required by this Act must be taken;
(b) respecting the filing of certified copies of payrolls with the Minister;
(c) respecting the certification of copies of payrolls filed with the
Minister;
(d) respecting the operation of this Act with respect to persons on fully or
partially paid leave, including sabbaticals, sick leave and maternity leave;
(e) exempting from Part I casual employees who are not paid in respect of days
of unpaid leave pursuant to this Act;
(f) further defining any word or expression defined in this Act;
(g) defining any word or expression used in this Act and not defined in this
Act;
(h) respecting any matter that the Governor-in-Council considers necessary or
advisable to carry out effectively the intent and purpose of this Act.
(2) A regulation may apply to all persons or bodies or to a class of persons
or bodies to whom this Act applies and there may be different regulations for
different classes of such persons or bodies.
(3) A regulation made pursuant to clause (f) or (g) of subsection (1) may
apply in respect of one or more provisions of this Act and there may be
different regulations in respect of different provisions.
(4) A regulation may, if it so provides, be made retroactive in its operation
to a date not earlier than the first day of November, 1993.
(5) The exercise by the Governor-in-Council of the authority contained in this
section shall be regulations within the meaning of the Regulations Act.
23. This Act has effect on, from and after the first day of November, 1993,
and shall accordingly be read, construed, interpreted and given effect on,
from and after that date.
Bill No. 52
An act respecting compensation in the public sector
Be it enacted by the Governor and Assembly as follows:
1. This Act may be cited as the Public Sector Compensation (1994-97) Act.
2. In this Act,
...
(b) "annual pay" means the total annual pay for regular hours of work as
determined by the applicable compensation plan and, for greater certainty,
excludes overtime;
...
(e) "compensation plan" means a collective agreement, contract of employment
or terms of employment;
...
3. (1) This Act applies notwithstanding any compensation plan, arbitral or
other award or decision, or other agreement or arrangement of any kind.
(2) The continuation, alteration or termination of a compensation plan
pursuant to this Act is not and shall not be deemed to be a breach of the plan
and, for greater certainty, does not entitle any person to terminate the plan,
to receive any payment or to any other remedy.
(3) The reduction in pay pursuant to this Act is not a reduction in
compensation for the purpose of any compensation plan and, for greater
certainty, shall not be deemed to be a termination of the plan and does not
entitle any person to terminate the plan, to receive any payment or to any
other remedy.
(4) Every enactment, whether enacted before or after the coming into force of
this Act, including, without limiting the generality of the foregoing, the
Public Sector Compensation Restraint Act, shall be read and construed as
subject in all respects to this Act and, in the case of conflict with this
Act, this Act prevails.
4. This Act is binding on Her Majesty in right of the Province.
Part I
Public employees
5. This Part applies to:
(a) persons appointed pursuant to the Civil Service Act;
(b) officers and employees appointed pursuant to the Corrections Act;
(c) persons appointed by the Governor-in-Council to the public service;
(d) persons employed by a member of the Executive Council or the member's
deputy;
(e) officers and employees of an "agency of government" as defined in the
Auditor General Act other than Sydney Steel Corporation;
(f) officers and staff of the House of Assembly and persons appointed pursuant
to the House of Assembly Act;
(g) employees of a municipality;
(h) employees of an authority, board, commission, agency, corporation or other
organization of a municipality, including a joint or regional body of two or
more municipalities;
(i) employees of a school board;
(j) employees of the Nova Scotia Community College;
(k) employees of a university to which the Universities Assistance Act
applies;
(l) employees of a hospital within the meaning of the Hospitals Act;
(m) employees of a facility that is required to be licensed pursuant to the
Homes for Special Care Act;
(n) employees of a housing authority within the meaning of the Housing Act;
and
(o) employees of a person, agency, authority, board, commission, corporation
or organization of a type similar to those listed in clauses (a) to (n) where
the Governor-in-Council declares that this Part applies to those employees.
6. (1) Every compensation plan in effect immediately before April 29, 1994, is
continued until November 1, 1997, except as provided by this Act.
(2) Where:
(a) a compensation plan has expired before April 29, 1994; and
(b) a new compensation plan is not established before April 29, 1994,
the expired plan is continued, effective from when it expired but for this
Act, until November 1, 1997, except as provided by this Act.
(3) Nothing in this section extends the period of employment for any person.
...
8. (1) No compensation plan, whether established before or after the coming
into force of this Act, shall be changed between April 29, 1994, and October
31, 1997, inclusive, except as provided by this Act.
(2) Notwithstanding any compensation plan, there shall not be any increase in
the pay rates in a compensation plan between April 29, 1994, and October 31,
1997, inclusive.
