Labor’s Big Retreat

Linda Diebel September 27 1982

Labor’s Big Retreat

Linda Diebel September 27 1982

Labor’s Big Retreat


Linda Diebel

For weeks workers on the line at the General Motors plant in Oshawa, Ont., had been wearing buttons instructing their union negotiators to STOP CONCESSIONS. Still, there was a collective sigh of relief when United Auto Workers Canadian Director Robert White announced a tentative agreement with the company last week, even though the pact fell far short of that demand. Among the UAW rank and file, workers such as Don Matheson, a 36year-old maintenance worker with 14 years seniority, were understandably disappointed with a contract that cost them as much as nine days in annual paid leave. But they could live with its shortcomings. Matheson and his wife, Marion, a line worker with six years at GM, realized that the alternative was $65 a week in strike pay. Said Matheson simply: “We have a house, a car and two kids . . .1 can put up with what we are

being offered. I guess I am happy just to go on working.”

Not since the union organizing drives in the early 1900s has labor been pushed so forcefully to the wall or felt so beleaguered. Unemployment is at a postDepression high of 12.2 per cent, with at least 1.5 million Canadians out of work. Organized labor’s ranks have been thinned by layoffs and closures, and what purchasing power workers still possess has been gouged by inflation and interest rates. Those pressures—as well as government and corporate influence-haunt union leaders at the bargaining table, forcing them to behave pragmatically and hoping to fight another day. The UAW’s White gave up the hard-won right to paid days off for his membership grudgingly but knows the alternative was a strike. “There’s not only a squeeze on anybody who is in collective bargaining today,” he says, “but there’s a squeeze on anybody who has a collective agreement. The labor movement is under intense pressure.”

Jean-Claude Parrot, leader of the militant Canadian Union of Postal Workers and a Canadian Labour Congress vicepresident, is soft-spoken in his chilling assessment. “The unions are fighting, but the fight is tough, very tough, and the odds are all against us. The other side is strong; they have everything on their side.”

Increasingly, in a time of layoffs, cutbacks, shutdowns and freezes, that attitude reflects the fears of working people across Canada. In Port Alberni, B.C., where only a few hundred men from a regular work force of 4,000 had work last week, welfare workers anguish over

the increasing case load, and townspeople worry about mortgage payments. In Sudbury, Ont., where Inco has laid off 10,000 steelworkers until January, 1983, Copper Cliff refinery employees talk about their mortgages and families and ask, “What can you do?”

Canadian workers once marched to Solidarity Forever, their voices exu-

berant as they sang: When the union’s inspiration through the workers’ blood shall run/There can be no power greater anywhere beneath the sun. But if fears in some labor circles are borne out, Canadian unions will have to use all of their muscle just to survive in the icy climate of recession.

They are not alone. Unions in Europe, Britain and the United States are reeling under the combined blows of mass unemployment, intense international competition for markets, and the extinction of highly unionized industries that had been traditional pacesetters for wages and benefits. This week Brit-

ish unions designated Wednesday as a Day of Action, when workers were to leave their jobs in support of health service employees, who are locked in a dispute with Prime Minister Margaret Thatcher’s Conservative government. And a successful display of solidarity was vital. After an abortive rail strike in June British unionism is floundering. Badly.

In France, Germany, Italy and the Benelux countries, widespread unemployment has depleted union finances,

making strikes virtually unsustainable.

In the United States, President Ronald Reagan’s victory last year over the striking air traffic controllers still chills union militancy. In that case, 13,000 members of the supposedly powerful Professional Air Traffic Controllers Association (PATCO) walked out to protest against working conditions that they believed endangered public safety in the air. But they also defied a federal law prohibiting strike action, and Reagan seized the chance to fire them. Then he took legal action to crush the union. Suddenly, the battle cry of “No backward step”—coined by John L. Lewis in

the 1920s to rally his army of coal miners against pay cuts—sounded like a sick joke as unions began to settle for less just to stay alive.

It took longer for the government to bear down on organized labor in Canada, but the campaign began with the June 28 federal budget. Until then, labor, while not necessarily optimistic, was still on the offensive. Even at the annual CLC convention in Winnipeg on May 24 the delegates (representing 2.3 million workers) were determined to

take any steps needed—“up to and including a general strike”—to prevent Ottawa from imposing wage controls. “Consider the turtle. He makes no progress until he sticks his neck out,” declared the CLC’s dapper president, Dennis McDermott. “We have our necks out, and I guess I am on the tip of it.”

