A hundred years ago, Canadian workers earned wages and that was about it. In general, they didn’t get paid time off for holidays and vacations, they paid all of their own medical expenses, and they had to provide for themselves if they were laid off, disabled or wanted to retire.
Over the course of the last century, because of the demands of workers and unions, there has been a steady growth in non-wage benefits – paid time off, pensions, insurance coverage and other things like child care and employee assistance programs. Some are provided through the government (Old Age Security, the Canada/Quebec Pension Plan, Employment Insurance, Workers’ Compensation, Medicare and Welfare Programs), and some are provided by employers.
These benefits are not a frill. They are essential the survival and dignity of working families.
In recent years, the workplace focus has been on group life and disability coverage, dental and extended health (including drug) plans, which fill in some of the gaps of our public medicare system. According to the most recent Statistics Canada survey, as of 2000, half of the Canadian workforce has medical, dental and life/disability coverage, 12% have one or two of these coverages, and 38% have none.
Actual coverage is probably somewhat higher than this, since, in families with more than one earner, some uncovered workers will be covered as dependents. Full-time permanent workers are more likely to have benefit coverage than part-time or casual employees.
As with wages, unionized workers have a big benefit advantage. 79% of unionized workers are members of pension plans, compared to 30% of non-unionized workers. 70% of unionized workers have medical, dental and group life/disability coverage, compared to only 40% of non-unionized workers.
Benefits are a big piece of the cost of labour. In the last 50 years, the cost of benefits (including payroll taxes for C/QPP, EI and Workers’ Compensation) has risen from around 15% to over 35% of total labour costs in Canada. In the last few years, costs have been rising rapidly, particularly for drug and supplementary medical plans. Drug companies in particular have very successful in building their profits through aggressive promotion to increase the use of expensive drugs, and by pushing governments to extend patent protection that limits low-cost generic alternatives.
Our public medicare system still gives us a big cost advantage over the U.S., where barely adequate medical insurance coverage adds thousands of dollars per worker to an employer’s labour cost. The cost of health insurance coverage is the root cause of many strikes in the U.S.
With costs increasing in Canada, employers are pressing to reduce benefit coverage and shift costs to workers through deductibles and caps.
Unions have led the way in expanding benefits for workers, in workplace negotiations and by working politically to create our public programs. Now the struggle is mainly about holding onto our past gains, both in the public sphere and at the bargaining table.
