CALL-ACAMS Newsletter - 2001

The collective agreement provided that employees were entitled to 14 days notice of layoff. The Union grieved layoff notices that provided more than 14 days notice to employees asserting that the collective agreement called for "exactly" 14 days notice.

Facts of the Case

The appeal involved the interpretation of the layoff notice provisions in a collective agreement. The Union grieved the employer’s procedure in a massive layoff of staff, wherein the employer gave layoff notice of much more than the 14 days specified in Article 15.05 of the collective agreement. Under the collective agreement, an employee had 48 hours after receiving the notice of layoff to decide on the position they wished to seek and initiate bumping rights. The Arbitration Board upheld the Union’s grievance, concluding that a literal interpretation of Article 15.05 required "exactly" 14 days notice. The decision was upheld on judicial review.

The Employer then appealed, arguing, among other things, that the decision was patently unreasonable because requiring exactly 14 days’ notice would create major practical problems in a large layoff, and that the mechanics of "exactly" 14 days’ notice were unworkable. The Employer’s position was that the 14-day notice period was merely the minimum period of notice required.

The Decision

The Court of Appeal granted the Employer’s appeal and concluded that the Board’s analysis was patently unreasonable. The Court applied a purposive analysis to Article 15.01 and noted that the purpose of the notice period was to provide an employee with adequate time to make other arrangements. That purpose, the Court decided, was served by longer, rather than shorter, notice periods.

The Court emphasized several factors which, cumulatively, indicated that the Board’s decision was patently unreasonable:

a. A literal interpretation is not possible as there are two possible meanings;

b. The Board failed to undertake any analysis to address questions like: What was the purpose of the notice? What context surrounds the words in dispute? Do the words appear elsewhere in the agreement? Does either possible interpretation lead to absurdity?

c. The decision contains many inconsistencies; and

d. The Board ignored relevant considerations and took into account irrelevant considerations.

Implications for Employers/Unions

The Court of Appeal has set aside an arbitration board’s decision on a matter deep within the Board’s expertise – the interpretation of a collective agreement clause dealing with layoff notice. While acknowledging that the standard of review is whether the decision is patently unreasonable, the Court closely examined the result of the decision rather than how the tribunal arrived at its conclusion as called for by the Supreme Court of Canada in C.A.I.M.A.W., Local 14 v. Canadian Kenworth Co. [1989] 6 W.W.R. 673 (S.C.C.):

The courts must be careful to focus their inquiry on the existence of a rational basis for the decision of the tribunal, and not on their agreement with it. The emphasis should not be so much on what result the tribunal has arrived at, but on how the tribunal arrived at that result. (Emphasis added.)

The Court of Appeal contends that the Board failed to adequately analyse the provision in question, when what the Court really means is that it disagrees with the Board’s analysis.

An Alberta court has already relied on this decision to justify judicial review. InI.A.T.S.E., Local 212 v. Plymouth Productions (Honey I Shrunk the Kids TV Series), (1999) Carswell Alta 365 (Q.B.) Justice Kent set aside an arbitrator’s interpretation of a collective agreement term dealing with holiday pay during a hiatus. The arbitrator analysed two provisions in the collective agreement dealing with hiatus and vacation pay, and dismissed the union’s grievance, concluding that there was no obligation to pay holiday pay for Christmas Day, Boxing Day or New Year’s Day during a temporary layoff that was effective December 20 to January 4. Justice Kent noted that the Court of Appeal in theFoothills case held that the decision was patently unreasonable where there was an "absence of analysis" or the "interpretation of the relevant clauses was flawed." In this case, the arbitrator’s decision similarly lacked analysis and was flawed, Justice Kent concluded, and was therefore patently unreasonable.

This is a worrisome precedent given that the Supreme Court has noted repeatedly that reviewing courts must be careful not to merely substitute their opinion for the tribunal’s, and must adhere to a strict standard of review of decisions made within jurisdiction.

2. Right to severance pay

Prison guards entitled to severance pay after provincial corrections institution transferred to the Federal Government

Alberta v. A.U.P.E. (1998), 223 A.R. 169; 183 W.A.C. 169; 8 Admin. L.R. (3d) 8; 68 Alta. L.R. (3d) 351 (C.A.)

Case at a Glance

The collective agreement between the provincial Crown and A.U.P.E. provided that laid off employees were entitled to severance unless the employer arranged continuing employment "in the Alberta Public Service or with any successor employer, or with any employer under the Public Service Employee Relations Act or with any other Crown Agency (including Boards, Corporations, Agencies and Commissions)." The union grieved the government’s failure to pay severance to employees who received continued employment with the federal government when the Grand Cache Correctional Centre was transferred from the provincial to the federal jurisdiction. The grievance was upheld on the basis that "successor employer" under the collective agreement meant an employer within the provincial public sector. The decision was upheld on judicial review and before the Alberta Court of Appeal.

Facts of the Case

When the Grande Cache Correctional Centre was transferred to the federal government, Alberta arranged for the continued employment of its employees by the federal government. Under the transfer agreement, Alberta was responsible for providing any termination entitlements to the transferring employees. As a result, there was no transfer of employee seniority for severance purposes, and a long-term employee would only be eligible for severance benefits based on length of service with the new employer.

Alberta argued that the federal government was a successor employer with whom it had arranged continued employment for the employees and, therefore, there was no right to severance under Article 15.05 of the collective agreement. The article reads:

An Employee whose position is declared abolished and for whom the Employer has not arranged continuing other employment in the Alberta Public Service or with any successor employer, or with any employer under the Public Service Employee Relations Act or with any other Crown Agency (including Boards, Corporations, Agencies and Commissions) shall be eligible for...(severance pay).

The Decision

Arbitrator Koshman ruled that the parties had intended "successor employer" to refer to the transfer of an undertaking as contemplated in labour relations legislation, and that the federal government was indeed a successor employer. Further, he held, the parties intended that "successor employer" be modified by the context of the words surrounding the term. He concluded that since the list of excluded employers in Article 15.05 was a list of employers within the provincial public sector, "successor employer" was intended to be limited to employers within the provincial public sector. His decision was upheld on judicial review and then appealed to the Alberta Court of Appeal.

The Court of Appeal agreed that it was reasonable for the arbitrator to consider the surrounding words, and to conclude that Article 15.05 contemplated two categories of situations where severance entitlements would not arise:

a. where the collective agreement continues to govern, and

b. where the collective agreement will not continue to govern, but employment remains within the provincial public sector.

The Court noted that the Board’s analysis of the parties’ intentions properly focused on the factual context – that employment within the provincial public sector would protect employees’ previous benefits and entitlements as much as possible, while employment outside that category would not provide the status quo ante. The Court rejected the employer’s argument that it would be absurd to interpret Article 15.05 as providing for severance pay to employees who would never miss a day of work. Instead, the Court decided that it would be absurd to conclude that the parties would intend otherwise, as it would deprive long-term employees of reasonable notice based on their prior length of service.

Implications for Employers/Unions

This decision is a practical application of a basic principle of contract interpretation – interpret the subject phrase in context. Moreover, context involves not only the context of the phrase within the article, within the paragraph and within the agreement as a whole, but also within the factual context. Technical language and terms of art will not be considered in isolation, but will be interpreted purposively to give effect to the parties likely intentions.

3. Duty of fair representation

Alberta Labour Relations Board concludes that focus should be more on what the union considered in coming to its conclusion that the grievance was without merit, than on the merits of the grievance itself

Wideman v. Edmonton Police Service Senior Officer's Association et. al, [1999] Alta.L.R.B.R. 64

Case at a Glance

A police association was found to have breached its duty of fair representation when it failed to process a member’s grievance which sought to set aside a resignation tendered with the assistance of legal counsel. The original panel concluded that the grievance was without merit and the association had not breached its duty to the member. The reconsideration panel concluded that the original panel had erred by focusing on the merits of the grievance. The reconsideration panel was concerned that there was no evidence that the association had performed the legal analysis or obtained a legal opinion which supported the original panel’s conclusion that the grievance was without merit. The reconsideration panel’s decision was upheld on judicial review.

Facts of the Case

Wideman, a long-term police officer, was charged with shoplifting and discipline proceedings were commenced against him. With the assistance of his own legal counsel, he resigned, with the result that the discipline panel no longer had jurisdiction over him. He had pleaded guilty to the shoplifting charge and during sentencing advised the court of his resignation. Approximately three months later, Wideman attempted to revoke his resignation. When the Police Service refused to accept the revocation of his resignation, he asked the Association to file a grievance. The Association had several meetings that Wideman was not invited to and decided not to file a grievance on his behalf. Wideman filed a duty of fair representation complaint and, with the assistance of the Labour Relations Board, another meeting of the Association was convened at which Wideman and his psychiatrist made presentations. The Association again decided not to proceed with the grievance.

The original panel of the Board concluded that the Association had cured its earlier procedural flaws by permitting Wideman and his psychiatrist to make a presentation to the Association. It also concluded that, given the circumstances of the resignation, the grievance was unlikely to succeed. Therefore, the Association had not breached its duty of fair representation.

The Decision

The reconsideration panel did not agree that the earlier procedural flaws had been cured. The reconsideration panel was not satisfied that there was an in-depth analysis of the merits of Wideman’s case. The panel emphasized the absence of evidence that the Association had sought legal advice or performed research of the kind a lawyer might have engaged in. Further, the reconsideration panel concluded that the Association should have at least processed the grievance through the initial steps of the grievance procedure, even if it was not going to proceed to arbitration.

The reconsideration panel’s decision was upheld on judicial review. The Association has filed an appeal to the Court of Appeal.

Implications for Employers/Unions

This decision appears to be inconsistent with labour board jurisprudence indicating that unions are not required to obtain legal opinions. It also suggests that it is not enough that the union "gets it right"; it must also show that it has a thorough legal analysis to support its conclusion that a grievance is without merit.

4. Union liability

The Alberta Court of Queen’s Bench found a union in civil contempt for violations of a Labour Relations Board directive restricting picketing. The union was found liable as there

was no evidence that it "disapproved of our disavowed the conduct of its members on the picket line".

Georgia Pacific v. BBF D513 et al, [1999] Alta LRBR 118

Implications for Employers/Unions

This case imposes a positive duty on union officers to dissuade members from illegal activity, failing which unions will be found in civil contempt.

Report submitted by Lyle Kanee of the law firm Chivers Greckol and Kanee in Edmonton, Alberta.

British Columbia

1. Report from British Columbia

On January 21, the B.C. chapter of CALL had its annual get together to discuss "recent developments in B.C." This year we had about 35 people attend, down slightly from last year. We were encouraged by the number of new faces and the number of in-house counsel that attended. There seems to be a great deal of interest in the August conference in Halifax, so we’re hoping for a good B.C. turnout.

The timing of our meeting was fortuitous because on the morning of the meeting, the Chair of the B.C. Labour Board announced his resignation effective March 31, 2000. Keith Oleksiuk, who formerly worked for the Steelworkers in Ontario and B.C. before he joined the Board in 1992, was the subject of much criticism from the employer community over the last year and one half. Gossip was rampant about who his replacement would be.

On a more legalistic note, there have been a number of important decisions in the past year from B.C. The Supreme Court of Canada decision in UFCW v. K-Mart Canada (1999), 176 D.L.R. (4th) 607, and its companion case from New Brunswick, Allsco Building Products v. UFCW (1999), 176 D.L.R. (4th) 647, were issued on September 9, 1999 and overturned the picketing laws in B.C. The Court went to some length to differentiate between picketing and leafleting and the societal and legal distinctions between the two. The Court effectively upheld leafleting as a freedom of expression issue. There has now been a subsequent decision of the B.C. Labour Relations Board related to the IATSE Projectionists strike, which interpreted and applied the K-Mart decision: Sony v. Projectionists, December 20, 1999, BCLRB B519/99.

