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New rules for companies in Canada

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TORONTO –

New rules prohibiting wage-fixing and no-poaching agreements kick in Friday in an effort to crack down on companies undermining competition at employees’ expense.

Here is what employers and employees need to know about the new rules:

What is the new law?

As of June 23, it is a criminal offence for two or more employers to form deals that fix, maintain, decrease or control wages. The same goes for agreements that prevent companies from hiring or soliciting each other’s employees.

It comes after the federal government made amendments to the Competition Act’s conspiracy provision in June 2022 as part of its Budget Implementation Act.

“Like price-fixing agreements between competitors, wage-fixing and no-poaching agreements undermine competition,” states the Competition Bureau, which is responsible for the administration and enforcement of the Competition Act.

“Maintaining and encouraging competition among employers results in higher wages and salaries, as well as better benefits and employment opportunities for employees.”

The penalty for violating the wage-fixing and no-poaching provisions includes imprisonment for up to 14 years, and/or a fine to be set at the discretion of the court.

What’s different from before?

Section 45 of the Competition Act has until now criminally prohibited agreements between competitors to fix prices, allocate markets or restrict output.

But that didn’t apply to companies’ practices when compensating for labour. Instead, agreements between competing purchasers were viewed under civil provisions contained in Section 90 of the act, which prohibits deals likely to substantially prevent or lessen competition.

“So if an agreement between competing purchasers resulted in anti-competitive effects, such as higher prices, then that agreement could be challenged and be prohibited under the civil provisions,” said Adam Goodman, a partner at Dentons’ competition and foreign investment review group.

“What the new law does is make it a criminal offence for a subset of buyer-side conduct segments.”

Under the previous provision, fines were capped at $25 million.

“The wage-fixing and no-poaching amendments coming into force is an important step in the ongoing modernization of Canada’s competition law,” competition commissioner Matthew Boswell said in a press release.

Who do the new rules apply to?

The amendment applies only to pacts between unaffiliated employers. That means wage-fixing or no-poaching agreements between two or more corporate entities controlled by the same parent company do not violate the provisions.

While the rules cover wage-fixing and no-poaching agreements between employers regardless of whether they compete in the supply of a product, the Competition Bureau said it expects to prioritize its enforcement on arrangements between companies competing for labour.

The new law also only targets no-poaching provisions that are mutual in nature. If only one company agrees not to hire another’s employees, the Competition Bureau says that’s not caught by the legislation.

Are there other notable exceptions?

The Competition Bureau says the law is directed at “naked restraints” on competition, which include restrictions on wages or job mobility that are not implemented to further a legitimate collaboration, strategic alliance or joint venture.

It said it intends to target restraints that “are clearly broader than necessary in terms of duration or affected employees, or where the business agreement or arrangement is a sham.”

The rules do not cover “ancillary restraints” on competition meant to add efficiency to “certain desirable business transactions or collaborations.” The ancillary restraint defence is available to employers when it is likely the restraint flows from a broader or separate agreement that includes the same parties and the arrangement is reasonably necessary to achieve an overarching objective.

If the parties could have achieved an equivalent or comparable arrangement through “significantly less restrictive means that were reasonably available,” then the bureau said it would conclude the restraint was not necessary.

The bureau said it will also generally not assess wage-fixing or no-poaching clauses that are ancillary to merger transactions under the new criminal provisions.

“This is really reserved for naked restraints, where the parties are essentially trying to game the system or cheat in terms of no-poaching, wage-fixing, to the detriment of employees,” said Goodman.

What prompted this change?

Goodman said there’s been heightened attention toward the issues of wage-fixing and no-poaching deals both in Canada and internationally over the past decade.

In the U.S., he said momentum started in 2010 when the Department of Justice challenged a no-poaching arrangement between major tech firms on a civil basis. Then in 2016, the department, along with the Federal Trade Commission, released a guidance indicating they would challenge such agreements on a criminal basis, which Goodman noted has had “limited success.”

The issue ramped up in Canada during the pandemic when grocery giants Loblaws, Sobeys and Metro ended a bonus program for hourly workers known as “hero pay” on the same day in June 2020, prompting questions about possible co-ordination.

While the companies told a House of Commons committee later that year that they had acted independently, Loblaw’s then-president Sarah Davis acknowledged she had sent a “courtesy email” about the move to competitors in advance.

In late 2020, Canada’s Competition Bureau released a guidance that clarified it couldn’t challenge wage-fixing and no-poach agreements on a criminal basis due to the wording of existing legislation.

“It was always an option for the Competition Bureau to challenge no-poach, or wage-fixing conduct if they thought it resulted in anti-competitive effects and they never brought a case,” said Goodman.

“It’s not as though there was an issue with the tools having been proven to be inadequate for the job. The tools were never used.”

This report by The Canadian Press was first published June 23, 2023.

 

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The #1 Skill I Look For When Hiring

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File this column under “for what it’s worth.”

“Communication is one of the most important skills you require for a successful life.” — Catherine Pulsifer, author.

