By Doug Nesbitt
It’s a sad state of affairs when a Conservative Party leader comes across as the champion of workers and unions.
Conservative Party leader Erin O’Toole has started the election by making big announcements. His plans are said to be pro-union and pro-worker.
After his Labour Day 2020 address, we made the case: “Beware the Corporate O’Toole.” Were we wrong?
Let’s look at his election campaign labour announcements.
In parliament and on the campaign trail, O’Toole talks about deindustrialization and job losses in the private sector. He talks about bad trade deals (no kidding). He’ll blame China for a lot of it.
O’Toole, however, makes no promise of reversing these corporate trade deals that have decimated private sector union jobs.
You won’t hear him talk about the 31-year trade deal with China signed in secret by Conservative Prime Minister Stephen Harper. You won’t hear him explain why he said nothing about the deal when he was a Harper backbencher.
In fact, O’Toole’s plan calls for more trade deals. It says nothing about revisiting or cancelling rotten deals, like NAFTA 2.0 which Canada’s major parties backed despite its concessions to American interests.
Citing the infamous Sears screwjob of 17,000 retirees, O’Toole says he’ll secure pensions for workers.
What’s the real Conservative record on pensions? Take the case of Hamilton’s steelworkers at the Stelco steel mill.
Harper signed a deal to allow US Steel purchase of the massive Stelco steel mill in Hamilton. In less than a decade, US Steel broke the purchase agreement, declared bankruptcy, and set about robbing the pension of thousands of Hamilton steelworkers.
Prime Minister Harper and the Conservative Party did absolutely nothing to punish US Steel for breaching the agreement or screwing Hamilton steelworkers. Erin O’Toole was a Harper backbencher. His mouth was zipped tight.
Unions: Private vs Public Sector
O’Toole talks about private sector unions because his agenda includes grim plans for public sector unions. When Conservatives are financing corporate handouts and tax cuts for the rich, it’ll mean squeezing transfers to the provinces. This will lead to hard times for workers in healthcare, education, childcare, public transit, and other critical public services.
The Conservative playbook is all about bashing public sector unions as a drain on tax dollars, all while turning a blind eye to union-busting job killers in the private sector. We should see the divide and conquer strategy coming from a mile away.
Like Harper and Trudeau, odds are damn high O’Toole won’t hesitate to break a strike on behalf of Canada Post, port authorities, CN, CP, or Air Canada.
Gig economy bait and switch
O’Toole has also decided he’s a champion of gig workers who have no benefits. O’Toole’s solution is setting up an “Employee Savings Account” to have gig companies pay the equivalent of EI and CPP.
But gig workers have no benefits because they are deliberately misclassified as “independent contractors” to legally prevent unionization! These chump change savings accounts will have none of the actual benefits of EI or CPP.
The big favour here is really for gig economy employers. Companies like Uber have been lobbying Canadian governments to provide a small safety net for gig workers. Uber’s strategy is about derailing gig workers from fighting back and organizing unions. O’Toole is only too happy to oblige.
O’Toole’s gig worker scheme is a step towards establishing another second-class tier of workers, like Canada has with migrant workers, agricultural workers, young workers, etc.
Employment Insurance: Back to status quo
Speaking of Employment Insurance, O’Toole says he’ll introduce a new formula that will boost EI wage replacement rates from 55% to 75% in regions with exceptional unemployment. This sounds good, eh?
Well, don’t get excited. It’s only going to be temporary. More chump change.
O’Toole shows no interest in reversing the assault on unemployed workers started by Mulroney and continued by Chretien, Martin, Harper, and Trudeau.
EI contribution rates have been cut for decades as part of the wider program of business tax cuts and attacks on workers. EI access was already at historic lows of 40% in the 25 years before the pandemic. Over 90% of the unemployed used to have access in the 1970s. Wage replacement rates used to be 75% in the 1970s and were cut down to 55% in the 1990s.
EI failed as a safety net at the start of the pandemic because of all these cuts and brutal means-testing. This failure created the demand for immediate income supports, resulting in CERB/CRB.
Help on EI? Nope. O’Toole will take us back to the same EI system that failed at the start of the pandemic. He’ll likely also continue the Liberal-Conservative practice of pinching billions from the EI surplus to balance budgets and finance corporate handouts.
Workers on corporate boards
O’Toole appears to have big ideas about workers running businesses. He says workers will get representation on the corporate boards of big federally-regulated companies. This would include Air Canada, WestJet, CP Rail, CN Rail, the banks, and presumably crown corporations like Canada Post.
O’Toole provides little more detail than that. There are no answers to basic questions of how worker representatives will be elected or selected.
We can presume workers will not have a majority on these boards, so what real advantage does this have for workers and their unions? Not much. Worker reps will be isolated, and probably wined and dined with the result that some will be bought off or give up (it happens).
One or two reps on a company board cannot substitute for the gains won through strike action.
O’Toole has also pitched “Employee Ownership Trusts” as a way of helping employees get more dollars. Sounds good. But how do these trusts work?
EOTs are a form of profit-sharing and employee ownership. EOTs can also arrange for those funds to be deposited in an employee retirement plan. The trust holds the shares of the company with the employees as its beneficiaries. The trust is controlled by a trustee. Is the trustee elected? Yes, they are (s)elected by the company’s Board of Directors.
It is essential to understand that EOTs are an indirect form of employee ownership. In other words, it is a powerless form of ownership. The company will still run like any other profit-seeking enterprise. Senior management and their corporate allies on the Board will still call the shots. Even with a worker rep on the board, corporate concerns over profits, revenues, market share and regulation will come into conflict with worker interests.
And here it comes…EOTs also provide a big handout to the business class. O’Toole pledges that any company owner selling a company or some shares to an EOT will get a “tax advantage”. This almost certainly means rich business owners can sell their company and pay no capital gains tax. This is the case with British EOTs. It is also true of the America’s version of the EOT called ESOP (Employee Stock Ownership Plan).
Some chump change profit-sharing for you while the business class gets fat tax breaks.
Beware the Corporate O’Toole
O’Toole’s promises for labour are a bait and switch. They look good on the surface but do not change the balance of power between workers and the business class.
O’Toole’s proposals for gig workers and Employee Ownership Trusts throw crumbs at workers to distract from the big favours for the corporate rich.
O’Toole champions private sector unions as part of a divide and conquer strategy. He wants to drive a wedge between workers in the private and public sectors. This is torn from the neoconservative playbook of the 1980s and 1990s. It worked a lot for them. Organized labour must unite against O’Toole, not be divided by him.
O’Toole remains the leader of a party built around privatizing public services, busting unions, and screwing workers so the business class can grow fatter and more powerful.
What are labour’s priorities?
Despite the hollowness of his claims, O’Toole is a big danger.
Political education inside and outside our unions is necessary to take on O’Toole’s demagoguery. However, it is highly unlikely that an intensive and effective effort can be mounted before the election is over.
O’Toole’s championing labour reforms is a wake-up call for trade unionists who aren’t fooled by the Conservatives. Organized labour should be setting the political agenda for labour reform, not the bloody Tories.
Whatever the outcome of the election, principled trade unionists have a difficult road ahead. In addition to rebuilding power on the workfloor, we need to develop the education programs necessary to fight O’Toole’s deceptive schemes, and we need to figure out how to re-establish and advance a new labour agenda.
About the author
Doug Nesbitt is a co-founder and editor of Rankandfile.ca. He is a former union organizer and is currently a researcher in a union organizing department. He is also a labour historian and is currently writing a history of the Ontario labour movement’s fight against Mike Harris and the Common Sense Revolution.