New bill could change compensation for Alberta public sector executives, non-union staff

The Alberta government wants to loosen the rules around how much non-unionized public sector workers are paid.

Public agencies need more flexibility when it comes to compensation for executives and other non-unionized workers, Alberta's finance minister said Wednesday.

Minister Nate Horner introduced legislation that he said is in response to his office being flooded with requests for exemptions to the existing rules around compensation not keeping up with inflation and changing market conditions.

"Inflexible and prescriptive compensation frameworks have restrained compensation for a one-size-fits-all approach for diverse public agencies. This has led to many well-qualified and exceptional workers leaving and finding more competitively compensated work elsewhere," he said.

Horner tabled legislation Wednesday that would scrap the Reform of Agencies, Boards and Commissions Compensation Act (RABCCA), replacing it with the new Public Sector Employer Amendment Act.

The legislation would affect compensation rules for the roughly 30,000 non-unionized public sector workers, particularly those in executive roles.

Horner said that while the new legislation is a step toward giving agencies the ability to compete for highly qualified candidates, it's not going to be a free-for-all with executive salaries and bonuses.

Over the past several years, the province has introduced and updated restrictions and regulations related to executive compensation – notably slashing CEO pay and eliminating perks like housing allowances and golf club memberships.

Even though a salary restraint regulation was lifted in July 2022, the RABCCA restrictions on executive compensation are still overly limiting, Horner said Wednesday.

Horner called the bill introduced today "a starting point" to start building a new framework that's more nimble.

But until that's established, Horner said he plans to direct public agencies to come to him with requests for variances, but in general to continue operating like RABBCA still exists – even after it's repealed.

"If there are golf club memberships approved under this, I don't expect to have this job long," he said, explaining the requests he gets are often simply for more money, particularly from post-secondary institutions trying to fill specialized positions but not being able to match salaries with competitors because of RABBCA.

If passed, the new legislation would change how compensation for non-union staff is handled at Alberta Health Services and Covenant Health, post-secondary institutions (excluding independent institutions), and some public agencies like Alberta Gaming Liquor and Cannabis Commission, Alberta Innovates, Alberta Pension Services Corporation, Special Area Board, Travel Alberta and the Workers' Compensation Board.

The proposed legislation comes as the government prepares for bargaining to begin with several of Alberta's major public sector unions in 2024. Horner said the legislation for non-unionized compensation will not affect negotiations with unionized workers.