In a previous post, I argued that most rhetoric espoused by some of the f***muppets (i.e., a narrow group of PS who disseminate ill-informed opinions on blast and crowd out more productive conversations) doesn’t accurately reflect how wages and labour markets work, not even in the public service context. My original argument was that the PS combines three wage elements (reworded here for simplicity) that are already baked into wage rates:

• R — The “rack” rate, i.e., how much it costs for you to get out of bed;
• C1, C2, C3, C4, C5 — The commuting compensation to leave your house to go to a job site; and,
• L — the cost for actually expending energy to do the “physical” labour of the job.

I also apologized to academic specialists for renaming the elements and ignoring the long history of these elements, and to non-academics who will likely still find me too wordy.

What about C(ommute) costs?

As I outlined in my initial post, wages in the public sector agreements are based on rates that were in existence before widespread telework and the wages already had commuting costs baked in. They weren’t and aren’t generally visible, but they’re there.

And as I said above, there are some very important groups who go off the rails when sh**diots and f***muppets wrongly suggest that we should suddenly “start” getting a premium for RTO, when in fact, we are already paid for our commuting costs. Asking for something you already get doesn’t move the needle, at least not in the right direction. The ONLY arguments in my view that have any chance to positively influence outcomes are either in showing changes in incremental costs, changes in usage, or changes in competitors.

For changes in incremental commute costs, transport is an easy one to consider. But, as expected, you need to show how transportation costs have risen from pre-pandemic to now. Pre-pandemic, you were expected to be in the office five days a week and that was baked into your compensation. When the pandemic hit, everybody went home…and continued to receive those Commute premiums. If it helps, think of it as a per diem. Post-pandemic, you’re expected to be in the office 3d a week.

Now, when you look at transport costs, transport is obviously not the same for everyone. Some people live close to the office (by choice or necessity) and walk; some live on major bus arteries and take public transport either short or long distances; and some people live farther out and drive. That’s generally none of the employer’s business. The ONLY question negotiators will care about is “what costs have changed from before WFH to now?”. As I said before, you’re already getting approximately $50 a day for commuting. You can’t argue it’s NEW to commute (it’s not), you can only explain why it isn’t $50 anymore, but rather $60 or 70 now.

For actual transport components, what sort of increase in costs are there? How much have bus passes, parking and/or gas gone up? Bearing in mind, the employer isn’t responsible if gas goes way up or parking goes way up, but buses stayed the same. You need to show ALL transport options have or the main option has gone up for everyone, regardless of choices. People want to compare pandemic to now, which isn’t relevant. You have to compare how the estimated $50/d you are already getting doesn’t cover things now. What’s gone up since before the pandemic?

And here’s the kicker, just as it was for the rack rate. You have to show how it has gone up by more than average CPI estimates. When negotiating new wages, the general assumption is you will get the basic CPI estimate costs. If it went up by 16%, you’ll likely end up at 16%. If you want to argue it isn’t sufficient, as I suggested with the rack rate, you need to show that transport went up by more than CPI in the same time frame — essentially, the only persuasive argument is that if a component is significantly different than the basic CPI average, and it’s a major driver, then you can argue that this “component” should be compensated differently aka a higher increase rate than CPI.

Now, there is an aspect that people flagged early on in transport discussions, and they got it slightly wrong in presentation but close enough that it could have created some interest, yet didn’t. People initially said, “Hey, I was at home before, commuting sucks, I have to take a bus to get to my site, really inconvenient, pay me to go.” As I said, they missed the mark. But they did brush by a really important concept, just not quite the way they intended.

Inconvenience is built into both rack rate and the commute rate. It’s inconvenient to leave your house and go to an office. And you’re compensated for that inconvenience as part of your C rate already. Sooooo, arguing that the difference is sitting at home vs. going to an office, yes, of course it is. That’s already baked in.

