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Wage Restraints: Part of the Solution?

January 1, 1983 -

The Canadian federal government and various provincial governments have begun to clamp down on the wages and salaries of their employees. In the summer of 1982, the Canadian government began its so-called Six and Five program, by which the federal government employees' wage increases will be limited to six per cent in the first year and five per cent in the second year of the program. Other governments have followed suit. One of the most drastic measures was taken by the financially hard-pressed Quebec government, which imposed drastic wage cutbacks on its employees. Quebec unions reacted in anger and threatened to retaliate with strikes.

The Ontario government's wage restraint program was strongly opposed by the Ontario Federation of Labour affiliates and by the provincial New Democratic Party. The latter sought to delay passage of the bill at the committee level as well as in the Legislature. The government eventually invoked closure, and the bill became law in late December 1982. While other unions unanimously condemned all aspects of this legislation, the Christian Labour Association of Canada, in its submission on this bill, agreed that restraint is needed at a time of recession and high unemployment. This Christian union argued, however, that restraints should not apply to those employees who are making less that $17,000 per year. In support of this position, the CLAC pointed to its experience with nursing home employees who are making less than $4.00 per hour.

Apart from the restraints imposed by the federal and other governments, the reality of the slumping economy has brought about lower average wage increases or even wage freezes and cutbacks in the private sector. Work sharing arrangements in order to avoid layoffs have been introduced by numerous companies as well.