Barely two weeks out from the Carney government’s first budget, there’smore talk about spendingthan cuts. More Mounties, military, and border-services officers – and billions more in new spending since the election.
Everyone knows cuts are coming. And Prime Minister Mark Carney drove that home this week in hisaddress to the nationabout the “coming sacrifices,” a relentless push to cut waste, efficiencies and make “difficult decisions.”
Job prospects for public servants are dropping fast. Will the coming cuts be a1995-style reckoning– 55,000 jobs gone mostly through buyouts and early-retirement incentives? Or more like Harper’s 2012 deficit-reduction plan, when 16,220 jobs were trimmed – nearly 60 per cent by attrition.
Carney has said attrition should handle most cuts, but his ministers talk about “tough decisions” and “adjustments.” In Ottawa, adjustments are code for layoffs – and there’s a decades-old rulebook for that: the Workforce Adjustment Directive,the WFA.
Yes, it’s bureaucratic and inside baseball – but it’s also the machinery that decides who stays, who goes, and how the public service reshapes itself when priorities shift. The WFA is one of those public-service crown jewels many private sector workers would envy.
As cuts loom, the Public Service Alliance of Canada and Treasury Board are moving on WFA: the government wants it out of collective agreements. PSAC wants to strengthen and expand it. The government wants flexibility. PSAC is not about to cede any ground.
The showdown begins – and it could throw a spanner into the works of a government that likes to move fast.
So, let’s dig in.
Today:
The limits of WFA: It wasn’t built to rebuild a workforce.
So you’ve been cut: You’ll have three choices.
The toughest sells: What PSAC really wants.
Three key tools: What PSAC stands to lose.
The government’s dilemma: It’s boxed in.
“The best job security system ever”: WFA had an ironclad start.
THE CHALLENGE Managing people, not positions The WFAis the main tool the government has to manage the coming job cuts, and HR teams are already working on how they will be rolled out. It’s all about managing people, not positions. The goal is to minimize layoffs and help employees whose jobs are disappearing to stay employed – ideally in the public service.
No one knows what’s coming. Some employees are holding off on retirement or departures, hoping for generous buyouts. That’s not officially on the table, but senior officials acknowledge the government is weighing whether buyouts or early-retirement incentives – used in 1995 – are worth the cost to get people off the payroll faster. Others worry the opposite will unfold: no money will be set aside for WFA costs, and departments will be left to absorb them, forcing bigger internal cuts.
The WFA works well for redeploying employees within the same kind of work – swapping roles among people at the same group and level, or retraining for a different classification, like, for example, a program manager moving into policy work.
But it can’t bridge completely different fields. A supervisor on a social program isn’t likely to qualify for a job in growing agencies like CBSA, the RCMP or the military. That’s the challenge. The WFA wasn’t built to rebuild a workforce. Carney’s government needs new skills and a different mix of people as it expands in some areas and trims others. For many employees, that mismatch will feel like a cut.
The Cadillac of job security. Back in 1991, this was adirective that gave federal workers near-ironclad protection against layoffs with the promise of a “reasonable job offer” when positions disappeared. It’s evolved since then, and today’s version was successfully used during the Harper government’s job cuts. But this is the first time the WFA will be tested with a government that is spending and slashing at the same time.
PSAC is putting the WFAfront and centre at the bargaining tableas it braces for major layoffs. Top priorities: seniority rights, protection for employees who refuse relocation, using remote work to reduce layoffs, and stronger relocation rules.
Changing the game. The government, however, has its own move in mind. Treasury Board has asked PSAC to remove the directive from its collective agreement’s appendix and deal with it instead through the National Joint Council, the NJC, the forum where unions and management both try to reach consensus on common workplace rules.
Most public servants don’t really know what the joint council does unless they’re in HR or labour relations. It was a wartime invention, created in 1944. It’s not a union or tribunal. It’s like a policy forum that shapes directives on travel, relocation, health plans – and, yes, workforce adjustment. In the event of an impasse, arbitration is always an option.
The WFA applies across the public service, but PSAC and PIPSC are the only two of the 19 unions that have negotiated it directly into their contracts. That gives them bargaining clout over how job security is applied. (Interesting to see the Union of Canadian Correctional Officers recently agreed to remove the WFA from its contract. It’s now handled at the NJC.)
For PIPSC, there is no surrender. “We are not ready to give up Workforce Adjustment provisions from our collective agreements,” said PIPSC president Sean O’Reilly (above), calling Treasury Board’s proposal “a rollback of our members’ rights.”
PRIMER The how’s of who stays and who goes Here are the broad strokes of what the WFA does – the rules that decide who stays, who goes, and what happens in between. (Even before the budget, thousands received WFA notices that their jobs are affected by the Trudeau government’s cuts still working their way through the system.)
When your job is cut, you become an opting employee. You choose a new job, a buyout, or retraining. Once you start looking (or the deadline passes), you become surplus, triggering a 120-day window for the department to offer you a new job.
Departments try to find a job at the same level and location. Refuse a “reasonable” offer, and you could lose buyout or retraining options.
Your choices:
Take another job.
Voluntarily leave with a lump-sum payment (a buyout or a transition support measure).
Retrain with an education allowance.
Alternation. If you want to stay, you can swap jobs with someone who wants to leave.
Other protections:
Salary protection if you move to a lower-level role.
Training to qualify for a new position.
Relocation rules. Refuse a move and you can be laid off without a buyout. PSAC wants to change that.
