Small business calls for back-to-work legislation for PSAC workers

The longer the PSAC strike lasts, the greater the risk of financial harm to small-business owners

Published April 25, 2023 • 3 minute read

Picketers march around the Office of the Prime Minister and Privy Council as approximately 155,000 public sector union workers with the Public Service Alliance of Canada (PSAC) continue to strike in Ottawa. Photo by Blair Gable/Reuters

By Jasmin Guénette and Christina Santini

Federal public servants have now been on strike for a week. That is particularly concerning for small businesses in Canada, as a whole host of services they rely on have been disrupted, including the Canada Revenue Agency and immigration processing. The longer the strike lasts, the greater the risk of financial harm to small-business owners.

How so? One example: a delay in the arrival of temporary foreign workers who work in our agricultural industry could result in lost production and sales, and operations being put on hold. Our 2022 survey showed over 42 per cent of agri-businesses could not get all the staff they needed to maintain current operations. Having access to workers coming through immigration is crucial to their operations. Another example: questions to CRA will go unanswered in the middle of the tax season, and the processing of any refunds will most likely be delayed.

Small-business owners will be left to absorb a lot of the costs of the disruptions on their own. Unlike unions, they don’t have strike funds to tap into. Entrepreneurs have recently had to endure the COVID-19 pandemic, inflation and supply chain problems. Let’s not add to that a prolonged paralysis of federal government operations.

While a service disruption of this magnitude could have a devastating effect if it continued for too long, civil servants’ demands, which for CRA employees initially included a 33 per cent compounded wage increase over three years, were unreasonable. The costs associated with meeting these demands would be staggering, resulting in endless deficits, future tax hikes and higher inflation. Few private employers can match such an increase, while taxpayers should not have to bear the burden of these costs.

The government is already projecting a spending deficit past 2027-2028. Since 2015, the civil service has grown by 30 per cent. Salary expenditures for staff now exceed $60 billion. The Parliamentary Budget Officer projects that annual pay increases of 4.5 per cent would add another $19.7 billion to this bill over the next five fiscal years. Even 4.5 per cent over three years is a bit rich. With these types of salary increases we won’t be out of the red anytime soon. Generations of taxpayers will bear the costs.

There aren’t many ways out of this bind. If the strike continues for more than a few days, the government should introduce back-to-work legislation. This will send a message to other union groups currently negotiating with the government that negotiations must be conducted in good faith, while ensuring continuity of service and taking into account taxpayers’ ability to pay.

Unfortunately, we have not heard of any union leaders expressing a desire to improve the services their members provide or to be good fiscal stewards who keep taxpayers in mind. Nor have they shown sympathy for the thousands of applicants waiting to be processed by Immigration Canada or indicating that their members are ready to return to the office, so as to be more effective at work and to make downtowns, like Ottawa’s, more vibrant. We also haven’t seen an acknowledgment from union leaders that their members already enjoy relatively secure jobs, with competitive pay and one of the most generous pensions going.

It’s time for public service unions to show good faith at the bargaining table and realize that taxpayer money is not a bottomless pit.

Jasmin Guénette is vice-president for national affairs at the Canadian Federation of Independent Business, where Christina Santini is a senior policy analyst.

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