by Brian McDougall, retired CAPE member and August Anderson. August Anderson is the pen name of a labour activist currently in the federal public service. The argument presented here reflects the collective understanding of a group of activists.

As the progressive paint on the Trudeau Liberals continues to flake off, relations between the federal government and its 270,000 public service workforce have reached new lows.

For the past three and a half years, the Liberal government has illegally broken the contract with many tens of thousands of its federal public service employees every two weeks, by underpaying, overpaying, or, in some cases, not paying them at all.

As a consequence, the Trudeau government may soon face strike action over the pay issue by the largest federal public service union, the Public Service Alliance of Canada (PSAC).

The Liberals and PSAC are locked in a game of chicken: a government that is sinking in the polls and cannot afford a pre-election strike versus a union that may not be able to mobilize its angry, though badly demoralized and disengaged, members.

The Phoenix system

The dispute arises from the 2016 government implementation of a completely dysfunctional pay-administration system called Phoenix, which Rankandfile.ca previously covered.

Phoenix-related errors in pay mean tens of thousands of government employees have likely faced unprecedented economic uncertainty and hardship, becoming unable to pay their bills, file their taxes, maintain their credit ratings, make their mortgage payments, and so on.

With more than 240,000 outstanding cases of incorrect pay, the workforce is under enormous pressure. They’re experiencing anxiety over possible home or vehicle loss, reduced ability to support family members, delayed career changes or retirements, rising levels of substance abuse, marital breakdowns, and other serious problems. To make matters worse, more than 100,000 workers are still waiting to have their last collective agreements implemented.

Adding insult to injury, the Liberal government has managed the Phoenix mess with nickel-and-dime pettiness, requiring workers to pay back overpayments in gross amounts when only net amounts have been received, and going after overpayments before resolving other issues, such as missing benefits, under- and non-payments. The latter practice finally stopped after union complaints.

The Phoenix debacle has created a lot of bad press for the Liberals. In the run up to the 2019 fall federal election, Trudeau likely wants to neutralize this issue because it highlights Liberal incompetence and indifference to the suffering of ‘middle class’ people.

The new Phoenix deal

In May, the Liberal Government announced an agreement with 17 of the 18 public service unions to compensate employees for Phoenix-related damages outside the existing collective agreements. The holdout was the Public Service Alliance of Canada (PSAC), the largest and most conventional union, which represents a wide variety of occupational groups.

Signatories included both the 55,000 member Professional Institute of the Public Service (PIPSC) representing a wide array of ‘professional’ employees (in occupations related to science, engineering, architecture, computer systems, and health services), and the Canadian Association of Professional Employees (CAPE) representing employees in social science occupations (e.g., economists, sociologists and translators).

The terms of the Phoenix deal are modest. Employees (full and part-time) who worked during the 2016-17 fiscal year receive two days of annual leave, as well as one day each for the next three years, for a total of 5 days. (Employees can cash-out the leave at the discretion of the employer.) The deal also creates a claims process for damages of $1,500 or more, which will allow employees to seek damages for catastrophic and major losses. Mental anguish and trauma or other personal hardship can also be claimed, and employees can seek reimbursement of sick leave days used as a result of Phoenix disruptions.

PSAC’s rejection of the Phoenix deal coincided with a declaration they were breaking off from separate negotiations for a new collective agreement. That means 90,000 members of PSAC will soon be able to strike over both Phoenix and their next contract.

Explaining the decision, PSAC President, Chris Aylward said the Phoenix deal was inadequate given the “enormous damage” union members have suffered. The Alliance has demanded better compensation; no threshold on individual claims; no restrictions on cashing-out leave; and assurance that all members with claims will be made whole.

From Phoenix to new contracts

Within days of signing onto Trudeau’s Phoenix deal, PIPSC and CAPE, the two largest self-described ‘professional’ unions, were rewarded with new and almost identical four year contracts. Both unions got better wage increases than the 1.5% annual increase (for each of four years) currently on offer to PSAC. For example, CAPE got a four year deal (2%, 2%, 1.5% and 1.5%) which probably translates to about 9% with compounding and ‘market adjustments’ included. (That is close to the current 2% annual increase in the cost of living.)

