The University of Calgary Faculty Association Wins 1.7% Retroactive Wage Increase in Important Arbitration Decision

Jul 31, 2020 | Bargaining, News

The University of Calgary Faculty Association (TUCFA) has just been awarded a 1.7% Across The Board (ATB) wage increase in an arbitration decision, retroactive to July 1, 2019. The decision contained a number of observations and conclusions that are relevant to the situation of the University of Lethbridge and its faculty as we enter negotiations under the current provincial government.

The first point had to do with the “provincial mandate.” In making the award, Arbitrator Andy Simms explicitly rejected the University of Calgary Administration’s position that a “provincial mandate” can be used to override the provisions of a collective agreement or that it should play any role in arbitration decisions. In his analysis of the administration’s argument, he writes: 

In seeking to justify its proposal’s departure from the range contracted for in the agreement to arbitrate, it [The University of Calgary Administration] argues:

The University recognizes that the Wage Re-Opener explicitly states that the outcome of the present interest arbitration shall be no less than a 0% ATB salary adjustment. However, the University did not contemplate the actions of the new Government of Alberta which tabled Bill 21: Ensuring Fiscal Sustainability Act, 2019 which introduced the Public Sector Employers Act. The University also did not anticipate the new mandate of -2% from the PBCO [Provincial Bargaining Coordination Office]. Given that the University is a publicly funded institution in Alberta, the University ignores the government’s direction on this issue at its peril.

The University was asked whether the legislation, which delayed arbitration and brought the PBCO and Ministerial directives into play in public sector bargaining, provided any authority to allow an arbitrator, under this wage reopener, to ignore the parameters set by the parties. It was unable to point to any such authority. I have examined that legislation and similarly can find no legal basis upon which I can alter the contractual mandate given me by the parties in their agreement….  

Having found nothing and been referred to nothing that changes my contractual mandate, I find I cannot lawfully entertain a proposal for a 2% roll-back. In any event, I would not be persuaded, on the evidence before me, that such a roll-back would be appropriate for this bargaining unit. I refer below to three subsequent arbitration awards, as well as the Saskatchewan teachers award, that came to a similar conclusion (6, 8).

As Simms went on to show, moreover, a “government mandate” that focussed on ATB wage cuts for teaching and research faculty in the post-secondary sector was out-of-keeping with the recommendations of the MacKinnon report — which the government is using to justify cuts to university funding in the first place:

The “Blue Ribbon panel” produced an influential report on Alberta’s spending position. It was left to others to evaluate and decide upon provincial taxation policy and other aspects of direct provincial revenue. It [sic] comments on Alberta’s spending on post-secondary education include the following at p. 41:

Alberta spends significantly more per student full-time equivalent (FTE) than the three comparator provinces. Alberta spends $36,500 per FTE while British Columbia spends $31,300 ($5,200 less), Ontario spends $21,500 ($15,000 less), and Quebec spends $25,800 ($10,700 less).

For Alberta, 77 cents of each dollar is used to deliver post-secondary programming. By comparison, British Columbia spends 87 cents, Ontario spends 77 cents and Quebec spends 67 cents on post-secondary programming. However, the big difference [sic] are in the amounts spent on administration. Alberta’s spending on administration at $8,372 per FTE is slightly lower than Quebec but significantly higher than British Columbia at $4,233 and Ontario at $4,910. (emphasis added [- Simms])

The MacKinnon Report, in several areas – particularly K-12 education and health care spending – found Alberta’s wage rates to be higher than elsewhere. No similar observations were made specifically with respect to post-secondary academic salaries [emphasis added – ULFA]….

I find this helpful because, if post-secondary institutions are to diversify their revenue sources they cannot simply do so through austerity and efficiencies. Much of the ability to attract research, government, and philanthropic grants depends directly on the quality of the faculty and the work they do. Much the same is true in attracting foreign students. The same is true of the University’s ability to capitalize on contributions and incentives that depend directly on the reputation (often the international reputation) of its faculty, individually or in teams (p. 9).

