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  • Bill Cole

From the Interest Arbitration Archives - Comparing Public and Private Sector Occupations

COLE LABOUR has an extensive collection of unreported interest arbitration decisions dating back to the early 1960's. Why are these of interest today? Many of the enduring "first principles" of interest arbitration were established in these early years. Often these decisions were the first opportunity for adjudicators to fully consider certain issues: the public sector's collective bargaining process still evolving.

The decision of Arbitrator Owen Shime in BC Railway is frequently quoted in relation to an employer's ability to pay, however the decision also sets out a number of other important interest arbitration principles.

On the question of comparison between the public and private sectors, Arbitrator Owen Shime concluded:

In the public sector, however, the employer, as the government, is required to provide services to the community it is elected to represent, and these services cannot be evaluated on a balance sheet or profit and loss statement in the same manner as a private sector company. Indeed, many services, to name a few - the distribution of pension and welfare cheques, the providing of hospital or firefighting services, the supervision of health and sanitation - can neither be considered nor assessed in the same manner as a private business. Also, there are many public sector activities that operate at a loss but are considered necessary for the vital operation and wellbeing of the community. In the instant case, the operation of a railway is an example of an industry which is necessary to the community - to the servicing and opening of remote areas, but which traditionally has operated at a loss with the full knowledge and acquiescence of the community which considers the service vital to its well-being.

Today many employers continue to draw comparisons between public and private sector occupations. Shime's 59-page unanimous decision (a tripartite board with nominees from the union and employer) shines important light on the difficulty making such a connection.

The British Columbia Railway Company and The General Truck Drivers and Helpers Union, Local 31 and Teamsters Union 213; and Brotherhood of Maintenance of Way Employees, Caribou Lodge 221, Lillooet Lodge 215, and Summit Lodge 252; The International Union of Operating Engineer, Local 115. (unreported) June 1, 1976 (Shime), at page 6.


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