Another major decision out of B.C. was the Meiorin decision (also known as the "Firefighter’s case") in which the Supreme Court of Canada reviewed the duty to accommodate in the context of reasonable "qualifications" for a job. [See British Columbia (Public Service Employee Relations Commission) v. B.C.G.S.E.U.(1999), 176 D.L.R. (4th) 1.] The decision eliminates the distinction between indirect and direct

discrimination and replaces it with a unified approach to questions of discrimination. The Court set up a three-step test to determine whether an employer has established, on a balance of probabilities, that a prima faciediscriminatory standard is a bona fide occupational requirement. This is obviously a gross simplification of an important decision which must be read in conjunction with the Supreme Court’s decision in Grismer. [See British Colubia (Superintendent of Motor Vehicles) v. British Columbia (Council of Human Rights)(1991), 181 D.L.R. (4th) 385.]

On the human rights side, the B.C. Human Rights Tribunal found Professor Donald Dutton guilty of creating a "sexualized environment" when he invited a university student to his house for a meeting and served wine, and had low lighting, candles and music. The Tribunal ruled that sexual harassment includes physical touching or conduct of a sexual nature which has a psychological effect. The fact that a complainant tolerates the conduct is no defense: Mahmoodi v. University of British Columbia, B.C. Human Rights Tribunal, October 26, 1999.

Lastly, the B.C. Court of Appeal ruled that the B.C. Labour Relations Board may review arbitration decisions that are inconsistent with the principles expressed or implied in the Labour Relations Code or another act dealing with labour relations. However, the Board cannot review awards dealing primarily with matters of general law, including human rights issues such as the duty to accommodate. Section 100 of the Labour Relations Code provides that such appeals proceed directly to the Court of Appeal: USWA, Local 7884 v. Fording Coal; CAW-Canada v. Westmin Resources United; BCGSEU v. Public Service Employee Relations Commission (1999), 179 D.L.R. (4th) 284 (B.C.C.A.).

Report submitted by Daniel Rogers and Diane MacDonald of the Victory Square Law Office in Vancouver, British Columbia.

Manitoba

1. Human Rights

2. Arbitration

3. Labour Board

1. Human Rights

In Schroen v. Steinbach Bible College et al (1999), 35 CHRR D/1 (Man. Bd. Adj.), a human rights tribunal determined that a small Mennonite bible college was entitled to fire its accounting clerk because she was a Mormon rather than a Mennonite. The College testified that it would not have hired the clerk if it had known she was Mormon. It fired her as soon as it learned of this fact.

The evidence was that the College was a tight-knit community of students and staff and that the accounting clerk interacted extensively with students. Among other things, for example, the clerk sold students religious books, some of which discussed Mennonite beliefs, including the Mennonite belief that Mormonism is a cult.

When the clerk was hired, she was asked to sign the college’s Statement of Faith which listed specific religious views held by Mennonites. Expert witnesses who testified about the difference between Mennonite and Mormon beliefs pointed to several items in the Statement of Faith that contradicted Mormon beliefs.

The tribunal held that the College had discriminated against the clerk on the basis of religion. However, given the unique nature of this particular workplace, the tribunal ruled, it was a bona fide and reasonable requirement or qualification for the clerk to be a Mennonite. The Human Rights Commission decided not to seek judicial review of the decision.

2. Arbitration

In Readyfoods Ltd. and United Food and Commercial Workers Union, Local 832(1999), 140 Man. R. (2d) 204 (QB), the Manitoba Court of Queen’s Bench upheld an arbitration decision dealing with severance and pay in lieu of notice. Under Manitoba’s employment standards legislation, employers are required to give employees pay in lieu of notice of termination, in cases of group termination. Under the collective agreement, the employer was required, upon plant closure, to pay employees an amount equal to one week’s wages for each year of service. When the employer closed its plant, it argued that it could set off the amount of pay required by the legislation against the amount of pay required by the collective agreement. The employer relied on the common law presumption against double recovery.

In an arbitration decision reported on Quick Law at [1998] MGAD No. 80, December 10, 1998 (Jamieson), the arbitrator held that the statutory pay in lieu of notice and the contractual severance pay were two distinct concepts. The contractual severance pay was an earned benefit while the pay in lieu of notice was a statutory obligation. Therefore, the employer was not entitled to set off one amount against the other. In a brief decision, the Manitoba Court of Queen’s Bench denied the employer’s application for judicial review of the arbitration decision.

The Manitoba Court of Appeal has just decided Assiniboine South Teachers’ Association v. Assiniboine South School Division No. 3, June 16, 2000, Docket Al 99-30-04139. In this case, a lesbian teacher asked permission from her employer to mention her sexual orientation in the classroom during "teachable moments". Her employer ordered her in writing not to disclose her sexual orientation. She obeyed the order and filed a grievance. The teacher’s collective agreement did not contain a no-discrimination clause. The majority of the arbitration board decided that it did not have jurisdiction to deal with the grievance, because it was not related to any specific article of the collective agreement. In a decision reported at (1998), 163 DLR (4th) 343, the Manitoba Court of Queen’s Bench overturned the arbitration decision. Relying primarily on the Ontario Court of Appeal’s decision in Metropolitan Toronto (Municipality) v. CUPE Local 43 (1990), 69 DLR (4th) 268, the Court held that the arbitration board had jurisdiction to deal with the grievance under the discipline provisions of the collective agreement. If the teacher had disobeyed the employer’s order and had been disciplined, an arbitration board would certainly have had jurisdiction to deal with a disciplinary grievance. According to the Court, the employee who obeyed, rather than disobeyed the order, should not be deprived of the right to grieve.

The majority of the Manitoba Court of Appeal disagreed with the lower court and upheld the original arbitration decision as not being patently unreasonable. Referring to the Metropolitan Toronto case, the Court commented that the "principle of testing a rule for reasonableness before its breach is a sound one. It must be recognized, however, that this principle can only be applied where there is a unilaterally imposed workplace rule capable of being judged for reasonableness regardless of the circumstances of its breach." The court reasoned that the workplace rule in dispute in Metropolitan Toronto was an absolute, categorical rule.

However, in the majority view, the rule against disclosing one’s sexual orientation was different, since it might be reasonable to prohibit disclosure in some situations but not in others. The majority also had some doubt that discipline would follow breach of the disclosure rule in all circumstances. Therefore, the decision of the arbitration board was not patently unreasonable. Justice Kroft dissented, and would have sent the grievance to a new board to be decided on its merits.

3. Labour Board

In Tucker v. Sheet Metal Workers International Association Local 511 et al(1999), 138 Man. R. 153 (CA), reconsideration denied at [2000] 1 WWR 108 (CA), the Manitoba Court of Appeal upheld the Manitoba Labour Board’s decision to hold an oral hearing. The complaint before the Board was brought by a group of employees who objected to the union’s certification. At the time of the certification application, the legislation allowed for automatic certification if 65% of employees were union members at the time of the application. As two of the three

employees at the time had signed union cards, certification was granted. The legislation allowed the employees to object to the certification only on the grounds of union misconduct. The group of objecting employees retained counsel and objected to the certification on the grounds that they did not want the union to represent them. They did not allege union misconduct. Therefore, the Board dismissed their complaint without an oral hearing.

The Manitoba Court of Appeal held that the Board’s ruling was not patently unreasonable. At paragraph 23 of its decision, the Court pointed out that, in the field of labour relations, it is not uncommon for statutes to provide for union certification without a hearing. There are many reasons for this, not the least of which are the need for a prompt decision and the need for confidentiality of union records. "Certification without a hearing has been held, at the highest level, not to abrogate the principles of natural justice so long as those interested have had an opportunity to put forward their arguments," the court held.

The Court also rejected the argument that the relevant provision of the legislation violated sections 7 and 2(d) of the Charter of Rights and Freedoms. Finally, in an unusual move, the objecting employees asked the Court to reconsider its decision. However, the Court very briefly ruled that the employees’ submissions did not meet the test for reconsideration.

Report submitted by Eliott Levin of the law firm Myers Weinberg Kussin Weinstein Bryk in Winnipeg, Manitoba.

New Brunswick

1. Environmental illness and WCB

2. Leisurewold not the law in New Brunswick (yet!)

3. Surveillance camera evidence admissible

1. Environmental illness and WCB

Gloria Mallais and Workplace Health Safety and Compensation Commission, [1999] N.B.J. 463 (NBCA)

In October 1999, the New Brunswick Court of Appeal overturned the decision of an appeal panel of the New Brunswick Workplace Health, Safety and Compensation Commission and placed the onus squarely on the Commission to prove the Appellant’s environmental illness was not caused by the workplace. The Appellant was a pharmacy assistant (and CUPE member) employed at the Dr. Everett Chalmers Hospital in Fredericton. In July 1998, she began experiencing respiratory distress while working at the Fredericton Hospital. The respiratory condition occurred only at the Fredericton Hospital and did not occur at home, in shopping malls or at another hospital where she also worked.

The WHSCC Appeals Tribunal ruled that there was no causal relationship between the employee’s symptoms and her occupation at the hospital. The Court of Appeal applied section 7(2) of the Workers Compensation Act, which legislates a presumption that an injured worker’s disablement occurred in the course of her employment. The Tribunal’s failure to apply the presumption was an error in law reviewable by the Court.

This is an important case as it presumes, given the right facts, that environmental illness is a compensable injury in New Brunswick.

2. Leisurewold not the law in New Brunswick (yet!)

UFCW Local 1288P v. Pepsi Cola Beverages Ltd., [1999] N.B.J. 526 (NBCA)

The UFCW, Local 1288P referred to arbitration a grievance concerning the seniority status of a group of employees. The employer raised the preliminary objection that the grievance had not been referred to arbitration within the time limits set out in the collective agreement. The union relied on section 73.1 of theIndustrial Relations Act, which permitts an arbitrator to extend the time for the taking of any step in the grievance procedure.

The employer relied on SEIU, Local 204 v. Leisureworld Nursing Home, [1997] O.J. 4815, a decision of the Ontario Court of Appeal, for the proposition that the "grievance procedure" does not include the arbitration procedure. There were no court cases interpreting the New Brunswick legislation.

The arbitrator dodged the bullet by holding that, because the collective agreement provision regarding referral to arbitration was included in the article governing the grievance procedure, he had authority to relieve against the time limit for referring the grievance to arbitration. In his view, it was part of the "grievance procedure" within the meaning of section 73.1 of the Act.

On judicial review, the Court of Queen’s Bench disagreed, ruling thatLeisureworld applied and there was no power under s. 73.1 to relieve against arbitration time limits. On appeal to the New Brunswick Court of Appeal, the Court stated:

"A request for referral of a grievance to arbitration is not necessarily, as a matter of law, a step in the arbitration procedure. It may, depending on the terms of the collective agreement between the parties, be a step in the grievance procedure contemplated by s. 73 (3.1) of the Act. To the extent that Service Employees International Union, Local 204 v Leisureworld Nursing Homes Ltd. et al. holds otherwise, I respectfully decline to follow it.

Section 73 (3.1) confers a discretion to extend the time for the taking of any step in the grievance procedure. The Act does not define what is meant by "grievance procedure" for s. 73 (3.1) purposes. However, the wording of s. 73 (3.1) suggests that the scope of the discretion conferred by it may vary from case to case, depending on the terms of the collective agreement that the arbitrator is called upon to interpret and apply."

The Court of Appeal did, however, indicate that the result in this case did not mean that Leisureworld was not applicable in New Brunswick. A time limit missed in an arbitration process that is clearly distinct from the grievance process will, based on the reasoning in Leisureworld, probably not be extended.

3. Surveillance camera evidence admissible

Re: Town of Riverview and CUPE Local 2162, decision of Eugene McGinley, September 16, 1998, unreported.

