Essential Services and The FortisBC Inc. Lockout of IBEW 213

Posted on January 12, 2014


British Columbia deals with essential service labour disputes differently from most jurisdictions.  Rather than the familiar game of industrial “chicken” (where unions press their strike actions as far as they can before government intervenes with back-to-work orders and lopsided arbitration) we have a “controlled strike” mechanism.  The Labour Relations Board designates specified levels of services and staffing as essential;  the parties are free to strike or lock out so long as the designations are maintained.

In the private sector, a strike is an economic weapon: unions disrupt production to inflict losses on the employer to build pressure for a satisfactory outcome in bargaining.  In the public sector, however, this lever is absent: strikes almost invariably save the employer money.  Public sector strikes are not economic but political weapons, aimed at generating public pressure to break the impasse.

The story is different with lockouts: the union and its members suffer the same economic pain from a lockout whether their employer is public or private.  However, public sector lockouts are very rare.  Few governments are willing to attract public wrath by withdrawing services to pursue bargaining objectives.

The essential service standard “global order” rules of engagement are intended to replicate the balance of forces which exists in the private sector uncontrolled strike.  They are supposed to compensate for the unbalanced impact that designations have on the union’s bargaining power.

The essential service rules were developed for hospital strikes.  For example, the global order requires the employer to maximize the use of disposables to minimize the need for designations for cleaning reusable implements.

Staffing levels are set on the footing that managers will put in 60-hour weeks.  This reduces the number of unionized worker designations and the relative ease with which the employers can carry on despite strikes, with their basic operations all maintained.  It helps restore the mutuality of attrition: on one hand, picketing workers subsist on strike pay; on the other, management is worked to gradual exhaustion.

(This element of the global order is no longer particularly effective.  That is because public sector industrial relations have been centralized into large province-wide employer associations, remote from the local hospital administration.  The Health Employers Association of BC does not particularly care if line-managers in struck facilities drop dead from overwork.)

Lately we have seen two related trends which import the controlled strike mechanism into disputes for which it was not designed.  We have seen several efforts to use essential service orders to protect employers from purely economic loss.  We have also seen more applications to the Board for designations by  private sector enterprises.  The resulting distortion of the balance of forces makes bargaining more difficult, strikes and lockouts more prolonged, and industrial relations more dysfunctional.

I have a recent case in point:  the 2013 FortisBC Inc. electrical utility lockout of IBEW 213

On June 26 2013, the employer locked out more than 200 linemen and other workers represented by the International Brotherhood of Electrical Workers, local 213, after obtaining essential service designations at the LRB.  FortisBC is the privately-owned electrical utility which serves much of south-central and southeastern British Columbia.  It provides monopoly services regulated by the BC Utilities Commission, with its rates pegged to ensure that its shareholders receive a healthy return from the company’s operations.

Nearly a half a year later, after fifteen formal orders by the LRB (not to mention countless hours of mediation and informal processes) and two proposed settlements had been turned down by the workers, the dispute was finally resolved with an agreement to resort to binding interest arbitration.  Just in time for Christmas the picket lines came down, and the IBEW members returned to work.

At the bargaining table, regarding wages, the difference shrank to one-half a percent per year over three years, but the lockout continued.  The employer complicated things enormously with concession demands which inflamed the workers.  The process was broken and so was the relationship.

As legal counsel for the Canadian Office and Professional Employees Union Local 378, Leigha Worth and I had ringside seats during this dispute.  COPE 378 represents the rest of the unionized workforce at FBC.  Many of our members were affected by the lockout, honouring IBEW picket lines in the long-standing tradition of British Columbia trade unionists, and a few were also designated as essential workers, forced to cross picket lines and report for work.

From that vantage point, we witnessed not only the interminable legal battles at the LRB, but also the human and political drama of the long and hard-fought dispute – the constantly raised and shattered hopes, the frustration, and the bitterness that is sure to linger long after the final terms of the renewed collective agreement are arbitrated.

In many ways, a union engaged in a strike or lockout with a privately-owned regulated utility faces the worst of both worlds.  Like a public institution, the employer is buffered from economic loss (because of its regulated status and guaranteed return).  But as a private corporation, it is not particularly sensitive to political pressure, either:  the fact that FortisBC felt free to impose a lockout is proof enough of that.

In that situation, the workers have few economic or political weapons.  Shackling the union with essential services takes away what few levers it has left to persuade the employer to negotiate an acceptable deal.

FortisBC’s resort to essential service designations before locking out the IBEW was a significant contributor to the dysfunction of the long dispute.  The process inflamed the workforce almost as much as being locked out in the first place;  it diverted energies and resources away from finding collective bargaining resolutions; and it made it far more difficult for the parties to come to terms.  It seriously damaged what was already an unhealthy industrial relationship.

The Labour Relations Board’s 15 formal orders all dealt with essential services or tangentially-related picketing issues.  Although the actual number of designated workers was relatively low compared, say, to a hospital or ambulance strike, their legal compulsion to keep the employer operating with impunity after locking them out led to great bitterness and resentment.  The parties were focused on border skirmishes around the designations (for example, when it was found that the employer had obtained designations to keep a vehicle operating which it did not actually need for essential service delivery) where bad feelings ran high, but the actual subject-matter of the legal battles was remote from the task of negotiating a renewal of the agreement.

In the end, despite months of picketing, many solidarity demonstrations by other unions, a campaign of written complaints to BC Utilities Commission, and an active social media strategy, the parties simply could not come to a negotiated agreement.  BC’s industrial relations system failed.  The intrusion into a private sector dispute of a set of rules designed for hospitals, social services and public protection services made a bad situation much worse and left a legacy of bitterness which will not fade easily.

The FortisBC-IBEW process was broken, and our industrial relations system failed to assist the resolution of an eminently resolvable dispute.  Hopefully other employers watching the sorry train-wreck of the FortisBC lockout will draw the appropriate lessons, and hopefully our LRB will not welcome efforts by private sector employers to exploit the essential service rules to try to gain an advantage at the bargaining table.

ibew 213

Posted in: Law