In the 2023 federal budget, the government proposed Investment Tax Credits for green technology projects, which included higher financial incentives for employers who adhere to labour standards, including paying prevailing wages to workers.
In a recent article from the Progressive Contractors Association of Canada, it was argued the proposed use of prevailing wage would cause “massive wage inflation across the construction sector.”
This is pure, I will say politely, nonsense.
The 2023 budget proposed that prevailing wage would be determined regionally by using the most recent collective bargaining agreements from the region in question, meaning the proposed wages are already being earned by unionized Building Trades workers.
The implementation of the Investment Tax Credits would ensure that both unionized and non-unionized skilled trades workers would earn the same wages on projects that qualify for the Investment Tax Credits.
It is not surprising to Building Trades Unions and our thousands of unionized contractors that the non-union progressive contractors association is making an argument to pay skilled trades workers less, including their own workers.
Tying prevailing wage and apprenticeship requirements to investment tax credits is good public policy. Just ask the United States government who did the exact same in with the Inflation Reduction Act.
Canada’s Building Trades Unions argument in support of prevailing wage is quite simple.
The federal government is proposing multiple billions of dollars in tax credits to mostly private sector entities. In return the government must make sure that the billions of dollars in foregone tax revenue is used to create good paying, middle class construction jobs.
Using union wages and benefits as the minimum standard “prevailing wage” ensures no worker gets left behind in the transition to net-zero.
This is good public policy for all workers – union, non-union and alternative union — and is demonstrably pro worker, regardless of union affiliation.
Not only will unionized and non-unionized workers benefit from the prevailing wage definition, but it will level the playing field for labour costs for projects across the country incentivizing owners and contractors to focus on innovation and alternative project delivery methods.
This Progressive Contractors Association article states “…encouraging contractors to innovate and ensuring good value for taxpayers and investors is what healthy competition is all about.”
We could not agree more. Win the job based on healthy competition, not on the backs of workers by paying lower wages and benefits.
And in a time where the cost of living is increasing, the use of prevailing wage on projects eligible for the Investment Tax Credits would be an opportunity for non-unionized skilled trades workers to earn wages that might not otherwise be available to them.
As many regions across the country face concerns around labour availability, the requirement of 10 per cent of work hours to be carried out by registered apprentices will be a game changer.
Strong union wages and benefits will help many young Canadians see that the construction industry is a great place for a career, especially given the labour force needs to help Canada transition to a more sustainable economy.
CBTU has and will continue to urge the government to implement the Investment Tax Credits and prevailing wage as it proposed in the 2023 budget, which would benefit all workers, employers and the economy.
In the transition to a net-zero carbon economy, it is the workers who stand to lose the most.
Canada cannot afford to repeat the mistakes and irreparable harm caused by the more recent economic transitions of free trade where tens of thousands of good paying middle class jobs simply disappeared.
We need to get this right. Prevailing wages and apprenticeship requirements will ensure our economic transition to a carbon-free world is fair and just and ensures the long-term prosperity for all construction workers.
Sean Strickland is the executive director of Canada’s Building Trades Unions. Send Industry Perspectives Op-Ed comments and column ideas to email@example.com