Two grievors were fired for theft of stockroom items. The employer’s primary evidence was videotape from a surveillance camera at its premises. The union raised a number of objections to the introduction of the evidence, all of which were overruled by the arbitration board.

First, in regards to the privacy rights of the individual, the Board distinguished between surveillance outside the workplace and surveillance inside the employer’s premises. The Board also relied upon the fact that the stockroom under surveillance was usually off limits to the grievors.

Second, the Board rejected the union’s argument that the employer was required to exhaust all other

avenues to identify thieves before installing a video camera. While this was an appropriate concern where surveillance was taking place in general work areas, it did not apply where the surveillance was of a restricted area.

Finally, the Board took no issue with the fact that the videotape offered in evidence was a copy, rather than the original.

Although not directly raised, the Board seemed unconcerned that there had been no prior warning to employees that they might be the subject of surveillance, a factor which has been relevant in other arbitration cases.

This case signals a much more lenient approach to video surveillance in the context of combating workplace theft.

Report submitted by David Brown of the law firm Brown MacGillivray Stanley in Saint John, New Brunswick.

Nunavut

1. The division of the Northwest Territories

Nunavut Born on April 1, 1999

One hundred years ago, the Northwest Territories was a large part of northern Canada. The area was a vibrant jurisdiction; a place where aboriginal cultures of Dene and Inuit heritage had lived for thousands of years, and then had come into contact with European civilization. The tree line, running diagonally from the northwest corner on the Beaufort Sea to the southeast corner along Hudson Bay, was a natural division between the two cultures.

When the early explorers sought a passage to the riches of China, and recognized the wealth of the fur trade, settlements grew, where aboriginals and Europeans exchanged furs for goods and supplies. Much of the fur trading took place in the western region occupied by the Dene, but settlement occurred in the Inuit area to the east with the establishment of whaling stations.

By the end of the nineteenth century, a vibrant political and judicial system was in place. However, this changed radically in 1905, when a large part of the geographic area became the provinces of Alberta and Saskatchewan. Several years later, portions of the land were added to Manitoba and Ontario. The remainder of the Territories - still a very large geographic area but now very much reduced in terms of population and commercial activity - shrank into a jurisdiction administered by the federal government. Decades passed before political representation of any real significance returned to the area, first at the federal level and then in the legislative assembly governing local and private affairs.

The landscape changed once again on April 1, 1999, when the Territories were divided into two jurisdictions, bringing into reality a political gestation that had taken many years to mature. The division, which had its roots in the cultural differences between the Inuit and Dene/Metis populations, gave the Inuit the new territory of Nunavut.

The division of the territories began as a negotiation of a land claim agreement between the Inuit and the Federal Government. In 1993, the land claim was settled and the Nunavut became a public government under the Nunavut Act, S.C. 1993, c.28.

With the division came significant legal and administrative challenges. A new government had to be set up, and laws and a judicial system put into place. The body of law for the new jurisdiction was comprised of statute law from the Northwest Territories, amended Territorial law and entirely new legislation.

The Nunavut Implementation Commission spent two years developing a detailed report on how the new government would be brought into being. An Interim Commissioner was then appointed under the Act and given instructions to implement the report’s recommendations. Part of this work involved the enactment of laws that would meet the particular needs of the jurisdiction.

Section 29 of the Act provided for a transitional scheme that enabled Nunavut to begin its governance under a set of Northwest Territories laws. These statutes were duplicated to the extent they could apply to Nunavut, and were deemed to be the laws of the new Legislature. Under section 29.1, all rights, privileges, licences, etc. existing in Nunavut prior to the division were preserved.

Where the particular needs of Nunavut required the enactment of new laws or the amendment of existing Territorial law, the Northwest Territories Legislative Assembly put the legislation in place by April 1, 1999 (s. 76.05). This legislative activity took place at the fall 1998 and winter 1999 sittings.

The Nunavut legislation can be accessed at the Court House Library site (http://pooka.nunanet.com/
~ncjlib/english.html) or the Access to Justice Network (http://legis.acjnet.org.). The consolidated statutes and regulations are current to April 1, 1999. The Court House Library is maintaining a table of amendments. The Government of the Northwest Territories will publish the revised statutes of Nunavut later this year.

An election of members to the new Legislative Assembly took place shortly before Nunavut came into being, after which time, the Legislature had full authority to pass laws for the new jurisdiction.. The Commissioner is the executive head of government in much the same fashion as the provincial Lieutenant Governor (see s. 12). Along with an Executive Council, the Commissioner will have authority over government affairs. Sections 5 to 7 define the office of the Commissioner (essentially the same as in the Northwest Territories) and s. 11 establishes the Executive Council which is appointed by the Commissioner on the advice of the Legislative Assembly. The appointment process is similar to that which is followed in the Northwest Territories. Specifically, convention and consensus government, in which there are no political parties are followed. Presently, the MLAs choose both the premier and the cabinet members and the premier then assigns portfolios. In past years, there has been much debate about the appointment process, and therefore, it may change in the future.

All of these changes put a new face on old patterns of doing business in the north. There will be a variety of transitional problems as well.

In the area of the administration of justice, s. 31 of the Act creates a Supreme Court and a Court of Appeal with the same powers and jurisdiction that their counterparts in the Northwest Territories have. An amending statute, passed in March 1999 and in force April 1, 1999, created the Nunavut Court of Justice. This is a single-level trial court consisting of three resident superior court judges, together with non-resident appointees. This innovative approach has required extensive amendments to federal and territorial law.

Judicature in this new court and in the Court of Appeal, is dealt with in theNunavut Judicial System Implementation Act. This statute provides for justices of the peace and repeals the former Territorial Courts Act - a necessary step in the process of establishing the single-level court. The rules of court in the Northwest Territories have been adopted for use in Nunavut.

Nunavut’s Law Society held its inaugural call to the Bar in April 1999, when 28 resident lawyers became its first members. The Bar now has 193 resident and non-resident members. The Nunavut Territory has the most northerly law office in the country - a legal services clinic in Pond Inlet. The Law Society has moved quickly to become an organization able to function on its own. While Nunavut members presently receive their insurance coverage through the Northwest Territories, on July 1, 2000, insurance will be provided directly by CLIA.

In May 1999, a ceremonial call to the Bar took place in Yellowknife for Northwest Territories lawyers wanting to practice in the east. Over 50 lawyers shared the solemnity and collegiality of this additional milestone in the growth of the north.

There are a number of special concerns associated with the transitional stage of the north. Judgments applicable to persons or property in the new jurisdiction, in place at the date of the division, would be difficult to enforce. There is a practice directive dealing with the mechanics of how to enforce such a judgment and s. 76.12 of the Act remedies this problem.

Jurisdiction over causes of action is tied to the date the action was commenced. The courts of the Northwest Territories have jurisdiction over matters commenced before April 1, 1999, and the courts of Nunavut have jurisdiction if the matter is commenced on or after that date (s. 76.1). That said, actions that were pending in the Supreme Court on April 1, 1999 can continue in the Northwest Territories, or they can be transferred into the Nunavut Court of Justice if the judge thinks the transfer is in the interests of justice (Act, s. 76.11). Thus far, the judges of the Northwest Territories have shown a preference to transfer cases over to Nunavut and let the judges deal with them there. This stems from a belief that the two jurisdictions should separate their affairs as quickly as possible. If a case remains physically in the Northwest Territories, the judges of the Supreme Court of the Northwest Territories are also judges of the Nunavut Court. A case can be convened in Nunavut simply by convening the court as the Nunavut Court.

A. Labour Laws

On the labour front, the Canada Labour Code will apply to Nunavut in the same way that it did in the past. This will mean that workplaces organized under a collective agreement will remain under the authority of the Canada Industrial Relations Board. Any new certification drives will similarly come under the Code. Employment standards are a matter of territorial jurisdiction, and the Labour Standards Act in force in the Northwest Territories has been enacted in Nunavut with a few minor changes. Other lesser-known employment laws are also part of the mosaic. As to human rights, the Fair Practices Act is part of Nunavut law.

During the first year of the new territory, the Labour Standards Boards for the two jurisdictions shared the same members. Under cross-appointment and a contract between the two governments, the members of the Northwest Territories Board provided their services to Nunavut. On April 1, 2000 Nunavut appointed its own Board. Similarly, the services of the NWT Labour Standards Officer were provided to the new territory. The contract expired on April 1, 2000 and Nunavut has now appointed its first Labour Standards Officer.

Employees of the new government are regulated under the Public Service Act (Nunavut). Many of these employees are members of the Nunavut Employees Union, a body created by the Nunavut Employees Union Act. These two pieces of legislation are practically identical to the laws that were applicable to Northwest Territories Government employees.

B. Administrative Law

The division effectively means that a great number of tribunals in the Northwest Territories now have counterparts in Nunavut. A detailed examination of the changes is not possible here. From an operational standpoint, a number of existing bodies are given the authority to act under Nunavut laws.

There are also new administrative bodies created to deal with the needs of the new jurisdiction. The institutions of public government created under the land claims agreement deserve special mention here. Bodies such as the Nunavut Water Board, the Nunavut Wildlife Management Board and the Nunavut Impact Review Board are given important powers and responsibilities, but it will take time to work out how these tribunals will interact with government and its agencies.

The Workers’ Compensation Board also deserves mention, because of the breadth of the Board’s activities. When the Workers’ Compensation Act was being duplicated, the Interim Commissioner agreed that provision should be made to have the Northwest Territories Board be the responsible authority for Nunavut as well. There is now one body with the legal mandate for compensation claims, occupational health and safety and mining safety throughout both jurisdictions. Because the old regime is effectively

being empowered to carry on as it did before, but in a shared arrangement under two sets of laws, the Minister responsible for the Nunavut legislation is authorized to enter into agreements with the Government of the Northwest Territories establishing the terms and conditions under which the G.N.W.T., the Board and the appeals tribunal (this body hears the appeals from decisions on compensation claims and assessments) will serve Nunavut under its legislation.

There are provisions in the Nunavut Judicial System Implementation Act for judicial review. Although applicable to all tribunals, these provisions appear to be designed primarily to review decisions made by justices of the peace. Any decision from which there is a statutory appeal can be appealed to the Nunavut Court of Justice. The legislation sets out a procedure for bringing the evidence into court, filing appeal books and getting the appeal on for a prompt hearing. Sections 83 through 91 contain the relevant law. The traditional avenues of judicial review are found in the Rules of Court.

Report submitted by Austin F. Marshall of the law firm Marshall & Co. in Yellowknife, Northwest Territories.

Ontario

1. Duty to provide competent counsel

2. Timeliness of grievance referral

3. Courts vs. arbitrators: Weber where no collective agreement exists

4. Board orders employer to return production work

5. SCC upholds the OLRB in Charterways

6. Dunmore to go to SCC

7. Bill 69

8. Grievance procedure cannot be used to relitigate criminal conviction

1. Duty to provide competent counsel

Dwyer v. Cavalluzzo, Hayes, Shilton McIntyre & Cornish, unreported judgment by Ground, J., June 25, 1999, Court File 96-CU-109538; Scarponi v. Hadwen, [1997] O.J. No. 1649, Corrigendum released [1997] O.J. No. 804 (Ont. Ct. Gen. Div.) – to the same effect.

For the third time in three years, an Ontario Court has held that it has no jurisdiction to entertain a negligence claim against trade union lawyers.

The plaintiff grievor sued the law firm Cavalluzzo, Hayes, which his trade union, the Canadian Union of Postal Workers, had retained to represent him on a grievance arbitration. The plaintiff alleged that the defendant solicitors were negligent and had maliciously compromised his rights. The solicitors brought a motion to dismiss the action.