The similarity and timing of the deals for PIPSC and CAPE suggests government negotiators held the upper hand at both tables, largely dictating the terms of the new agreements. Both unions and government know all the federal public service unions are now much weaker after years of suffering under Phoenix without a serious fight back.

By signing the Phoenix deal, leaders of PIPSC, CAPE and the other unions hope they’ve buried the issue, without ever having to strike against the employer. However, because a replacement pay system won’t be ready until 2023, federal employees will get another 3-5 years of bi-weekly reminders of the power of the employer to break the law and the impotence of their unions to defend them. With the Phoenix deal signed independent of the collective agreement, any strike against Phoenix would be illegal.

‘Professionals’ free-riding on PSAC

The most telling aspect of the Phoenix compensation agreement is the so-called “us too” clause, which permits the signing unions to benefit from any additional concessions PSAC is able to extract from the government. In their joint press release, some of the signing unions openly boasted about ‘free-riding’ on the PSAC.

Disgusting as that may be, such conduct is a long-standing tradition in the federal public service. The smaller self-described ‘professional’ unions rarely if ever accept responsibility for fighting the employer, leaving that to the PSAC. While unions like PIPSC and CAPE are happy to claim the benefits produced by PSAC’s struggles, they seek to justify their separate existence with artificially low dues (they don’t require serious strike funds) and regular public criticism of PSAC for higher dues and greater propensity to strike.

Virtual resistance to Phoenix

PSAC’s decision to fight for better compensation over Phoenix raises an obvious question: Can the union build an effective strike threat after the damage done by many years of members enduring employer attacks without an effective union response?

Planned by Harper and implemented by Trudeau, Phoenix is just one of a number of attacks federal public service workers have endured since Harper’s election in 2006. Severance pay was eliminated, sick leave came under attack, and massive job cuts were made – all without a serious union fightback by any of the unions.

So the past three years of ‘virtual’ resistance to Phoenix — including lobbying, grievances, legal complaints, distribution buttons that said ‘Burned by Phoenix’, and small media-oriented demonstrations – is part of a long-term pattern.

Since 2016, the unions accommodated to life under Phoenix, restricting themselves to legal pressure tactics out of a misplaced duty to respect the law the government continually breaks. In fact, the unions have taken ownership of the Phoenix problem by collaborating with management on various Phoenix-related committees.

The failure by the federal public service unions to match the government’s bi-weekly violation of the contract with commensurate union-initiated contract violations (like rotating strikes), has left their members angry, confused and demoralized. Repeated demonstrations of the impotence of their organizations have damaged the credibility of trade unionism among government employees.

Whenever groups of angry rank-and-file public servants raised the possibility of strike action to get greater government attention to the Phoenix problem, their union leaders derailed the argument claiming the unions would lose favorable media coverage and public sympathy.

Will PSAC strike over Phoenix?

PSAC recently applied for conciliation, a necessary step before a legal strike. With polls showing the electoral vulnerability of the Trudeau Government, PSAC’s decision to link Phoenix compensation to contract negotiations means many of their members will soon have the option of striking for a better Phoenix deal.

PSAC has demanded a three year contract with wage increases of 3.75% per year. Since the government offer, a 1.5% wage increase per year for four years, is well below the current 2.0% rate of inflation, acceptance would mean serious wage erosion. That will be the price PSAC members pay if the union proves unable to get a strong enough strike mandate or fails to win a strike with the government.

The decline of PSAC

PSAC’s presence in the workplace is merely a shadow of what it once was. Large and sometimes illegal strikes by PSAC members in the past (in 1980 and 1991), combined with important victories over pay equity, cemented the support of members for their union, and produced serious workplace organization.

That former workplace presence is now gone, leaving PSAC union leaders to become masters of token protests and virtual resistance, not a serious substitute for the power created by the strikes of the past. With badly degraded links to their members, PSAC leaders may not have the credibility to win a strike mandate, pressure the employer into concessions, or win a strike.

Certainly, the PSAC decision to combine Phoenix and contract negotiations creates the possibility of a strike fueled by anger over years of Phoenix abuse. But does that anger outweigh the damage done by member demoralization over poor leadership?

Decades of decline coupled with merely symbolic resistance, have left PSAC almost a zombie organization. It is now bereft of the layer of knowledgeable and confident unionists produced by the member-driven actions of the 1980s and 1990s. (Most of them are now retired.) It is hard to imagine the PSAC activists of the past ever accepting a Phoenix-style ongoing violation of the contract without striking, legally or illegally.

