Backgrounder
Document d'information
07-38
April 12, 2007
ONTARIO FAIR WAGE POLICY REVIEW
The McGuinty government is retaining the services of University of Toronto Professor Morley Gunderson to conduct a full independent review of Ontario’s current Fair Wage Policy. Prof. Gunderson is with the University’s Centre for Industrial Relations and Human Resources and holds the CIBC Chair in Youth Employment. The review is expected to be completed by the end of 2007 with a report-back to the government.
What is the Fair Wage Policy?
Ontario’s Fair Wage Policy (FWP) is established in 1995 by an Order-in-Council, and has not been reviewed or updated since that time. Its purpose is to ensure that employees of private sector employers who contract with the government to perform construction or provide building cleaning or security services are accorded fair wages and certain labour conditions.
The FWP attempts to create a level playing field for bidders on government contracts by minimizing conflicts between organized and unorganized labour in competitions for work. Under the policy, contractors must agree as a term of the contract to adhere to the applicable fair wage schedules.
A “fair wage” is considered by the Ministry of Labour to be the current, generally accepted wage paid to a competent worker in the region where the work is performed.
To which contracts does this policy apply?
The FWP applies to contracts made directly by the government’s ministries and, subject to some qualifications, the Ontario Realty Corporation, the Ontario Clean Water Agency, the Ontario Housing Corporation and the Ontario Transportation Capital Corporation with private sector employers in the following instances:
- Construction projects in the industrial, commercial and institutional (ICI) sector valued at $100,000 or over
- Road building projects where the contract value is $160,000 or over
- Sewer and watermain projects, regardless of value
- Janitorial and security contracts, regardless of value.
FWP contracts require contractors to ensure that any subcontractors they retain fulfill the obligations under the contracts awarded by ministries or the previously mentioned agencies.
Each of the three industries covered by the policy has its own schedule of fair wage rates and set of labour conditions.
How is this policy enforced?
Under FWP contracts, contractors must post the appropriate fair wage schedule and labour conditions in a conspicuous place on the work site.
Contractors and subcontractors are required to maintain accurate records showing the names, trades and addresses of all employees, the hours worked by them, and the wages paid to them. Such records must be made available to staff of the contracting ministry for inspection upon request.
Contractors are responsible for their subcontractors and any FWP claims made against subcontractors.
Ministries and Crown corporations to which the FWP applies must maintain a registry of their contracts that are covered by the policy. Any person may obtain any of the information from the registry by making a written request. Compliance with the FWP is achieved through a holdback of a portion of the financial value of the contract.
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Media enquiries:
| Susan McConnell Minister’s Office 416-326-7710 |
Belinda Sutton Ministry of Labour 416-326-7405 |
