On August 16, 2012, the provincial government released the Putting Students First Act, 2012, (the “PSFA”) its attempt to bring the increasingly unruly education sector into line. The PSFA legislates employment terms and conditions on virtually all employees employed in the public education sector. The PSFA imposes a broad compensation freeze on all employees and effectively imposes the July 5, 2012 memorandum of understanding negotiated between the Ministry of Education and the Ontario English Catholic Teachers’ Association (the “OECTA MOU”) on all unionized employees. All school boards and unions are required to complete collective agreements by December 31, 2012.

It should be remembered that, as of August 16, 2012, the House is not sitting. The PSFA has not been introduced in the House and may not be introduced any time soon. As well, it is highly questionable, and perhaps even doubtful, whether the government has the support to pass this law or a variation of this law if it even makes its way through the House. Notwithstanding that reality, the P utting Students First Act, 2012 clearly shows where this government intends to go should it obtain the majority it probably needs to pass this legislation.

Employees Who Do Not Bargain Collectively

For non-unionized employees, the PSFA freezes their compensation or rate of pay as of September 1, 2012 for a period of two years, although that period may be further extended by regulation. As with previous wage restraint legislation, compensation is broadly defined and includes salary, benefits, perquisites and all forms of non-discretionary and discretionary payments. The compensation freeze does not apply to directors and superintendents earning more than $100,000, whose compensation has already been frozen pursuant to the terms of the Broader Public Sector Accountability Act, 2010.  

All sick days accumulated by non-unionized employees as of August 31, 2012 will stand to the employee’s credit but no sick leave days will accumulate after that day. Upon the retirement of the employee, sick leave credits that accumulate until August 31, 2012 shall be paid out to the employee at the employee’s rate of pay as of August 31, 2012. Going forward, non-unionized employees are eligible for 10 days of sick leave at 100% of their salary and thereafter 120 days of sick leave at a rate of pay of 66.67% or 90%, if the entitlement to 90% has been determined through an adjudicative process agreed to by the employee and the board. Any service credits also will not accumulate after August 31, 2012.

Employees Who Bargain Collectively

With respect to employees who bargain collectively, the Putting Students First Act, 2012 preserves only the façade of collective bargaining. All boards have a “mandate to negotiate for collective agreements”. However, that mandate, and indeed bargaining itself, is greatly circumscribed by the PSFA. The mandate given to school boards is to negotiate the terms of the OECTA MOU. For teachers, school boards must bargain for a collective agreement that includes and is not inconsistent with the terms of the OECTA MOU. For non-teacher bargaining units, school boards must bargain terms and conditions that are substantially similar to the OECTA MOU or to a memorandum of understanding entered between the bargaining agent and the Ministry prior to August 31, 2012, provided that memorandum of understanding is substantially similar to the OECTA MOU. It would appear the Ministry believes that between now and August 31, 2012 there is time for further memoranda of understanding with non-teacher unions. Moreover, any term in any concluded collective agreement that is inconsistent with the OECTA MOU is inoperative during the two-year restraint period.

Under the terms of the PSFA, once the parties believe that they have concluded a collective agreement, before it becomes operational, it must be submitted to the Minister. If the Minister is satisfied that it has adopted all of the terms set out in the OECTA MOU, she will declare the collective agreement in force. If she concludes that the collective agreement does not contain the terms in the OECTA MOU, she will not declare the collective agreement in force and the Lieutenant Governor in Council then has a number of powers. It may impose a collective agreement on the parties – no doubt a collective agreement that applies the terms and conditions set out in the OECTA MOU – and prohibit a union from striking or a school board from locking out employees.

During the period of time when no collective agreement is in force after September 1, 2012 (i.e. when the parties are engaged in bargaining) no school board may apply, agree to or implement any terms or conditions of employment that are inconsistent with the terms of the OECTA MOU. The OECTA MOU, at least as far as the PSFA is concerned, is the governing agreement in public education.

As we indicated at the outset, it is doubtful that the PSFA will pass before the start of the school year and doubtful it will pass at all unless this government is able to achieve a majority government in the upcoming by-elections. Having said that, should the PSFA Act pass it will no doubt be subject to a constitutional challenge under the freedom of association protections of the Canadian Charter of Rights and Freedoms. Although the PSFA requires school boards and unions to bargain, the effect of the Act is to eliminate free collective bargaining in the sector.

Under the PSFA, there is no way not to conclude a collective agreement that does not include all aspects of the OECTA MOU. As well, the PSFA eliminates the right to strike and lock out during the two-year restraint period. It is clear that the government is mindful of a constitutional challenge. The PSFA expressly provides that neither the Ontario Labour Relations Board nor any arbitrator may make any decision on whether any provision of the PSFA is constitutionally valid and so such a challenge would have to be brought in Superior Court. No doubt the government will respond to any challenge by asserting that tough economic times justify certain time-limited restrictions on collective bargaining rights.

Political Context

Premier Dalton McGuinty has warned that he will recall the legislature early from its summer recess for a vote on the bill if contracts are not reached in time to avoid $473 million in teacher pay raises that would automatically take effect on September 1, 2012. If the pay raises proceed and the banking of sick days continues, they will be clawed back under the legislation – in the event that the minority Liberals can get the support of the NDP or the Progressive Conservatives.

NDP House Leader Gilles Bisson has stated that it is too early to tell whether members of his party would support the bill. Mr. Bisson accused the Liberal government of over-blowing the risk of a teacher strike in order to win support. “They’re trying to create a crisis in the background of the by-elections,” he said referring to the empty seats in Vaughan and Kitchener-Waterloo. In the event that the Liberals win both seats in the by-elections scheduled for September 6th, they will have a majority government.

All of this is to say that it is business as usual (or perhaps unusual) in education. School starts on September 4, 2012. If the PSFA is not passed by then, every bargaining relationship in every school board will be in different states and most will be in states of uncertainty. Some relationships will be in a strike/lock out position, some relationships will roll over the terms of the previous collective agreement and some, although it appears few, will have concluded collective agreements based on the OECTA MOU.

Already ETFO is calling for a day of action or protest, although it is not clear what they have in mind. OSSTF has indicated that it will continue talks with eight boards around the province to find savings outside of wages. Ken Coran, the President of OSSTF, said that it’s “unrealistic” to expect results by September 1st. Coran stated, “We’re trying to come up with a different template” than the deal the province reached with the Catholic teachers and Franco-Ontarian teachers.

These events are taking place while OSSTF and one school board group have filed separate unfair labour practice complaints about various aspects of the process by which the Ministry has sought to achieve collective agreements in 2012, and while the province continues to languish under a massive and seemingly intractable deficit.

Indeed, it is a new school year and any party should be forgiven if they are as apprehensive as a Grade One student on her first day of school as to what the year will bring.