However, what isn’t baked in is if you now have something VERY different than existed pre-pandemic. For example, the complex of offices in NCR that are located in Gatineau has undergone significant changes in the last seven years for parking. Prior to the pandemic, there was monthly parking available underground with a relatively long waiting list or external monthly always available or daily albeit an extra block or two depending on if you arrived before 9:00 a.m. or not. The underground options changed their allocation formula before the pandemic and the waiting list decreased. But part of the pressure to change was because two outdoor lots closed to build more office towers (private sector, not government-owned buildings, although GoC rented space).

During the pandemic, monthly rates were replaced with pre-paid daily pass options, and two more large lots closed. Another large lot is set to close Dec 1. The building is still served by main public transit arteries, BUT the availability, timing, cost, and frustration with all of those have changed dramatically over the last seven years. One COULD argue that in a case like this, it is DEFINITELY a higher inconvenience rate than before, and thus arguable that it might need a raise in the commute rate. Just like with Amazon decreasing friction in purchases by having a very active BUY NOW option, the work at the Portage complex and other nearby buildings now have a much higher friction rate, as do almost all locations in the NCR. So there should be a raise, right?

Well, probably no. I don’t know. Collective agreements are set for the entire PS all across Canada. Commutes in Toronto, Montreal and Vancouver are longer and more expensive than other cities, but the overall pay rate is the same. Nobody wants to move to city differences in rates of pay, not even the union as it would lower the pay for a large number of non-big city workers. There’s never been an interest in that, even when we know in our travel per diems that different rates exist for some cities that are more expensive to work in.

I love the issue, there’s clear evidence in small pockets, but for every big city constraint you find, TBS could point to other places where it got better. Or places where people are working in new regional offices instead of HQ. If you want to fix the first, will that mean everyone has to work in their HQ’s main office, no co-working sites, no regional sites, etc.?

We messed up on childcare

Another incremental cost, and one that is really complex, is childcare. And it’s where I think the FMs jumped in way too early and crowded out some much needed discussion of actual experiences.

For context, a lot of people are VERY passionate and frustrated about the challenges of childcare while working 3/d a week in an office. I get it. I really do. I struggle with all aspects of scheduling, coverage, costs, etc. too. My situation is different than the average one of people having toddlers or arranging after-school care, but I’ve been through that world previously. My current life is manageable with WFH options for 5d a week, but a frequent dumpster fire when I can WFH only 2d a week. The pressures of scheduling alone were enough for me to take some time off at one point, just to ease the transition back into some form of normal routine. And those with childcare spaces, multiple parents and step parents, custodial coverage across weeks, all of that? It’s a bandwidth killer, absolutely. Yet, aside from the mental challenge and juggling, the childcare issue is almost as problematic to talk about as the rest of the Commute rate.

The original $50 per day estimated premium covered ALL of the expenses associated with leaving your house and going to work. That included childcare. So, yes, like the rest, it is already embedded and assumed it was 5d/week. If you want to now argue the cost has changed, this is the area to do it, in the Commute rate. Except, well, some f***muppets have previously killed any support or openness on the issue from TBS.

Breaking it down, you have three general categories:

1. FD: Full-day care for kids under the age of 5
2. ASC1: After-school care for kids up to the age of 7 or 8
3. ASC2: After-school care for kids up to the age of 11 or 12

Some people will argue the cutoff is 4y not 5y; others will inflate or deflate the years for the ASC1 or ASC2 groups. However, the age cutoffs are not as important as the categories, so here is my take on the academic literature categories.

The FD group is for those kids who basically need someone looking after them all the time. If you were 5d a week at the office, these kids not yet in school would need someone looking after them 9-5. The standard everyday daycare need that most parents have for toddlers. Pre-pandemic, this was a standard cost and part of the rationale for your C rate (C1 for day 1, C2 for day 2, etc.). Unfortunately, there are f***muppets and sh**diots who raised this issue BADLY, immediately after the RTO mandate came down.

