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August 8, 2009
City got the deal it needed
Guest Column in National Post: City got the deal it needed (by City Manager Joe Pennachetti) August 8, 2009

The Toronto Sun (last week) and the National Post (this past Saturday) have recently included a guest column ("op-ed") in the newspaper from City Manager Joe Penachetti.

Below is the guest column that appeared in the National Post this past Saturday.

The strike was difficult for our residents, businesses, union and non-union and management staff. Residents and businesses responded by showing patience and civic pride and the City's management and non-union staff kept many critical services operating during the strike; all of these efforts were greatly appreciated.

Nobody wins in a strike.

That is why in the days leading up to the union's strike deadline, the City stated we were ready to continue negotiating until a settlement was reached. The unions did not have to strike to reach the settlement that was achieved. Bargaining in good faith involves strong negotiation and compromise. However, in the end, only the unions can call a strike and only the unions can end a strike.

Now that we have reached an agreement, what is important is that we focus on moving forward together. The work required to resume all City services is well underway and I know all staff in the Toronto Public Service are looking forward to working for the public we serve.

Equally as important is that the public understands the facts behind the new agreements.

Torontonians could not afford the costs associated with giving the unions everything they requested to either avoid a strike or immediately end the strike once it began. The need to reach settlements that were fair to workers but also affordable to our residents and businesses was an extremely important objective of the City's bargaining. The City achieved these objectives.

Negotiating new contracts during a strike is no easy task. We knew that if the strike went on much longer the City could have a settlement forced upon us if the province legislated workers back and appointed a single arbitrator to impose the terms of a new contract. This would likely have meant that the City would not have achieved the bargaining objective of controlling the costs of the sick leave plan. In negotiating the new agreements the City's bargaining teams followed the direction of Toronto's Employee and Labour Relations Committee and achieved the bargaining objectives it established. This agreement ended the strike with a settlement that was fair to workers and affordable to the City. Remember, prior to and for much of the strike the unions were still seeking wage increases in excess of 3%, 3%, 3% and had refused to accept, and in the case of one of the unions, even discuss, changes to the sick leave plan that had been in place for 50 years.

The existing sick leave plan will be phased out. New hires will have a short-term disability plan that will not allow accumulation and cash out of sick days. Current staff may choose to take a partial payout, or to bank their days until they retire. Either way, this plan saves the City money during a time of significant financial pressure. When current employees take the payout option and move to the new short-term disability plan and significant numbers of staff retire, the City's sick leave liability costs will go down by an estimated $140 million over the next five years. Current staff has until November 18, 2009 to indicate if they wish to stay in the current plan or move to the new one. There will be no ongoing partial cash out option.

Mississauga and Etobicoke took this approach when they phased out their sick leave plans and it makes sense for Toronto to do the same. In addition, the City was also successful in negotiating modest pay increases of 1.75%, 2% and 2.25% over three years. These increases are in-step with the City's financial realities and the world-wide recession. It's been a difficult time for us all, but this agreement will allow the City to continue to offer high quality services to Torontonians. Now we can get back to showing the world what a great place Toronto is in which to live, work and visit.

Joe Pennachetti
City Manager
City of Toronto



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