A worker in B.C. was a member of a union affiliated with the Building Trades Council (BTC) over ten years ago. For the past several years, he has worked under the contract of an independent union. Due to a sweetheart deal between the BTC and the B.C. government, this worker is now forced to pay over $1,000 in back dues to the BTC, simply in order to have the right to work on the publicly-funded Vancouver Island Highway project.
The injustice doesn’t end at back dues, however. That worker, and many others, are losing their pensions. Instead of providing for their retirements, the money allotted for these workers’ pensions, estimated at $9.6 million, will be lining the coffers of BTC union pension funds.
Labour for the $ 1.1 billion Vancouver Island Highway project is provided exclusively by Highway Constructors Limited (HCL), a crown corporation. HCL has entered into a collective agreement with the BTC. Employees of a contractor or subcontractor who secure work on this new construction project must terminate their employment with that contractor and apply for employment with HCL.
As a condition of employment with HCL, employees must join one of the building trades unions. Pension contributions are remitted by HCL to the appropriate union-administered pension program, some of which have vesting conditions that many workers on this project will find almost impossible to meet.
When their portion of the job is completed, it is reasonable to expect that most of the individuals employed by HCL will return to their real employer (not just their paper employer), and thus will not qualify for the vesting period. It is estimated that 45 to 75 per cent of the workers on the project are in this situation. If the workers tried to stay with the BTC and work longer in order to meet the vesting requirements, they likely wouldn’t be able to find work since the BTC only has about 20 per cent of B.C. construction jobs.
The money that has been deposited in the union pension plan on behalf of the Island Highway project employees, at a contribution rate of between $1.50 and $3.25 per hour, stays in the pension fund. Given the number of hours of work, and the estimated size of the non-BTC employees brought in for this project, the amount is substantial.
This scheme was documented in a report by the Shasta Consulting Group of Vancouver, which was commissioned by the Work Research Foundation. “The common-law principle of ‘unjust enrichment’ may be applicable to this situation. A number of union pension plans are receiving a benefit at the expense of a significant number of HCL employees who have, by the nature of those pension plans, little expectation of receiving any benefit payments from those plans,” said the report.
$5 million insurance policy
When confronted with this information by a B.C. news reporter, the Minister of Transportation and Highways, Lois Boone, expressed surprise. However, this is not a new issue. A group of non-BTC affiliated contractors and their members and two independent unions and their members filed a complaint with the B.C. Labour Relations Board in 1994, when this scheme was first announced. At that time, the B.C. Transportation Financing Authority, HCL, BTC unions, and the Attorney General all objected to the complaint. The Labour Board looked at the issue and decided that since the project had not begun yet, and therefore no one had been directly affected, there were no grounds for a complaint.
Before this arrangement was made public, the B.C. Ministry of Employment and Investment engaged a consultant to provide a review of the labour construction costs under four different scenarios: the agreement currently in place, one which was open shop only, one which would open bidding to both BTC contractors and open shop contractors, and one which would be BTC contractors only. The confidential report concludes that the current arrangement is not the most cost-efficient, but reasons that it is the best one since it appeases the Building Trades Council and therefore is the arrangement most likely to have the fewest labour disruptions.
Instead of standing up to the blackmail tactics of the BTC, the B.C. government chose to ignore the rights of non-BTC workers and engage in an exclusive contract with a group of BTC unions. The cost to B.C. taxpayers of this little insurance policy: $5 million.
Unfortunately, such forfeitures of freedom of association rights and pension money will become increasingly common in the near future, if the government proceeds with its plan to replicate this labour relations model with the BTC on all future highway projects of more than $50 million. Something stinks in B.C., and it’s not the salmon.