Federal employees DO NOT earn more than private workers!

By Michèle Demers on January 15, 2009

For the fifth time in a row, the Canadian Federation of Independent Business has issued a flawed analysis alleging “widening gaps” between public and private-sector employee compensation.  The problem is that the CFIB study does not compare wage differences for individual occupations -- only groups of occupations.  This allows the CFIB to lump financial auditors, lawyers and civil engineers together with office clerks, secretaries and janitors in order to imply that federal public-service professionals are overpaid relative to their business-sector counterparts.  This sleight of hand disguises the fact that while high levels of unionization in the public sector improve wages and benefits for non-professional employees in particular, private-sector professionals enjoy variable pay, lump-sum bonuses, stock options and generally higher salaries not available to their public-service equivalents.  Indeed, in response to competition for professionals’ specialized skills and qualifications, the federal government has been forced to implement special recruitment and retention allowances to prevent public-service professionals from jumping ship to the private sector.

It was precisely this recruitment and retention problem that Treasury Board Secretary Wayne Wouters had in mind when he told KPMG that the Canadian federal public service needed to find ways of counteracting the effect of comparatively low pay on attracting highly-qualified personnel to the federal public service. He stated, “We need to brand the public service and sell it better to graduates and experienced hires. We don’t pay as high as the private sector but we can offer a varied and interesting career and the work is challenging.” (KPMG International, 2007, page 15). Coming from one of Canada’s most senior federal executives, this statement succinctly summarizes the compensation reality in the federal public service.

The day after releasing the study, CFIB President and CEO Catherine Swift sent a letter to the leaders of the main federal political parties urging them to cut spending, starting with public sector compensation.  The CFIB’s study – carefully avoiding an occupation-by-occupation comparison of public and private compensation that would reveal the truth about professionals’ earnings in the federal public service – should be understood in this context.  It is intended to provide ammunition for the federal government’s imposition of real wage cuts on federal employees by denying their Charter right to collective bargaining. We, at PIPSC, shall continue to pursue our demands and policies in protecting our members regardless of the government in power. The collective bargaining and dispute resolution process must be permitted to resume. Treasury Board should live up to its duties by agreeing to a viable solution for those workers who form the backbone of the Canadian institutions. Their name is still… Public Service Employees!


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