Judge Ground held that a trade union’s duty of fair representation included the duty to retain competent counsel to represent a grievor. This important component of the duty of fair representation falls within the exclusive jurisdiction of the Canada Labour Relations Board. On the authority of French v. Chapman(unreported, Ont. Ct. Gen. Div., Brockenshire, J. November 18, 1996, affirmed [1997] O.J. No. 4035 (C.A.)), the Court held that it had no jurisdiction to entertain the claim against the defendant solicitors. Since the Canada Labour Relations Board and the Ontario Divisional Court had already dealt with CUPW’s alleged failure to provide fair representation to the plaintiff, the allegations raised in the lawsuit were res judicata in any event.

2. Timeliness of grievance referral

Natrel (Ontario) Inc. and Teamsters, Local 647, unreported decision of Elaine Newman dated August 7, 1999.

Unions have been hampered with the Court of Appeal decision in Leisure Worldand the subsequent arbitration awards dealing with grievance procedure time limits. These decisions suggest that if the union violates the time limits for referring a grievance to arbitration, the grievance is inarbitrable. In a recent award, Arbitrator Elaine Newman has provided a way around the Leisure Worldproblem. Arbitrator Newman has determined that, in circumstances where the parties have developed a lax approach to referring a matter to arbitration, an estoppel has arisen which would preclude the employer from raising a Leisure World argument.

Therefore, if a union is faced with a Leisure World argument from an employer, it should immediately investigate the past practice of the parties to determine whether the time limits for arbitration have been strictly adhered to or whether the employer has not required the union to comply with the referral provisions of the collective agreement.

Report submitted by Michael McCreary of the law firm Jesin, Watson & McCreary in Toronto, Ontario.

3. Courts vs. arbitrators: Weber where no collective agreement exists

Two 1995 decisions of the Supreme Court of Canada (Weber v. Ontario Hydro(1995), 125 D.L.R. (4th) 583; O’Leary v. The Queen, (1995) 125 D.L.R. (4th) 609) continue to cause confusion about the proper forum for litigating disputes arising in unionized workplaces. Some courts have shown a great willingness to infer or imply a connection to a collective agreement, hence declining jurisdiction and leaving the dispute to be resolved by arbitration or by the Ontario Labour Relations Board (the "Board"). As illustrated by three recent decisions, uncertainty about the proper forum exists even where a collective agreement is not in force at the time of the dispute.

In Duncan and Cadillac Fairview Corporation (1999), 178 D.L.R. (4th) 530 (Ont. S.C.), Duncan was a Union member and a security guard at the Eaton Centre for Cadillac Fairview ("CF"). Before the Union could negotiate its first collective agreement, but after it had notified CF that Duncan would be a steward, CF discharged him as a result of complaints of sexual harassment and assault made by two co-workers. The Union responded by complaining to the Board that CF was bargaining in bad faith and had violated Duncan’s protections under theLabour Relations Act, 1995. Subsequently, the Union and CF settled the complaint on terms which included Duncan’s resignation, with damages. Duncan refused to sign the settlement and issued a Statement of Claim against CF seeking special and punitive damages for abuse of process, conspiracy to injure, and negligence. CF then brought a motion to dismiss the claim, asserting that the Court was without jurisdiction.

On the jurisdictional issue, the Court acknowledged that Weber means that, in most cases, all differences between employees and employers arising from a collective agreement must be dealt with by arbitration; the Courts have no power to entertain actions in respect of such disputes. However, the Court found that here, at the times relevant to Duncan’s employment, no collective agreement had yet been negotiated. Accordingly, no grievance and arbitration provision applied. Because Duncan’s Statement of Claim pre-dated the collective agreement, his action in tort against CF was permitted to continue and CF’s motion for summary dismissal was dismissed.

Duncan and Cadillac Fairview was followed in Armitage v. ZCL Composites Inc.,[1999] O.J. No. 3789 (Ont. S.C.). Here, the plaintiffs were employees who were permanently laid off due to a plant shutdown in Belleville. They sued ZCL for wrongful dismissal and requested a preliminary determination on the Court’s jurisdiction. ZCL argued that, as members of a bargaining unit, their rights could be determined only under the Act.

The Union at ZCL was certified in August, 1997. Subsequently, one negotiating meeting occurred and a Conciliation Officer was appointed. By the time of the lay-offs in 1998, further negotiations had occurred. At that time however, a "no board" report had not been issued and no employee had applied to de-certify the Union. Following Weber, the Court found that, had a collective agreement existed, the Court would have been without jurisdiction to deal with a wrongful dismissal claim. However, the critical factor was the existence of a collective agreement and its remedial provisions. Without one, the employees were without a remedy. The Court determined that the plaintiffs, although represented by a Union, could proceed in a civil suit since no collective agreement yet existed with their employer.

In Dagher v. McDonnell-Ronald Limousine Service Ltd., (1999) 46 O.R. (3d) 97 the Ontario Court of Appeal took a broader approach to the Weber principles than did the courts in Duncan and Armitage. Here, a limousine company had Service Agreements with its brokers, allowing them to operate an airport limousine for a monthly fee. In 1995, for the first time, the company entered into a collective agreement covering some of its brokers. The collective agreement acknowledged the company’s right to have Service Agreements and impose a maximum monthly fee on the bargaining unit members. The collective agreement expired in November, 1997. Six weeks later, the company increased the brokerage fee by 20%. The Union complained to the Board that the company was bargaining in bad faith and sought interim relief. At the hearing of the interim relief application, the company argued that the Board was without jurisdiction since the collective agreement had expired. The Board dismissed the interim relief application.

Following the preliminary Board appearance, the Union applied to the Ontario Court (General Division) claiming a breach of contract under the Service Agreement. The Court assumed jurisdiction over the matter by distinguishingWeber. It held that the Service Agreements were commercial contracts which pre-dated the collective agreement; the terms of the Service Agreements were untouched by the collective agreement and involved persons outside of the bargaining unit. The limousine company appealed the Court’s assumption of jurisdiction.

The Court of Appeal disagreed with the lower court and allowed the company’s appeal. It held that Weber could not be distinguished. Rather, it extendedWeber’s principle of deference, which applied to the statutorily-imposed arbitration process, to the decision-making structures created by the Labour Relations Act. The Court reasoned that since the Board has the jurisdiction to remedy violations of the Act which occurr after a collective agreement has expired, then in effect, the dispute arises under a collective agreement and the courts are without jurisdiction.

These decisions illustrate some of the confusion which exists post-Weber. In light of the Court of Appeal’s ruling in McDonnell-Ronald Limousine, was the Court in Duncan mistaken to have assumed jurisdiction since, under the Act, the Board could, and possibly already did, deal with Duncan’s statutory protections from discrimination even though no collective agreement yet existed? Was the Court mistaken to have assumed jurisdiction over wrongful dismissal cases at ZCL since the Union could have claimed a breach of the statutory freeze under the Act? Was the lower court really wrong to have decided that the unionized brokers at McDonnell-Ronald had independent, commercial contracts with their employer, separate from their collectively bargained rights? At one level, decisions such as Duncan and Cadillac Fairview, appear to provide more options for seeking relief in some situations (e.g., proceeding before both the Board and the courts.) However, does that conclusion impose corresponding duties on unions to act for their members in more than one forum? Will extreme judicial deference to the labour relations’ dispute resolution mechanism make an expeditious, informal system as legalistic and slow-moving as the courts have become? In the wake of Weber, the courts appear eager to defer to arbitrations and to the Board. However, in the long run, such deference may limit the rights of individuals in unionized workplaces and expand the obligations of unions, bringing commercial and tort disputes for resolution into the labour relations field.

4. Board orders employer to return production work

The Ontario Labour Relations Board has issued a decision giving strong and effective remedies to a newly-certified trade union after an employer avoided dealing with a union, discriminated against union supporters for two years, and transferred bargaining unit work to another facility. In Rapid Transformers Ltd., Marcus Transformer of Canada Ltd., (unreported, OLRB, July 21, 1999), the Board considered several complaints filed by the CEP under the Labour Relations Act, 1995, and the Occupational Health and Safety Act. The CEP alleged that, since its certification in 1997, the employer had transferred work out of the unionized location in Cornwall to its Quebec facility in order to avoid dealing with the union, thus reducing the bargaining unit from 27 to 15 employees. The CEP also alleged that the employer had discriminated against union supporters by selecting them for lay-offs, refusing them normal wage increases, transferring them to less lucrative work, cutting their hours, disciplining them without just cause, and committing reprisals against them for participating in health and safety issues.

The Board heard extensive evidence and assessed the employer’s credibility and motivations. The Board stated that, while an employer is free to expand or contract its business, contract out its work, or change its methods of production, it may do so only for genuine and legitimate business considerations. An employer will breach the Act if its motivations, even in part, are to avoid its obligation to bargain collectively or to otherwise defeat or impede employees’ statutory rights under the Act, the Board ruled. The Board concluded that the Employer’s reasons for dismantling the Cornwall plant included a desire to avoid dealing with the union. Similarly, the Board held that the employer had laid off employees, transferred some to less lucrative jobs, imposed discipline, and awarded wage increases based on the employees’ support for, or opposition to, the Union. The employer had also refused to deal with the union’s selected representatives, instead of its own favourites. The Board ruled that the employer’s conduct seriously breached the Act and sent a message to the Cornwall employees that their jobs were in jeopardy because they had chosen to bargain collectively. According to the Board, this was a particularly significant message, since it was conveyed when the parties should have been negotiating a first collective agreement.

The Board commented on its long history of providing practical remedies where an employer shuts down a location or otherwise removes work to avoid dealing with a newly-certified trade union After identifying several breaches of the Act and the OHSA the Board ordered the employer to:

return to the Cornwall plant all production and pre-fabrication work removed since the CEP’s application for certification on September 11, 1997;

reinstate and reimburse, with interest, all employees laid off as a result of the removal of work from Cornwall;

pay a wage increase retroactively to all employees who had been denied one;

restore certain employees to their previous bonus-generating positions, with compensation for lost bonuses;

remove unjustified discipline;

post and mail to employees a Board notice describing their rights under the Act.

The Board concluded by remaining seized to deal with any matters arising out of these remedies. Clearly, in this decision, the Board sent its own message: that the Act guarantees a right to bargain collectively and that the Board will do its utmost to protect this right in a meaningful way.

5. SCC upholds the OLRB in Charterways

The Supreme Court of Canada has issued its decision in Ajax (Town) v. National Automobile, Aerospace and Agricultural Workers (CAW-Canada), Local 222,upholding the ruling initially made by the Ontario Labour Relations Board that a sale of business had occurred when the Town began operating its bus service with the same employees formerly employed by a service contractor. (See [2000] S.C.J. No. 23)

The bus service, although owned by the Town of Ajax, was operated by Charterways Transportation. In 1992, the Town decided to operate the service directly and cancelled its contract with Charterways. The drivers employed by Charterways, and represented by the CAW, were laid off. Subsequently, the Town hired a significant number of them back as drivers, and the service then ran without regard to the Union’s bargaining rights.

The Union successfully argued before the OLRB that there had been a sale of a business from Charterways to the Town; the Town acquired an essential element of the business when it hired the drivers, who made up the substantial part of its workforce. (See [1994] OLRB Rep. Oct. 1296.) The Town then successfully applied to the Divisional Court for a review of the Board’s decision ((1995), 84 O.A.C. 281 and 95 C.L.L.C. para 210-040.). On the Union’s appeal to the Court of Appeal, the Court found that the Board’s conclusions were not "patently unreasonable", reversed the Divisional Court’s decision and restored the Board’s order ((1998), 41 O.R. (3d) 426).

The judges of the SCC were not unanimous in agreeing with the Court of Appeal and the Board. Three of the nine judges supported a dissenting opinion which emphasized that there was no nexus between the operations of the Town and those of Charterways. The dissenting judges held that it was "patently unreasonable" for the Board to find that the hiring of Charterways’ former employees was an "essential element" of the business so that the sale of the business provision could apply.

