Open Letter to Winnipeg Construction Association Members:

Ladies and Gentlemen

On behalf of the Board of Directors of the Winnipeg Construction Association, I am writing to you to summarize our position on the Floodway Labour Agreement, and to clarify comments made in recent media coverage.

On March 9, 2005, the Manitoba Floodway Authority announced that it had concluded negotiations on a Master Floodway Agreement for the Red River Floodway expansion project. This brings to a close WCA's involvement in a long and difficult process. It is now up to our members to make their own business decisions as to whether they want to participate in this construction project given some very difficult conditions.

WCA's position at the very beginning (February, 2004) of this process was, and continues to be, that the Floodway project – and its component parts – do not warrant a “Hydro style” project labour agreement, and that the best value for Manitobans will flow from the tendering of this work in the traditional and open manner.

The Manitoba Government and the Manitoba Floodway Expansion Authority (MFEA) clearly did not share this view. They were convinced that a project labour agreement was needed on this project.

There can be no argument that project labour agreements (PLA) have their place in certain construction projects. Manitoba Hydro routinely uses these agreements on the hydro dams in Northern Manitoba and they are sometimes used in industrial construction projects elsewhere in the province. Industrial projects often utilize a highly unionized workforce, and in the case of Manitoba Hydro, have to deal with very remote site conditions for long periods of time. In projects like this, PLA's have been used to create a measure of labour peace between the various unions themselves. Labour peace was cited by the Manitoba Government as one of the main reasons for advocating such an agreement. WCA responded to this statement frequently suggesting that the construction industry in Manitoba has enjoyed relative labour peace, and harmony between the union and open shop sector, for many years and we do not see the Floodway expansion project challenging this climate.

In public debate that ensued – often through radio talk shows, the newspapers, and television – it became quite clear that there are some very strongly held positions on this issue. In March, 2004, the Government appointed Wally Fox-Decent as a conciliator and to make recommendations to Government relative to this issue. The Fox-Decent report was a mixed bag of recommendations, and / or options, and essentially supported the use of the Labour Agreement and the inclusion of conditions that allowed open-shop (non-union) companies to bid the work without fear of certification. The Government accepted this report without comment on the “either / or” options contained within it, and continues to contend that the process has followed the recommendations of Mr. Fox-Decent. One example of the inconsistency was the suggestion by Fox-Decent that the wage scale for floodway construction workers follow the Construction Industry Wages Act OR a labour agreement. Option 1 never did receive serious consideration by the MFEA despite our protests.

The Manitoba Floodway Expansion Authority formed an “Interim Owners Committee” (IOC) that was to provide advice to their labour agreement negotiating team as they progressed through the creation of the Master Floodway Agreement. The Interim Owners included representatives from WCA, Manitoba Heavy Construction, Merit Contractors Association, and the Construction Labour Relations Association. We agreed to refrain from any further media comment during the negotiation period.

It became clear rather quickly that while the negotiating team would use the IOC as a sounding board, the IOC members would not have a great deal of meaningful input

in the terms of the actual project labour agreement.

After a particularly difficult session, the Manitoba Heavy Construction Association and the Merit group indicated to us that they would no longer attend these meetings.

After much discussion at the WCA Board, the WCA contingent elected to continue involvement this process despite the fact that we could see an agreement developing that would be objectionable to a large number

of our member companies. WCA elected to stay at the IOC table to ensure that we had a voice in the

process, and so that the negotiating committee were well aware of the issues our members would find objectionable, contrary, or unworkable. Our position

at the table should in no way be interpreted as tacit approval of the process or the final agreement.

WCA is not a signatory to the final floodway labour agreement .

For 100 years, Winnipeg Construction Association has represented Manitoba construction companies that are both unionized and open-shop. There have been divisive issues in the past – including the famous Winnipeg General Strike – and we have endeavored to be a moderate voice for the entire commercial construction industry. There is no question that this has been one of those divisive issues and we have tried to provide the best possible representation to our members.

It is unfortunate that the Manitoba Government elected to require a project labour agreement on this project. In our view, they have taken what could have been a good news story all around and turned it into a bitter “Us vs. Them” debate. Our President met with Premier Doer on two occasions and related this sentiment. Our voice was heard, but the message unheeded.

There will be some very definite impacts both positive and negative from having this large project underway next door to Winnipeg . We can only hope that our local industry will benefit (as opposed to out-of-province firms) and that it is resilient enough to withstand these additional pressures.

We welcome your comments.

Ron Hambley

Executive Vice President

Winnipeg Construction Association

775-8664

rhambley@wpgca.com

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