9. (1) Effective November 1, 1994, the pay rate for each position covered by a
compensation plan shall be reduced by three per cent except as provided by
this section.
(2) For greater certainty, the reduced pay rates shall be the basis for any
pay-related calculations.
(3) This section does not apply to an employee whose annual pay, as a person
described in section 5, is twenty-five thousand dollars or less.
(4) No employee's annual pay, as a person described in section 5, shall be
reduced by this section to less than twenty-five thousand dollars.
10. (1) An increase in pay rates may be paid to or received by an employee for
or in recognition of:
(a) the successful completion of a course of professional or technical
education;
(b) subject to subsection (2),
(i) meritorious or satisfactory work performance,
(ii) the completion of a specified work experience,
(iii) length of time in employment,
if such provisions have been expressly contained in the compensation plan.
(2) Any increase in pay as described in clause (1)(b) that would, but for this
subsection, have been awarded to an employee at any time between May 1, 1994,
and April 30, 1995, inclusive, is cancelled.
(3) An employee referred to in subsection (2) is not entitled to:
(a) any other increase as described in clause (1)(b) until one year after the
time referred to in subsection (2); or
(b) any greater increase or adjustment at another time as a result of
subsection (2).
(4) Nothing in subsection (1) prevents increases in pay or pay rates as a
result of the bona fide promotion of an employee to a different or more
responsible position.
(5) Subsections (2) and (3) do not apply to an employee whose annual pay, as a
person described in section 5, is twenty-five thousand dollars or less if the
increase in pay as described in clause (1)(b) would not increase the
employee's annual pay to more than twenty-five thousand dollars.
11. Nothing in this Act prevents increases in pay rates pursuant to the Pay
Equity Act but the amount of any such increase effective between November 1,
1994, and October 31, 1997, inclusive, shall be reduced in accordance with
section 9.
12. A compensation plan to which this Part applies, entered into, established
or amended at any time, is of no force or effect to the extent that it
provides for pay rates in excess of pay rates permitted by this Act.
13. Every employer to which this Part applies shall provide to the Board such
information as the Board may request for the purpose of this Act.
Part II
Elected and appointed public officials and members of courts
14. This Part applies to:
(a) members of the Executive Council;
(b) members of the House of Assembly;
(c) the mayor or warden and aldermen or councillors of a city, incorporated
town or municipality of a county or district;
(d) village commissioners;
(e) members of a service commission;
(f) members of a school board;
(g) judges of the Provincial Court and judges of the Family Court;
(h) adjudicators of the Small Claims Court;
(i) members of regional assessment appeal courts; and
(j) members of an agency, board, commission, committee or body who are
appointed by the Governor-in-Council or by a member of the Executive Council.
15. The remuneration of a person to whom this Part applies shall not exceed:
(a) between April 29, 1994, and October 31, 1994, inclusive, the rate in
effect immediately before April 29, 1994; and
(b) between November 1, 1994, and October 31, 1997, inclusive, ninety-seven
per cent of the rate in effect immediately before April 29, 1994.
...
Part III
Medical Services
17. This Part applies to payments for insured services provided by physicians,
dentists, pharmacists and optometrists.
18. (1) In this section, "total payments" means the total payments for the
insured services provided by physicians.
(2) The total payments are two hundred fifty million nine hundred and
seventy-three thousand dollars for the 1994-95 fiscal year.
(3) The total payments shall not exceed two hundred forty-six million five
hundred and twenty-five thousand five hundred dollars for subsequent fiscal
years.
(4) This section applies until November 1, 1997.
19. Every tariff of fees or other system of payment for insured services
provided by a pharmacist, dentist or optometrist in effect immediately before
April 29, 1994:
(a) continues unchanged until November 1, 1994;
(b) is reduced by three per cent effective November 1, 1994; and
(c) shall not thereafter be increased before November 1, 1997.
Part IV
General
20. An administrator and such other persons as are necessary for the
administration of this Act shall be appointed in accordance with the
regulations.
21. A Board for the purpose of this Act shall be appointed in accordance with
the regulations.
22. (1) Where a question arises pursuant to this Act as to:
(a) whether a compensation plan is a compensation plan to which this Act
applies;
(b) whether a compensation plan complies with this Act;
(c) whether a compensation plan has been established, amended or administered
contrary to this Act;
(d) when a compensation plan came into effect;
(e) what information or documentation is required by the Board;
(f) who is an employer or employee for the purpose of this Act;
(g) who is the employer for a particular compensation plan;
(h) whether the increase in pay rates is in recognition of,
(i) the successful completion of a programme or course of professional or
technical education,
(ii) meritorious or satisfactory work performance,
(iii) the completion of a specified period of work experience,
(iv) length of time in employment,
(v) the bona fide promotion of an employee to a different or more responsible
position;
(i) the application of a provision of this Act to any person,
the Administrator may decide the question or refer the question to the Board.
