By next week, more than 22,000 workers from 10 locals of the Canadian Union of Public Employees expect to hold strike votes.

And if deals aren't signed, they could be walking off the job before the end of September.

"It would have quite a serious impact on the province. It would basically, after a number of days, shut the province down," said CUPE New Brunswick president Steve Drost.

"If these groups decide to pull their services … it would have quite a detrimental impact on the province."

Workers in 10 locals without contracts

The 10 union locals include workers in the health care, education, transportation and agricultural sectors, as well as social workers, jail guards, court stenographers, and staff at Worksafe NB, the New Brunswick Community Colleges and N.B. Liquor.

All have been without contracts since between 2016 and 2019.

"These workers never wanted to take strike action, but they feel they've been backed into a corner," Drost said.

Union and government bargaining teams have been in separate meeting rooms in a Fredericton hotel since Tuesday, passing proposals back and forth.

Premier Blaine Higgs has said wage restraint was necessary because COVID-19 pushed the province into a precarious financial position. (Jon Collicott/CBC)

Pandemic put pressure on finances: Higgs

Last December, Higgs said he would ask public-sector unions to agree to four-year contracts with no wage increase in one year and one-per-cent wage increases in each of the three remaining years.

He said wage restraint was necessary because COVID-19 had pushed the province into a precarious financial position.

• Unions call out premier on wage freeze plan 

This year's provincial budget projected a deficit of $244.8 million. The government had planned to release its first-quarter financial update on Thursday but that was later postponed.

Drost said years of wage increases below the pace of the cost of living have forced many public employees to take on second jobs or leave their jobs altogether. Others can't keep up with rents that are rising far faster than their salaries, he said.

The premier's office said Thursday it was not able to comment on the talks.

Earlier this year, spokesperson Jennifer Vienneau said the province and CUPE could "collaborate to find savings" that would allow wage increases.

She also said at the time that in the event of a strike, "impacted departments will have a contingency plan in place to minimize disruptions and delays to residents."

Centralized wage negotiation process requested

In August, Higgs asked the CUPE locals to agree to a centralized wage negotiation process. All 10 locals are in talks with provincial negotiators to try to reach a single wage template for all their collective agreements.

If that happens, they'd then finalize the other non-wage terms of each contract individually.

• 6,000 nurses, health-care workers reject tentative contracts with N.B. government

Drost said last week the province proposed a new six-year wage package with one-per-cent increases in each of the first four years followed by two-per-cent increases in the fifth and sixth years.

He said that was "quite an insult" because it was identical to the package recently rejected by the New Brunswick Nurses Union.

Even if the two sides agree to a wage package before Tuesday, the strike votes will probably go ahead to ensure the other parts of the individual contracts are settled quickly.
 
"The members feel it's necessary to have a very strong message to government that they are expected to resolve these contracts," Drost said.

The Canadian Union of Public Employees wants to intervene in a lawsuit brought by another union against the province of New Brunswick over changes to public service pensions.

The Professional Institute of the Public Service of Canada initiated the lawsuit after the provincial government converted its public service pension plan into a shared-risk pension plan.

CUPE said the change "significantly reduced" pension benefits, the security of benefits and barred any collective agreement provisions that could improve pension benefits in the future.

• 'Slow down' move to shared-risk pension, CUPE says 
• CUPE official backs pension reforms despite protests 
• Does New Brunswick have the answer to Canada's pension funding crisis?

CUPE announced Thursday it has served the provincial government with notice it wants to intervene in the lawsuit.

"The rights of CUPE members and many other public sector workers were violated when the government unilaterally imposed pension changes on workers, in violation of their right to free collective bargaining," said Daniel Légère, the CUPE New Brunswick president, in a news release.

Légère contends the pension changes violate a members' right to have freedom of association under the Canadian Charter of Rights and Freedoms.

"CUPE fully supports this court challenge and will intervene to defence our members' rights," he said in the statement.

It is up to the court to decide whether a party is granted intervener status in a lawsuit brought by another party.

New Brunswick Investment Management Corporation CEO John Sinclair appeared before the standing committee on Crown corporations on Thursday, but he avoided the pension controversy.

“NBIMC continues to exceed the investment requirements for the pension funds under our management,” he told the committee of MLAs.

Sinclair said despite the 2008 market crash his team averaged a 4.75 annual return investing public-sector pension funds.

Liberal MLA Roger Melanson praised the success, and tried to pin down Sinclair on the Progressive Conservative government's proposed reforms.

