Anti-scab Legislation

The Federal government introduced "anti-scab" legislation in Parliament last week. The legislation would make it illegal for federally regulated businesses to hire replacement workers in case of strike action by their regular workers.

I have noted in this space before that one of the reasons why workers have not benefited from the steady rise in productivity over the last 30+ years is the erosion of workers rights and the steady drop in union membership. The simple fact is businesses will not raise the wages of their workers unless forced to by minimum wage laws and collective bargaining creating upward pressure on wages in the labour market.

So it is heartening to see the federal government introduce legislation that will tip the balance a little bit back towards workers during collective bargaining. Of course, it does not go far enough. What really needs to be done is laws need to be passed that will make it easier for workers to organize. However, the level of government with that responsibility is the Provincial level and most of them are Conservative governments.

Indeed, the backlash against the legislation by conservative commentators and the business community has been predictable. It is also overblown. Even with this legislation businesses will still have the most power and the greater advantage during labour disputes. This just reduces that by a small amount. Of course, that will not prevent them from claiming all sorts of negative outcomes if the legislation is passed. They are completely unwilling to give up even a small part of their power and advantage.

The fact that workers have not seen any benefit from the increase in productivity was never sustainable and negative outcomes for the economy and businesses were inevitable. They seemed sustainable in the last decade or so because credit was practically free. Who needed wage increases when you could get money from the bank at negative real interest rates? That situation was always going to be reversed it was just a matter of when. The economic impact of the COVID pandemic just caused that reversal to be much more sudden and steep than if it would have followed a more typical business trend.  

With credit no longer being free the house of cards that was built on it is crashing down. The first victims of that destruction are the young people, which is not new as young workers are always the first victims of economic shocks. However, if you are a more mature worker you will not be spared the impacts. Higher interest rates will have an impact on you in due time. The banks will eventually reduce interest rates again. They have no choice because the economy is no longer structured to absorb high interest rates for long anymore. However, the days of negative real interest rates are probably behind us. So, if we want our purchasing power to keep up with inflation we are going to have to see our wages go up.

That is only going to happen if the balance of power between business and their workers becomes more even. The "anti-scab" law is a step in the right direction but more needs to be done.