The majority issued only brief reasons, relying for the facts and arguments on the decision of Goudge, J.A. in the Court of Appeal’s decision. The majority reiterated that the test on judicial review is whether the decision at issue was "patently unreasonable", not "correct", and determined that it was not patently unreasonable for the Board to decide as it had.

Report submitted by Elizabeth Mitchell and Ursula Boylan of the law firm Koskie Minsky in Toronto, Ontario.

6. Dunmore to go to SCC

The Supreme Court of Canada has granted leave to appeal in Dunmore v. Ontario (Attorney General), [1999] S.C.C.A. No. 196 (S.C.C.). The case began in 1995 when the provisions giving agricultural workers the right to unionize was removed from Labour Relations Act. The applicant employees were bargaining for a first collective agreement when their right to bargain collectively was repealed. They challenged the repeal in court, claiming violations of their Charterrights to freedom of association (ss.2(d)) and freedom from discrimination (s. 15).

The application was dismissed at the Ontario Court, General Division ((1998), 155 D.L.R. (4th) 193). Justice Sharpe held that the Charter did not require positive government action to facilitate either the formation of associations or collective bargaining. He ruled that the repeal did not deny agricultural workers the right to form associations and that the disadvantage they may be suffering resulted from their employer’s exercise of a private power, which was not reviewable under the Charter. Finally, the Court held that agricultural workers are not a historically disadvantaged group deserving of s.15 protection. The Court of Appeal agreed with the lower court (1999), 182 D.L.R. (4th) 471 (Ont. C.A.).

The issues in Dunmore are similar to those raised in Delisle v. Canada (Deputy Attorney General, [1999] 2 S.C.R. 989. where the majority of the SCC held that the Charter’s guarantee of freedom of association does not guarantee a right to establish a particular type of association. In Delisle, the majority determined that, although under the Public Service Staff Relations Act and the Canada Labour Code the RCMP are prohibited from joining or forming trade unions, that legislation does not offend the Charter since the PSSRA expressly permitted the RCMP to form employee associations. In considering Dunmore, one obvious question will be whether the repeal of the agricultural workers’ right to unionize under the LRA, 1995 is balanced by any alternative rights in other legislation respecting their freedom to associate. The fact that the SCC granted leave toDunmore at all clearly indicates that the Court has more to say on the meaning of freedom of association vis-a-vis trade union representation.

Report submitted by Elizabeth Mitchell and Ursula Boylan of the law firm Koskie Minsky in Toronto, Ontario.

7. BILL 69

Labour Relations Amendment Act (Construction Industry), 2000

The Labour Relations Amendment Act (Construction Industry), 2000 ("Bill 69") was tabled in the legislature on April 25, 2000, and has received second reading. Just before the Bill was scheduled to go back to the Legislature for final reading, the unions withdrew their support. As a result, Bill 69 has been shelved and Labour Minister Chris Stockwell plans to come back after the summer recess with a different Bill. Bill 69, was to affect collective agreements in the construction industry only, and proposed to amend the Labour Relations Act in five major areas:

Changes to ss. 1(4) (single employer) and s. 69 (successor employer) (s. 126): Bill 69 proposes 2 changes: first, the Board is required to disregardfamily relationships. Secondly, in cases involving "key persons", the Board is required to consider the following factors:

the length of any hiatus between the activities of the key individual with the entities in question;

whether the key individual occupied a "formal management role" in the first entity; and,

whether the first entity was able to carry on business "without substantial disruption or loss when he or she ceased to be involved" with that entity.

Changes to the residential sector of the construction industry: Bill 69 (ss. 150.1 and .2) will limit strikes and lock-outs in the residential sector of the construction industry in the Greater Toronto Area for the 2001 round of bargaining. There will only be a limited "window" (May 1, 2001 to June 15, 2001) in which to conduct a strike or lock-out. Once the window closes, if no agreement has been reached, either party may request interest arbitration. These new residential provisions are automatically repealed on April 30, 2002.

Agreements to abandon bargaining rights (s. 160.1): Bill 69 allows an employee bargaining agency to agree with an employer to abandon bargaining rights in the construction industry.

Re-opening provincial agreements -local modifications in the ICI sector (ss. 163.2-.4): The Bill permits an employer bargaining agency or a "designated regional employers’ organization" (DREO) to seek, from a Local Union, certain amendments to a provincial agreement. The permitted amendments can be to:

wages, including overtime pay and shift differentials and benefits;

restrictions on the hiring of employees who are members of another affiliated bargaining agent that is in the same employee bargaining agency as that in which the affiliated bargaining agent is a member but who are not members of the EBA;

restrictions on an employer’s ability to select employees who are members of the affiliated bargaining agent;

accommodation and travel allowances;

- the ratio of apprentices to journeymen employed by an employer.

The Bill anticipates that, if the parties agree, the amendments must be approved by the provincial bargaining agencies. However, if the parties cannot agree, the employer bargaining agency or DREO may request arbitration by final offer selection. The test at FOS arbitration is whether the provisions of the provincial agreement render the employers who are bound by it at a "competitive disadvantage" with respect to the kind of work, the market and the location indicated in the application.

Changes to mobility rights and name-hires (s. 163.5): Certain "default provisions" for hiring are deemed to be included in provincial agreements in the ICI sector, allowing an employer to transfer up to 40% of the total number of required employees to a project located in a distant geographic area and, in addition, to name hire up to 60% of its workforce from the local union in the area where the project is located.

The Minister of Labour is required to conduct a review of the effectiveness of the provisions of the Bill by no later than December 31, 2001.

Comment

Bill 69 proposes extensive amendments to the Act and should be reviewed for its full details. It gives substantial control to employers to force local modifications in province-wide agreements, makes substantial intrusions into union hiring hall provisions, and imposes new limits and interest arbitration in the residential sector.

Report submitted by Alan Minsky of the law firm Koskie Minsky in Toronto, Ontario.

8. Grievance procedure cannot be used to relitigate criminal conviction

In the previous CALL Newsletter, reference was made to a decision of Arbitrator Doug Stanley rendered in December 1998 which allowed the discharge grievance of a member of CUPE 79 at the City of Toronto who had been convicted of sexually assaulting a client. The arbitrator ruled that the conviction in and of itself did not constitute just cause for discharge and that the Union had called sufficient evidence to rebut the prima facie evidence of misconduct arising from the conviction.

In similar decisions by the Crown Employees Grievance Settlement Board, arbitrators concluded that criminal convictions did not constitute absolute or conclusive evidence of misconduct and that neither the grievor nor the Ontario Public Service Employees Union were barred by the doctrines of issue estoppel or abuse of process from contesting the prima facie evidence arising from the convictions. In one case, Arbitrator Nimal Dissanayake heard the merits of the grievance, concluded that the presumed fact of misconduct arising from the conviction had been rebutted, and allowed the grivance in its entirety. In the other case, Arbitrator Owen Gray, in two interim decisions, indicated that he was prepared to hear the evidence which the union and the grievor sought to

tender in rebuttal.

The employers in all three cases sought judicial review. In a decision released on May 5, 2000, a unanimous panel of the Divisional Court allowed the applications and quashed the arbitrators’ decisions in their entirety. The Divisional Court’s decision is of obvious interest to anyone interested in the relationship between criminal and arbitral proceedings. Both CUPE 79 and OPSEU are now seeking leave of the Court of Appeal to appeal the decision of the Divisional Court.

This area of the law will be reviewed, together with other topics of interest, in the workshop entitled "Crime and Punishment" scheduled to be held at the upcoming CALL Conference in Halifax.

Report submitted by Craig Flood of the law firm Koskie Minsky in Toronto, Ontario.

Saskatchewan

1. Report of Saskatchewan Labour Law

During this past year, there have been a few labour matters of special note.

In CAW – Canada v. Saskatchewan Indian Gaming Authority, the Saskatchewan Labour Board ruled that the First Nations casinos in the province are subject to provincial labour laws. The Labour Board relied heavily upon the Supreme Court of Canada’s decision in Four B Manufacturing to support its reasoning that, even though the Band Councils are the beneficiaries of gaming proceeds, the labour relations component of the casinos follows the provincial government’s ability to regulate gambling in the province. This decision has since been upheld by the Saskatchewan Court of Queen’s Bench and is on its way to the Court of Appeal. In the meantime, bargaining has proceeded at a snail’s pace given the employer’s refusal to recognize its statutory obligation to bargain in good faith. Behind the scenes, it also comes as no surprise to report the existence of a management-dominated employee association just waiting for the first open period to decertify the union. But so far, we are confident the original supporters of the union will prevail — if necessary, with the assistance of first contract arbitration.

There has also been a fair amount of controversy in the construction industry. This spring, the NDP Government announced that it is planning to amend The Construction Industry Labour Relations Act to prohibit double-breasting for companies in existence

prior to 1992. Further, the Act will be amended to ensure that employers’ associations participating in collective bargaining under the Act are not dominated by non-union spin-off companies. In return, the government has stated that it will scrap its Crown Corporation Tendering Agreement.

Finally, the Supreme Court of Canada has refused to grant leave to three different employers who challenged the applicability of provincial statutory procedures in unionized workplaces. In Dominion Bridge, Cadillac Fairview, and Prince Albert Health District, employers challenged the right of unionized employees to access dispute resolution procedures under The Labour Standards Act, The Human Rights Code, and The Occupational Health and Safety Act respectively. Relying upon Weber and O’Leary, the Court of Queen’s Bench ruled that unionized employees were required to pursue these matters strictly through the grievance and arbitration procedures contained in their respective collective agreements. However, on a split decision, the Court of Appeal overturned these decisions and ruled that the statutory framework applied equally to all employees in Saskatchewan. Accordingly, unionized employees now have a choice to pursue their complaints either through a grievance or through the various statutory regimes relating to their complaints.

Report submitted by Rick Engel of the law firm Gerrand Rath in Regina, Saskatchewan.

Federal Jurisdiction

1. Exclusion of RCMP from collective bargaining regime does not violate Charter

2. Minimum age requirements for CPP survivor’s benefits are constitutional

3. PSAC wins 15-year pay equity fight

4. Adjudicator appointed under PSSRA does not have jurisdiction to decide human rights dispute

1. Exclusion of RCMP from collective bargaining regime does not violateCharter

Delisle v. Canada (Attorney General), Supreme Court of Canada, September 2, 1999, reported in the November/December 1999 issue of Lancaster’s Labour Law News.

The exclusion of RCMP officers from the collective bargaining regime under the Public Service Staff Relations Act does not violate the officers’ right to freedom of association under s.2(d) of the Charter, the Supreme Court of Canada has ruled, since freedom of association does not include the right to engage in collective bargaining.

In 1985, RCMP members in Quebec formed an informal association to represent their job-related interests. In 1987, frustrated by the RCMP’s refusal to recognize the officers’ association for the purposes of collective bargaining, Association President Gaetan Delisle applied to Quebec’s Superior Court for an order declaring that s.2(1) of the Public Service Staff Relations Act and s.6 of theCanada Labour Code, which excluded RCMP officers from the public service collective bargaining regime, infringed the officers’ rights to freedom of association, freedom of speech, and equality under the law.

Judge Pierre Michaud held that the exclusion did not infringe their right to freedom of association. An appeal to the Quebec Court of Appeal was dismissed on the basis that a 1990 decision of the Supreme Court of Canada had clearly established that the right to engage in collective bargaining was not protected by the freedom of association in s.2(d) of the Charter. Undaunted, Delisle appealed to the Supreme Court of Canada.

Judge Michel Bastarache, writing for a 5-2 majority of the Supreme Court, held that the exclusion of the RCMP from the collective bargaining regime set out in the Public Service Staff Relations Act did not violate the officers’ rights to freedom of association and expression under s.2(d) and (b) of the Charter, and did not deny them the right to equality before the law guaranteed by s.15(1).

