Wage freezes drive privatization by stealth

Bill 124, just like any wage freeze or forced overtime needs to be seen as key drivers of privatization

Hamilton Health Sciences has a staffing crisis due in part to Bill 124

Ever since Bill 124 was passed in 2019, it’s been regularly touted as an example of Doug Ford’s anti-worker agenda. It is, of course: it mandated a wage freeze across the public sector. This violates collective agreements, blocks the right of workers to engage in free and fair collective bargaining and constrics workers’ budgets at a time of sky-high inflation.

Bill 124 is often talked about alongside the push to further privatize Ontario’s public services, but it’s rare that it’s mentioned as a driver of privatization. That’s because the connection is round-about; it’s much easier to point to a private health clinic doing Taylorism on people’s cataracts or hernias than it is to look at how a public sector wage freeze aids privatization.

But freezing public sector wages creates a powerful incentive for those workers to look for private sector jobs. As the screws are turned to these workers in the workplace, a better salary with a private-sector employer becomes impossible to resist. The resulting mass exodus creates a staffing crisis and the same nurse is hired back at a higher cost to the public system to fill the gap.

Back in October, I was a delegate to Unifor’s Media Council meeting on behalf of the Canadian Freelance Union. Media Council brings together Unifor’s communications workers, many of whom work for communications companies. Nearly all are private sector workers.

Not all, though. A worker for Tele-Français Ontario, the french-language public broadcaster operated by the Government of Ontario came to the microphone to talk about Bill 124. As public sector workers, his small organization was struggling to keep camera operators, editors and journalists because they were easily wooed to other broadcasters. 

How could they compete with Radio-Canada, Rogers or Bell if their salaries couldn’t rise more than 1%, he asked the room. Bill 124 posed an existential threat to public broadcasting in the province.

There are very few media workers covered by Bill 124 – not big enough to register, really. That makes it really difficult for these Unifor members to fight this legislation.

But that’s not the case for nurses, teachers, civic employees and other sectors who are also covered under the legislation. Fighting Bill 124 has been a priority for public sector workers since it reared its head. Back in November, an Ontario Superior Court judge found that Bill 124 was unconstitutional and it was struck down. The judge was not swayed by the argument that the legislation was necessary due to various budgetary constraints, and found that it violated workers’ constitutionally-protected right to collectively bargain.

The bill was nonetheless in force for three years. Back in July, CUPE and SEIU-Healthcare called on Doug Ford to ban the use of agency nurses and to repeal Bill 124, as the combination of these two factors was placing tremendous strain on the public system.

Last week, a CEO of several non-profit nursing homes in southwestern Ontario Steve Harrison told CBC News that they’re really struggling to retain staff within his long-term care facilities and Bill 124 has a lot to do with it.

Because of the legislation, they haven’t been able to boost workers’ salaries. So many go to private agency work where they have more control over their schedules and better pay. Then, because facilities are desperate for staff, they hire workers through the agencies, placing intense strain on their budgets. 

More than 28% of registered nursing positions in long-term care are empty in Ontario, so facilities have little choice but to hire nurses through these agencies. 

There is a similar trend in Ontario’s hospitals. In Hamilton, for example, Hamilton Health Sciences has a gap of 1500 personnel, nearly double the number of vacancies that the network had in 2021. There too, the gap was partially blamed on Bill 124.

Of course, it isn’t just wage freezes that are pushing healthcare workers into private settings. Inflexible schedules, outrageously long shifts and mismanagement are also wreaking havoc on healthcare worker retention in the public sector. In Nova Scotia, some health units are using staffing agencies to fill gaps that can reach as high as 80% in some places.

In one year, Nova Scotia Health has doubled the amount of money it's paying to staffing agencies. 

Travel nurses in Newfoundland and Labrador are being relied upon more by public agencies too. They’re paid more and have more flexibility than full-time nurses in public settings.

On Wednesday, the governing CAQ served legislation that would ban the use of agency nurses by public sector bodies by 2026. There, private agency nurses can sometimes earn $100 per hour or more. Oft-cited mandatory overtime is one of the reasons why nurses there are fleeing the public system, as the agencies both offer better salaries and more humane hours.

Private, for profit healthcare agencies have existed for decades, but as the health system has been rocked by the COVID-19 pandemic, they have filled an even more important role than ever before. Carecore Health Services, for example, places nurses in Ontario, Nova Scotia and PEI, and so they’ve learned how to operate in multiple jurisdictions effectively and efficiently. The public sector is at a massive disadvantage as no public health agency works across jurisdictions like the private companies do. 

These companies fly under the radar. For example, there are no news hits when you search Carecor Health Services on Google News. If you search Select Medical Connections, a company that operates across Western Canada, you only get a single news story hit, an article from last week that shows how Alberta’s reliance on healthcare staffing agencies has exploded.

I couldn’t find reliable net income information about either agency.

Squeezing public sector workers through wage freezes and mandatory overtime, and then outsourcing the resulting empty jobs is privatization by stealth, buoyed by necessity thanks to an invented crisis. Nurses in the public sector don't have to be worked to death for wages that can’t keep up with inflation; this has been a political choice made by governments all across Canada to carve up public systems and pass them off to private operators. 

It’s a win-win for someone like Doug Ford who doesn’t care if the public system ultimately pays more for these nursing services. It takes human resources management out of public administration and replaces it with contract management. This creates a self-fulfilling prophesy: the private sector becomes both the only place to work if you want good wages and better job conditions, and the only place to seek medical help, if you want that help tomorrow. 

Coté is the best characturist in Canada. Here’s his latest: the first nurse says: “Hello, I’m Stephanie, private nurse.” The second nurse responds, “Hello, I’m Martine, public nurse”