Promoting a Flourishing Society
 

A Call for Reasoned Debate Over Ideology

From the Archived "Cardus Policy in Public" Series

September 1, 2008

Perhaps one of the biggest surprises in this reaction piece is that the Canadian Building Trades Director is not wildly opposed to all the concepts that are mooted in Ray Pennings’s article. There are things that need to be discussed, and discussed coolly and rationally. If our industry is to prosper, it must change. How that change comes about, and who drives such change, is at issue. Further change needs to be meaningful, thoughtful, and the product of dialogue between the stakeholders – not the product of self-interested people who are on an ideological romp nor those who see change as beneficial to themselves without consideration for others. In that vein, some of my comments will not be surprising at all!

Perhaps one of the biggest surprises in this reaction piece is that the Canadian Building Trades Director is not wildly opposed to all the concepts that are mooted in Ray Pennings’s article. There are things that need to be discussed, and discussed coolly and rationally. If our industry is to prosper, it must change. How that change comes about, and who drives such change, is at issue. Further change needs to be meaningful, thoughtful, and the product of dialogue between the stakeholders – not the product of self-interested people who are on an ideological romp nor those who see change as beneficial to themselves without consideration for others. In that vein, some of my comments will not be surprising at all!

The manner in which a work place is organized is central to any labour-management relationship. Proper unit, appropriate unit, or policy unit are the most litigated parts of our labour relations law sphere.  Learned works abound about the ‘difference in construction’ and the protection of craft unions by the labour relations statutes across Canada.1 There are very solid reasons for this craft-based system. In the main, our industry’s contractors do their work on a craft basis, or with one or two crafts at most.2 Craft employers, as with craft employees, are transitory and their work from project to project has a short “build up and build down” cycle. It is ludicrous to suggest that one group of workers will start, finish, and do everything in between on any mildly complex work site. It takes a lot in mastering the skills in a trade, and becoming both proficient and productive takes a good tradesman decades. To be completely fair in this discussion, it is instructive to consider employers that employ workers who are ‘represented’ by CLAC (Christian Labour Association of Canada). Do these workers start a job working on the foundations and graduate to forming, structural steel, plumbing, heating, electrical, roofing and closing off with paint, tile and cabinets? The answer is, of course not. CLAC employers marshal their workforce like any other construction employer. Craft remains king among the construction industry, and the so-called new models obfuscate practice with ideology.3

There’s now a new way to look at organizing companies by certification or voluntary recognition, particularly in the Provinces of B.C. and Alberta.4 The best organizers for this new method are management lawyers who are trying to ensure that craft unions can’t get a shot at organizing contractors’ businesses by using an industrial model of certification. If you contrast this model to the CLAC organizational model in Alberta, it becomes clear—Alberta requires a craft by craft organizational structural system. This  CLAC system leads to the “Noah’s Ark“ certification where, by off chance, employees who are at work for only one day, in pairs of plumbers, boilermakers, ironworkers, scaffolders, millwrights, et al., all have need of representation, and on this coincidental occasion a CLAC  Business Agent is just coming around the corner with organization on his mind. Here, too, there is an employer’s lawyer lurking to synchronize the coincidence!

What is at issue here is not the method of organization; it is that employees get to actually pick their bargaining agent. It always seemed to me that that the employees’ choice, not the employers’, was paramount. If that changed, it did so on a day that I was away from law school. This selection of bargaining agents by employers could be reversed by taking a page out of the play book of the Quebec construction labour relations system. In Quebec there is no economic advantage to the employer to be gained by preferring one union to another. Bargaining in Quebec creates one collective agreement across the entire industry.5 Workers have a choice as to the union to which they belong; the majority bargain an industry collective agreement over four industry sectors and each employer is obligated to apply these terms.6 I have actually suggested this to a senior CLAC representative as a way to reduce the ‘tension’ between the Building Trades and the CLAC. I was rebuffed because “if we had to use the same collective agreement, why would anyone want us?” If a worker is worth his hire, why should he get less than his full value simply because the desire to represent him allows a “labour provider” (not really a union but no other title suffices) to sell him short! This is hardly a formula to encourage young people to enter the construction industry. If we are truly interested in creating capacity, getting people to work on the cheap doesn’t recommend itself.

Construction lives and dies on a competitive bidding process, and generally low bid wins (or loses, because often the low bid is the one that has missed something in the tender documents). Every contractor pays about the same for materials, equipment, and engineering. Overheads are roughly similar. The only real flex is in the price of labour. Who would you rather work for, the contractor who paid you the market rate or the contractor who could get the ”union” to cut the cost of labour by cutting the hourly rate, offering lesser overtime premiums and fewer benefits? The bid process which underlies the industry (outside of Quebec where labour rates are equal for every contractor) creates a real incentive to find a pliable ”labour provider” when the contractors should focus instead on their abilities to manage, attract, deploy, and inspire the workforce.7

Competition based on who can pay the least and get at least some people with some skills is a mug’s game! Again, a rhetorical question: Who would you want doing your job, someone who will work for a lower wage, or the contractor that deploys a work force of qualified and motivated people?