Freedom of association defined

Judge Bastarache held that the outcome in this case was largely determined by previous decisions of the Supreme Court which have defined the concept of freedom of association under s.2(d) of the Charter to protect only the establishment of an independent employee association and the association’s exercise of the lawful rights of its members. The Court has made it clear that s.2(d) does not protect an activity just because it is a foundational or essential purpose of an association: see Canadian Egg Marketing Agency v. Richardson, [1998] 3 S.C.R. 157.

The question for the Court, therefore, was whether the exclusion of RCMP officers from the PSSRA regime prevented them from forming an association or exercising their rights as a group.

"In my view," Judge Bastarche stated, "the purpose of the exclusion of RCMP members is simply not to grant them any status under the PSSRA — trade union representation and all it entails — which does not violate the appellant’s freedom of association." According to Judge Bastarache, this did not mean, however, that an association that did not come under the PSSRA could not exist or enjoy analogous protection directly under s.2(d) of the Charter. If RCMP management used unfair labour practices to interfere with the creation of an officers’ association, or if internal regulations of the RCMP had such a purpose or effect, the judge remarked, any affected individual could challenge these practices by relying on s.2(d) of the Charter directly.

However, the judge ruled, the RCMP was not obliged to set up mechanisms for negotiating working conditions or for grievance arbitration. All that freedom of association implied was that the existing mechanisms should be as open to independent employee associations as to individual RCMP members. The RCMP was not obliged to grant official recognition to independent employee associations for the purposes of collective bargaining, he ruled.

No infringement of freedom of expression

Turning to the question of the officers’ right to freedom of expression, Judge Bastarache concluded that the officers’ message of solidarity was not dependent upon the association’s status as a recognized trade union. Even if the effectiveness of the expression was undermined by the officers’ exclusion from the PSSRA’s collective bargaining regime, this did not amount to a violation of their freedom of expression, Bastarache ruled.

No violation of equality rights

In this case, Judge Bastarache held, Delisle had not established that the professional status of RCMP officers was an analogous ground to those listed in s.15(1). In the first place, the officers’ employment was not an immutable characteristic but a career choice. A distinction made on the basis of an individual’s employment was not, in the judge’s view, likely to lead to discrimination and the denial of equality. In the second place, Delisle had failed to demonstrate that RCMP police officers were a historically disadvantaged group. To the contrary, Judge Bastarache noted, the evidence indicated that police officers in Canada were generally held in high regard.

In the circumstances, Judge Bastarache concluded, Delisle had not discharged his burden of showing that the distinction created by s.2(e) of the PSSRA was discriminatory within the meaning of s.15(1) of the Charter.

2. Minimum age requirements for CPP survivor’s benefits are constitutional

Law v. Canada (Minister of Employment), Supreme Court of Canada, March 25, 1999, reported in the July/August 1999 issue of Lancaster’s Human Rights and Charter Law Reporter.

The Supreme Court of Canada has held that the denial of CPP survivor’s benefits to claimants who are able-bodied, under 35 and without dependent children does not violate s.15(1) of the Charter of Rights and Freedoms. The differential treatment of young widows and widowers is not discriminatory because it does not violate human dignity.

Nancy Law of Courtenay, B.C., was only 30 years old when her husband of 11 years, Jason, died of a brain aneurysm in 1991. Jason was 50 years old when he died, and had contributed to the Canada Pension Plan for 22 years. Prior to his death, the couple co-owned a small business, which failed soon after Jason’s death.

Law’s application to receive CPP survivor’s benefits was refused because she was under 35 years of age, was not disabled, and did not have dependent children. She was informed that she would not be entitled to collect CPP benefits until she turned 65. Under section 44 of the Canada Pension Plan, benefits are granted to surviving spouses over the age of 35 immediately following the death of the contributor. However, these benefits are not available to able-bodied spouses without dependent children who are less than 35 years of age at the time of the death of the contributor, until they reach age 65, unless they become disabled in the interim. Moreover, pursuant to s.58, those over 45 are entitled to receive benefits at the full rate, but those between 35 and 45 receive only partial benefits.

Law appealed the rejection of her claim to the Minister of National Health and Welfare, the Pension Plan Review Tribunal, the Pension Appeals Board and the Federal Court of Appeal, without success. Throughout this process, she argued that the age distinctions set out in ss.44(1)(d) and 58 of the CPP discriminated against her on the basis of age, contrary to the guarantee of equality in s.15(1) of the Charter of Rights and Freedoms. Finally, Law appealed to the Supreme Court of Canada.

The Supreme Court unanimously dismissed the appeal, ruling that the law was not discriminatory because it did not demean the dignity of adults under the age of 45.

Approach to analyzing s.15(1) claims outlined

While noting past differences of opinion among members of the Court, Judge Frank Iacobucci observed that a consensus had been reached on certain guidelines in the application of s.15(1) of the Charter. These guidelines, which assist in identifying and evaluating relevant factors in claims of discrimination, involve the posing of three questions: First, does the impugned law treat the complainant differently than other people? Second, is the differential treatment based on a prohibited ground of discrimination? Third, does the differential treatment involve stereotyping, prejudice or historical disadvantage.

In the Court’s view, the purpose of s.15(1) is to prevent the violation of essential human dignity and to promote a society in which all Canadians enjoy equal recognition at law as human beings. He held that legislation will violate the purpose of this section if it imposes differential treatment on people on the basis of one of the prohibited grounds of discrimination, and the treatment is based on stereotypical assumptions. Differential treatment is not likely to be discriminatory unless it violates human dignity in this way.

Factors to be considered

Judge Iacobucci identified four contextual factors that may be used to determine whether legislation has the effect of demeaning dignity, stressing that these factors are not exhaustive, and that not all four will necessarily be relevant in every case.

(i) "Pre-existing disadvantage." The Court has consistently held that the most compelling factor favouring a conclusion that differential treatment imposed by legislation is truly discriminatory is pre-existing disadvantage, vulnerability, stereotyping, or prejudice experienced by an individual or group. Justice Iacobucci stressed that there is no presumption that differential treatment of historically disadvantaged persons is discriminatory, but he acknowledged that, if a claimant can demonstrate that a legislative provision has the effect of perpetuating or promoting the view that the individual is worthy of less recognition than another person, this will suffice to establish an infringement of s.15(1).

(ii) The relationship between the ground or grounds on which the claim is based and the claimant’s characteristics or circumstances. The mere fact that legislation takes into account the actual situation of persons like the claimant will not necessarily be sufficient to defeat a s.15(1) claim, but it will make it more likely that it does not have a negative effect on human dignity.

(iii) The effect of the impugned law upon a disadvantaged person or group in society. One of the purposes of s.15 is to better the position of disadvantaged groups. Thus, an ameliorative purpose or effect which accords with this purpose will not likely violate the human dignity of individuals.

(iv) The nature of the interest affected. Relying on Judge Claire L’Heureux-Dubé’s judgment in Egan v. Canada, [1995] 2 S.C.R. 513, Judge Iacobucci held that the more "severe and localized" the consequences of legislation or actions on an affected group, the more likely that the distinction responsible for these consequences is discriminatory within the meaning of s.15(1) of the Charter.

Judge Iacobucci summed up the Court’s approach to analyzing discrimination claims by stating that s.15(1) is breached when a reasonable person in circumstances similar to the claimant’s considers all the relevant contextual factors and concludes that the differential legislative treatment demeans his or her dignity.

CPP distinction not discriminatory

Judge Iacobucci held that, as a result of the ages specified under the CPP, the government had drawn a clear distinction between claimants over and under the age of 35. In his view, both the delay in the receipt of benefits and the reduced entitlement to benefits constituted a denial of equal benefit of the law. Thus, the first criterion of the equality analysis was satisfied. Since the differential treatment was clearly based on age, a prohibited ground of discrimination, the second criterion was also met.

The central issue in the case was whether the age distinction drawn by ss.44(1)(d) and 58 of the CPP imposed a disadvantage on Law as a younger adult in a manner which constituted discrimination under s.15(1). According to the approach set out by the Court, this involved deciding whether the provisions, in purpose or effect, violated essential human dignity through the imposition of disadvantage, stereotyping, or political or social prejudice.

The Court unanimously held that neither the purpose nor the effect of the provisions violated Law’s dignity so as to constitute discrimination. Judge Iacobucci acknowledged that surviving spouses of all ages are a vulnerable group immediately following the death of a spouse. However, he held that the purpose of the CPP provisions was not to remedy the immediate financial needs faced by widows, but to enable older widows to meet basic needs in the long term. He took judicial notice of the fact that young people experience fewer impediments to long-term participation in the labour force and that they are in a better position than older persons to replace the income of a deceased spouse.

Judge Iacobucci also ruled that the provisions were not discriminatory because the group they affected, younger adults, had not been traditionally discriminated against, and because the provisions did not stereotype or devalue younger adults. The impugned provisions, he found, corresponded with the actual situations of the people they affected.

The clear ameliorative purpose of the pension scheme for older surviving spouses was another factor supporting the view that the provisions did not violate essential human dignity, Justice Iacobucci held. He noted that Parliament’s intention in enacting a survivor’s pension scheme with benefits allocated according to age was to allocate funds to those people whose ability to pay was weakest. This intention was in keeping with the purpose of s.15(1), and simply reflected the fact that younger adults are better able to overcome long-term need than older adults because of the nature of the human life cycle.

In the end, Justice Iacobucci concluded, a reasonable younger adult person, who took into account the contextual factors relevant to the claim, would determine that the legislation did not demean the dignity of those it affected and was not discriminatory. Accordingly, he ruled, the impugned legislation did not violate s.15(1) of the Charter.

3. PSAC wins 15-year equity fight

Canada v. PSAC, Federal Court of Appeal, October 19, 1999, reported in the September/October 1999 issue of Lancaster’s Public Service and Crown Agency Employment Law News.

Fifteen years after the Public Service Alliance of Canada filed its first wage discrimination complaint on behalf of federal public service employees in female-dominated job categories, the Federal Court of Canada has upheld the decision of the Canadian Human Rights Tribunal ordering the government to pay almost 200,000 current and former employees an estimated 4 to 5 billion dollars in back wages.

In the late 1980s, the federal government invited all public service unions to take part in a Joint Union Management Initiative (JUMI) Study to assess pay discrimination in the federal public service. The Study’s results indicated that there was a wide disparity between the wages of male and female workers. However, the Joint Initiative proceedings broke down in 1989 after the government disputed the results of the job evaluation study, and PSAC withdrew permanently from the Initiative. The breakdown occurred before the JUMI Committee could devise and implement a system-wide method to eliminate the disparity.

In 1990, PSAC filed a complaint with the Human Rights Commission on behalf of the six female-dominated occupational groups surveyed in the JUMI Study. The Commission conducted an investigation and decided in October 1990 to refer both an earlier 1984 complaint and the 1990 complaint to a Tribunal. The fundamental question for the Tribunal to decide was whether the union had established a case of discrimination contrary to s.11 of the Canadian Human Rights Act. The Tribunal issued its rulings in two phases, both dealing with the issue of discrimination.

In the Phase 1 ruling, the Tribunal held that the job evaluation results of the JUMI Study were a reliable assessment of the value of the work of the male and female-dominated job categories.

In the second phase, which involved the assessment of the size of the wage gap, all the parties agreed that, in order to determine the wage gap, it was necessary to use a wage adjustment methodology. However, each of the three parties, the union, the Commission and the Treasury Board, proposed different wage adjustment methodologies. Each of the proposed methodologies resulted in a different cost of equalizing the wages between male and female-dominated job categories in the public service.

In a unanimous decision, the Canadian Human Rights Tribunal concluded that the wage discrepancy between male and female-dominated jobs should be determined using the level-to-segment methodology, as proposed by the Commission. This approach groups female-dominated jobs together by occupational level and then selects data from the deemed male-dominated group that has "on average" the same point values as the occupational group of the female complainants, thereby achieving an "on-average" fairness in pay in keeping with s.11 of the Act. The point values were those determined by JUMI based on skill, effort, responsibility and working conditions. The government had argued in favour of a "central tendency" methodology, which focuses largely on lower-paid male-dominated comparator groups when assessing the wage gap between male-dominated and female-dominated groups.

