Federal Public Service Workers Prepare to Strike: Refusing to Pay for the Inflation They Didn’t Cause

Over 124,000 members of the Public Service Alliance of Canada (PSAC) and around 35,000 Union of Taxation Employees are now in a legal strike position. Though some of them are designated “essential”, PSAC says that over 100,000 staff could still strike with a few days’ notice. A mass strike can happen anytime between now and June 2021, with three-days’ notice. 

A walkout of more than 155,000 federal public service workers would be one of the largest strikes in Canada’s history.

The previous collective agreement for these PSAC groups expired in 2021. Bargaining began in June 2021. A non-binding report was released in January 2023 after the union went to the federal labour board in May 2022. PSAC said its members’ needs were still unmet, so held a strike vote from February 22 until April 11. The Union of Taxation Employees began bargaining with the government in January 2022. The union declared an impasse in September and went to the labour board, which released its report about two months ago. Strike votes for the tax group were held from Jan. 31 until last week. 

The union has listed the following key issues on its website as outstanding: fair wages, more inclusive workplaces (e.g. putting an end to racism, sexism and homophobia at work), better work-life balance, and good, secure jobs. At the forefront of the current negotiations is wages:

The union’s latest proposal for a pay increase is 4.5% annually for 2021, 2022, and 2023. In contrast, the Treasury Board offered to increase wages by an average of 2.1% over four years.

Essentially, the employer’s proposal amounts to a wage cut, as the rate of annual inflation in Canada was 6.8% in 2022. Moreover, the cost of essential goods and services that directly impact the lives of the workers, such as transportation (+10.6%), food (+8.9%), and shelter (+6.9%), has increased at a higher rate.

Nonetheless, the public sector dispute is not just about the wages of PSAC and Union of Taxation Employees workers. It’s about the future of the working class in Canada.

The proposed attrition of wages is not just unjust, it is draconian. If cuts are condoned, a dangerous precedent for workers across the country is set.

Clearly, the problem is not unique to the public sector. Workers across the economy are struggling to keep up with the rising cost of living. The average worker has lost over three percent of real purchasing power in just one year. Workers’ share of GDP is shrinking, while prices continue to surge.

While general inflation may be slowing down, we can’t afford to let wages remain far behind. Workers deserve compensation for the already significant increase in inflation, so that they don’t experience a permanent reduction in their living standards. The legacy of hyper-inflation should not ravage the workers who keep the country running.

The Bank of Canada claim that tight labour markets and wage growth are the main causes of inflation is inaccurate. Empirical evidence shows wages have been trailing behind inflation by an average of 2.5 percentage points since early 2021. Meanwhile, corporate profits have skyrocketed during the pandemic — highly concentrated in industries that are contributing most to inflation. These industries include petroleum, real estate, building materials, car sales, and major supermarket chains. Profits have risen 50% since 2019, while unit labour costs have grown one-third as much.

The Trudeau Liberal government is leading the charge against workers, and the labour-based New Democratic Party is giving them a free pass by propping up the Liberals minority government in Ottawa. Major labour unions are failing to fight adequately for their members’ living conditions, as well as for workers not unionized. What we need is strong leadership to leverage the federal public service workers’ struggle and take a stand for a wage catch-up for all. The Canadian Labour Congress, its affiliates, and other unions like Unifor, should plan days of job action in support of the PSAC. It’s time for workers to unite against the bosses and fight for fair wages for everyone.

Don’t let corporate greed and the Trudeau government further erode our living standards. Let’s stand with the public service workers in their fight for decent wages, more inclusive workplaces, better work-life balance, and good, secure jobs. Stand up for the future of the working class across the Canadian state.

By YK / April 14, 2023

If you would like to get more information or become involved in the movement, contact:

Socialist Action: socialistaction.ca | socialistactioncanada@gmail.com | (647) 986-1917 or

Workers’ Action Movement: workersactionmovement@gmail.com |www.workersactionmovement.ca | (647) 728-9143