Just a few weeks later, then Finance Minister Allan MacEachen drew the battle lines by announcing that the government had torn up the contracts of 500,000 public servants and Crown corporation employees. In the name of a Six-and-Five restraint program there would be a mandatory six-per-cent ceiling on wage and salary increases over the first year and five per cent the next. The right to strike (once considered a cornerstone of democracy) would be removed.

Overnight, the public sector was isolated from the private sector unions, singled out by the federal government to set an example for all other Canadians to follow. Treasury Board Chairman Donald Johnston and his cabinet colleagues—including the enigmatic Labor Minister Charles Caccia (see page 35), whose second-row seat in the Commons reveals his second-level rank in the Trudeau cabinet—opened up a campaign to convince Canadians that unions “are not entitled to increases in salary in the absence of


substantial gains in productivity.”

For those who might feel that such an attitude places an unfair burden on labor, Ian Sinclair, chairman of both Canadian Pacific Enterprises Ltd. and Ottawa’s blue-ribbon 6/5 Committee, had an answer. “I would never support any controls program on the basis of equity,” said Sinclair, who, in a recent show of personal restraint, slashed his own salary from $699,546 to $556,228. “Let’s face it, controls aren’t equitable.^ But a lot of things in this world aren’t equitable.”

Across the newly widened divide an apparently chastened McDermott is carrying a much smaller stick than he did at the May convention. In an interview at his suburban Ottawa home he acknowledged that any discussion of manning the barricades now has a hollow ring. “We have a pretty damn sober labor movement out there today,” he explained. Still, McDermott suggests that the recession could bring benefits to labor, because it “may tend to civilize the collective bargaining process a lot more than people expect.” It could, he enthused, even compel negotiators to take “responsible” positions.

But McDermott’s remarks ring hollow to unions that find themselves pinned down on the front lines. In Halifax firefighters have launched their second strike in three years, with Glen Stoddard, president of the Halifax local of the International Association of Firefighters, vowing at week’s end to keep the 242 union members off the job

until the city boosts its pay offer. “You wanted it. . . you got it,” said Stoddard to city officials as he led his men out. And in Quebec the Common Front of Quebec public and parapublic workers last week served official notice that they are not interested in bearing the brunt of provincial government restraint. The unions will fight for 11.9per-cent annual increases in their new contracts (the old one expires Dec. 31). Public sector employees face Quebec’s Bill 70, a law that would roll back their wages 18.85 per cent and freeze them for the first three months of 1983. And thinking along McDermott’s line has accomplished little in Port Alberni, on Vancouver Island, where unemployment insurance will soon run out for a few thousand jobless lumber workers. For his part, Employment Minister Lloyd Axworthy says that he does not want to “rush into” extending benefits beyond the 52 weeks provided by current legislation, because he is concerned about the cost to the system; and new job opportunities at the pulp mill and in the forests are not expected before 1985.

That prospect offers little hope to people such as David Tyler, 29, who is married with a 16-month-old daughter, a three-bedroom townhouse in Port Alberni and a mortgage payment of $578 each month. Tyler cannot meet these expenses so he has his place up for sale. He has not worked since July, 1981, when he lost his job as a production worker in a MacMillan Bloedel sawmill, and he has virtually no chance of landing a new job soon. “There are days

when you just like to forget everything,” he says. “It’s depressing.” And Tyler backs the firm refusal of his union, the International Woodworkers of America, to permit a rollback of wages for its members, arguing that “it [a rollback] wouldn’t have put me back to work anyway.”

All of British Columbia, meanwhile, is caught up in a dispute between the 40,000-member British Columbia Government Employees Union and Premier William Bennett’s Social Credit government. The government is offering the BCGEU—which is coming off a threeyear contract that gave its members an eight-per-cent increase annually—a maximum of 6.5 per cent in the first year. Provincial authorities maintain that because of the present state of the economy that is all the government can afford and it has been cutting social programs to prove it. The union has been imaginative in its response, with General Secretary John Fryer offering to pass up a wage increase if the province uses the money to create jobs for the unemployed. “For some years,” Fryer told Maclean's in a clear-cut statement of labor’s new vulnerability, “public sector unions have realized that all-out confrontations don’t work. All they do is allow governments to save lots of money.”

