President's Commentary: The outrage that is outsourcing | National Union of Public and General Employees

President's Commentary: The outrage that is outsourcing

This one small story illustrates the larger danger of greed unchecked. All of our jobs and all of our communities are vulnerable to outsourcing and its cousin, privatization. These strategies might boost profits, but at a terrible cost.

Ottawa (10 April 2013) – Massive stories sometimes start small - a simple break-and-enter in 1972 eventually led to the downfall of the world’s most powerful politician - and a small story that broke this past weekend here in Canada is building momentum and has the potential to become huge. Is this a watergate for our business leaders? I hope so.

It started when the CBC reported that a multinational outsourcing company called iGate used the federal government’s Temporary Foreign Workers Program to bring a worker into Canada as part of a contract it has with Royal Bank of Canada (RBC). This particular worker was allowed into the country to be trained in the processes of the bank’s “investor services” department by the very people whose work is about to be outsourced. Forty-five RBC workers will lose their jobs in the process.

The numbers may be small - it’s just one temporary foreign worker of the tens of thousands brought into Canada every month, and just 45 of hundreds of thousands of middle-class Canadians who’ve lost their jobs to outsourcing over the past decade - but the story has shone a glaring light on the practice of outsourcing, the unabashed greed that underlies it, and the damage that it is doing to us all.

Across the country, people are outraged by this story. RBC is the most profitable of Canadian banks, one of the most stable and successful corporations in the world, and yet its leaders believe they’re perfectly justified in fundamentally disrupting the lives of a couple dozen of their employees in the pursuit of a sliver more in short-term profit.

Outsourcing is often sold as a necessary business tactic in an ever-more competitive global economy; that Canadian companies risk outright bankruptcy if they’re not able to use cheap labour offshore. For some companies, this might be a credible argument. But RBC is hardly a company fighting for its life. As RBC CEO Gord Nixon said while presenting the company’s annual report last year, “2012 was a record year – our annual profit was the largest not only for RBC, but also for any Canadian company … ever.”

A few more quick stats show just how well-fed this bank is:

  • it made more than $2 billion in profits in the first three months of 2013;
  • it paid CEO Nixon more than $12 million last year - and another $27 million to his top four VPs; and
  • its total tax burden has dropped from 32.9 per cent in 2010 to 28.9 per cent in 2012.

And yet despite these clear signs of near-bullet-proof stability and health, RBC’s leaders have hired an aggressive offshore company specializing in cheap labour (one of whose slogans is “It’s criminal to pay for time and materials”) in order to squeeze more profit from its largely Canadian business. What’s worse is that the extra profits they’ll realize from outsourcing the work done by these 45 workers will be minuscule - considering that RBC employs 57,000 Canadians, will saving a few tens of thousands of dollars even register on their financials?

No, there’s something larger at play here. RBC’s leaders have shown us the consequences of living in a society that celebrates unmitigated greed. We've arrived here after more than 30 years of assurances from our political leaders that greed is a virtue and that our only responsibility in life is to our own self-gratification, and the RBC 45 are just the latest of many whose lives have been crushed under this dangerous and corrosive dogma.

This one small story illustrates the larger danger of greed unchecked. All of our jobs and all of our communities are vulnerable to outsourcing and its cousin, privatization. These strategies might boost profits, but at a terrible cost.

Turning the tide on the dogma of greed will not be easy nor quick. But we have an opportunity now to start. Each of us must stand up against corporations and politicians driven only by greed. We yearn instead for more from our leaders: more responsibility, more community-mindedness, and more engagement with the lives of the people who contribute to their own success.

We can send a message that our corporate and government leaders won’t be able to ignore.

In solidarity,

James Clancy
National President

NUPGE

James Clancy is the National President of the National Union of Public and General Employees (NUPGE), one of Canada's largest labour organizations with over 340,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE