Why the LCBO Strike Probably Won’t Happen

By Raysonho @ Open Grid Scheduler / Grid Engine - Own work, CC0, https://commons.wikimedia.org/w/index.php?curid=32734566

Why the LCBO Strike Probably Won’t Happen

On April 24th and 25th LCBO employees, members of the OPSEU (Ontario Public Service Employees Union), voted 93% in favour of a strike mandate put forth by the union. I’m here to tell you why this strike probably won’t happen.

In the LCBO’s 91-year history, there has never been a strike, but this is not the first time LCBO workers have voted in support of one. In 2013, the last time the collective agreement expired, the OPSEU had set a strike deadline for 12:01am on May 17th (ahead of May long weekend, when the LCBO stands to lose the most profit). A deal was reached about two hours before the deadline.

Since the collective agreement expired on March 31st, the OPSEU has been flexing their muscles, heavy-handedly hinting at a strike. On the one hand, this is to be expected; their job is to protect LCBO employees and they’re using whatever leverage they have to do so. On the other hand, I think their attempts to manipulate public sentiment are misguided.

Still, I think everybody was surprised by the results of the vote: 93% in favour of the strike mandate, an overwhelming show of support. This means that both the OPSEU and LCBO are now able to contact the Ministry of Labour to set a negotiation deadline, which if passed without an agreement would force a strike.

The OPSEU’s Problem

The cornerstone of the OPSEU’s campaign has been a strong opposition to selling beer, wine and cider in grocery stores, describing it as “creeping privatization”. OPSEU President Warren (Smokey) Thomas put it like this:

“The fact is, these members are fighting to save this important public asset. The people of Ontario built the LCBO, paid for the LCBO, and own the LCBO. We’re not about to let the Wynne government destroy it through this piecemeal privatization.”

But the OPSEU’s approach strikes me as pretty damn tone deaf. In my experience, the people of Ontario certainly don’t feel a sense of ownership and loyalty toward the LCBO. The way I see it, drinkers are at the end of their patience with the LCBO/TBS duopoly in this province. And the Wynne government knows that, which is why they launched the grocery store program.

Banking on positive public sentiment toward our Liquor Control Board is not going to win the OPSEU any support. Most people in Ontario are fine with alcohol privatization, and for good reason. While the OPSEU cries foul at the loss of LCBO jobs, private alcohol retailing will create an entirely new industry in Ontario in need of good, experienced workers. And the lost public revenue generated by the LCBO will be made up for by the high tax rates of alcohol sales, which can now be collected without the associated overhead expenses of a government-owned-and-operated retail chain.

The real risk here is to the LCBO itself, as I’m sure the OPSEU knows. While they package their strike threat in rhetoric about protecting the LCBO from privatization, they must be aware that actually following through with a strike would be disastrous for the already-fragile public sentiment toward our Liquor Control Board. If stores have to close due to a strike, the growing voice for privately-owned alcohol retailers will gain a hell of a lot of support.

The LCBO’s Problem

So, yes, the union should not strike and probably knows it should not strike; it would be a nail in the LCBO’s coffin. But they can (and should) still win this fight, because the LCBO can afford to give them what they want.

The LCBO is doing very well. Even though you can now buy beer, wine and cider in grocery stores, those grocery stores can’t buy them directly from manufacturers. Instead, breweries, wineries and cideries must sell their products first to the LCBO, who then sells them to the grocery stores. The bulk of the profit still ends up in the LCBO coffers.

And the success of craft beer has also been a financial boon for the LCBO. Craft beer has caused a huge proportion of the beer-drinking public to stop going to the Beer Store and start shopping at the LCBO instead. Most craft breweries don’t list in the Beer Store, and because these beers are (sometimes much) more expensive than mainstream beers, the LCBO is making a significantly larger profit on them.

The LCBO is unlikely to allow negotiations to fail and force a strike, because they are not struggling financially. They are in a position to meet their employees’ demands. They will try to get the best deal they can, of course, but I believe they’ll settle on something before the deadline. If they don’t, well, then the OPSEU is right: they’re not treating their workers fairly. And, at least temporarily, we’ll all be spending a lot more time in breweries, wineries and distilleries (which is probably a good thing anyway).