Two days after Manitoba Public Insurance signed a deal with brokers to give them a cut of online sales — estimated to increase commissions by $23 million over five years — the province demanded a two-year pay freeze for MPI employees.
"All Manitobans are meeting unprecedented disruption and hardship" during the COVID-19 pandemic, Crown Services Minister Jeff Wharton wrote in a Nov. 26, 2020, letter to MPI leadership.
The message to Crown corporation chairman Michael Sullivan and interim president and chief executive officer, Satvir Jatana, said amidst the COVID-19 environment and with a "very large deficit" expected, the government's collective bargaining mandate is an immediate zero per cent compensation increase for the next two years.
The order not to negotiate a wage increase for MPI workers followed the Nov. 24 signing of a deal with the Insurance Brokers Association of Manitoba. The five-year agreement gives brokers a percentage of online Autopac renewal fees "whether they do anything to earn it or not," the union representing MPI workers says in a Jan. 5 letter to Wharton.
"This lucrative deal will increase commissions for brokers by $23 million over five years," Michelle Gawronsky, president of the Manitoba Government and General Employees' Union, wrote last week.
"All these people have done really good work on behalf of Manitobans," Gawronsky said Monday in an interview. Now they're not being allowed to negotiate a cost-of-living increase from a Crown corporation so financially healthy it has issued rebate cheques to customers, she said.
"That's my question to Minister Wharton and my question to the premier: you're not willing to let MPI negotiate a collective agreement but you quietly signed off on $23 million of Manitoba's MPI money to brokers?" Gawronsky said.
"Where's the fairness? Where's the transparency?"
The 16-page contract was not publicized by either MPI or the brokers association. It was signed after the government appointed a conciliator to get the two sides together on the future of online product sales.
MPI had produced internal financial models that showed the Crown auto insurance corporation could save millions of dollars in broker fees if its products were available for purchase online.
Brokers said they were not opposed to the greater use of online insurance purchases, but insisted such transactions must go through them — even if the customer doesn't ask to consult a broker or uses the public insurer's website.
Under the deal signed Nov. 24, Manitoba insurance brokers will receive a commission from all online Autopac renewals when modernized service delivery becomes available in 2023.
In her Jan. 5 letter, Gawronsky cites a 2019 email from then-CEO Ben Graham to the MPI board stating: "Your government directed the corporation to hand over 100 per cent of online transactions to brokers," and MPI and brokers agree "demonstrating mutual respect" and "good faith co-operation" was critical to reaching an agreement.
"It is disappointing that the employees at MPI have not been granted the same respect and good faith in their negotiations, as your government continues to illegally force wage freezes on them without free and fair collective bargaining," Gawronsky wrote to Wharton.
On Monday, when asked to respond, Wharton's office issued a statement, saying part of government’s role is to set broad public-sector mandates.
Autopac rebate cheques on wayClick to Expand
MPI says 315,000 of 675,000 rebate cheques have been printed and mailed to motorists who will receive a rebate on vehicle insurance because of fewer claims and less traffic in 2020 due to COVID-19.
The cheques issued so far are worth a total of $23.6 million.
MPI announced in November a second rebate cheque would be issued because there were about 20 per cent fewer collision claims from mid-March to the end of October compared with same time period a year earlier. MPI is forecasting the trend to continue into spring 2021.
Each rebate is expected to be about $100 per policyholder, or about six per cent paid for an annual basic Autopac premium.
"We have done this in an open and transparent way, recognizing the unprecedented challenges caused by COVID-19," the email says. "Many Manitobans have experienced outright job losses. and we continue to offer a broad range of assistance and stabilization programs for them, while making massive investments in public health, safety and protection.
"We appreciate the efforts of all Manitobans, including public-sector unions and employees, as we lead an all-hands-on-deck approach to fighting the pandemic while avoiding layoffs and keeping taxes low."
There was no response to questions about the timing of the letter demanding a wage freeze.
"You see the government's priorities reflected here," NDP Opposition Leader Wab Kinew said Monday.
"We all know this government has been freezing wages like the MPI employees' since they got in," Kinew said in an interview. "Now, all of a sudden they've been doing it because of the pandemic."
In June, 2020, the Manitoba Court of Queen's Bench ruled the Tory wage-freeze legislation (Public Services Sustainability Act) violated the constitutional rights of unionized public-sector workers by eliminating their right to collective bargaining.
The province has appealed, but no court date has been set.
After 20 years of reporting on the growing diversity of people calling Manitoba home, Carol moved to the legislature bureau in early 2020.