I’m one hundred percent in agreement with Pulsifer, which is why my evaluation of candidates begins with their writing skills. If a candidate’s writing skills and verbal communication skills, which I’ll assess when interviewing, aren’t well above average, I’ll pass on them regardless of their skills and experience.

 

Why?

 

Because business is fundamentally about getting other people to do things—getting employees to be productive, getting customers to buy your products or services, and getting vendors to agree to a counteroffer price. In business, as in life in general, you can’t make anything happen without effective communication; this is especially true when job searching when your writing is often an employer’s first impression of you.

 

Think of all the writing you engage in during a job search (resumes, cover letters, emails, texts) and all your other writing (LinkedIn profile, as well as posts and comments, blogs, articles, tweets, etc.) employers will read when they Google you to determine if you’re interview-worthy.

 

With so much of our communication today taking place via writing (email, text, collaboration platforms such as Microsoft Teams, Slack, ClickUp, WhatsApp and Rocket.Chat), the importance of proficient writing skills can’t be overstated.

 

When assessing a candidate’s writing skills, you probably think I’m looking for grammar and spelling errors. Although error-free writing is important—it shows professionalism and attention to detail—it’s not the primary reason I look at a candidate’s writing skills.

 

The way someone writes reveals how they think.

 

  • Clear writing = Clear thinking
  • Structured paragraphs = Structured mind
  • Impactful sentences = Impactful ideas

 

Effective writing isn’t about using sophisticated vocabulary. Hemingway demonstrated that deceptively simple, stripped-down prose can captivate readers. Effective writing takes intricate thoughts and presents them in a way that makes the reader think, “Damn! Why didn’t I see it that way?” A good writer is a dead giveaway for a good thinker. More than ever, the business world needs “good thinkers.”

 

Therefore, when I come across a candidate who’s a good writer, hence a good thinker, I know they’re likely to be able to write:

 

  • Emails that don’t get deleted immediately and are responded to
  • Simple, concise, and unambiguous instructions
  • Pitches that are likely to get read
  • Social media content that stops thumbs
  • Human-sounding website copy
  • Persuasively, while attuned to the reader’s possible sensitivities

 

Now, let’s talk about the elephant in the room: AI, which job seekers are using en masse. Earlier this year, I wrote that AI’s ability to hyper-increase an employee’s productivity—AI is still in its infancy; we’ve seen nothing yet—in certain professions, such as writing, sales and marketing, computer programming, office and admin, and customer service, makes it a “fewer employees needed” tool, which understandably greatly appeals to employers. In my opinion, the recent layoffs aren’t related to the economy; they’re due to employers adopting AI. Additionally, companies are trying to balance investing in AI with cost-cutting measures. CEOs who’ve previously said, “Our people are everything,” have arguably created today’s job market by obsessively focusing on AI to gain competitive advantages and reduce their largest expense, their payroll.

 

It wouldn’t be a stretch to assume that most AI usage involves generating written content, content that’s obvious to me, and likely to you as well, to have been written by AI. However, here’s the twist: I don’t particularly care.

 

Why?

 

Because the fundamental skill I’m looking for is the ability to organize thoughts and communicate effectively. What I care about is whether the candidate can take AI-generated content and transform it into something uniquely valuable. If they can, they’re demonstrating the skills of being a good thinker and communicator. It’s like being a great DJ; anyone can push play, but it takes skill to read a room and mix music that gets people pumped.

 

Using AI requires prompting effectively, which requires good writing skills to write clear and precise instructions that guide the AI to produce desired outcomes. Prompting AI effectively requires understanding structure, flow and impact. You need to know how to shape raw information, such as milestones throughout your career when you achieved quantitative results, into a compelling narrative.

So, what’s the best way to gain and enhance your writing skills? As with any skill, you’ve got to work at it.

Two rules guide my writing:

 

  • Use strong verbs and nouns instead of relying on adverbs, such as “She dashed to the store.” instead of “She ran quickly to the store.” or “He whispered to the child.” instead of “He spoke softly to the child.”
  • Avoid using long words when a shorter one will do, such as “use” instead of “utilize” or “ask” instead of “inquire.” As attention spans get shorter, I aim for clarity, simplicity and, most importantly, brevity in my writing.

 

Don’t just string words together; learn to organize your thoughts, think critically, and communicate clearly. Solid writing skills will significantly set you apart from your competition, giving you an advantage in your job search and career.

_____________________________________________________________________

 

Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.

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Politics likely pushed Air Canada toward deal with ‘unheard of’ gains for pilots

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MONTREAL – Politics, public opinion and salary hikes south of the border helped push Air Canada toward a deal that secures major pay gains for pilots, experts say.

Hammered out over the weekend, the would-be agreement includes a cumulative wage hike of nearly 42 per cent over four years — an enormous bump by historical standards — according to one source who was not authorized to speak publicly on the matter. The previous 10-year contract granted increases of just two per cent annually.

The federal government’s stated unwillingness to step in paved the way for a deal, noted John Gradek, after Prime Minister Justin Trudeau made it plain the two sides should hash one out themselves.