Built-in union timidity

While the erosion of PSAC’s workplace presence has much to do the general success of neoliberal governments and corporations in reducing union power, it is also a product of the peculiar nature of federal public service unionism. Created by government fiat in the late 1960s, Canada’s federal public service unions were, from their inception, all top-down business unions.

In 1967, after an illegal strike by postal workers, the Pearson Government passed legislation imposing unionization on its entire workforce, including those professional employee associations opposed to the change. The labour regime ensured the new unions would be weak and divided.

Federal public service workers were prohibited from negotiating over key issues (hiring, promotions, pensions, etc.), required to negotiate many separate contracts on the basis of occupational groups (promoting craft-based divisions), and obligated to declare in advance of negotiations which of two paths they would follow (arbitration vs conciliation/strike). In addition, they had to contend with an employer that has the power to legislate against them.

The result was a federal public service workforce badly fragmented into 18 competing unions, with occupational divisions that ensured the anti-union ‘professional’ groups could perpetuate their hostility to basic trade union principles like solidarity.

With the partial exception of PSAC during the militant upsurges of the 1980s and 1990s, the federal public service unions remained conservative organizations whose leaders work full-time to oppose the militancy that might undermine good relations with management, and the solidarity that might threaten the basis of their small fiefdoms and perks (e.g., the better jobs, salaries they enjoy).

PSAC’s descent into ineffectiveness began with the full-scale application of neoliberalism to the federal public service. In 1995, the Liberal government announced the elimination of 45,000 jobs – the largest layoff in Canadian history. While the unions negotiated workforce adjustment policies to assist those losing employment, they did little to address the accompanying speedup and management power in the workplace.

Losing at the game of ‘divide and conquer’

Acceptance of the Phoenix deal by most unions underscores the chronic weaknesses of the model of unionism that accepts fragmentation of the workforce into a plethora of craft-based unions, with deep sectional divisions between a large general union (PSAC) and many smaller ‘professional’ ones.

The employer has repeatedly used that split to ‘divide and conquer’ its workforce. Poisoned by sectionalism, the smaller ‘professional’ public service unions rely on the legally-imposed reality of numerous occupationally-based contracts to justify their continued existence. Their union leaders regularly extol the virtues of their low dues/no strikes union model, while deriding the higher dues and strike activities of PSAC.

Thus, many federal public service workers are trapped in a time warp, ignoring a crucial labour movement discovery dating back to the Knight of Labour in the 1880s and the Congress of Industrial Organizations in the 1930s: the understanding that unifying all categories of workers under a single employer leads to greater bargaining power.

The only people in the federal public service unions that benefit from continuation of craft unionism are the officials of the ‘professional’ unions.



What activists should do

The immediate issue federal public service union activists must grapple with is how to ensure PSAC wins the coming showdown with the Trudeau (or Scheer) government.

PSAC activists must push their union to begin immediate and serious planning to ensure the Phoenix anger is turned into a force that can offset the current deficit of workplace organization. The recent practice of virtual mobilization must be abandoned.

Rank and file PSAC activists need to pass resolutions and begin organizing in their locals and regional councils to ensure their leaders are not just posturing over Phoenix and contract negotiations. For the employer, the threat of strike action will not become real because some union leader makes a public statement. There has to be compelling evidence the membership is willing and capable of striking.

When all the non-PSAC union leaders signed onto the Phoenix deal, they made it official: a victory by PSAC would benefit all federal public service workers. Activists in the other federal public service unions need to use the “us too” logic of the Phoenix agreement to initiate unprecedented efforts to build solidarity with PSAC.

The small circles of PIPSC and CAPE activists who reject the poison of sectionalism need to devote their energy to building workplace-based solidarity via information leaflets, educational sessions, resolutions, and meetings for their members. Joint solidarity-building activities and meetings with PSAC members are also crucial.

By openly campaigning on the principle that a victory for one is a victory for all, activists outside PSAC can build the basis for future campaigns to unite all employees in the federal public service into one big militant union.

Cognizant of the dangers inherent in strike preparations securely under the control of militancy-adverse union leaders, activists in all federal public service unions desperately need to build their own workplace-based capacities for action.

