According to the collective agreement database maintained by Alberta Mediation Services, about 100 workers in the Fort McMurray area have a new collective agreement.
The workers, who are employed in the tool rental and sales division of the Herc Rentals branch in the community, agreed to their new 3-year contract in December. Their previous contract expired at the end of September 2023.
Based out of Florida, Herc Rentals is a full-service equipment rental company with about 370 locations across the United States and Canada, including a branch in Fort McMurray.
According to the information published in the database, these 101 workers include mechanics, electricians, welders, gasfitters, small engine mechanics, parts persons, lube technicians, customer service representatives, drivers, warehouse workers, and yardworkers.
The database doesn’t include the entire new contract, which is set to expire in September 2026 and had to go to mediation, but it does provide information on wage increases.
| 21 Dec 2023 | 4% |
| 6 Dec 2024 | 4% |
| 5 Dec 2025 | 1% |
That’s a combined increase of 9%. Well, 9.24% if you account for accumulative increases.
And that does sound pretty impressive, but keep in mind that their last contract came with 2 years of wage freezes. And the contract before that was just 1% over 3 years.
Let’s recap.
| 2018 | 0.0% |
| 2019 | 0.5% |
| 2020 | 0.5% |
| 2021 | 0.0% |
| 2022 | 0.0% |
| 2023 | 4.0% |
| 2024 | 4.0% |
| 2025 | 1.0% |
That works out to an average of 1.29% per year.
The first wage increase came into effect in August 2019. That contract took effect in November 2018, so let’s use that as our benchmark.
In November 2018, the consumer price index in Alberta was 140.7. Five years later, this past November, it sat at 165.6. That’s an increase of 24.9 points, or 17.7%
So, while these workers have received a 5% pay increase over the last 5 years, inflation skyrocketed by more than 3 times that amount. Even if you include the 4% increase they’re due to receive this year and the 1% raise coming next year, they’ll still fall short by over 7%.
This means they’ll end up with a cut to real wages, which are wages adjusted for inflation.
If they get a 10.34% wage increase over 8 years, but inflation is 17.7%, then that works out to a 7.36% reduction in real wages. And that’s for inflation up to November 2023. Presumably inflation will increase this year and next year, too, which mean a further reduction in real wages.
But let’s stick with the 7.36% reduction for now.
What cost these workers $100 in 2018 now costs them $107.36, even with all their wages increases over this 8-year period. To put it another way, the same $100 that they spent in 2018 would now only buy them $92.64 worth of goods and services in 2023.
So, while 9% is better than nothing, those 4 years of wage freezes and 2 years of 0.5% increases in the other contracts really put them behind.
Hopefully, they’ll make it up in the next contract.
