Nova Scotia to Pay Estimated $470 Million to Public Sector Workers Over Unconstitutional Wage Law
The Nova Scotia government has agreed to pay approximately $470 million in compensation to an estimated 81,000 public sector employees affected by Bill 148, a 2015 law that imposed wage restrictions and eliminated long-term service awards. The settlement follows a February Supreme Court ruling declaring the legislation unconstitutional.
The Nova Scotia government has reached a settlement to pay an estimated $470 million in compensation to public sector employees affected by Bill 148, legislation introduced in December 2015 that imposed wage restrictions and eliminated long-term service awards.
Bill 148 was introduced by the former Liberal government led by Premier Stephen McNeil and enacted in August 2017. The legislation imposed a four-year wage pattern on public sector workers that included a two-year wage freeze, followed by raises of 1%, 1.5%, and 0.5% respectively. It also eliminated long-term service awards.
In February, Supreme Court Justice Ann Smith ruled that Bill 148 was unconstitutional, finding that it substantially interfered with union rights and infringed upon the Charter rights of workers. An estimated 81,000 public servants are entitled to payouts as compensation for that infringement.
Under the proposed remedy, eligible workers will receive lump-sum payments of $1,250 for each of the first two years of wage restraint, $750 for the third year, and $500 for the fourth year. Approximately 55,000 workers who were affected by the elimination of long-term service awards will receive an additional $1,250.
Kevin Kindred, senior counsel for the Department of Justice, stated that the payouts reflect damages for the infringement of Charter rights rather than an attempt to quantify lost wages.
Finance Minister John Lohr confirmed that the cost of the settlement is reflected in the province's 2025-26 budget. When Bill 148 was originally introduced, the government cited a $200 million deficit.
Justice Smith has not yet signed off on the final order. She requested revisions to the draft order, specifically requiring the parties to agree upon a deadline for the payments before she approves the remedy.