The purpose of this paper is to examine in more detail the nature and scope of two-tier wage systems in a Canadian context. The plan of the paper is as follows: first, it will examine the form which two-tier settlements have taken and provide some data on their prevalence. Second, it will examine possible legal implications of two-tier agreements, and in particular, whether a union which agrees to a lower wage rate for new hires risks violating its duty of fair representation. The final section assesses the long-term viability of two-tier wage systems.
Archives for June 1987
Part-time employment now stands at 16.6% of total employment in Canada and therefore governments and employers can no longer afford to ignore the demands of part-time workers for improved wages and benefits.
This paper attempts to examine part-time employment from both a legal and economic perspective, looking at the extent of part-time employment, the compensation arrangements for part-time employees with particular emphasis on benefits other than wages, and the apparent inequities in these arrangements. The treatment of part-time workers under existing employment standards and collective bargaining legislation is reviewed and the potential impact of the Charter of Rights and Freedoms is examined. Finally, the actual cost of prorating benefits for part-time workers or paying cash in lieu of benefits is examined within the framework of the model developed in 1982 by Reid and Swartz. Overall, the available data seems to indicate that these costs are not overly excessive.
Interpretation of the Charter, although uncertain at this point in time, may require governments to amend existing employment legislation as it pertains to part-time workers to eliminate any discriminatory elements, and consequently force employers to provide a full range of benefits on a prorated basis.
The time has come to recognize part-time workers as a distinct group and to provide equitable compensation in terms of wages, and especially benefits. This may result in a more satisfied workforce and have positive effects on productivity, turnover, and absenteeism, and thereby assist to a large degree in offsetting the increase in costs of providing the prorated benefits.