08/19/2012 04:00 EDT | Updated 10/18/2012 05:12 EDT

Liberals poisoned wage freeze efforts by awarding bonuses to managers: critics

TORONTO - The governing Liberals shot themselves in the foot by giving bonuses to senior civil servants while demanding a wage freeze from public sector workers to eliminate a $15-billion deficit, union and opposition leaders say.

The cash-strapped government still has to negotiate new labour contracts with scores of other workers and the bonuses will undermine their push to hit the pause button on compensation, they said.

Warren "Smoky" Thomas, president of the Ontario Public Service Employees Union, said the Liberals can't expect rank-and-file government workers to hold the line on wages when almost all of their bosses got performance pay in 2011.

Talks affecting 38,000 of the union's members will start Nov. 5, and the bonuses will definitely come up, he said.

"No doubt in my mind that the government's going to want zeroes," Thomas said, adding that the average salary of those workers sits at about $42,000.

"What I would say to the government: 'Tell you what, keep my salary. Just give me that bonus once a year,'" Thomas said referring to hefty bonuses given to many senior civil servants.

Premier Dalton McGuinty ordered a review of performance pay a day after The Canadian Press reported that nearly all eligible government managers received bonuses in 2011, costing $35.6 million.

But he pointed out that their base salary was frozen and the overall pool of money for bonuses has shrunk by 30 per cent since 2009.

The fact that they still got bonuses is a kick in the gut to the average worker, unions leaders said.

"I had this argument with him face-to-face. I said, that's not a pay freeze," Thomas said.

"So I don't get a raise but I get an $80,000 bonus? Well hell, I'll take that over a raise any day."

Last week, the head of eHealth Ontario returned the $81,250 bonus he got in mid-June — on top of his $329,000 salary — after it was reported by The Canadian Press.

It's hard to believe the Liberals are serious about reining in costs when 98 per cent of government managers got bonuses last year, said Progressive Conservative Leader Tim Hudak.

"I mean, what did the two per cent do that didn't get them? It seems like you got a big bonus simply for showing up to work," he said.

Merit pay should only be awarded to those who do an outstanding job in saving taxpayer money, Hudak added.

"The government sort of shrugs it off," he said. "You tell me how are you going to negotiate tough deals with teachers, doctors, other public service unions if 98 per cent of bureaucrats got off the hook," he said.

The minority Liberals could also lose the strong support they received over the last nine years from teachers' unions, who spent million of dollars helping them get re-elected last fall.

The government signalled in its spring budget that it would take a harder line to restrain compensation and threatened to use a legislative hammer if all other options failed.

The self-described "education premier" vowed to bring in legislation to impose a new contract on teachers if they don't sign local agreements before the end of the month, in order to halt pay hikes the province can't afford.

Education Minister Laurel Broten infuriated the unions further by saying the average Ontario worker wouldn't expect to get a 5.5 per cent pay hike "just because they took the summer off and refused to negotiate a new agreement."

It's "extremely arrogant" for the Liberals to attack public sector workers while handing out bonuses to managers, said Sam Hammond, president of the Elementary Teachers' Federation of Ontario.

Teachers across the province feel "betrayed" and won't be helping the Liberals next time around, he said.

"I will be absolutely blunt: given what has happened over the past several months ... I could not — and this federation could not — support this Liberal government," Hammond said.