In the result, the Tribunal upheld the complaints of sex-based wage discrimination and ordered the government to adjust wages and reimburse all members of the six complainant female-dominated occupational groups, retroactive to 1985. The government appealed to the Federal Court of Canada.

Method of calculating wage gap approved

The government argued that the Tribunal had erred when it accepted the method recommended by the Commission to determine the wage gap, but the Court disagreed. First, Judge Evans noted, the level-to-segment method performs exactly the sort of comparison which the Human Rights Act requires. As well, the Act gives no specific direction as to how wage inequities are to be identified, quantified, or eliminated. In the absence of such direction, Judge Evans stated, the government’s approach to evaluating methodologies was far too restrictive. The Tribunal must be allowed some latitude in doing its work, the Court held.

In addition, the method recommended by the government used a narrow range of evidence, drawn from the JUMI study. In pursuing the goal of examining and eliminating a systemic problem, reliance on a much broader base of information was preferable, Judge Evans observed, and the Commission’s method provided exactly that advantage.

Finally, in Judge Evans’ view, the weight of the expert evidence heard by the Tribunal indicated that the Commission’s method was far preferable to the one recommended by the government. If the Tribunal’s selection process was discretionary, it was clearly a reasonable exercise of that discretion.

"Causation" argument rejected

The government also attacked the method of calculation from another angle. It argued that any difference between the wage of the lowest-paying male-dominated occupation and other male-dominated occupations could not be accounted for by gender since all the positions were principally held by men. For this reason, the wages of occupations dominated by women should be compared only with the lowest-paid male-dominated occupations. To extend the comparison any further would necessarily take into account wage differences that were unrelated to gender bias, and that were likely accounted for by superior bargaining power or greater market demand. Section 11, the government argued, provides protection against discrimination based only on gender. Thus, s.14 of the Equal Wages Guidelines, which required that multiple male-dominated occupations used in the collection and assessment of data be grouped together, was ultra vires, since it would include wage differences unrelated to gender, and the level-to-segment method of calculation would similarly be illegitimate.

The Court rejected this argument on a number of grounds. First, s.11 does not specify that a wage difference is prohibited only if it is based on gender; it prohibits, without any qualification, wage differences between men and women who perform work of equal value. Second, Judge Evans noted that s.7(2) of the Act granted the Commission a very broad discretion to issue guidelines, and in such a situation a guideline would have to be clearly incompatible with the purposes of the Act for a court to interfere. The Court concluded that s.14 of theEqual Wages Guidelines fell within that broad discretion.

As well, the Court noted that other provisions in the Act clearly indicated that the wage discrimination addressed by s.11(1) was not limited to wage gaps attributable to sex. Finally, Judge Evans emphasized that systemic discrimination is often difficult to prove, and may be obscured by a host of socially approved rationalizations. Section 11(1) has dealt with this difficulty by creating a presumption that a discriminatory result arises from a wage gap between men and women performing work of equal value, subject only to rebuttal based on a justification approved by the Commission and contained in its Guidelines.

In the result, the Court upheld the Tribunal’s decision.

4. Adjudicator appointed under PSSRA does not have jurisdiction to decide human rights dispute

Mohammed v. Canada (Treasury Board); Canada (Treasury Board) v. Boutilier; O’Hagen and others v. Canada (Treasury Board), Federal Court of Appeal, December 2, 1999, reported in the January/February 2000 issue of Lancaster’sPublic Service and Crown Agency Employment Law News.

An adjudicator appointed under the federal Public Service Staff Relations Actdoes not have jurisdiction to decide a grievance relating to human rights, the Federal Court of Appeal has ruled.

Three public service employees governed by the federal Public Service Staff Relations Act filed grievances alleging that they had been discriminated against contrary to the human rights provisions in their respective collective agreements. In two cases, the adjudicators appointed under the PSSRA decided that they lacked jurisdiction under s.91(1) to hear the grievances because the Canadian Human Rights Act set out an administrative procedure for redress. Section 91(1) of the PSSRA provides that an employee who is aggrieved by the interpretation or application of a collective agreement or statutory provision relating to the terms and conditions of his or her employment, may file a grievance only if there is no other administrative procedure for redress provided by legislation.

The Trial Division of the Federal Court agreed with the adjudicators and dismissed the employees’ respective applications for judicial review.

In the third case, the employee succeeded at adjudication. The employer applied to the Federal Court for judicial review of the adjudicator’s decision and argued that, under s.91(1) of the PSSRA, the employee was required to take his complaint to the Canadian Human Rights Commission. The Trial Division of the Federal Court agreed and quashed the adjudicator’s decision.

The appeals from the three decisions of the Federal Court were heard together.

In a unanimous ruling, the Federal Court of Appeal dismissed the appeals. In its view, Parliament chose, by virtue of s.91(1) of the PSSRA, to deprive an aggrieved employee of the right to present a grievance in circumstances where another statutory administrative procedure for redress was available. In this respect, the Court noted, the PSSRA is different from most labour relations legislation across Canada, which make arbitration the exclusive remedy for disputes arising from the interpretation or application of a collective agreement.

Furthermore, the Court ruled, while the complaint must be essentially the same in the other "procedure for redress" as it would be under the grievance procedure, the remedies available under the two systems need not be identical. "It need not be an equivalent or better remedy as long as it deals ‘meaningfully and effectively with the substance of the employee’s grievance.’" Thus, although the human rights procedure does not involve the same parties and is subject to considerable delay, those circumstances alone do not mean that it is not "another administrative procedure for redress" within the meaning of s.91(1) of the PSSRA, the Court concluded.

The Court determined that, in each of the three cases, the substance of the grievance involved a complaint of a discriminatory practice in the context of a collective agreement. Since primary jurisdiction in human rights matters was meant to reside with the Canadian Human Rights Commission, its procedures must apply, the Court held.

However, the Court rejected the suggestion that its interpretation of s.91(1) would prevent unions from bargaining for rights beyond the scope of the Human Rights Act. A grievor could go to arbitration as long as no remedy was available at the Human Rights Commission to vindicate these new rights, the Court ruled. Moreover, s.91(1) does not preclude the possibility of proceeding by way of arbitration in some cases. The Human Rights Commission may exercise its discretion under s.41 of the Human Rights Act to refer the matter back to arbitration until the grievance procedure is exhausted.

Any other interpretation of the words in s.91(1) would make the provision meaningless or twisted beyond recognition, the Court concluded.

The Court also took note of the fact that the

governing Master Agreement signed by the representatives of the parties involved in the appeals — namely, the Public Service Alliance of Canada and the Treasury Board — included a provision that used language very similar to that of s.91(1). The provision denied access to the grievance procedure "where there is another administrative procedure provided by or under any Act of Parliament to deal with the employee’s specific complaint." In the circumstances, the Court held, it could not be said that the statutory bar in s.91(1) was imposed unilaterally on the appellants, since it was agreed to by their representatives in their collective agreement.

In the result, the Court concluded that the language of s.91(1) and the weight of previous authorities dictated that the appeals must be dismissed.

Report submitted by Lancaster House Publishing in Toronto, Ontario.

Wrongful Dismissal

1. Senior civil servants may sue for wrongful dismissal if their jobs are eliminated

2. Non-renewal of a fixed-term contract does not constitute dismissal

3. Court certifies class action in wrongful dismissal action

4. $1.7 million award for constructive dismissal upheld

5. Notice provision that specifically incorporated another province’s statutory requirements ruled enforceable

1. Senior civil servants may sue for wrongful dismissal if their jobs are eliminated

Wells v. Newfoundland, Supreme Court of Canada, September 15, 1999, reported in the September/October 1999 issue of Lancaster’s Wrongful Dismissal Employment Law News.

The Supreme Court of Canada has ruled that, while the Crown is free to legislate away an appointed office, non-unionized senior civil servants who lose their jobs as a result can sue for wrongful dismissal, unless legislation specifically prevents them from doing so.

Andrew Wells was appointed as a commissioner of the Newfoundland Public Utilities Board under the province’s Public Utilities Act, and was entitled to hold office during good behaviour until the age of 70. A new Public Utilities Act was passed which restructured the Board, reducing the number of commissioners and abolishing Wells’ position. Having served for four and a half years, Wells was six months short of the time required for his pension to vest. He was not reappointed to the new Board and did not receive any compensation. Wells decided to sue for wrongful dismissal.

The Newfoundland Supreme Court dismissed Wells’ action, holding that government appointees whose positions are abolished by statute have no right to compensation unless such compensation is provided for in the abolishing legislation.

A majority of the Newfoundland Court of Appeal allowed Wells’ appeal. The Court of Appeal recognized that the Legislature has the power to reorganize the civil service as it sees fit, including the elimination of offices such as the one held by Wells. However, the Court observed, there was a distinction between the right to eliminate a job and the right to do so without compensating a displaced employee.

Writing for a unanimous Supreme Court of Canada, Judge John Major dismissed the government’s appeal and upheld the decision of the Court of Appeal. According to the Court, the fundamental elements of Wells’ appointment were that he was entitled to serve until he was 70 years old, and that he was subject to a good behaviour requirement. This plainly meant that the government could not terminate Wells’ employment unless he did something which rendered him unfit to continue serving as a commissioner.

The Court rejected the government’s argument that Wells’ employment arose purely by operation of statute, and that he was therefore restricted to administrative law remedies. Rather, the Court held, his position was created by a contractual relationship. The Court commented that the common law viewed mutually agreed employment relationships through the lens of contract, which was undeniably the way virtually everyone dealing with the Crown saw it. "While the terms and conditions of the contract may be dictated, in whole or in part, by statute, the employment relationship remains a contract in substance and the general law of contract will apply unless specifically superceded by explicit terms in the statute or the agreement," the Court held.

Since no misbehaviour was alleged against Wells, his termination constituted a breach of his contract and entitled him to damages. In the private sector these principles would apply without question, and the Court held that the fact that he worked for the government should not change the nature of Wells’ employment relationship, or the remedies available to him.

The government breached its ongoing obligations to Wells when it cut off his remuneration, the Court held. Since his right to seek damages for that breach was not taken from him by legislation, he was entitled to compensation. There was no question that the government had the authority to restructure or eliminate the Board, the Court declared. "There is a crucial distinction, however, between the Crown legislatively avoiding a contract, and altogether escaping the legal consequences of doing so. While the legislature may have the extraordinary power of passing a law to specifically deny compensation to an aggrieved individual with whom it has broken an agreement, clear and explicit statutory language would be required to extinguish existing rights previously conferred on that party."

The Court noted that some offices were exceptions to this rule, including those held by judges, ministers, and others who "fulfil constitutionally defined state roles." The terms of employment for these exceptional forms of employment were constitutionally defined rather than negotiated, and could not be altered, even by agreement. Wells’ position was not one of these exceptional offices, however.

In the result, an award of two and a half years salary was approved, plus additional pension benefits.

2. Non-renewal of a fixed-term contract does not constitute dismissal

Chambly v. Gagnon, Supreme Court of Canada, January 25, 1999, reported in the May/June 1999 issue of Lancaster’s Wrongful Dismissal Employment Law News.

The Supreme Court of Canada has ruled that, if an employee is hired pursuant to a fixed-term contract and the employer decides not to renew the contract on expiry of the term, the employee has not been dismissed.

When the municipal council of Chambly, Quebec, decided not to renew the contract of the City’s Police Chief, Fernand Gagnon, Gagnon claimed that he had been wrongfully dismissed. In the Council’s view, however, it had not dismissed him: it had merely followed the terms of its contract with Gagnon by letting it expire. The City had hired Gagnon in June, 1989, and the parties had signed an agreement stating that the contract of employment was for a period not exceeding five years. There was no renewal provision.

