08/30/2013 01:07 EDT | Updated 10/30/2013 05:12 EDT

Thousands of union members in Toronto protest against wireless rule changes

TORONTO - Thousands of members from two of the country's biggest unions rallied Friday against federal telecom rules they fear will let foreign firms into Canada without the guarantee of new jobs.

It was a raucous show of labour strength that came a day before the Communications, Energy and Paperworkers and Canadian Auto Workers unions formally merge.

Demonstrators marched in downtown Toronto and thronged outside an Industry Canada office to voice opposition to Ottawa allowing foreign companies such as U.S. giant Verizon to jump into the telecom market — a move the unions say won't generate new jobs but rather destroy existing ones.

Verizon said last month it was considering entry into Canada. Some have questioned, however, if the American behemoth is still interested in crossing the border after revelations Thursday that parent company Verizon Communications is in talks for a potential $100-billion deal to buy its remaining unowned stake in Verizon Wireless from a British firm.

But CEP president Dave Coles told ralliers in Toronto that even if Verizon never enters the Canadian market, foreign firms opening up shop in Canada won't create jobs in the same places they hope to draw new customers.

"Verizon or any of the others, AT&T... they're not required to create one job, build any infrastructure or supply good service," said Coles, whose union has thousands of members at BCE Inc's Bell Canada (TSX:BCE), a home-grown wireless heavyweight that has been decrying Verizon's potential northern foray.

Coles added there's no reason to believe foreign entrants will send phone bills falling.

Bell employee John Rowe was in the crowd and worried that Verizon's entrance would lead to layoffs at his company.

"They're going to undermine our system and we'll be losing a lot of jobs. They'll be all going to the United States."

The Conservative government recently eased the rules on foreign investment for wireless companies with less than 10 per cent of the marketplace, paving the way for foreign companies to enter the Canadian market and also buy small Canadian wireless organizations.

Canada's big wireless providers — BCE, Telus (TSX:T) and Rogers (TSX:RCI.B) — have launched a campaign arguing that big foreign players like Verizon would be given an unfair advantage due to current wireless rules.

New wireless companies are permitted to bid on two blocks of prime 700 megahertz spectrum in an upcoming auction while the big trio domestic carriers can bid on only one block apiece.

Coles said that will block competitive bidding and amount to a taxpayer subsidy to Verizon if it joins the spectrum sell-off.

Meanwhile, Prime Minister Stephen Harper has said there are no special rules or loopholes for foreign companies looking to enter the Canadian market.

A spokeswoman for Industry Minister James Moore said worries about telecom job loss from foreign competition are unfounded.

"We understand the need for unions to represent their interests but the facts speak for themselves. Jobs in the wireless industry went up by more than 25 per cent since we created policies to increase competition," Jessica Fletcher said in an email.

Friday's march was also something of a coming out party for Unifor, the mega-union created by the merger between the CEP and CAW.

Many in the energetic crowd wore red T-shirts bearing the white-shield Unifor logo, which was also featured on anti-Verizon placards.

Unifor will be the country's largest private sector union with more than 300,000 members and has its founding convention this weekend in Toronto.

CAW head Ken Lewenza said the rally shows the new union will make its presence felt on the Canadian labour scene.

"We are a united team utilizing our combined energy, our combined resources, our combined commitment from our membership to win justice."