Original article by Howard Levitt published in the Financial Post, September 9th, 2019.
The Liberal government’s promise to legislate “work-life balance” for federal employees is smoke and mirrors, a pandering virtue signal designed to obtain votes, heedless of its likely impact on employment.
The federal government recently rolled out sweeping changes to the Canada Labour Code promising to “provide a better work-life balance for middle-class families.” This will affect tens of thousands of federally regulated employees, including government, bank, airline, transportation and telecom employees.
Notable changes to the labour code include:
- Flexible work arrangements: After only six months in a new job an employee can request a change to hours, work schedule, location and other terms of employment yet to be specified. Employers can only refuse the request on certain grounds, and must respond to the request in writing within 30 days.
- Series of new leaves: including a personal leave of up to five days, three days with pay; and leave for victims of family violence of up to 10 days, with five days paid.
- Vacation: employees with more than 10 years of service will now be entitled to four weeks of vacation (and 8 per cent vacation pay). Previously employees had to work six years to be entitled to three weeks of vacation, now they are required to work only five years.
- Leave for Aboriginal practices: Aboriginal employees who have completed at least three months of employment, may take up to five days of unpaid leave each calendar year to participate in traditional practices.
The government’s promise to improve the lives of many Canadians couldn’t be better timed — scant weeks before the federal election. However, the changes bring with them dangerous consequences.
First of all, many of them are expensive. More vacation and the introduction of paid leaves increase the costs of labour for employers. An extra week’s vacation alone costs an employer 2 per cent, about the same as the average pay increase and also as much as the rate of inflation. While some of the companies affected are large institutions, many federally regulated firms are small to midsize employers that will be financially squeezed. These new costs will either be passed on to the consumer or result in a reduction in workforce.
At least vacation can be planned, and even stipulated, by the employer. Many of these changes call for time off with little or no advance notice. Unplanned days off, without the opportunity to arrange overtime in advance or to call in extra personnel, is more costly yet.
Perhaps the most worrisome of these changes is the government’s commitment to more “flexible work arrangements.” The fact is, these changes will instead unravel carefully crafted collective agreements and cause employment disruption.
Thousands of federally regulated jobs are unionized and are extremely technical. The key duties and responsibilities in these roles are often the subject of hours of negotiating during collective bargaining, as are subjects such as where work is performed and the schedule upon which the work is done.
As of Sept. 1, an employee can ask for changes to their schedule, their hours and their work location. Employers will likely be flooded with these requests. But most unionized jobs are rigidly defined and do not offer the flexibility the government has promised. A bank teller can’t do much working from home, nor can a flight attendant.
Denying these requests, as many employers will be required to do, will lead to increased friction and in some cases the rewriting of collective agreements. Any unionized employer knows how laborious and fraught with tension contract negotiations can be. If those deals cannot be rewritten, employers will still have to comply with the new legislation, but if there is a breach, there will not be an efficient way to remedy the dispute.
It also incentivizes employees to apply to companies they want to work for but at locations, shifts or schedules they don’t, knowing that, after six months, they can request a change. Even existing employees who want different shifts or schedules may demand accommodation, however inefficient it would be for the employer.
The right to refuse overtime for unspecified “family responsibilities” will be a recipe for many to avoid it, even when there is a genuine business emergency that requires handling.
And creating a leave only for Aboriginal people would have once been deemed discriminatory. What about the right of any Canadian to take a week off to participate in their faith? In my small law firm, among lawyers alone, we have members of five races and even more religions. If everyone suddenly received an extra week off beyond their vacations at a time of their choice, it would be extraordinarily disruptive. This particular move seems designed to win back Aboriginal voters who were turned off by the way Jody Wilson-Raybould was treated during the SNC-Lavalin affair, rather than addressing an actual problem.
The net result of these changes, and in particular the legislated “flexible work arrangements” clause, is ill-timed but election ready. The Liberal government wants Canadians to see it as employee friendly, instead of an ally to business. Unfortunately, it is employees, still, that will pay the price.