KEY ASKS What PSAC’s really after PSAC has yet to release detailed proposals to strengthen the WFA at contract talks with Treasury Board this week. Along with more money for buyouts and retraining, here are some key asks:
Add seniority to layoff decisions. Make seniority and equity key factors instead of relying solely on management’s assessment of merit.
Create a national WFA committee to co-ordinate workforce adjustments across departments and avoid chaos when jobs are cut or moved. This would be a permanent joint committee, with union and Treasury Board reps.
Reduce forced relocations. Limit cases where employees must uproot their lives and move to keep a job.
Use telework to save jobs. Allow remote work as an alternative to relocation or layoff when positions are moved or restructured.
TOUGH SELLS
The push for seniority and remote work
In the last round of bargaining, PSAC pushed one of its hardest sells – making seniority, not merit, the deciding factor in who gets laid off. The union even signed a joint MOU with Treasury Board to have the Public Service Commission study the issue. The commission ultimately said no.
In this round, PSAC is still pushing for seniority to determine layoffs. But it argues layoffs should reflect both seniority and employment equity – protecting newer, often younger equity-hired employees while still giving weight to experience and years of service.
The government has long resisted letting seniority trump merit – and merit is enshrined in law. The Public Service Employment Act makes merit the governing principle for appointments and layoffs. The Federal Public Sector Labour Relations Act bars unions from bargaining for anything that contradicts it. Changing that rule would take more than negotiation – it would take amending the law itself.
Remote work as job protection. PSAC also wants remote work formally recognized as a possible job-saving tool under the WFA. The directive was written in the era of fixed workplaces – if your job moved, you moved. Making remote work an option would let employees keep their jobs even if the work shifts elsewhere.
Say a program is downsized or moves from Ottawa to Halifax. Under PSAC’s proposal, an affected employee could stay put and work remotely if the nature of the job allows it to be done off-site.
It’s a significant ask. It would protect workers from forced relocation – and could give unions new leverage in their broader push to make remote work a right, not a privilege.
IT’S ABOUT CONTROL Why PSAC won’t budge on the WFA
Timing is everything. Treasury Board’s proposal lands just as the government gears up for another round of spending reviews and potential layoffs.
For unions, it looks like a bid to loosen job security. For Treasury Board, it means fewer formal negotiations, fewer legal constraints, and perhaps an easier path to adjusting WFA rules – at a time when employees need protection most.
PSAC’s resistance isn’t about losing WFA protections. The directive would still apply. The big shift is control and leverage.
As it stands, Treasury Board can’t change the WFA without PSAC’s consent because the directive is embedded as an appendix in PSAC’s collective agreements. That gives PSAC independent bargaining power and three key tools:
Bargaining leverage – changes must be negotiated, not imposed.
Member ratification – no deal without member approval.
Grievance rights – violations can be challenged before a neutral adjudicator.
If the directive is moved to the National Joint Council, PSAC becomes just one voice among 19 unions. Changes could move forward through broader consensus, which means PSAC would lose its power to negotiate WFA improvements directly at the table.
BOXED IN The government’s dilemma As long as the WFA remains in collective agreements, the government can’t legislate changes without political and legal blowback. It risks a Charter challenge over bargaining rights, alienating the NDP and Bloc in a minority Parliament, and handing the Conservatives – rarely friends of federal unions – an easy target. Not to mention it would bruise the bureaucracy it needs to execute its economic reset.
But unions no longer have the leverage they had in the Trudeau years. The dynamics have shifted. Carney’s team is not focused on keeping unions happy. It’s focused on execution and efficiency – getting things done.
As one senior official put it: “Unions have lost the sympathetic ear they once had in power" – the kind that, under Trudeau’s agreement with the labour-friendly NDP, helped shield them from cuts, layoffs, and back-to-work legislation.
And: “I don’t think unions understand just how much the environment is going to change,” the official added.
THE WFA STORY Ironclad, then suspended. Now what? Job security always heats up when Ottawa talks reform, restructuring, or retrenchment – cutting costs and staff. Those moves trigger rocky labour relations, fears of job loss, and questions about what the public service is and does.
PSAC’s 1991 strike – mostly over pay equity – ran alongside separate talks on job security. The result was the Workforce Adjustment Agreement, written into PSAC’s contract with the toughest job-security language ever negotiated in Canada. The union could bargain, grieve, and even strike over it.
Ron Cochrane, one of PSAC’s negotiators at the time, called it “the best job security system ever” – a benchmark for public-service protections globally. It introduced the “reasonable job offer,” guaranteeing surplus employees a new position with full salary protection – and it was enshrined in the collective agreement.
The protections were so strong that some employees couldn’t be laid off, and the government took heat for paying surplus workers to stay home waiting for jobs that might never come.
That WFA couldn’t handle the scale and speed of layoffs during the Chrétien government’s program review. The directive was suspended in 1995, replaced by generous early-retirement and departure incentives for workers in the hardest-hit departments. The exodus was massive – and fast.
Now, 30 years later, what's next?
-:-:-:-
On a scale of zero to 10, how did you find today's edition?
A bit about me. I write The Functionary as part of my work covering and analyzing the federal public service for Policy Options, where I am the Accenture Fellow on the Future of the Public Service. I've been reporting on the public service for more than two decades, covering parliamentary affairs and politics for the Ottawa Citizen and iPolitics. My work has been recognized with a National Newspaper Award and a Canadian Online Publishing Award.
