A plan to move a massive government corporation from Toronto to London has alarmed the agency’s workers, while sparking interest from commercial realtors in London.
A plan to move a massive government corporation to London from Toronto has alarmed the agency’s workers, while sparking interest from commercial realtors here.
Tea Ontario government announced it intends to move the Workplace Safety and Insurance Board (WSIB) to the Forest City, a relocation that may total 3,000 jobs over the next four years, Ontario’s labor minister, local MPP Monte McNaughton, said.
But that news shocked 2,000 of its employees represented by the Ontario Compensation Employees Union, affiliated with the Canadian Union of Public Employees. The union will fight for relocation costs for those moving, and severance packages for those who will not, possibly making it a costly venture for the government, said Harry Goslin, president of the union.
“We had no news of this whatsoever. We were surprised by the announcement. It’s inappropriate for the province to make such an announcement for an organization that’s arm’s length from the province,” he said. “We will absolutely enforce the terms of our collective agreement and take any action to protect the interests of our members.”
The union has collective agreement language that states if there is an office closing or a reduction in employees, “provisions have to be enforced,” Goslin said.
“There are exit packages and relocation expenses. If the employer does not honor those terms, there will be grievances.”
The union believes employees will not be mandated to move, but if that changes “the cost would be considerable and prohibitive,” Goslin said.
McNaughton said earlier this week in London that WSIB now occupies 650,000 square feet of office space in one of the most expensive buildings in the country and the government is looking for “efficiencies,” in moving to communities with cheaper real estate.
The provincial government did not release a timeline or a location for the move, but McNaughton said the whole relocation may take place during the government’s second mandate if it is re-elected in June.
The WSIB is not funded by taxpayers, but by employer premiums, Goslin said.
In a statement, WSIB said it is looking forward to making London its new head office “as part of a reshaping of our real estate footprint,” read the message from spokesperson Christine Arnott.
The move will need legislative support, she said. “We are currently working on a long-term plan to make sense of our real estate leases so that we have modern, inviting and productive space that costs less.”
Evaluating its real estate portfolio to identify “efficiencies” was a recommendation of an operational review of the WSIB in 2019, Arnott said.
News of the possible move has caused a stir in London’s commercial real estate sector, as the downtown has a vacancy rate of 28 per cent. With nearly one in three properties vacant, the core can provide all 650,000 square feet of WSIB office space, if it arrives, said Brent Rudell, broker and vice-president at Cushman Wakefield, a commercial realty firm.
“It will be huge, huge for the core, if they bring people here. We can definitely accommodate it,” he said.
It would mean office space in different buildings would have to be leased. There is not one block of space that size available, Rudell said.
But he points to the vacant Market Tower on Dundas Street and the nearly empty RBC building on Richmond Street, and vacant spaces between the two, as perhaps the largest contiguous section of space available downtown.
“They would need significant investment to accommodate WSIB. They would have to be updated.”
The former London Free Press building at 369 York St. is also vacant. It has 180,000 square feet of space.
A report released in March by commercial realty firm CBRE shows core office space vacancies at 28 per cent, a 50 per cent spike from 2020, when the rate was18.5 per cent.
As for whether the move will happen, “there is a realness to this,” Ruddell said. “I have gotten a lot of calls over the last few days and there are talks about this going on at a very high level.”
As for the union, many of its members have been working from home, or splitting time between the home and office. WSIB employs more than 3,000 in Toronto located in 15 offices. Because WSIB is arm’s length from government, the union will bargain any move with the agency and not the government.
“It’s a management right to assign work and where it will be located, but there are job security provisions,” Goslin said. “They can’t be forced to move, but if they don’t want to go, we’re talking exit packages.”
Across Ontario WSIB employs more than 4,200.
Arnott confirmed WSIB does not rely on tax support, but employer premiums. It covers 5.3 million Ontarians and processes more than 200,000 claims a year delivering almost $3 billion in benefit payments annually. A London businessperson, Jeff Lang, was recently named its president.