On May 6, 2010, the Creating the Foundation for Jobs and Growth Act, 2010 (Bill 16) was reported as amended by the Standing Committee on Finance and Economic Affairs. Originally introduced on March 26, 2010, the Bill is omnibus legislation amending various Acts to give effect to the initiatives outlined in its 2010 Budget. Of particular note to employers is Schedule 24 of the Bill, which if passed, will enact the Public Sector Compensation Restraint To Protect Public Services Act (“PSCRPPSA”).

As we reported in our FTR Now of March 29, 2010, the PSCRPPSA would freeze wages (with certain specific exceptions) for defined and deemed employees at the rate they were on March 24, 2010 (excluding employer who receive less than $1 million funding from the province, municipalities or boards) until March 31, 2012.

This two year wage freeze would apply to non-bargaining employees in the Ontario Public Service, hospitals, boards of health, schools, colleges, universities, Hydro One, Ontario Power Generation, and many other provincial agencies, boards and commission.

"Compensation plan" is defined to include all aspects of an employee’s compensation including base pay, merit pay, time off such (e.g. vacation), pension, health and other benefits. The PSCRPPSA does not exempt or distinguish compensation changes that were formalized but not yet implemented / decided but not yet formalized prior to March 24, 2010.

The Standing Committee specifically clarified that "boards of health" are NOT exempt. The amendment reads as follows:

Exceptions

(3) This Act does not apply to the following employers:

1. Municipalities.

2. Local boards as defined in subsection 1 (1) of the Municipal Act, 2001.

2. Local boards as defined in subsection 1 (1) of the Municipal Act, 2001. However, this exclusion does not apply with respect to boards of health.

A government FAQ is available.