It started off simple, and went downhill really fast. The argument started with the fact that it was really hard to find daycare for only 3 days a week. A perfectly logical and legitimate issue. At first. But then people thought through that complaint and said, “Wait a minute. You’re working five days a week already, what do you mean it is “new” and that you would only need 3d a week daycare? Haven’t they already been in daycare fulltime since you worked fulltime?”. And, of course, some sh**diots blithely piped up to say, “Oh, no, we don’t pay daycare, I just have my 2y, 3y and 4y olds running around while I work” and the FMs echoed that on blast.

Umm…newsflash, that’s not allowed. You are not allowed to babysit your kids yourself while supposedly fully focused on work. That’s literal time theft. It would be no more acceptable than it would be to take your kids to work with you every day and watch them there. And as I said, those discussions did NOT go well, really fast. Almost everyone knew you shouldn’t do it, but the L5s (sh**diots) and L6s (f***muppets) tried to argue that it was legit, and that you SHOULD be able to, which pissed off a lot of taxpayers, MPs, analysts at TBS, Ministers, etc. and almost nuked WFH for everyone. I’m not kidding. In some non-GoC jurisdictions, PS workers have been fired for doing it AND sued for backpay. There is NO sympathy for anyone on this front for pay and compensation. There is barely any residual sympathy for ANY childcare issue.

The second group, aka the ASC1 group (from age 3/4/5 to 7/8), the first cohort of after-school kids, people tried the same argument. “Oh, they can be home with me after school, it’s not distracting at all.” Well, there are certainly exceptions to that, but generally, the younger ones certainly can’t be relied on to entertain themselves every day. And yes, yes, yes, your child is VERY mature for their age, but this is about everyone as a “class”, not your specific situation or child, the rules apply equally to everyone. But there is a reason why AS care exists — cuz kids in that age can’t be on their own every day.

So, while there was SOME sympathy, it mostly fell into the same category as above. You’re not supposed to be looking after your kids while you’re working, and if you’re saying that they need minding if you’re at the office, they need minding if you’re at home too. I have lived this world too, I get your concerns, but the union, collective agreement and legal precedence aren’t on your side, I assure you. It’s “understandable” if it happens from time to time, due to closures or schedule or some other calamity, but it is not allowed as a daily solution to your childcare needs.

Yet on these first two groups, as the FMs went on blast, some people who were not thinking about the risk listened to the FMs and thought, “Hey, I should stand up for this as a right too!”. And promptly got called into meetings with their bosses to explain whether or not they were committing time theft. Which is an allowable ground for the employer to say you’ve broken the employer relationship and terminate you. Now, within the GoC, my understanding is most of those saying “Hey, I’m doing this too” got told to delete their posts, shut the heck up, and find a solution fast so they didn’t get fired. People sent me messages on my blog saying, “Hey, I might have f***ed up and want to know if I’m about to be fired.” That was WAY beyond any help I could provide. I deleted the comments long before they could go live. This was a union or lawyer situation, not a question for ThePolyBlog.

However, the third category, call it the ASC2 group, these are the kids who CAN entertain themselves for an hour or two at the end of your day. Call it the near-latch key kids, with all the pluses and minuses that go with that rubric. They are still a bit young, but if you were home, they’d be off doing homework, doomscrolling, or vanquishing digital dragons. They need someone around, but not necessarily full-time after-school care. You could literally be there, if they’re home, and still work uninterrupted. Ah-hah, now we have a legitimate issue, at least at the start. However, obviously, if you were getting the money pre-pandemic, it doesn’t make any difference if you have to pay post-RTO too. It’s already in your bucket, right?

Or maybe it’s not. On the one hand, sending them for 5d a week to ASC should be same issue as the other two. But if you’re WFH 2 days a week, and RTO 3 days a week, maybe it makes sense to ONLY do 3d a week in paid ASC. Except only going 3d a week often requires a PREMIUM charge. In theory, if you pay more for 3d coverage than you would have for 5d coverage previously, maybe that’s a legit increase to talk about. There is no argument for daycare costs going up from pandemic days when you might have been temporarily violating rules, but if you can point to higher overall childcare costs for 3d/week now over 5d/week pre-pandemic ASC for the older kids, or even new 5d/week is higher than previous 5d/week AND also higher than the CPI index, that’s a clear incremental change to your costs of working 3d a week instead of 5d. Not compared to WFH, but compared to pre-pandemic rates.