(2) An employer, a bargaining agent or, where there is no bargaining agent, an
employee who is affected by and is not satisfied with the decision of the
Administrator may request that the Administrator refer the question to the
Board and the Administrator shall do so.
(3) The Board shall decide any question referred to it and the decision or
order of the Board is final and conclusive and not open to question or review
but the Board may, if it considers it advisable to do so, reconsider any
decision or order made by it pursuant to this Act and may vary or revoke any
decision or order made by it pursuant to this Act.
23. (1) The Board may authorize changes to a compensation plan upon
application by:
(a) the employer and the bargaining agent where the compensation plan is a
collective agreement; or
(b) the employer where the compensation plan is not a collective agreement,
if:
(c) the total effect of the changes does not increase the total cost of all
compensation in respect of the employees to whom the compensation plan
applies;
(d) the pay rates are not more than that permitted by this Act; and
(e) the changes would not be contrary to the intent and purpose of this Act.
(2) Nothing in this section authorizes or enables an employer, employee or
bargaining agent to resolve, or attempt to resolve, any dispute respecting
changes to a compensation plan by strike, lock-out, mediation or arbitration.
24. (1) Where the Board determines that:
(a) this Act is not being complied with;
(b) a compensation plan does not comply with this Act;
(c) an employer or other person is implementing, has implemented or is likely
to implement an increase in pay rates or rates of remuneration that do not
comply with this Act; or
(d) an employer or other person is not implementing, has not implemented or is
not likely to implement a reduction in pay rates or rates of remuneration as
required by this Act,
the Board may make an order:
(e) requiring compliance with this Act;
(f) prohibiting in the manner it specifies the employer or other person from
implementing the increase in pay rates or rates of remuneration that do not
comply with this Act;
(g) requiring a recipient of pay or remuneration to pay back to the employer
or other person any increase in pay or remuneration that does not comply with
this Act.
(2) To the extent that the compensation plan is inconsistent with an order of
the Board, the order prevails and is deemed to be part of the compensation
plan.
(3) An order of the Board is a public document and shall be made available for
inspection at the office of the Board during regular business hours.
25. Every person who fails to comply with this Act, the regulations or an
order of the Board is guilty of an offence and liable on summary conviction to
the penalty provided for in the Summary Proceedings Act.
26. (1) The Governor-in-Council may make regulations:
(a) designating any compensation plan or class thereof to which this Act
applies and, where necessary, prescribing the manner in which this Act is to
be applied;
(b) determining whether Part I applies to a person, agency, authority, board,
commission, corporation or organization;
(c) respecting the appointment of an Administrator and other persons necessary
for the administration of this Act;
(d) respecting the establishment of the Board for the purpose of this Act;
(e) providing for the management and administration of the Board;
(f) conferring powers, privileges and immunities on the Board;
(g) respecting procedures of the Board for giving notices, making demands,
issuing instructions and directions;
(h) providing for the filing of orders of the Board at the prothonotary's
office to make the same a judgement of the Supreme Court;
(i) prescribing the person or the class of persons whose method of
compensation is deemed to be a compensation plan for the purpose of this Act;
(j) further defining any word or expression defined in this Act;
(k) defining any word or expression used in this Act and not defined therein;
(l) respecting any matter that the Governor-in-Council considers necessary or
advisable to carry out effectively the intent and purpose of this Act.
(2) A regulation may apply to all persons or bodies or to a class of persons
or bodies to whom this Act applies and there may be different regulations for
different classes of such persons or bodies.
(3) A regulation made pursuant to clause (1)(j) or (k) may apply in respect of
one or more provisions of this Act and there may be different regulations in
respect of different provisions.
(4) A regulation made pursuant to this Part may, if it so provides, be made
retroactive in its operation to a date not earlier than April 29, 1994.
(5) The exercise by the Governor-in-Council of the authority contained in
subsection (1) is regulations within the meaning of the Regulations Act.
27. (1) Clause 2(m) of Chapter 10 of the Acts of 1993, the Public Sector
Unpaid Leave Act, is amended by striking out "earlier" in the second line and
substituting "later".
(2) This section has effect on and after November 1, 1993.
28. This Act, except section 27, has effect on and after April 29, 1994.