With So Much Economic Uncertainty, We Must Not Support Any Wage Increases on Monday Night.
Because of the current economic uncertainty, I will not support any wage increases on Monday night.
These are unprecedented times. Now is the time for swift and decisive actions showing care for our citizens, our economy, and our city’s future, not for opportunism and political advantage.
As governments around the world come to grips with Coronavirus, we have many responsibilities. As your Mayor, I have consistently done what I believed was in the best interest of taxpayers and this is no exception. In fact, if I gave in to the resistance and barriers, I would not even write this note and would quietly leave my post. There’s never a good time to have this conversation and that’s why we are where we are. I’ll continue to share often, be transparent and share facts.
As your mayor, I have been clear that my number one priority has always been the taxpayer. Our community has been asked to shoulder an enormous burden for far too long. Declining revenue and costs rising well above inflation has crippled our fiscal stability, resulting in unaffordable taxes. These taxes will be even harder to afford with the layoffs, business closures and economic downturn facing our citizens.
The time for collaboration among all leaders in unions, government, businesses, and organizations has never been as crucial and tested in this way before.
Unions should unite to help, not to take
Bargaining needs to happen within present-day realities. This is why our labour agreements must reflect this new economic reality. While taxpayers are shouldering these changes I cannot in good conscious support raises for our union groups.
There is a tentative agreement for Local 18 coming to council on Monday night. If there are any raises, bonuses or barriers in this agreement — and I expect there to be — I cannot support it and I will ask councillors to not support it as well.
If you feel that no group should receive raises at this time, PLEASE CALL your councillor to voice your opinion.
This is a reflection of what our citizens are facing. Our labour unions are all well compensated and, unlike many taxpayers, will NOT be at risk of losing hours or their jobs.
We cannot give raises with taxpayer money when taxpayers are losing their jobs. Our employee groups need to take 0% raises, at a minimum. I won’t support anything more and we all need to ask council members to do the same.
Two vital aspects of this crisis
We have two major aspects to the response to Covid-19, first is the public health components and our need to follow the advice and flatten the curve. Second, we have the responsibility to develop a plan to respond to the global economic crisis. This will and has already impacted our community.
Yesterday a citizen asked me “when will this all be over”? The short answer is, we don’t know. We don’t know what normal is anymore, and we must act in the best interest of the community as a whole — a community of families, individuals, and businesses — all taxpayers.
I’m not trying to scare you, I’m trying to be the best leader possible. It’s our job as elected officials and city employees to take every step necessary to serve, protect, and ensure the sustainability of the community. Most citizens are worried about keeping their jobs right now and if their employer will be around next month. That’s the benchmark of our new reality.
We must control our budgets and put the city in a position to invest in those areas that will help us grow and thrive. That was the case in 2016, last week, and has never been more important than today. We don’t know what will be required, however we do know we can’t be held hostage by wage costs and terms of employment within the city’s workforce.
As an employer, we are looking out for our staff
If you work for the city of Saint John, you are appreciated, respected and well-compensated for your work. Especially when you consider the single person median income in Saint John is less than $33,000 per year. If you’re an employee of the city, there’s virtually no risk of you not getting paid.
Over the last few days, I’ve had hundreds of conversations with people who have lost their jobs, can’t pay their rent, mortgages, have closed their businesses, laid-off employees and frankly, don’t know if they will survive economically. I simply can’t sit back and not act.
This year the wages and benefits costs at the city will be over $90 million. I’ve consistently shared my frustration about our labour agreements, how we lack the management flexibility we need, how we can’t manage productivity effectively, and that we have a cost problem. In the last 15 years alone, our wage costs have gone from 48 million dollars to 91 million dollars and we’ve paid out $100 million in extra wages above the rate of inflation.
There have been many attempts to mute my voice on this subject by the unions themselves and regardless of the outcome of my recommendations, I’ll know I did not choose silence and fear. I choose leadership and the necessity to act.
These uncertain times mean, like many companies, our deficits will grow. That means taxpayers will be responsible to pay the bill. I simply can’t and won’t support paying raises to our well-paid employees during these uncertain times. Especially when municipal employees are amongst the highest-paid employees in the region and enjoy benefits and pensions that most taxpayers don’t have themselves.
While companies around the globe cut costs aggressively to survive, the city’s union groups insist on terms, pay rates, and barriers that we simply can’t and should not accept any more.
I am not anti-union. I respect the original mandate of unions, to have employees be safe, earn a fair wage, and have reasonable work conditions. This is no longer the case in the city, as our agreements lack balance. We must have the option to make the difficult decisions, to put taxpayers first. Currently, we can’t.
I’m not negotiating in the public domain, I’m telling you that this new reality requires us to think, act and muster the administrative and political courage to say no. No more bad deals, no more terms that we can’t afford, no more political collusion, no more leaked mandates to the very unions we’re trying to negotiate with, no more wages and benefits we can’t afford.
I’m asking all of our employees to recognize you’re well-compensated and be part of the solution, in a bigger way than you might have been 30 days ago.
Our world has changed very quickly. What we knew just a few weeks ago no longer applies. As a leader, it’s important to be the first to step up. That’s why this past Tuesday night, I volunteered to take a $10,000 pay cut in my own salary.
Unprecedented actions required
We’re in unprecedented times and that requires unprecedented actions. I’ll be presenting a motion at council this Monday to direct the city manager to do the following;
- Prepare a monthly forecast of the impacts from Covid-19 on finances, human resources and city operations. Including mitigation plans.
- Work with our employee groups to gain, at minimum, a wage freeze for 4 years and the flexibility to reduce wage costs as necessary, to protect the sustainability of the local economy and taxpayers.
- That due to restrictions related to some employee groups in terms of binding arbitration and the failure to recognize local conditions, that a corresponding recommendation be made to budget allocations, should current realities be ignored and wage increases be forced upon taxpayers.
- That the barriers associated with current collective agreements be clearly communicated to the public from all city, agencies, boards and commissions within the next 30 days.
- That council rejects in principle any labour agreement that is not at minimum a wage freeze and with restrictive clauses removed, impeding necessary management, productivity and cost flexibility.
- Enhance governance to ensure the barriers we face related to our workforce, collective agreements and the negotiation process, are addressed.
- Work with the provincial and federal governments to achieve the necessary support to rebuild the Saint John economy. This would include the key reforms, already on our priority lists, direct support from both the Federal and Provincial Governments.
- That the Ernst and Young Operational audit due at the end of March, includes commentary on the new realities we face and that a staffing report is presented to council within 30 days of receipt, with recommended actions and priorities.
Please contact me if you have any questions. I can’t anticipate all of the ways that my position will be twisted and “interpreted” but, in this crisis, I am working for the people who have elected me and pushing through long term agreements in the middle of so much economic uncertainty is irresponsible, unethical, and I will not support it.
Don