Except I’m not sure we ever adequately discussed all the challenges. Nor that I captured the breadth and width of the challenge.

When the conversation first started regarding the interplay between WFH, RTO and childcare, a small number of FMs jumped on the wrong issue, didn’t understand it, went on blast, and TBS had to respond. So they did. They smacked everyone, said it was all fake news and time theft to boot, and smacked the crap out of everyone. Including Departments who were told to crack down. Which they did. And ended any broader conversation about childcare that might have come out of it.

If I was running the Zoo, like young Gerald McGrew, I would have hoped for some more nuanced considerations, even if none of them led to increased compensation. I would likely frame it myself as encompassing a series of stages throughout the day:

• Initial considerations around gaps in coverage due to finding childcare during the RTO process, what to do when the provider is sick or closed for the day, what are the limits around home care (1/2 day instead of full day off? Can you work while they’re sleeping?) on ad hoc basis?
• What are the flexibilities around transition times at the start of the day, such as schools starting at say 9:00, doing drop-off but it means you don’t get to the office until 9:15 or 9:20, is that an identifiable flexibility that managers SHOULD grant on their own, does it need to be documented in some way, what happens if you have to leave during the day or have to pick them up to take them to an appointment, and your care provider doesn’t offer in/out privileges?
• What does transition look like at the end of the day, both in normal as well as ad hoc situations that develop, or what does it mean if there are custodial coverage issues by week/biweekly/month/day?
• What does it mean overall for how things are resolved when there’s a conflict, how much flex does a manager have?

As I said, I don’t think it would have led to compensatory changes. Nor allowance for working while caring for children. However, there is considerable room in the above list where managers previously had a fair amount of discretion to interpret the rules generously and liberally, as long as the work was completed. When the FMs went on blast, arguing without thinking it through and pissing decision-makers off, the system responded by shutting down all flex on the issue and freezing legimate non-compensatory and potentially compensatory situations out of the discussion space.

It was framed as simple time theft, and the public scrutiny had some DMs telling TBS they needed a Government-wide response that they could all implement; they were not willing to be the one leading on the issue and wearing the results. I had very experienced managers reaching out to me, asking, “Hey, so you’re pretty good at finding ways to be flexible…do you see any wiggle room in THIS situation that I have to manage?”. And most of the time, I didn’t. Not in the new locked-down environment. It totally backfired on everyone.

For the future, people MIGHT find some evidence to suggest incremental costs have gone up, but there won’t be much openness at TBS. Will all the negative press and reactions of those inside the government, it came very close in my opinion to the end of WFH at all.

The last area for changes in incremental cost is that which derives from working from home. There are some really good people in the discussion forums who have a very detailed analysis of what it means for increased costs by working from home. Increased internet usage, the space in your house devoted to a home office, heating, lighting, power use to run the computer, etc.

I don’t get excited by it much, I admit. I think it is likely to come out a mix of plus and minus across the board and doesn’t really move the needle, but if you can show incremental increases in those areas for everyone, I think people who care about this issue should go all in. They are neither sh**diots nor f***muppets, they are pointing to a legitimate cost area. Some even want to point to pre-pandemic usage of telework, where people were often reimbursed for internet or even routers. Or that we already acknowledge the costs of desks or chairs. I am happy with all of that, I think it is incredibly useful analysis to support union consideration.

