OTTAWA POLICE SERVICES BOARD COMMISSION DE SERVICES POLICIERS D’OTTAWA
	Working together for a safer community La sécurité de notre communauté, un travail d’équipe	REPORT RAPPORT

DATE                              25 March 2013

TO/DEST.                       Chair and Members of the Ottawa Police Services Board

FROM/EXP.                   Executive Director, Ottawa Police Services Board

SUBJECT/OBJET         RESOLUTION ON INTEREST ARBITRATION

RECOMMENDATION

(Submitted by Member A. Doyle)

That the Ottawa Police Services Board approve the following resolution:  

WHEREAS municipalities and police services boards continue to struggle with the escalating costs of police services, and increases in wages and benefits in the emergency services sector continue to exceed those of other public sector employees; and

WHEREAS interest arbitration is mandated by statute as a means of concluding a collective agreement for essential services when the parties are unable to reach a settlement through collective bargaining; and

WHEREAS the interest arbitration system lacks accountability and transparency because arbitrators are not required to demonstrate how their awards reflect any criteria in considering "ability to pay", and arbitration awards do not contain any consideration of the impact of increases in wages and benefits on a community's property taxes; and

WHEREAS the Emergency Services Steering Committee (ESSC) and the Association of Municipalities of Ontario (AMO) have developed a package of legislative changes that would bring more accountability and transparency to the arbitrators’ decision-making process;

THEREFORE BE IT RESOLVED that the Ottawa Police Services Board write to the Premier of Ontario, the leader of the Provincial Conservative Party and the leader of the Provincial New Democratic Party, expressing support for the ESSC/AMO proposed legislative changes, and calling on the political parties to work together to enact them.

BACKGROUND

At a media event held on 14 February 2013 the Association of Municipalities of Ontario (AMO) along with the Large Urban Mayors’ Caucus of Ontario (LUMCO) and the Mayors and Regional Chairs of Ontario (MARCO) announced a legislative checklist aimed at achieving a more efficient, accountable and transparent interest arbitration process in the Province of Ontario.

The legislative checklist included:

· Streamlining the process and creating a 12-month timeline for completion

· Clear, measurable criteria for evaluating the fiscal health of a community

· Requiring that arbitrators give priority to the fiscal health of a community and provide a clear, written explanation of how it was considered.

The Ontario Association of Police Services Boards (OAPSB), since 2005, has partnered with AMO, LUMCO and MARCO as part of the Emergency Services Steering Committee (ESSC) to improve accountability and transparency for municipal taxpayers as well as municipal employers and employees.  The OAPSB is supportive of this initiative to improve the arbitration system specifically as it is applied in the police sector.

OAPSB President Barbara Bartlett was present at the media event and issued the following statement:

“The Ontario Association of Police Services Boards (OAPSB) has been working closely with other municipal leaders and staff on this critical issue. There is broad consensus that the interest arbitration system needs improvement. The main issue is the need for arbitrators to truly consider local financial circumstances in determining their awards. We join our municipal partners in calling for all three political parties to work together and with us to make the system more efficient, transparent and accountable across Ontario.”

The interest arbitration checklist prepared by AMO is attached as Annex A.

DISCUSSION

In 2012, the ESSC and AMO made submissions to the Legislature in response to Bill 55, the Government’s proposed changes to the arbitration system at that time.  The submissions were intended to ensure that the interests of all stakeholders are reflected.  In particular, the ESSC and AMO recommended that interest arbitration criteria be amended to reflect the following principles:

• Total compensation costing of the entire settlement including present and future liabilities
• The employers ability to pay in light of its fiscal situation with consideration given to, and consistent with, the municipal council's service priorities
• The extent to which municipal service levels may have to be reduced to implement the arbitrator’s decision if the current funding and taxation levels are not increased
• The economic situation in Ontario and the municipality, including private sector settlements
• A comparison between the employees and the bargaining unit and other municipal employees and groups within that municipality, and the employers ability to attract and retain qualified employees
• In order to ensure that comparative data amongst emergency services does not override other factors, the legislation should include a provision directing that once the arbitrator is satisfied that the employer has substantiated a demonstrated inability to pay the rate which would otherwise be derived from the relevant comparator data, the arbitrator must issue a decision in accordance with the municipalities ability to pay.

The intent is to have local realities and economic conditions play a role in arbitrators’ awards that are comparable to negotiated contracts. 

After reviewing the ESSC/AMO proposed changes, Board member Doyle expressed a wish to put forward a resolution in support of the changes for the Board’s consideration, as contained in this report. 

CONSULTATION

Consultation is not applicable.  

FINANCIAL IMPLICATIONS

There are no direct financial implications arising from the approval of the recommendation in this report, however the impact of collective bargaining and interest arbitration conducted by and for the Ottawa Police Services Board has a significant financial impact on Ottawa taxpayers.  Emergency services, of which police are a part, account for a significant portion of municipal budgets, and wages and benefits which are determined through collective bargaining and interest arbitration account for 85-90% of the budgets of emergency services.  As a result, the current imbalance within the interest arbitration system and the impact it has on collective bargaining and resulting settlements may have a significant financial impact on municipalities and their ability to deliver services to their residents and taxpayers.

CONCLUSION

The Ontario Association of Police Boards believes that the interest arbitration system requires substantive improvements to ensure that outcomes take into account the fiscal health of the municipality, and do not consider comparator data to the exclusion of all other factors. The system requires significant improvements to ensure that all appropriate factors are considered and applied by arbitrators, and to ensure transparency and timeliness in interest arbitration awards.

Police services boards value the contribution of their police service members and do not question their dedicated service to the community, or their right to be fairly compensated for the work they do.  However, the status quo with respect to interest arbitration and its impact on collective bargaining is not sustainable.  It is essential that broad support for interest arbitration improvements be translated into appropriate legislation.

(original signed by)

Wendy Fedec

Executive Director

Attach. (1)