Submission for the Public Consultation on the CEWS Program

ATU Canada welcomes this opportunity to provide feedback on how the Canada Emergency Wage Subsidy (“CEWS”) can be improved. We commend the Government for its commitment to providing CEWS to more Canadians facing the dire economic realities of the pandemic.

In ATU Canada’s view, extending eligibility for CEWS to public transit providers is critical to achieving this goal. The sad reality is that public transit has fallen between the cracks of the relief programs provided to date by the different levels of government.[1] While governments squabble over their respective responsibilities, thousands of transit workers have been laid-off and a municipal funding crisis has developed that seriously threatens our country’s economic recovery. 

It should come as no shock that COVID-19 has placed an astronomical strain on public transit. Public transit providers are reporting losses in revenue ranging from 70%-85%,[2] and yet they have been expected to implement costly disinfection and cleanliness policies,[3] while finding new ways to deliver service based on evolving public health advice.[4] Public transit has had to respond to this crisis in real time, without the economic means to engage in long-term planning or solutions.    

Our members have experienced firsthand the dangers caused by failing to fund public transit in this emergency context. The result has been reactionary and haphazard  measures which have not kept pace with the pandemic, exposing our members to increased risk. Before the shut-down of non-essential businesses, public transit providers across the country refused to allow their workers to wear masks.[5] In April, weeks into the emergency, it took the unilateral action of  ATU members to place limits on the number of passengers that could ride on buses on busy routes. Some of our members still work in unsafe conditions because municipalities have not been able to implement necessary protective measures consistent with public health advice.[6]

When it became apparent that emergency funding was not forthcoming, many public transit providers reacted with service cuts and layoffs. The job loss has been widely reported in the media, but it is important to take stock: The TTC has laid off approximately 450 workers, and expects to lay-off 750 more in the coming weeks.[7] Winnipeg Transit laid-off 250 workers back in April,[8] while the City of Edmonton laid off approximately 450 transit workers.[9] In Windsor, transit services were suspended in March with 130 transit workers, virtually the entire workforce, sent home.[10] In Calgary, approximately 450 transit workers were laid off in early May.[11] This is just a small sampling of layoffs. Other transit workers have had their hours, wages, and overtime pay cut. They are expected to do the same work, in more dangerous conditions, for less.

Remember that there are people behind these numbers. These are hard-working Canadians with families, who put their personal health at risk to show up for work in the earlier phases of the pandemic, when very little was known about how COVID-19 spread. It is easy to forget what things were like in March, before ‘social distancing’ was entrenched in our social milieu. These workers risked their lives each time they stepped on a bus or a vehicle. It is an injustice that they are not being provided with the same emergency relief as other workers in private or non-essential workplaces. 

Cuts to transit services threaten Canada’s ability to recuperate from COVID-19. This is not a hypothetical proposition. Some public transit providers have admitted that they are not presently equipped to keep up with service demand.[12] Months after the emergency declaration, a high percentage of buses in Winnipeg are over-crowded.[13] Of course this number will sky-rocket as more workers are required to attend their workplaces. Less frequent service will result in overcrowding as demand increases. This Government cannot risk the infection of the first wave of transit commuters once our major cities re-open. This would jeopardize the fruit of our collective efforts since March to flatten the curve. Failing to fund public transit is a serious risk to the health and safety of all Canadians.

The truth is that public transit has fallen into a lacuna, with no level of Government taking responsibility for the funding crisis that has developed. Finger pointing at the provinces has proved ineffective. Municipalities do not have appropriate taxing powers to compensate for the gross loss of revenue caused by the pandemic.[14] Transit commissions have no other means of raising operating revenue.  It is time for the Federal Government to provide a solution which is in the best interest of all Canadians, regardless of the province or municipality that they live in.

In ATU Canada’s submission, that solution is simple. The Government can use its power under s. 125.7(1) of the COVID-19 Emergency Response Act, No. 2, SC 2020, c 6 to prescribe all entities providing public transit as “organizations” that meet the definition of “eligible entity” in s. 125.7(1) of the Act, whether or not they might otherwise fall within the definition of a “public institution”. It is possible this change could be made through Regulation without even the need for a legislative amendment.

Of course, a legislative amendment is also an option. Specific language could be adopted that applies to a small range of municipal services that are vital to economic regrowth. However the change is implemented, extending CEWS eligibility to public transit providers is an efficient and fair way to provide relief to municipalities for the following reasons:

1. There are minimal administrative costs associated with extending relief through an existing program, since the Canada Revenue Agency already has the personnel and infrastructure in place to administer the program, and this consultation process will lead to further program efficiencies. This means that virtually all of the funding provided will go towards the continued employment of transit workers.

1. Providing funding through CEWS ensures that the funding will be directed at preserving employment, rather than other municipal programs or operational costs. This aligns with the Government’s priority of keeping Canadians working throughout the crisis.[15] It also means that the funding will have a ripple effect on economic growth as workers maintain or increase their purchasing power.

1. It eliminates the arbitrary distinction created by the present version of the program between public transit services that have been contracted out to private entities, and public transit that is provided through a municipality, city board, or Crown corporation. There is no principled reason why a transit worker at a private bus company in York Region should benefit from the CEWs Program, but not a transit worker employed by the City of Calgary.  The present iteration of the program inadvertently fuels regional division and promotes contracting out a vital public service to private entities that provide inferior wages and terms of employment. 

1. It is consistent with the Federal Government’s extension of CEWS to other transportation services, such as airlines like Air Canada. While both airlines and public transit providers will be essential to economic re-growth, only public transit is used by elderly or vulnerable populations to access necessities like groceries or medical appointments every single day, or as the means of transportation used by many essential workers to get to their jobs.

1. Finally, extending CEWS to public transit providers fills the lacuna created by the jurisdictional division of responsibility. It also provides targeted relief that will allow municipalities to direct their advance of the Gas Tax Fund to other important initiatives, potentially reducing the amount of funding that the Federal Government will have to provide to municipalities in the future.

The CEWS program in its present form is innovative, but it is also under-inclusive. Extending CEWS to public transit providers ultimately kills three birds with one stone: (i) saving municipalities from the brink of bankruptcy, (ii) preserving jobs, and (iii) ensuring transit providers have the resources available to comply with public health advice in the provision of service. Immediate action is needed to ensure that safe and reliable public transit will be available to fuel Canada’s economic recovery over the coming months. It is time the Government does something for the thousands of transit workers who were willing to risk their own health to keep this country moving.

ATU Canada hopes that the Government will seriously consider this submission.

Respectfully,

John Di Nino

ATU Canada President