But…I go back to the fact that we are getting $50 a day to go into the office. If that was 5d a week, it’s about $13000 a year or $1100 a month. If they want to include this in negotiations, they have to start by showing the combined costs are above $1100 and negotiating up from there. Which will be almost impossible to get anywhere…even by the most ambitous or generous proportional costs, it will be almost impossible to show you are using more than the $50 / day you already get. The proportionality will kill it. The government doesn’t pay you for ALL internet, only the proportion that is used for work. And even then, for reasonable options. Even in telework reimbursement days, you couldn’t go in and get a T1 line installed and charge the cost to the government — they reimbursed for a share of general dialup costs. Plus, unfortunately, the government threw in an option to claim home office costs on the taxes, so you can’t get reimbursed twice either. If the passionate can find reasonable and acceptable incremental numbers, I think they should go for it! I just don’t think it has enough $$ legs to lead to a wage increase.

Changes in usage or competitors

For changes in usage or changes in competitors, I wish I was more optimistic. As with the rest of the C component, it has to have enough evidence of incremental change to get above the $50 rate we already get. Changes in usage is more about whether people are using Rack + Commute to get to a job site while change in competitors is more about them going to someone else’s job site.

Both generally rely on the same evidence. Just as I noted social assistance usage demonstrates changes in the overall rack rate, the best evidence of change here is if people are leaving the government at higher rates to go work somewhere else, not joining in the first place, or broader evidence of exhaustion rates on EI increasing. Let me jump ahead and start with EI for a moment.

I noted in the previous post that you have to calculate a general “replacement rate of income” equivalent to how much it would be worth it to someone to get out of the house (rack rate) and go to the job site (commute rate) in order to start earning more money. Someone in the comments suggested that I shouldn’t have used EI because it wasn’t the same everywhere or that it changes yearly. They’re right. Those two facts are both true. Even though it has little to no impact whatsoever on the analysis.

It doesn’t matter if EI is $700 a week or $750 a week or $500 a week. It is being used as a proxy, just like social assistance is. It’s not the ACTUAL rack+commute rate. It’s an estimate of the income replacement rate. If you go to the academic literature, as I said above, there are extensive articles and even whole Ph.D. theses written about what the income replacement rate is in various jurisdictions. In Canada, for employment, the only national rate across the country is EI, so it’s the one I chose. In all that academic literature, you can find extensive analyses of whether it should be higher or lower, and very passionate pleadings or arguments that it should be 1% lower because one of the EI variables overestimates automobile maintenance costs or 1% higher because in jurisdiction X out of all the EI zones, professionals are claiming at a rate of 2% higher than the rest of the country. For a blog? EI is good enough as a proxy.

But, in the end, it is only relevant in terms of how the actual income replacement rate would interact with the EI rate at any given time. It acts the same as the social assistance proxy did. The EI rate (at least for insured workers) acts both as a minimum rate to show up at the job site (a little over reality) and the minimum rate needed to stay on EI. If EI exhaustion rates are going up, it either means it’s hard to find a job (high unemployment) or that EI is equal to or more than the actual R+C rate; if EI exhaustion rates are going down, it means EI is insufficient to cover R+C, thus a greater incentive to work to cover real costs. Of course, the usual caveats apply about all other things being equal or ignoring sluggishness in economic responses. However, as with some of the other pieces, the ONLY relevant evidence for wage negotiations would be EI usage by actual PS employees who have left the government. Data in that regard will be hard to come by, which I’ll cover again in a minute.

Returning to the question of employees leaving in droves or the government not being able to hire, this could show overall wage rates are insufficient. That is certainly the case in very specific occupational groups, like CS, where there is lower usage and lots of competitors. We can’t compete, and can even throw in relative compensation rates (although a true comparison also has to include full benefit packages, government pensions, and wages, not just wages). For the PA and EC groups? No such problems or good evidence of gaps. Some levels are challenging to staff, including the old EC-01 levels and stuff, but external hiring of AS and PMs is generally oversubscribed, as is EC, even at entry levels. But in the same way that there are animals in the wild with no natural predators, there are limited direct competitors / comparisons for many government jobs. Processing jobs in call centres have some natural comparators, particularly in insurance companies and pension providers, and there are some in other levels of government, etc. Recruiting isn’t generally a problem, which is a sign that the market thinks the pay rates are good enough to take.

