Province Tables Legislation to Limit Public Sector Wage Increases

On June 5, 2019, the Ontario Government introduced Bill 124, the Protecting a Sustainable Public Sector for Future Generations Act, 2019. The Bill applies to a wide range of employers in the public sector, including Ontario Crown agencies and corporations, school boards, universities, hospitals, and long-term care homes (subject to prescribed exceptions). It does not apply to municipalities or municipal boards.

The Bill proposes to establish 3-year “moderation periods” during which salary increases are limited to 1% per year for both represented and non-represented employees in the public sector. For represented employees, the moderation period would generally begin on the day after the current Collective Agreement expires. For non-represented employees, the moderation period would generally begin on the earlier of: (i) a date to be selected by the employer that is after June 5, 2019; and (ii) January 1, 2022.

The Bill also proposes to authorize the Management Board of Cabinet to issue directives to employers requiring them to provide information relating to collective bargaining or compensation for purpose of ensuring compliance with the legislation. The Bill would also authorize the President of the Treasury Board to make orders declaring that a collective agreement or an arbitration award is inconsistent with the legislation.

We will continue to monitor the status of Bill 124. If you have any questions regarding how Bill 124 may impact your workplace, please contact the firm.


Evan Daikov