The incidence of strikes and threatened strikes in the Canadian economy during the last three or four years involving the railways, teachers, lumbermen, fishermen, civil servants, electricians, automotive workers, carpenters, to mention some of the categories — indicates that the existing machinery of negotiation, conciliation and arbitration which is provided is quite inadequate.
When negotiations are deadlocked and conciliation fails in the face of both parties to a management-labour dispute being convinced of the justice of their case, they are reluctant to agree to arbitration. The history of arbitration is not calculated to inspire confidence in its outcome. The only other course left to the members of the labour union involved is to resort to strike action. In other words, in an effort to force their demands on management they must take direct coercive action by withholding their labour and forcing the company to cease operating.
Herein lies the glaring injustice of this recognized feature of our economy, for the rank and file of labour can never benefit, much less gain their demands, by strike action. For example, let us assume that a union is seeking a 10% increase in wages for its members, while management maintains that the company is in no position to increase its production costs and consequently cannot afford any wage increase. A strike is called and let us assume that it continues for two months at the end of which time the union and management agree on a 5% wage increase. Leaving out of account any subsistence strike pay, it would take over three years for the rank and file of the union members involved to get back in increased wages what they lost in incomes during the strike on the basis of their pre-strike pay. However, before that occurred most probably the general price level will have risen to wipe out the increase they had gained. Consequently, the company's employees will be worse off as a result of striking. To a greater or lesser degree this is true of all strike action.
Not only does the rank and file of labour not benefit from strikes but such action causes lasting damage to the economy. It is not unusual in the case of a major dispute for strike action by the members of one union to force the company to close down their operations and to lay off workers in another union who are not involved in the dispute. Furthermore, in most instances a strike against a company is directed equally against the public and disrupts the economic life of the country as for example in the case of a transport company, a utility undertaking or a food producing or distributing concern. In fact, to some degree, strike action by labour or a lockout by management harms everybody concerned, benefits nobody, and inflicts irreparable damage on the national life.
However, the question goes even deeper. Wage increases granted to members of one labour union — particularly if engaged in a key national industry like packing plants, automotive plants or railways — are soon reflected in increased prices in that field, leading to demands from other unions for higher wages. Thus the continual pressure of rising prices keeps nullifying the wage gains of labour, and leads to an uncoordinated scramble by them to catch up which merely accelerates the inflationary trend.
This has, by usage become so much to recognized part of our economic life that it is taken for granted. Yet, when considered objectively, the glaring injustice to the rank and file of labour, to management and to the general public, is all too opparent. There is evidence of growing dissatisfaction within the ranks of labour and of mounting exasperation on the part of the public, although as yet there is no general appreciation of the grave implications which are involved.
In Canada we share the British constitutional concept of nationhood as an organism — an organism in which government and people, management and labour, industry and agriculture — in fact all aspects of our national life — should be integrated in serving the common good. Freedom is inherent in that concept of nationhood, and essential to its growth. The bulwark of that freedom is the right of every Canadian to the Queen's justice before the courts. Persons or corporations considering themselves the victims of injustice in a dispute have the right to take their case to a Court of Law, where both parties to the dispute lay all the evidence before a judge who gives an objective decision based on law and the recognized tenets of justice. It would be unthinkable that, in such disputes, the parties involved should have no option but to settle their difference by taking direct coercive action against each other. The right to invoke the machinery of impartial justice is not only the prerogative of every Canadian, but it is fundamental to law, order and good government under our constitution. Yet this prerogative is being denied to both labour and management in the vital sphere of industrial relations, and the former are being left to fight their battle under conditions which must result in harm to themselves and to the national life.
This aspect of the impact of inflation calls for early ameliorative action before the damage and disruption to the economy assumes menacing proportions. This should be based on those recognized tenets of British justice in which our Canadian Constitution is rooted.
The above is an extract from a brief, entitled "Post-war inflation of prices in Canada", submitted to the Senate Standing Committee on Finance by Mr. L. Denis Byrne