The same premise applies in bad times. Would you, in your job, feel somewhat ‘slighted’ if the Boss told you that because the price of oil has dipped, you are now paid less? If we are to weather hard times, should we do it on the basis of “lowest wage takes the prize”? Attraction of the brightest and the best is always an issue. Clearly, one of the reasons that young people avoided the construction industry in the last twenty-five years was the ”bottom falling out of wages” phenomena and the unseemly rush of some “labour providers” to work for less to gain market share.8

In both the long and the short runs, construction will remain an inherently competitive business. It will remain driven by competition between sub-trades, workers and contractors, and purchasers of construction. This competitive underpinning creates corrosive relationships and adversarial conduct at all levels and industry interfaces. This area of our endeavours needs a long, hard look. The current argument isn’t about who can re-invent “craft versus wall to wall,” because that debate just pulls a curtain over the true issue: Is there a cheaper source of skilled labour?9 We should debate these issues, not from ideology but from reasoned thought, being mindful of the economic impacts on the 1.6 million people who make their livings in construction, in Canada.

NOTES
1       Every province has some form of construction craft provision and all provinces have a legislated construction bargaining system that provides for “industry” collective agreements across a sector of the industry, generally on a province-wide basis. The transitory nature of the industry has also resulted in benefit plans that allow for transitory workers to keep in benefit as they move from employer to employer.
2      Around 80% of all of Canada’s 100,000 plus contractors are trade contractors (Statistics Canada).
3       With the exception of British Columbia where the “wall to wall” model has gained some traction, the “wall to wall” has generally been rejected. See Alberta Board Policy Bulletin #11 which requires certification on a trade by trade basis. The reference in the keynote paper to the Alberta Labour Relations Board decision in TNL Industrial Contractors Ltd. [1996] Alta. L.R.B.R. 497 has as its gravaman not the correctness of “alternate unions” encroaching  within the statutory Registration system, but rather the fact that over time some of the relationships developed and that those relationships were for some time unchallenged, and it would not be appropriate to interfere with those relationships at this “late” time. It is interesting to note that the Alberta decision was considered and rejected in Nova Scotia in 360 cayer ltee, (2000) decision #2086 C. and 360 cayer ltee was again followed by the Nova Scotia Labour Relations Board in Daharpro Construction (2007), decision #3068. Saskatchewan in Emerald Oilfield Services  (1990), 94 C.L.L.C. 16,070 rejected CLAC as a bargaining agent under that province’s construction legislation, and Ontario has rejected not just CLAC but also non-construction locals, of the carpenters within its ICI sector. The fact that virtually all of these cases have gone on to judicial review and then on to Courts of Appeal certainly creates an interesting legal patchwork across the country.
4      It is worthy of note in British Columbia where there has been significant commercial institutional construction work available in the past few years, that the “wall to wall” organizational units mainly in the civil trades, are fighting it out to see who can get the work by competing for the lowest wage cost. The craft-based sub-trades are able to maintain reasonable increases that are in keeping with those found across most of the other provinces for similar trades. The civil trades in other areas of Canada do not seem to share in the “wage malaise” for their skills. Workers in British Columbia’s lower mainland civil construction industry need to belong to a number of unions in order to keep working, and their benefits and future prospects are at risk in the result.
5       Labour Relations, etc. in the Construction Industry. RSQ 1977, R-20, as amended
6      This is not unlike the Registration, Designation or Accreditation systems in each of the other provinces. The most significant difference being that the provinces outside of Quebec can only bind employers with whom unions have established a bargaining relationship.
7       Again, the construction labour relations regimes in most provinces introduce a single collective agreement across a province for an industry sector (e.g. plumbing, electrical, boiler-making). There is no room for individual deals and competition must be based on management skills, the skills of the workers, not wage rate. Only in British Columbia and Alberta is the system undermined by allowing alternate “collective bargaining regimens” invariably at lower wage rates, premiums and benefits to co-exist with the industry deal. The Nova Scotia decision of 360 cayer ltee, supra, at para. 63 postulates that there would be “unavoidable chaos that would flow from granting certification or allowing effect to a voluntary recognition agreement “by having” more than one trade union per craft classification within a construction industry collective bargaining regimen. In B.C. and Alberta that has been the result.
8      Carol Marshal, Oakland Business Review (28 Aug ‘08).
9             Renewal of the construction industry workforce is also at issue here. Roughly 20% of the construction industry will retire by 2016. (Construction Sector Council, 2008 Labour Market Forecast). There needs to be capacity to train to replace those who retire. There is an infrastructure of craft training across Canada in the rough amount of $600 million dollars, invested by Building Trades Unions and their employer partners who make an annual expenditure in the range of $200 million dollars on training. This investment helps in dealing with capacity issues. It is useful to note that none of the “pretenders” in the construction industry spend anything of consequence on training. Prism Economic Study of Union Training Centres for HRSDC, 2003.