Wednesday, May 14, 2014

Hudak's "Million Jobs Plan": Details, Please

Ontario's into an election campaign now.  The general consensus, except among the most hardened partisans, seems to be that our choices are between bad, worse, and worst, with varying views on which is which.

The Progressive Conservative Platform hinges on what they call a "Million Jobs Plan", the details of which were released this morning.

Which seems strange, given that Statistics Canada's most recent numbers put Ontario's unemployment numbers at barely more than half that - at about 555,000.  (Even if you factor in the 100,000 public sector jobs he plans to eliminate, it still doesn't seem to add up.)  The PC platform itself pegs the number of unemployed at 800,000, but it's not clear where they're getting that figure.  (Perhaps it's a rounding-up of the number including those who have stopped looking for work.)

I'm not proposing to comment broadly on all facets of the platform - for example, there are people better qualified than I to assess the merits of the PC math suggesting that a reduction in corporate taxes from 11.5% to 8% would generate 119,808 jobs.  (Personally, I've always seen the connection between corporate tax rates and job creation as rather counter-intuitive:  There are tax deductions for investments in growth of jobs and infrastructure, so corporate taxes primarily impact things like retained earnings.  Thus, corporate taxes incent investment in business growth by fostering an "It's deductible" mentality, whereas lower tax rates tend to encourage companies to stockpile more cash and pay out larger dividends to shareholders.  The empirical evidence tends to support this logic, as well.)  Also, aside from pointing out that Mr. Hudak needs to brush up on his Keynes if he thinks that eliminating 100,000 jobs will stimulate private sector job growth, I'm going to stay out of that particular debate.

Mainly, I'm going to draw attention to a few of the workplace-related reforms being proposed, as I think many of them need more detail.

Cutting the Red Tape

The PCs propose to "Eliminate rules and regulations that don't benefit consumers, workers or employers, reducing the total by one-third over three years", claiming that Ontario companies spend $11 billion per year on compliance, and that the regulations make it particularly difficult for small businesses, "the ones who don't have HR and legal departments and can't afford experts to help them figure out how it all works."

First off, the notion that the aggregate collection of rules and regulations can be quantified, such that they might be reduced by "one-third", is perplexing.  Laws are complicated things, and it would be next-to-impossible to parse a statute like the Employment Standards Act and list off the myriad obligations it imposes, particularly when many of the rules and regulations are consequential or conditional.  And if you did so, the number you'd end up would be deceptive, because you'd include fundamental contractual obligations like "You have to pay your employees" as government rules and regulations.

Secondly, when an employer says it can't afford to figure out the legal framework, that's a false economy.  Even without government regulation, there are a lot of contractual issues that employers need to address up front, and failing to do so can create massive expenses and liabilities.  An employer can pay me up a bit of money up front to help them structure their employment relationships, or they pay me a lot of money at the tail end to do damage control when they're staring down the barrel of legal proceedings.

There is a lot of red tape for employers.  There's no denying it.  But much of it has purpose, and while there are probably ways of simplifying and streamlining it, it sets off alarm bells in my mind to hear political party broadly promising to cut the red tape, without specifics.

The specifics I've seen laid out are pretty limited, such as some talk of eliminating the 'government monopoly' for workplace insurance.  In fact, that's likely to complicate matters:  Unless you remove the necessity for insurance altogether (which would be insane - the end result would be that many employers would choose to go uninsured, and that a workplace injury would result in the injured employee suing the employer into the ground, destroying the business and ultimately leaving the employee without significant compensation; WSIB protects both workers and employers), you're going to have implement a whole new host of rules and regulations regarding the requirements for private sector workplace insurance.

The PCs also write about eliminating "rules that prohibit competitive bids on government construction contracts".  It's not entirely clear what he means by this - government construction projects are typically subject to competitive tender processes - but it appears that this may be related to his objection to the TDSB's obligation to "give its union all building maintenance jobs".  Which is different from construction, and more importantly is a fundamentally contractual matter, rooted fairly abstractly in the Labour Relations Act, and it's not clear how the legislature would change this reality.

There are a handful of statutes that specifically create rules and regulations for employers, such as the Employment Standards Act, the Labour Relations Act, the Occupational Health and Safety Act, the Workplace Safety Insurance Act, the Human Rights Code, and a few others that are smaller or have more limited application.  These are the kinds of statutes you're talking about when you talk about needing HR departments to parse your obligations.  And yes, there are a lot of obligations in those, but I'd really like to know what Mr. Hudak intends to remove in the name of simplicity, because most of those obligations are in place for the express purpose of protecting workers, and compromising substantive worker protection in the interests of saving employers the costs of implementing policies would be...a little backward.  The right approach to such an issue is to streamline and simplify the obligations to make them easier to fulfill.

Though it does seem that the PCs are going beyond strictly employment regulations, and also looking at industrial regulation as well - loosening regulations for apprenticeships and changing the mandate of conservation authorities.  Not to mention eliminating "hundreds of unnecessary" (and unspecified) "rules that bog down the social assistance system".

Re-Balance Labour Laws

As my readers will know, I fully acknowledge that reforms are necessary to the Labour Relations Act.

But the PC platform is odd:  Firstly, it promises "a secret ballot in certification votes".  Which would be great.  So great, in fact, that it already happens:  Certification votes already have a secret ballot.  Again, I would support certain reforms in terms of the certification process, and the elimination of card-based certification (so a vote in all certification applications), but that's not what the platform describes.  Secondly, they're promising "paycheque protection so that workers are not forced to pay fees towards political issues they don't support".  Which sounds strangely like the "right to work" policy that Hudak so recently waffled on.  Unless he plans to make the 'opt-out' specific to the portion of dues the union is applying toward political activities, which would be (a) very complicated if possible at all and (b) constitutionally questionable.

And fundamentally, it's not so much about protecting the workers as it is a politically self-serving move, given the traditional antipathy between unions and conservatives.

I would support labour relations reforms to give bargaining unit members a more meaningful choice in whether or not to become and remain part of a union, as I recently proposed.  But policy notions such as 'right to work' are specifically designed to kneecap unions, and I can't get behind that.

At the end of the day, the platform makes big promises, but is really scant on the details of how these promises are achievable.


This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.

The author is a lawyer practicing in Newmarket, primarily in the areas of labour and employment law and civil litigation. If you need legal assistance, please contact him for information on available services and billing.

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