“Have you been asked in regard to this discussion of potentially going to a shared-risk model in New Brunswick?” asked the Dieppe Centre-Lewisville representative..

The reform would see retirees lose cost-of-living increases in years the market performs badly.

But Sinclair explained his role is not to pay out benefits but to play the market, which wouldn't change under the reform.

"We feel comfortable that we can provide investment management services for various objectives,” he said.

No questions from Tories

Sinclair did say longer life spans would strain pension funds.

“You know, that's something that is recognized industry-wide. In terms of specific details with respect to the reform discussions going on here, whether it's with the task force or the coalition, we haven't been party to those details.”

Despite the controversy over pension reform, none of the Progressive Conservative MLAs spoke up when committee chair Ross Wetmore called on them.

Melanson said he was surprised the Tories were not curious about a pension system that's been causing their party so much political grief.

A coalition of retired civil servants has threatened a lawsuit to block the reform.

The New Brunswick Investment Management Corporation disclosed in its annual report released Wednesday that a number of its executives were paid the performance bonuses, even though the funds they supervise lost more than 18 per cent of their value in the same year.

The rest of the civil service was placed under a strict governmentwide freeze on bonus payments and similar bonuses were cancelled at other Crown corporations, such as NB Power.

The corporation defended the bonuses, noting they were much less than the $1.3 million paid out a year earlier. Additionally, these payments were meant as a reward for good results over a four-year period despite poor results in 2008-09.

"The previous three fiscal years had positive net value added results which help to offset the fiscal 2008-09 performance," said the corporation in explaining the bonus. 

However, the report also made it clear that losses in 2008-09 were so bad they wiped out all of the gains in the previous three years and then some, after inflation.

The annual report also states that after the market collapse, the corporation decided in December 2008 to freeze salaries in 2009-2010.

The Department of Finance said it plans to review the operation of the investment corporation, including its bonus program, in the near future.

Progressive Conservative MLA Bruce Fitch, the opposition's finance critic, said the department's review is "too late." Fitch said in a release, "this type of thing sickens New Brunswickers."

Fitch said in an interview on Thursday that he was under the impression that those bonuses were on hold.

"It wouldn't have been the end of the world if the bonuses were deferred or not paid for a year or two, given the circumstances," Fitch said.

Lost $1.6B in market crash

N.B. Auditor General Mike Ferguson recommended in his recent annual report that the bonus structure at the New Brunswick Investment Management Corporation be reviewed. ((CBC))

It had $8.7 billion in assets under its management at the start of the 2008-09 fiscal year, but lost $1.6 billion of that when stock markets crashed last fall. 

The corporation has paid out modest bonuses to certain key executives for several years, but more recently upped the amounts dramatically. 

Employee bonuses hit more than $1.3 million in fiscal 2007-08, up from the $134,000 paid out in 2000. 

John Sinclair, the corporation's president, is the highest paid employee in the New Brunswick government, earning more than $475,000 last year.

Auditor general questioned bonuses

Auditor General Mike Ferguson raised questions about the bonuses being paid to the investment managers in his last report. He recommended the Department of Finance step in and set some kind of limit on what can be paid out.

"We felt the best approach and still feel the best approach to determining the total amount would be to have a formula agreed on between the province and the corporation," said Ferguson on Wednesday.

The president of NB Power is defending his salary and bonus package, which came under fire last month in the legislative assembly, as just a part of his contract.

The Opposition Conservatives grilled the Liberal government in December over a bonus the board of directors paid to David Hay at a time when other bonuses are being postponed.

Hay said when Bernard Lord's Conservative government hired him early in 2004, he was offered a five-year contract with annual bonuses.

"I didn't ask for it. That's what I was provided. I didn't negotiate it. That's what was provided. And I'm an old lawyer by training, and a contract is a contract," Hay told a legislative committee on Wednesday.

Hay said 2007-08 was a spectacular year for NB Power when the company won a $338 million legal settlement with Petroleos de Venezuela, S.A., the country's state-owned oil company, over the failed Orimulsion fuel deal.

He said the Point Lepreau nuclear station ran well and the company was named a top employer. So the company's board decided to pay bonuses to him and several top executives.

Conservative MLA Bruce Northrup said New Brunswickers wanted to know the amounts.

"They would like to know what these bonuses were, as far as the exact dollar and everything, I think they have the right to know as New Brunswickers," Northrup said.

Hay said privacy rules prevented him from naming the other bonuses but he offered to reveal his own.

Northrup didn't ask for it. Hay told reporters after the committee that it was $96,000 on top of his $375,000 salary.