Social Contract (Ontario)

The Social Contract was a 1993 initiative of the provincial Ontario New Democratic Party government of Bob Rae to impose austerity measures on civil service. The plan imposed a wage freeze and mandatory unpaid days of leave for civil servants, which became known as Rae Days.

History

Ontario in the 1990s was in the worst economic recession since the Great Depression, with a 1993 deficit of $12 billion annually.

Rae requested $2 billion in wage cuts within the civil service and asked the public sector unions to work together with the government to implement the cuts. When both of Ontario's largest unions, the Ontario Public Service Employees Union (OPSEU) and the Canadian Union of Public Employees (CUPE), boycotted the talks, the government decided to enact the initiative unilaterally.

Terms

The initiative was based mainly around a forced twelve days of unpaid leave for all civil service workers, including (but not limited to) teachers, nurses, and accountants. The unpaid days off quickly became known as Rae Days and are probably the best known aspect of the policy. The measure excluded workers who earned less than $30,000 annually.[1]

The Social Contract also reopened collective bargaining agreements of all public unions and froze the wages of all civil workers.

Aftermath

The Rae Days were successful in their original aims. The government saved $1.95 billion,[1] and prevented public employee layoffs.[2]

The initiative was incredibly unpopular, however, and the labour-allied NDP lost a majority of its union support, including Buzz Hargrove and the Canadian Auto Workers union. Support for the provincial party fell to 6% and contributed greatly to the decimation of the federal NDP in the 1993 federal election. The provincial NDP never recovered its past support when the 1995 election came around. The Liberal Party was initially the main beneficiary of the opposition to the Social Contract, but, ultimately, the Progressive Conservatives won the election. In that campaign, the NDP was reduced from a majority to a third party, a position from which they were not able to recover from until the 2018 election, when it became the Official Opposition because of the collapse of the Liberal Party.

The Social Contract affected Rae during his 2006 run for leadership of the Liberal Party of Canada.

References
  1. Richard J. Brennan (6 Nov 2009). "`No regrets' about days that bear his name, Rae says". Toronto Star. Retrieved 8 April 2011.
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