That’s not a normative statement that they are good, or as someone said in the previous discussions that “take it or leave attitudes is why we have unions”, it is just the description of the transaction. The employer offered a job with a wage and someone said that was a sufficient combo for them to say yes. That’s how labour markets work. Whether the rate is “right” isn’t part of my analysis, it’s whether we have signs in the opposite that it is so wrong, nobody will take it. There’s no evidence of that, however. Jobs are not going unfilled after advertised, unless there are internal constraints (we choose not to fill them) or they’re in specific categories.

By contrast, in the private sector, there are specific examples where jobs are advertised, repeatedly even, and no applicants at all. While there are varying reasons for some of them, the underlying reasons are generally wage or lack of skilled workers in that area. Health care is dying for people, for example, and any sector using Temporary Foreign Workers in general. Not so the general PS.

Which leaves possible evidence of people leaving and taking other jobs. When people quit, we generally have stats that show how they left — formal retirement after a certain age, early retirement or simple resignation with deferred retirement. In a WFA situation, we have some other categories. Yet, we have little evidence of where they go with resignation+deferred — did they inherit money and retire to the South of France? Did they decide to start their own business because they have a more entrepreneurial spirit? Did they decide to stay home and tend to family while someone else provided the main income? We have very little info here, nor on EI usage either. Partly because if they quit, they didn’t get EI; any EI usage would normally be tied to other types of EI benefits (sickness, compassionate care, etc.) than regular benefits.

And even the evidence we have in abundance is totally messed up right now. For those who are retiring, the general analysis divides into two.

First, there is the obvious assumption that retirement decisions are based on the level of your retirement income…aka if you retire, you are deciding to do so because you have sufficient income to do so. It is, by and large, a statement about your pension and savings, relative to your pay, not simply about your current rate of pay.

Second, alternatively, you could argue that those who continue to work are doing so because they NEED to do so to cover expenses in times of inflation (although, again, that is about pension failure, not current salary) OR because it is simply generous enough to keep working rather than retire.

For those who DO quit, you can try to calculate if people are quitting because the overall rate is too low. The idea would be that you are quitting because you’re not paid enough for R, C or L or the combo of all three. You can argue that departures are a commentary more on C or L, but the econometric evidence and behavioural analyses are far from clear. The only way you’ll know is basically exit interviews or union satisfaction surveys, both of which are often highly skewed. It’s really hard to get this data in a reliable form.

So where does that leave us?

There is virtually no openness within the government to look at the Commute rate. It is baked into the base pay, it was not clawed back during the pandemic, and nobody has any interest in increasing nor decreasing it now. Add in the negative reactions to FMs who pushed the childcare example in the wrong way, and not only did we not get anything related to compensatory interest, we also lost flexibility in the ensuing crackdown.

There might be some areas where incremental costs have gone up at a rate higher than average CoL increases by CPI estimates, but it’s still going to be hard to get around the belief that we are already being paid for 5d/week of commuting and only have to do it 3d/week. For TBS, if people want to start conversations about the Commute elements, the first thing they’ll do is say, “Everybody back to work 5d/week” and start from there. Because that’s what we’re being paid to do now, even if we don’t go 5d/week. And some already work in the office 5d, while being paid the same rate as those at home 2d and only in the office 3d. If someone wants to change something, it won’t be to pay the other workers more, it will be to pay those at home less.

There may be some evidence of incremental friction in transportation in specific locations, or indications that the incremental costs of commuting have outpaced general inflation for everyone. I just don’t think anyone will listen. The FMs shut things down on childcare amid suggestions that we should get paid AGAIN as a result of RTO when we were already paid to be in the office, and all of it did NOT go over well with anyone on the government side.

We’ll get a basic inflationary bump, but that’s probably it. I don’t think the incremental costs can overcome the overpayment of commuting premiums.

Interestingly, though, there is an element of our new way of working that people want to argue in this space (aka we can work from home just as effectively as in RTO), but that actually goes to our third area, not the commuting variable. That will be in the next part. I even have an idea of what might help, although it doesn’t solve RTO.