“Public opinion basically pressed the federal cabinet, including the prime minister, to keep their hands clear of negotiations and looking at imposing a settlement,” said Gradek, who teaches aviation management at McGill University.

After late-night talks at a hotel near Toronto’s Pearson airport, the country’s biggest airline and the union representing 5,200-plus aviators announced early Sunday morning they had reached a tentative agreement, averting a strike that would have grounded flights and affected some 110,000 passengers daily.

The relative precariousness of the Liberal minority government as well as a push to appear more pro-labour underlay the prime minister’s hands-off approach to the negotiations.

Trudeau said Friday the government would not step in to fix the impasse — unlike during a massive railway work stoppage last month and a strike by WestJet mechanics over the Canada Day long weekend that workers claimed road roughshod over their constitutional right to collective bargaining. Trudeau said the government respects the right to strike and would only intervene if it became apparent no negotiated deal was possible.

“They felt that they really didn’t want to try for a third attempt at intervention and basically said, ‘Let’s let the airline decide how they want to deal with this one,'” said Gradek.

“Air Canada ran out of support as the week wore on, and by the time they got to Friday night, Saturday morning, there was nothing left for them to do but to basically try to get a deal set up and accepted by ALPA (Air Line Pilots Association).”

Trudeau’s government was also unlikely to consider back-to-work legislation after the NDP tore up its agreement to support the Liberal minority in Parliament, Gradek said. Conservative Leader Pierre Poilievre, whose party has traditionally toed a more pro-business line, also said last week that Tories “stand with the pilots” and swore off “pre-empting” the negotiations.

Air Canada CEO Michael Rousseau had asked Ottawa on Thursday to impose binding arbitration pre-emptively — “before any travel disruption starts” — if talks failed. Backed by business leaders, he’d hoped for an effective repeat of the Conservatives’ move to head off a strike in 2012 by legislating Air Canada pilots and ground crew to stick to their posts before any work stoppage could start.

The request may have fallen flat, however. Gradek said he believes there was less anxiety over the fallout from an airline strike than from the countrywide railway shutdown.

He also speculated that public frustration over thousands of cancelled flights would have flowed toward Air Canada rather than Ottawa, prompting the carrier to concede to a deal yielding “unheard of” gains for employees.

“It really was a total collapse of the Air Canada bargaining position,” he said.

Pilots are slated to vote in the coming weeks on the four-year contract.

Last year, pilots at Delta Air Lines, United Airlines and American Airlines secured agreements that included four-year pay boosts ranging from 34 per cent to 40 per cent, ramping up pressure on other carriers to raise wages.

After more than a year of bargaining, Air Canada put forward an offer in August centred around a 30 per cent wage hike over four years.

But the final deal, should union members approve it, grants a 26 per cent increase in the first year alone, retroactive to September 2023, according to the source. Three wage bumps of four per cent would follow in 2024 through 2026.

Passengers may wind up shouldering some of that financial load, one expert noted.

“At the end of the day, it’s all us consumers who are paying,” said Barry Prentice, who heads the University of Manitoba’s transport institute.

Higher fares may be mitigated by the persistence of budget carrier Flair Airlines and the rapid expansion of Porter Airlines — a growing Air Canada rival — as well as waning demand for leisure trips. Corporate travel also remains below pre-COVID-19 levels.

Air Canada said Sunday the tentative contract “recognizes the contributions and professionalism of Air Canada’s pilot group, while providing a framework for the future growth of the airline.”

The union issued a statement saying that, if ratified, the agreement will generate about $1.9 billion of additional value for Air Canada pilots over the course of the deal.

Meanwhile, labour tension with cabin crew looms on the horizon. Air Canada is poised to kick off negotiations with the union representing more than 10,000 flight attendants this year before the contract expires on March 31.

This report by The Canadian Press was first published Sept. 16, 2024.

Companies in this story: (TSX:AC)

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Federal $500M bailout for Muskrat Falls power delays to keep N.S. rate hikes in check

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HALIFAX – Ottawa is negotiating a $500-million bailout for Nova Scotia’s privately owned electric utility, saying the money will be used to prevent a big spike in electricity rates.

Federal Natural Resources Minister Jonathan Wilkinson made the announcement today in Halifax, saying Nova Scotia Power Inc. needs the money to cover higher costs resulting from the delayed delivery of electricity from the Muskrat Falls hydroelectric plant in Labrador.

Wilkinson says that without the money, the subsidiary of Emera Inc. would have had to increase rates by 19 per cent over “the short term.”

Nova Scotia Power CEO Peter Gregg says the deal, once approved by the province’s energy regulator, will keep rate increases limited “to be around the rate of inflation,” as costs are spread over a number of years.

The utility helped pay for construction of an underwater transmission link between Newfoundland and Nova Scotia, but the Muskrat Falls project has not been consistent in delivering electricity over the past five years.

Those delays forced Nova Scotia Power to spend more on generating its own electricity.

This report by The Canadian Press was first published Sept. 16, 2024.

The Canadian Press. All rights reserved.

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