Registered nurses in Ontario will receive bonuses of up to $2,600 over the first two years of a new collective agreement, leaving the government on the defensive over a restraint program that opposition critics say has largely failed.
The one-time, lump-sum payments – equal to 0.9 per cent of nurses' salaries – will cost hospitals $80-million and are in lieu of wage increases in 2011 and 2012. Nurses will also receive an across-the-board wage increase of 2.75 per cent in the third and final year of the agreement.
The agreement, released on Friday, covers 57,000 front-line nurses who work in 137 hospitals, ranking it one of the largest contracts up for renewal this year. It is the latest arbitrated award in Ontario that ignores the McGuinty government's call for a voluntary wage freeze for public-sector workers who bargain collectively, opposition members said. The government unveiled measures in the 2010 budget to rein in spending in the public sector and fight the province's multibillion-dollar deficit.
Premier Dalton McGuinty reiterated on Friday that there will be no money from the province to cover salary increases for new contracts at hospitals or any other public-sector employer.
"If you negotiate something beyond zero, you're going to have to find that within your existing budget," Mr. McGuinty said. "So to be fair, it is not adding pressure to our budget."
A board of arbitration headed by Jane Devlin has awarded nurses who are just beginning their careers one-time, lump-sum payments of $565 in each of 2011 and 2012. Those with 25 years experience or more will receive lump-sum payments of $1,306 in each of the two years.
Linda Haslam-Stroud, president of the Ontario Nurses Association, said in an interview that nurses have met the government's wage freeze because there are no increases to the salary grid in the first two years.
Ms. Haslam-Stroud described the lump-sum payments as more routine, saying nurses also received one-time pay totalling $100-million in their last collective bargaining agreement in addition to 9.25 per cent in wage hikes over the three years.
"The award doesn't reflect the type of gains that we've achieved in the normal rounds of bargaining," she said, describing the process as one of the most difficult nurses have endured.
The agreement does include health benefits, such as dental and prescription drugs, for retired nurses – a key objective for an aging workforce, Ms. Haslam-Stroud said. The benefits will be available to nurses who retire as early as age 57, with costs shared 50-50 by the employer and the employee.
In return, disability and other benefits were scaled back, so there will be no additional costs for hospitals.
Tom Closson, president of the Ontario Hospital Association, which bargained with the nurses on behalf of the province, said he is pleased with the arbitration award because hospitals will have to come up with less money for compensation than under the previous agreement.
Under the previous collective bargaining agreement, he said, hospitals had to pay nurses wage increases that exceeded the increases in their global budgets. Hospitals received budget increases of 1.5 per cent this year.
"I would say it actually makes it a little bit easier for this year," Mr. Closson said.
Other collective-bargaining settlements have helped set a pattern for public-sector wages in Ontario. In the health-care sector alone, an arbitrator awarded 2,250 professional and paramedical staff at Ottawa Hospital annual increases of 2.5 per cent over two years, saying he had no choice but to follow an earlier ruling for 16,000 hospital workers. Freezing their wages, arbitrator Christopher Albertyn said, would have "unjustly penalized [these workers]relative to their peers."
New Democratic Leader Andrea Horwath said it is "splitting hairs" to say lump-sum or merit pay is not part of the wage deal. As well, she said the government were go after the generous compensation packages of hospital chief executive officers, not "the hard-working folks on the front line," if it were truly serious about reining in public-sector wages.
"The agreement with nurses is the latest example that the government is not taking restraint seriously enough," she said.