New proposed legislation is scrapping the current compensation model for public sector employees in Alberta in hopes of making it easier for employers to retain and attract talent.
Bill 5, the Public Sector Employer Amendment Act, was one of two finance bills unveiled by the provincial government on Wednesday.
The bill would impact employees currently governed by legislation known as RABCCA (Reform of Agencies, Boards and Commissions Compensation Regulation) as it repeals it.
Nate Horner, president of the Treasury Board and minister of finance, said RABCCA is very prescriptive, leading to issues around recruiting and retaining employees.
“Inflexible and prescriptive compensation frameworks have restrained compensation with a one-size-fits-all approach for diverse public agencies,” he said. “This has led to many to many well-qualified and exceptional workers leaving and finding more competitive compensation elsewhere.”
The new proposed legislation would create more flexible compensation guidelines. In the end, the province said it would be able to pay these public sector executives more or offer better perks.
The proposed legislation would primarily change the compensation governance structure for non-union public sector employees at Alberta Health Services, most post-secondary institutions and some public agencies like the Alberta Gaming, Liquor and Cannabis Commission.
It will most affect those at an executive level or other specialized employees, who Horner said are not being offered competitive salaries.
“You heard from a lot of the smaller post-secondaries that needed really specifically skilled people for certain roles, and RABCCA didn’t provide the flexibility to understand that there are things other than the size of a school that determine the specific requirements and skills that are needed. So they would get poached often by the bigger schools,” Horner used as an example.
Horner added the current regulations do not account for inflation or evolving labour market conditions, noting the new guidelines strike a better balance between staying competitive and allowing for fiscal oversight.
“I still get flooded with ministerial asks for exemptions to RABCCA, so if anything, this is trying to get us to a more flexible place where we are not having people leave the province because the compensation is out of whack with other jurisdictions,” he said.
The Opposition NDP said removing salary restraints is the same plan that led to what it believes was the misuse of taxpayers’ money under previous conservative governments.
“Instead of caring about regular Albertans who are struggling to pay rent and buy food, (Premier Danielle) Smith and the UCP are giving the highest-paid executives a raise they don’t need,” Opposition finance critic Shannon Phillips said in a statement.
While the new legislation would enable the compensation changes – none of them have been made yet.
Horner noted the changes could take years to fully implement.
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