Telus Wants 3-Year Freeze on Employee Wages, Offers Lump-Sum Payments

The Financial Post reports that Telus is trying to impose a three-year wage freeze on thousands of employees as competition with Shaw looms and the incumbent tries to control costs.

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When it comes to six-year contracts, Telus is considering lump-sum payments of $8,900 to $19,000 instead of annual wage increases, according to updates from the Telecommunications Workers Union. The proposal also includes payment in lieu of overtime pay and an extra “float day”. When the first half of the contract ends, Telus is proposing a 2% annual wage increase, the report says.

This strategy has been widely used by car manufacturers, especially after the 2008 financial crisis, as it allowed them to freeze base salaries for several years. According to Craig Rix, a labour and employment lawyer with Hicks Morley in Toronto, this is a standard procedure when companies try to “squeeze as much out of your limited financial mandate as possible.”

The union has yet to present Telus’ offer to its members, but apparently some parts of the proposal contradict Canadian labour laws.

The proposal comes at a time when Telus is having to compete with Shaw on wireless and home internet services, and the carrier has pledged to increase dividend payments to shareholders and invest $2.85 billion in 2016 alone in network improvements.