US embassy cable - 04HALIFAX127

UNCLAS HALIFAX 000127 
 
SIPDIS 
 
DEPT FOR WHA/CAN 
 
E.O. 12958: E.O. 12958: N/A 
TAGS: ELAB, PGOV, CA, Danny Williams 
SUBJECT: NEFOUNDLAND-LABRADOR GOVERNMENT SUFFERS THROUGH BITTER 
UNREST 
 
REF: HALIFAX 97 
 
 
1.  (U) SUMMARY: Having broken a 4-week-old public sector union 
strike April 27 with the introduction of back-to-work 
legislation, Newfoundland-Labrador Tory Premier Danny Williams 
is making a last-ditch offer to negotiate a collective labor 
agreement.  On April 29, the Premier said he would suspend 
passage of back-to-work legislation until May 3, in response to 
union officials' agreement to a new round of negotiations. 
While he has thoroughly angered the unions, to what degree he 
has damaged his political future is unknown, pending general 
public reaction.  Looming on the horizon is a potential stike by 
the teachers and nurses unions.  END SUMMARY. 
 
2.  (U) The cash-strapped Williams government and the 20,000 
members of the Newfoundland and Labrador Association of Public 
and Private Employees and the Canadian Union of Public Employees 
have been locked in a bitter dispute over new labor agreements, 
culminating in a 4-week strike that only ended on April 27, when 
the government introduced back-to-work legislation.  The 
province's unionized workforce called the bill the toughest back 
to work legislation in Canada.  Consisting of tough penalties 
for not returning to work and a mandated four-year agreement, 
the government's terms fell well short of what the unions were 
seeking on issues such as wage increases and sick leave 
benefits. 
 
3. (U) Despite an ugly backlash from labor groups and the fact 
that the workers have returned to their jobs, the Premier has 
remained undeterred in moving the legislation through the House 
of Assembly.  Claiming that the strike has drastically affected 
hospitals, nursing homes, schools, provincially-operated ferries 
and other public services, the Premier said he had a 
responsibility to protect public health and safety from the 
possibility of any more labor unrest.  Nonetheless, the Premier 
pledged to continue negotiations with the union officials up 
until the last minute. That offer met with some success on April 
29, when the Premier said he would suspend passage of the bill 
until May 3 in response to a new round of negotiations with the 
union officials. 
 
4. (SBU) COMMENT:  This bitter and uncertain labor scene 
undoubtedly has brought a swift end to Danny Williams' honeymoon 
with the electorate just six months after he and his Tory party 
won a decisive victory in the October 2003 provincial election. 
Our contacts on "The Rock" tell us that Williams undoubtedly has 
made a lot of enemies with his hard-nosed approach with the 
unions, to the point that no one is willing to guess just how 
damaging this situation will be to his political career.  A 
major unknown is just how the general public will judge the 
Premier's actions, which will not be known until the next poll 
results are released.  Residents, especially those with cardiac 
problems and needing cancer treatments, have been waiting weeks 
for services, and hospital administrators are acknowledging that 
it could months to get caught up from the strike.  Obviously 
with their health in jeopardy, these patients have had little 
support for the strikers. 
 
4. (SBU) Comment (Continued):  There are also countless other 
Newfoundlanders and Labradorians who support Williams and his 
firm stance that this is not the time in the province's fiscal 
history to be looking at wage increases.  It is not clear just 
how prevalent is this sentiment.  One point that our contacts do 
agree on is that the Premier and his government are definitely 
going through a tough time with no real end in sight.  However 
the situation with the two public sector unions is eventually 
resolved, contracts with the province's teachers and nurses are 
also about to expire.  The Premier could then find himself 
knee-deep in the exact same situation a few months down the road 
- only this time it will be teachers and nurses on the picket 
line.  END COMMENT 
 
ROWLAND