Fryer admits to being worried about the union movement’s short-term prospects. “This is the worst economic climate in the living memory of most trade unionists,” he says. “And employers are becoming incredibly hawkish.” Many smaller companies are

trying to emulate the hard-nose, don’t give-an-inch tactics used by B.C. Telephone, a large utility with a record of poor labor relations. And that kind of stance may become the norm for business, Fryer fears. B.C. Tel recently fired 2,000 workers after the courts ruled that it had not given enough notice for an earlier, temporary layoff. “They believe in Bolwerism,” said Fryer, referring to George Bolwer, a vice-president at General Electric in the 1950s who approached the first bargaining session with a written final offer for the union. He also had a statement, which read: “Here’s what you will be settling for. Take it or leave it.”

Northern Ontario nickel miners and their families are keenly aware of the problems involved in working for a tough employer. Both Inco Ltd. and Falconbridge Ltd., the largest nickel producers in the world, recently announced new, longer layoffs as well as plans to slice staff in Sudbury early in 1983. The decisions were a hard blow for the United Steelworkers of America (at Inco) and the Mine, Mill and Smelter Workers Union (at Falconbridge) in a city where 13,000 are already jobless.

Sudbury currently holds the dubious honor of being the unemployment capital of Canada.

Ironically, federal Mines Minister Judy Eróla is a native of the area and represents the surrounding constituency of Nickel Belt. Although she makes headlines locally each time she puts on a hard hat, she has not alleviated the hardship faced by Sudbury residents.

Richard Mohns, for one, has worked for Inco since 1975, most recently at the smelter. But his seniority will not be enough to save his job when the staff cuts are made in January. He lives with his wife, Susan, and their two children in a new home where the $250-a-month mortgage payments keep his finances tight. “I’m extremely frustrated, and I’m not alone,” he says. “Sudbury right now is like a pot of water on the stove— and it’s about to boil.” Mohns and two other workers have formed the Laid-Off Inco Employees Committee (LIE) to counsel and assist the 1,050 who will be thrown out of work. But, he admits, “There is an air of hopelessness. Every time Inco makes an announcement, everyone shudders.”

Counselling is also being provided in Hawkesbury, Ont., where the 84-yearold Canadian International Paper Co.


(CIP) mill, which produces sulphide pulp used in the manufacture of cellophane and rayon, is permanently closing its doors on Dec. 1, throwing 440 out of work. A team of company specialists is studying each case and suggesting the kinds of jobs a worker might look for, providing advice on how to write a résumé and related assistance. The pressure faced by Canadian labor can perhaps best be evoked by one grim Hawkesbury scene: one day last week, 58-year-old Armand Larocque waited nervously for his appointment with the company specialists to learn how to write a résumé—after 40 years on the job. Leaders of Local 28 of the Canadian Paper Union blame governments for high interest rates and promise to get better severance pay for their members. But the union leaders have little muscle to work with.

Even in Cape Breton, where times have been tough for so long in the Atlantic provinces’ only industrial centre that workers have become stoically inured to appeals for wage restraint, labor faces a gloomy scenario. As president of District 26 of the United Mine Workers, Ray Holland represents 3,500 miners at the federally owned Cape Breton Development Corporation (DEVCO), the largest island group to fall under Ottawa’s Six-and-Five program. He dismisses the restraints as “an attempt to blame the ills of the economy on labor.” But then he admits the futility of organized labor’s opposition to controls in the face of federal manipulation of public opinion. Another miners’ strike, he says, would be “a fool’s errand .... When you lead people somewhere, you have to have something in mind for them when you get there. You don’t just lead them to the edge of the cliff, like PATCO did.”

When unions are squeezed, their newest members are the first to suffer. Raj Chouhan, president of the Canadian Farmworkers Union, said that it became increasingly difficult to organize workers during the summer because people laid off from other jobs scrambled to find work in the fields. In British Columbia’s Fraser Valley more than 60 per cent of the 10,000 farm workers are women, and Chouhan noted that they are facing double oppression. For one thing, they are unable to get good jobs to begin with. For another, they now risk being pushed out of picking jobs by men, who are flooding the market. (Farm workers are not covered by provincial minimum wage laws.) “There is little doubt women are the hardest hit,” observed Laurell Ritchie, organizer for

the Canadian Textile and Chemical Union. “Wage controls freeze them into an unequal position; they are already the workers at the lowest income levels.”

Ritchie attended a meeting between unionists, women’s groups and Ontario Labor Minister Russell Ramsay. The minister told them they should not press for legislation providing equal pay for work of equal value in the current recession because such a law would be “the straw that breaks the backs of many companies struggling through the recession.”