Indeed, Simms pointed out, an emphasis on performance-based funding, of necessity, results in a greater rather than a lesser emphasis on inter-institutional comparisons, including salaries. Since the institutions are being compared — meaning that they are believed to be comparable — in terms of their performance, Simms argued, the desirability of eliminating pay differentials through a comparison of wages also should be considered in arbitration awards:

The move to performance-based budgeting of necessity involves measurement and comparison. For the University of Calgary, the most direct comparisons will be to the University of Alberta. This makes it harder to justify an 8.8% or similar differential between the two institutions (pp. 21 and 31).

Finally, Simms also discussed the degree to which government expectations interact with market expectations in reaching wage settlements. Noting that government pressure undoubtedly affects the way a University responds to financial challenges, Simms nevertheless argues that  

[i]t is by no means obvious that salary reductions will be the option favoured by either side. This is particularly so if the result is salary levels that reduce Calgary below those institutions to which they have customarily compared themselves. There are other approaches, perhaps involving a reduction in staffing levels, or the elimination of programs, that will find more favour than salary reductions or restraint to the point where the academic staff member’s buying power is eaten up by ongoing inflation. Another approach, suggested by the MacKinnon panel, is a readjustment in the amount spent on administrative costs. I only note this, but I have no independent basis on which to suggest this should be a favoured option.

The academic salary component of the University’s budget is sufficiently large that it is easily seen as a target for reductions. However, academic salaries, whether under an arbitration regime or a free collective bargaining regime, still involve market factors and the comparisons that at least partially drive expectations.

Indeed, as Simms points out, despite similar “provincial mandates” calling for ATB wage rollbacks of -2% or -3% across the public sector, all arbitration decisions in the province since the election of the new government have resulted in either a wage increase (AUPE 1%, TUCFA 1.7%) or wages staying the same (UNA, ATA). There have been no examples of voluntary wage rollbacks — a fact pointed to, as Simms notes, in the UNA ruling, where the Arbitration Board explicitly 

rejected the Employer’s request for a roll-back and referred to the lack of any examples of such a result in free collective bargaining. It adopted the words of Arbitrator Peltz:

On this approach to replication, we observe that the government acting reasonably would accept the reality that it cannot, without unacceptable consequences, force public sector units to roll back wages at this time. Saskatchewan Teachers’ Federation v. Saskatchewan School Boards Assn. (Renewal Collective Agreement Grievance) [2018] SLAA 9 at para. 73

In his conclusion, Simms returned to emphasise a number of points that are particularly relevant for the situation at the University of Lethbridge:

I find this increase is justified by a comparison to the salaries in place for similarly placed academic staff…. The justification of this comparison is increasing as the Province establishes a funding structure that will inevitably compare the institutions’ performance, the one to the other….

One of the unfortunate by-products of policy or pattern bargaining across public sector workforces, and across the Province, is that it tends to put at a relative disadvantage institutions and employees that have already worked to constrain expenditures…. It precludes consideration of the type of market forces that produce an equilibrium between institutions and allows little or no recognition of each institution’s history or current needs.

The U-15 survey comparisons are also supportive of this increase. The data establishes that the University of Calgary’s ranking in comparison to that group has declined. These comparisons represent the dominant market for academics in Canada. I agree… that this data shows a significant downward trajectory in comparison to similar institutions.

An increase is also supported on the basis of the projected cost-of-living changes…. Academic staff perform a whole range of important teaching and research functions. Academics gain little when the economy is booming in comparison to employees in other industries. It is not inappropriate for that reason that their salaries increase, for this year, to at least compensate them for their decreasing purchasing power.

This process (and others) was delayed to allow consideration of the MacKinnon Report. Its conclusions about public sector employment generally are not specifically directed at academic staff. Indeed it suggests the cause of higher per student costs primarily lies elsewhere. (34-35, emphasis added – ULFA).