What is Bill 124 and how is it affecting Ontario’s nurses, public-sector workers?

It’s been more than two years since Ontario’s Bill 124, which generally limits annual salary increases to one per cent for many parts of the public sector in the province, received royal assent, but calls to repeal the law continue to be made.

The Registered Nurses’ Association of Ontario (RNAO) participated in a downtown Toronto rally on Sunday calling for an end to the law with some saying it “demoralizes and undermines our profession” and is contributing to nursing professionals leaving their positions.

“Staffing challenges are so severe that Ontarians’ health care is in danger if the current conditions continue,” Leah Waxman, a registered nurse and one of the event’s organizers, said.

RELATED: Ontario nurses rally against Bill 124

Morgan Hoffarth, the president of the RNAO, cited statistics that said nursing vacancies in Ontario have more than quadrupled over the last five years, adding there was a 56-per-cent increase in vacancies during the first half of 2021.

While the Ford government said Bill 124’s three-year “moderation period(s)” is time-limited and “designed to protect public-sector jobs and vital frontline services,” critics argued the annual increase of one per cent doesn’t keep up with inflation and could result in skilled workers fleeing to the private sector.

What is Bill 124?

Dubbed by the provincial government as the Protecting a Sustainable Public Sector for Future Generations Act, it was introduced in the Ontario legislature in June 2019 and in November it received royal assent.

Bill 124 applies to most of the Ontario government as well as provincially funded, public corporations and agencies, except for municipalities and municipal boards, Indigenous communities, police services and for-profit entities (unless exempt by regulation). It’s estimated more than one million people are covered by the law and the three-year periods vary in timing based on different sectors and when collective agreements end.

A spokesperson for Treasury Board President and Brampton Centre Progressive Conservative Party of Ontario MPP Prabmeet Sarkaria called it “fair, consistent and time-limited,” going on to say affected employees will still be allowed to get increases tied to seniority, performance, or increased qualifications.

When it comes specifically to the health care sector, the government touted its 16-week pandemic pay bump in mid-2020 as well as spending nearly $400 million on recruiting new professionals and funding training for registered nurses and registered practical nurses to upgrade their skills.

Groups representing affected workers are in the process of challenging the law through the courts, but as of mid-November a decision wasn’t made.

Ontario government could face exodus of skilled workers, labour lawyers say

When asked to reflect on Bill 124, Puneet Tiwari, a lawyer at Levitt Sheikh LLP in Toronto, called it an “unusual” move — especially for the health-care sector amid the COVID-19 pandemic.

He said his firm has heard from affected employees in different sectors across Ontario after they were told they would ultimately only receive a one-per-cent annual increase.

“If you’ve been there for a while or you hit a threshold of five years, or 10 years or 15 years, great but all the people left in between are only getting a one-per-cent raise and that’s troubling,” Tiwari said.

The move to limit wages, he said, is feeding into the recruitment efforts by private-sector companies.

“Many headhunters are going after them knowing that they haven’t been getting a raise or likely won’t be getting a raise over the next two years,” Tiwari said, citing the technology sector where double-digit-percentage raises.

“I think there could be long-term effects.”

Rich Appiah, the founder and principal of Appiah Law, echoed that concern. He said while other governments in the past have legislated general caps on raises, it impacts competitiveness — something that will impact multiple sectors such as health care, post-secondary education etc.

“From the perspective of attracting and retaining top talent, the legislation in my view does place handcuffs on employers,” Appiah told CityNews.

With respect to the provincial government statement that employees will still get increases associated with seniority, performance, or increased qualifications, he, like Tiwari, said it’s likely not going to be significant in terms of the broader workforce and added younger workers wouldn’t necessarily receive seniority-based bonuses.

Meanwhile, he called for reflection in terms of the whole issue of compensation more than a year-and-a-half since the pandemic began.

“I think it’s important for us as a society to give some thought to how do we say thank you and express our appreciation to those workers in a meaningful way other than just through talking,” he said.

“Money talks and we’re working through a pandemic that has been the worst since the early 1900s and public-sector employees have borne the brunt of the labour to get us through that.”

How do the opposition parties view Bill 124?

Ontario NDP Leader Andrea Horwath said she and her party have heard from health-care workers who feel “disrespected and undervalued” since Bill 124 came into effect.

“The nurses just feel they haven’t been given the kind of respect and dignity that they deserve after everything that they’ve sacrificed and they’re leaving the profession because they’re exhausted and stressed out,” she told CityNews in an interview Monday afternoon.

Horwath also called for a “proper” retention plan for employees, saying she was recently in Windsor and heard of workers who trained and graduated in Ontario and left to work in Detroit and other locations in the United States.

“The government doesn’t understand people need to earn a decent wage. Things are getting very expensive. The price of everything is going up. And of course, wage caps like this mean not only do you not get to bargain your collective agreements on wages you lose ground financially,” she said.

RELATED: Ontario Nurses Association ‘outraged’ as Ford government refuses to exempt from Bill 124

Ontario Liberal Party Leader Steven Del Duca said in a statement on Monday should his party form government after the 2022 provincial election, repealing the law would be “one of our first acts should we earn the chance to govern.”

“Bill 124 is an attack on the very people who put it all on the line to keep us safe through this pandemic,” he wrote.

Green Party of Ontario Leader Mike Schreiner said the caps under the law are “well below inflation” and said it “amounts to a pay cut,” calling for pay raises for frontline health-care workers.

“I support the many labour groups, workers and organizations that believe Bill 124 infringes upon people’s constitutional rights for collective bargaining and that it shuts down good-faith negotiations at the bargaining table,” he wrote.

— With files from John Marchesan