Canadian Federation of Independent Business gets it wrong on union wage demands

PSAC calls the results of a CFIB study into question for their flawed methodology because reputable compensation research firms don’t use census data for comparing wage rates between jobs. 


OTTAWA – Claims by the Canadian Federation of Independent Business that union wage demands are excessive are just plain wrong, says the Public Service Alliance of Canada.

“Contrary to the CFIB’s claims, PSAC members in the federal public sector are not overpaid,” indicates PSAC National President Nycole Turmel. “Between 1991 and 2002 (the last year PSAC members received wage increases), our members’ salaries rose by 18%. During the same period, increases in the private sector totalled 26.5%. Our increases haven’t even kept pace with the cost of living as the CPI rose by 24.6% between 1991 and 2002.”

PSAC calls the results of the CFIB study into question. According to Turmel, their methodology is flawed because reputable compensation research firms don’t use census data for comparing wage rates between jobs. They use a much more intensive – and accurate – way of assessing comparative rates. The assignment of jobs categories in the census is based on very limited information and there is great potential to mis-code occupations and make false comparisons as a result. The study also fails to take into account factors that explain wage differences, such as age, length of service, the size of the employer, education levels and level of unionization.

“The fact is that the federal public service is a large, unionized employer,” says Turmel. “When making comparisons with the private sector, it is reasonable to compare it to other large employers, many of which are also unionized. Mixing a wide range of employers into the research, including very small businesses and even “mom and pop” operations, produces very misleading results at best. The joint PSAC/Treasury Board study of operational services workers’ jobs, which showed an average wage gap of 20%, was carried out by a reputable research firm, Morneau-Sobeco, using a rigorous, recognized methodology.”

Turmel says it is interesting that the CFIB itself indicates that private sector wage increases are running on average at about 2.5% to 3.%. These reflect the increases recently recommended by the Conciliation Board for PSAC members at the Canada Revenue Agency. The report noted that the federal government has been enjoying larger than anticipated budget surpluses since 1996. This is thanks in part to the wage freezes inflicted on our members in the 1990s and certainly doesn’t square with the CFIB’s rhetoric about excessive wage demands.

Claims about the growth of the federal public sector also don’t bear close scrutiny, suggest Turmel. Despite what the CFIB says, federal government employment declined by fully 12% between 1991 and 2003. The reduction is even more striking when you consider that Canada’s population increased by 9% between the 1991 and 2001 censuses. In other words, 12% fewer government workers are providing service to 9% more people.

“Our members just want a wage increase that will pay them fairly for the work that they do,” concludes Turmel. “They’re tired of their contribution to the well-being of Canadians being attacked by organizations best known for their anti-public service and anti-union ideologies.”