Opinion| Pay Freeze Step in Right Direction. Next, Eliminate Pay Catch Up.

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It was probably no shock to the 227 non-unionized staff at city hall when council this week decided to freeze their salaries until Jan. 1, 2018, a move that will bring about savings of $227,395, $181,915 in salaries and $45,485 in benefits, for the city over the course of 2017.

After all, they had had some warning.

Council, to the surprise of probably most taxpayers at the time since such raises had always been automatic, had voiced just such a possibility during budget discussions last spring.

And it had already set the stage in February by voting unanimously at the end of a three-hour budget session to freeze the honoraria, cell-phone and car allowances of the mayor and councillors for the 2016 and 2017 calendar years.

Citing low oil prices, illegal steel dumping and hundreds of recent layoffs, the resolution drafted by Councillors Paul Christian and Matthew Shoemaker said the city must lead by example in “tightening its financial belt in solidarity with our residents who are experiencing economic hardship.”

Those woes, of course, have gotten worse, with Essar Steel Algoma being behind somewhere around $20 million in tax payments, leaving the city in a position of running a deficit this year and who knows what thereafter.

Coun. Matthew Shoemaker, who moved the motion seconded by Coun. Frank Fata to freeze staff salaries, told council similar salary freezes were ordered by the provincial and federal governments during the 2009-10 recession.

He was right about that but he could have gone further. Governments at both the provincial and municipal levels are still imposing salary freezes on employees.

In January, facing slumping oil prices, a record deficit and a struggling economy, Alberta imposed a two-year wage freeze for non-union government employees.

“This is not a decision we made lightly. The Alberta Public Service is made up of hard working and dedicated women and men who do valuable work each and every day in the service of Albertans,” Finance Minister Joe Ceci announced at an afternoon news conference. “However, to maintain stability and protect jobs within the public service, we must deal with the economic realities we’re facing.”

The move will freeze the salaries — and movement within salary grids — for roughly 7,000 senior officials, managers and other non-unionized government employees at 2015 levels until at least April 2018, Ceci said.

In May of this year the council of St. John’s approved changing how the city negotiates contracts with management and non-union employees.

Previously, those employees — including the mayor and council — saw the same increases as were negotiated by the city’s union workers. Council decided it is no longer bound to give management the same increase as unionized workers.

Coun. Jonathan Galgay, chairman of the city’s finance committee, called it a “win-win” for taxpayers and employees, something I imagine the employees will dispute.

Galgay had originally called for an immediate two-year wage freeze, but he said the city received legal advice that employees should be given due notice of changes to how wages and raises are negotiated. He admitted he was “somewhat disappointed” in the watered-down motion council approved, but called it a compromise.

In November of last year Calgary’s city council nixed pay raises for nearly three dozen of city hall’s general managers and departmental directors for 2016 — sending what it said was an unmistakable signal to other departments.

“It’s more than sending a message, it’s dealing with reality,” said Coun. Ward Sutherland, vice-chair of the city’s priorities and finance committee.

In January of 2015, council had awarded top managers a 3.2 per cent pay hike for 2015, an increase of roughly $225,000 annually

Not all attempts at freezing wages go smoothly.

In Brampton last year John Corbett, the city’s interim chief administrative officer, recommended against the pay freeze council wanted, a move that eventually cost him his job.

Corbett told a sub-committee of council that with a wage freeze in place, staff morale would drop and it would be hard to compete for talent.

Instead his suggestion, which obviously came off the top of his head as it was not included in his report, was to decrease the number of non-union staff by 12 per cent by 2017.

At the meeting, staff presented two scenarios for the 2015 budget, one resulting in a 6.59 per cent increase to the city’s share of the tax bill, the other recommending a four per cent increase.

Neither scenario included the wage freeze council had asked for.

Council, of course, was more than a little angry and Corbett is no longer in the city’s employ.

I don’t think our city employees can really complain about the pay freeze. They are among the best paid in the city and get 12 paid holidays a year to boot.

But I think council has one more move to make – putting an end to the catchup for senior staff that seems to take place every five years or so.

This is where an outside firm is employed to find out what other communities in the north are paying senior non-union staff and always, it seems, returns with a suggestion that some catchup is in order.

That catchup, you may recall, in 2008 resulted in increases as high as 12 percent in some cases, then chief administrative officer getting the top prize, an $18,000 raise.

I don’t think we should care what other communities pay their senior staff. I think we should pay what the job is worth in Sault Ste. Marie and what Sault Ste. Marie can afford to pay.

There is the case made in some quarters, as Corbett tried to do in Brampton, that such increases are necessary to retain staff. I don’t agree with that.

People retire and they are replaced. If managers are doing their job, there should always be someone properly prepared to replace them.

As Cliff Sharp, a former publisher of The Sault Star, once said, if anyone really wants to find out how much he or she will be missed in the workplace, all that person has to do is stick a finger in a pail of water and pull it out. The pail of water will be the same, so will the workplace.

In a corporation the size of the City of Sault Ste. Marie, I think that would indeed be the case.

Doug Millroy can be reached at dmillroy@gmail.com

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  • Bill Nash

    Since non-union employee’s salaries aren’t determined by collective bargaining, some rollbacks should also be in order. The concept of “what the city can afford” should be applied. If non-union employees are disgruntled and develop a “low morale” and feel their heart isn’t in the job, perhaps they should resign and move to a city with a bigger trough to belly up to.

  • Linda Marasco

    Good article Doug. My Dad used that line on me all the time when I was stressed at work and felt the weight of the world on my shoulders … and you sure get it when you retire.

  • Mark Andrew Brown

    Saving taxpayers $227,400 by freezing non-union wages in 2017 is a good start, but that’s only about $7.58 a household. That’s not anywhere near enough to make life more affordable for city taxpayers.

    Plus, that pay cut will only mean that this Mayor and Council won’t cut our city services as deeply. The city is still facing a $3 Million dollar capital shortfall in 2017.

    I’m just wondering where Councillors Shoemaker and Fata and Mayor Provenzano and the rest of city council were with their, “similar salary freezes were ordered by the provincial and federal governments during the 2009-10 recession” back in 2015?

    You know, 2015, when our Mayor and Council were negotiating automatic yearly union pay increases that will amount to about $14 Million of our tax dollars by the time union contracts expire in 2019.

    $14 Million tax dollars wasted for “happy” unionized city employees by this Mayor and Council.

    It’s always expensive for us taxpayers when our governments REACT to tough times with CUTS instead of planning for tough times like this Mayor and Council should have done with a pay freeze during 2015 union contract negotiations like they were repeatedly told to do by myself ( http://tinyurl.com/2015ZeroPct ) and at least one other citizen who provided Budget Input to our Mayor and Council saying:

    “since salaries make up such a large component of the city budget, that has to be a
    central focus of budget control. Salaries and raises must be constrained by the city’s ability to
    pay today, not the expectation that taxpayers will cut their own household budgets so city
    workers can get above average cost-of-living increases. That is simply not sustainable. Many
    people in the Sault have not had raises in years or are otherwise on fixed income, yet they are
    expected to manage exorbitant property tax hikes to fund city salary hikes and perks. That’s just not right and it needs to be addressed.” (Comment #40 p.130 http://tinyurl.com/2015Apr13Agenda )

    Unionized wage freezes were a highly publicized option for this Mayor and Council’s way back BEFORE union contracts were negotiated in 2015.

    Get ready unionized city employees. You’ll be lucky to get a pay freeze in 2019.

    We citizens simply cannot afford the cuts to city jobs and basic city services that your automatic yearly raises cost.