A common thread joins the Six-andFive thesis of the federal government to that of the varying public sector restraint programs of the provinces—including Ontario, which is expected to announce its plans this week. It is the belief that working people have a duty to make wage and salary concessions in order to help rescue the economy. Sam Gindin, UAW research director, argues that the theory accompanies “the argument that corporations such as oil companies should be given concessions in the form of tax writeoffs, subsidies and loan guarantees. Concessions from working people should become concession to the corporations, and this ultimately should provide us with a better future.” It is not surprising that such union leaders as Robert White agonized over every concession. They have already made involuntary sacrifices as real wages for Canadians have fallen over the past five years while unemployment has steadily grown.

Coupled with the concessions argument, says Ritchie, is a familiar political plea to workers to increase produc-

tivity. It is brought into play, she says, only “when it suits them and dropped when it doesn’t.” To illustrate her argument Ritchie points to mail sorters in the post office, who are told that they can only expect wage increases if their productivity goes up. Then, the post office brings in new equipment for sorting, and the same workers, using the machinery, achieve greatly improved production levels. But, instead of getting a wage increase, management argues that their salaries should be reduced because their jobs have become “deskilled.”

Not everyone is convinced that wage concessions will do anything to protect jobs. Argues United Steelworkers Research Director Peter Warrian: “Companies aren’t offering any guarantees in contracts; they aren’t promoting the Japanese-style arrangements, where you are with a company for life. Instead they are saying, ‘Roll back your demands or we’ll lay you off.’ ” Not only that, but, charges Warrian, the current recession has been caused by high interest rates and the squeeze on demand, not by wage costs. And taking more money away from more workers is not going to stimulate growth or recovery he says. “If you throw steelworkers or autoworkers out of work, it just means they can’t afford to buy cars, so more autoworkers lose their jobs. It’s a cycle,” says Warrian.

In Canada there has always been a strong argument that the need is not so much for marginal improvements— such as concessions from workers—but for structural changes in an economy that has been damaged by cash-starved U.S. parent companies that siphon funds out of Canada through their subsidiaries. U.S. ownership, said Warrian, is still a serious problem. The Canadian Institute for Economic Policy recently released a study that claimed that, through dividend payments and other charges, parent firms drained $1.5 billion from the Canadian manufacturing industry between 1976 and 1980—a rate that is increasing because the recession is leaving head offices desperately short of working capital. During UAW negotiations, GM of Canada President Donald Hackworth threatened to shut down Canadian car production completely if Canadian workers did not modify their demands. And that, says the UAW’S Warrian, was “corporate blackmail.” He adds: “Since the Second World War, Liberal strategy has been based on exporting our resources and encouraging foreign investment. Well, that strategy has run out of gas. It’s time for a change.”

But the consequences of the squeeze on labor are less debatable than the causes. Currently, unions, such as the UAW, are so strapped for funds that a

prolonged strike could be financially ruinous for its members. A worker, such as Jerry Cowle, who has been on the line at GM for nine years, is torn between his right to fight to improve his lot and his awareness of the futility of battling a company belabored by today’s economy, for whatever reason. He voted for the agreement reached by the union leadership and says laconically: “My real income will definitely be less, but I can live with it. We did better than the States. And I have still got a job, and that’s the main thing.”

Still, unions that manage to survive this recession but become, in the process, too weak, too poor and too frightened to fight for their membership will almost certainly lose their battle for survival. Currently, an estimated 92 per cent of the working adult Canadian population works for somebody else.

“For most of these people,” wrote Washington columnist Nicholas von Hoffman of their U.S. counterparts, “without union power there is no power . . .so that we are left with only merchandising surveys and public-opinion polls to make our preferences known.”

The CLC’s McDermott tries to look at the bright side. “If adversity and hard times breed character,” he says wryly,

“we’re going to have a helluva lot of character.”

But the sense of pessimism is deepening, and the ability of such leaders as McDermott to lead the rank and file through the bleak times ahead is still unproven. If he is right then, perhaps, instead of doom the predictions of Sid Parker, New Democratic MP for Kootenay East-Revelstoke will start to ring true. Forecasts Parker: “When there is less fear for their jobs, the unions will try to improve their lot.” They will take a“strong position” in six months, Parker declares. “Unless conditions are much improved, the government will have a lot of problems with the trade union movement,” he warns. Instead of simply being able to mop up the remains of trade unionism, government and industry could find a newly invigorated avenger. But for now that prospect holds little threat—or promise.

With Malcolm Gray in Port Alberni, Jane Mingay and Susan Riley in Toronto, Shona McKay in Oshawa, John Hay in Ottawa, Anne Beirne in Hawkesbury, Parker Donham in Sydney, William Lowther in Washington, Carol Kennedy in London and Peter Lewis in Brussels.