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8,500 top managers will remain eligible for so-called performance pay while the pay of tens of thousands of ordinary workers remains frozen.
Toronto (1 April 2010) - The Ontario public sector wage freeze will not apply to the performance bonuses of senior managers.
Premier Dalton McGuinty says bonuses will continue to be paid to those in the upper ranks of the public service while the pay of tens of thousands of lower-paid public employees remains frozen.
McGuinty told reporters this week that the bonuses are part of the pay structure of the elite and it was determined that a lawsuit could be filed against the government if "performance pay" was cut.
McGuinty said the only constraint the government can impose is to freeze the pool of money it sets aside for bonuses, meaning that managers will have to compete against one another for the money.
"For people that are entitled to performance pay, they will continue to be entitled to performance pay, but the maximum amount available for the performance pay is now frozen," he said.
Introduced by the former Conservative government of Mike Harris, the bonuses are paid to about 8,500 senior managers or about 12% of the Ontario public service.
The latest Ontario budget, tabled last week, imposes a two-year wage freeze across the public service to cope with large budget deficits caused by the recession. The freeze applies immediately to non-unionized workers and is to begin for unionized workers as current contracts expire.
However, labour leaders are not prepared to concede that the freeze will go into effect automatically for unionized workers.
Sid Ryan, president of the Ontario Federation of Labour, says the policy announced in the budget is more an opening bargaining position at this point than a fixed government policy.
"When you look at all the sectors, the health care sector is covered by arbitration, so it's not really going to be impacted," he says. "(And) municipalities won't be impacted by this, so they're gone."
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