Section 79 of Quebec’s Police Act provided that police chiefs who were dismissed by a municipal council could appeal the council’s decision to the Court of Quebec. Gagnon did so. In response, the City applied to the Court of Quebec to dismiss the action on the ground that the Chief had not been "dismissed" and that the Court, therefore, had no jurisdiction to hear the case.

The Court ruled in Gagnon’s favour, holding that s.79 of the Act was meant to be remedial and that a liberal interpretation of the word "dismissal" was in order. The Court ordered the City to reinstate Gagnon. The City applied to the Quebec Superior Court for a review of this decision, arguing that "dismissal" meant firing an employee for disciplinary reasons, and did not include simply not entering into a new contract. Gagnon responded that, interpreted in a large and liberal fashion, "dismissal" encompassed all situations where, because of the City’s intervention, the Chief of Police ceased employment.

The Superior Court granted the City’s application for review of the Court of Quebec’s decision, ruling that the lower court was not entitled to interfere with the City’s decision not to renew the employment contract because Gagnon had not been dismissed.

Judge John Bishop of the Quebec Superior Court reviewed numerous dictionary definitions of the words "dismiss" and "dismissal," and concluded that, based on these definitions, Gagnon had not been dismissed by the City. He also considered previous decisions that had interpreted the words "dismiss" and "dismissal," and decided that the jurisprudence established three principles of law. First, a dismissal includes both an act by an employer which deprives an employee of his job and a sanction imposed as a disciplinary measure. Second, in the absence of an automatic renewal clause or a tacit renewal, the expiration of a fixed-term contract ends the employment. Third, the non-renewal of such a contract is not the same as dismissal, although this principle does not apply if the evidence proves that the non-renewal was really a dismissal in disguise.

In applying these principles to the present case, Judge Bishop concluded that the City had not committed any act that deprived Gagnon of his job. Rather, his job ceased because of the contract’s expiry. He also held that the non-renewal of Gagnon’s contract was not a disciplinary sanction or a dismissal in disguise. Accordingly, the Court held, the City had not dismissed Gagnon.

On appeal, the Quebec Court of Appeal quashed the judgment of the Superior Court, agreeing with the Court of Quebec that the term "dismissed" should be given a liberal interpretation. The City appealed to the Supreme Court of Canada.

The Supreme Court unanimously allowed the appeal and restored the Superior Court’s judgment. Speaking for the Court, Judge Charles Gonthier said that he agreed with the reasoning of Judge Bishop of the Superior Court, particularly as to the meaning of the word "dismissal." In this case, Gonthier declared, there had been no dismissal since the City did not carry out any act which deprived Gagnon of his office. His post ended because of the expiry of the fixed term set out in his employment contract without a new contract being made.

3. Court certifies class action in wrongful dismissal action

Webb v. K-Mart, Ontario Superior Court, June 14, 1999, reported in the July/August 1999 issue of Lancaster’s Wrongful Dismissal Employment Law News.

The Ontario Superior Court certified a class action brought by 4,000 employees who were laid off when the Hudson’s Bay Company bought K-Mart Canada. In addition, the Court ruled that members of the class had been wrongfully dismissed.

Karen Webb had worked part-time for 18 ½ years at K-Mart in Windsor, Ontario, when the Hudson’s Bay Company bought and merged the K-Mart chain with Zellers and the Bay chains. As in the case of some 6,000 other employees across Canada in similar situations, Webb’s employment was terminated as a result of the merger. The employer gave Webb 12 weeks’ written notice of termination, plus an additional payment of 23 weeks’ severance pay. Rather than seek employment elsewhere, Webb started her own business.

Webb and some of her co-workers decided to sue for wrongful dismissal. She sought certification of the lawsuit as a class action and a declaration that the class members had been wrongfully dismissed. While acknowledging that the company had met its minimum obligations under the Employment Standards Act, Webb, the group’s representative plaintiff, sought damages equal to one month’s pay per year of service.

Judge John Brockenshire granted Webb’s motion and certified the dismissed employees as a national class, ruling that they were dismissed without cause. The Court ordered that the issue of compensatory damages, if any, be determined on an individual basis.

Judge Brockenshire noted that the Ontario Class Proceedings Act allows certification where there is a cause of action, an identifiable class, common issues, an appropriate representative plaintiff, and where a class proceeding would be the preferable procedure.

In considering whether there was an identifiable class, Judge Brockenshire noted that the class must be defined in a way that permits later determination as to who is or who is not in the class. In this case, the Court held, the class included all former K-Mart employees, anywhere in Canada, except British Columbia and Quebec, whose employment was terminated without cause on or after the date the merger was announced. Furthermore, the Court decided, there were common issues linking the class members, namely, whether the class members’ contracts of employment required the company to provide reasonable notice of termination if dismissed without cause, and whether the class members were so dismissed.

The Court concluded that Webb was a suitable representative plaintiff, as she had been actively involved in the action since its inception. However, it noted that Webb’s position might differ from that of other class members because she had pursued self-employment, and therefore, it suggested that other representative plaintiffs be added.

While acknowledging that the pursuit of separate claims by each employee would be more equitable, the judge observed that it was likely that many employees would not pursue separate actions and that individual actions would result in the employer being insulated from any independent review of its decision. Consequently, he held that a class proceeding would give the best and perhaps only opportunity for the employees to show that the company did not pay as much as it should.

Finally, the Court certified the class as a national class, excluding British Columbia and Quebec, where proceedings by way of class action are also available. Here, a single decision, made by a corporation carrying on business across the country, had adversely affected employees nation-wide. The fact that there was no comparable class action legislation elsewhere in Canada, except B.C. and Quebec, and that potential class members could opt out of the class action, Judge Brockenshire concluded, outweighed concerns about extra-territorial involvement of the Ontario courts.

While not disputing that members of the proposed class were dismissed without cause, the company contended that it had no liability because it had given the employees sufficient notice and compensation, including more severance pay than required under Ontario’s Employment Standards Act. However, this argument was rejected. Courts have traditionally been more generous, commonly awarding approximately one month’s salary for every year worked. Since the employer did not dispute that the dismissal was without cause, the Court declared that the class members were so dismissed and were entitled to reasonable notice of termination and/or pay in lieu of notice.

Ed. note: Hudson’s Bay motion for leave to appeal this decision was dismissed on September 13, 1999.

4. $1.7 million award for constructive dismissal upheld

Schumacher v. Toronto-Dominion Bank, Ontario Court of Appeal, May 19, 1999, reported in the May/June 1999 issue of Lancaster’s Wrongful Dismissal Employment Law News.

As Senior Vice-President, Treasury Trading and Risk Management, John Schumacher, who had worked for the Toronto-Dominion Bank for eleven years, had complete responsibility for worldwide trading and risk management. He oversaw all trading in five areas: derivatives, fixed income, money market, funding and foreign exchange. Paid a base salary of $200,000 per year, plus a bonus based on "contribution to profit", he earned $1.6 million in 1994.

In January 1995, without consulting Schumacher, the Bank hired a new senior vice-president and assigned him responsibility for trading in fixed income, money market and funding. Schumacher was to retain his responsibilities for foreign exchange and derivatives, which accounted for over 85% of his group’s contribution to profit.

When he learned of the Bank’s decision, Schumacher took the position that he had been constructively dismissed. He offered to continue working pending negotiation of a severance package. The Bank, however, insisted that, unless he accepted the new position unconditionally, he could not return to work. Negotiations proceeded, nonetheless, until the Bank suddenly declared that Schumacher had resigned. He sued for wrongful dismissal, claiming that the unilateral transfer of many of his responsibilities to the new employee constituted constructive dismissal.

At trial, Judge Frances Kitely of the Ontario Court of Justice upheld the claim, ruling that the unilateral changes to Schumacher’s responsibilities constituted repudiation by the employer of the contract of employment. Judge Kitely awarded Schumacher 13 months’ pay in lieu of notice, which amounted to over $1.7 million, one of the largest wrongful dismissal awards ever made in Canada. The Bank appealed. Schumacher cross-appealed the period of notice and the amount of damages.

The Ontario Court of Appeal unanimously dismissed the appeal and cross-appeal, ruling that Schumacher had been constructively dismissed and that the trial judge had not erred in the calculation of the notice period or damages.

Writing for the Court, Chief Justice Roy McMurtry briefly reviewed the law of constructive dismissal, citing the decision of the Supreme Court of Canada inFarber v. Royal Trust Company (1997), 145 D.L.R. (4th) 1. In Farber, the Court ruled that, where an employer unilaterally makes substantial changes to the essential terms of the employment contract, without the employee’s consent, the employee is constructively dismissed, even if the employer is acting in good faith. The test for constructive dismissal is an objective one. The question is whether a reasonable person in the employee’s situation would have felt that the essential terms of the employment contract were being substantially changed.

In the case at hand, the Court noted, the re-alignment of Schumacher’s duties resulted in several significant changes to his job. Schumacher lost control over two of five areas of responsibility, one of which had the greatest growth potential. Important advantages stemming from Schumacher’s leadership in all five areas were lost and a significant project, which had dramatically increased profitability in its first year, was rolled back. In addition, Schumacher stood to lose at least 15% of his bonus.

These facts, the Court held, amply supported the trial judge’s conclusion that Schumacher had been constructively dismissed. The removal of significant parts of Schumacher’s job, without his consent, objectively represented a demotion. The Bank’s failure to consult Schumacher before making these changes was further evidence of its repudiation of his status. In the circumstances, the Court concluded that a reasonable person in Schumacher’s position would have felt that the essential terms of his contract had been substantially changed. In fact, the Court held, Schumacher had been wrongfully dismissed, when, during ongoing discussions, the Bank took the position that he had resigned.

The Bank’s argument that Schumacher failed to mitigate his damages when he refused to continue working in the job was rejected by the Court of Appeal. By insisting that Schumacher accept the new position unconditionally, the Court of Appeal held, the Bank lost the right to complain that Schumacher failed to mitigate his damages.

Turning to Schumacher’s cross-appeal, the Court concluded that the notice period of 13 months was reasonable in the circumstances. Although there was some evidence that, had he continued working at the Bank, Schumacher’s bonus would have been greater than that calculated by the trial judge, the Court found no overriding error in the trial judge’s calculations relative to the notice period.

In the result, the Court dismissed the appeal and cross-appeal, upholding the trial judge’s award of 13 months’ notice and $1.7 million in damages.

Ed. note: The T.D. Bank’s application for leave to appeal to the Supreme Court of Canada was dismissed on January 20, 2000.

5. Notice provision that specifically incorporated another province’s statutory requirements ruled enforceable

Waddell v. Cintas Corp., British Columbia Supreme Court, October 27, 1999, reported in the November/December 1999 issue of Lancaster’s Wrongful Dismissal Employment Law News.

When Bill Waddell was hired as Director of Sales of Cintas Corporation, he was advised that, in the future, he would likely be asked to relocate to Vancouver or elsewhere, in order to assume the position of general manager. After two years of working in Ontario, Waddell was transferred to Vancouver as Director of Sales and Marketing for an acquired company. Waddell excelled in this new position for one year. However, he did not agree to a proposed new compensation package, which Cintas maintained was essential to the viability of the business. Given this impasse, Waddell was dismissed, receiving as his severance package four weeks’ salary, as well as vacation pay.

The employment contract signed by Waddell and Cintas was governed by the laws of Ontario. Specifically, the termination clause stipulated that Cintas could dismiss Waddell at any time by giving him written notice or pay in lieu, as well as severance pay, if any, in accordance with Ontario’s Employment Standards Act. The parties agreed to an absolute minimum notice period of four weeks.

While four weeks’ salary was clearly in line with his employment contract, Waddell sued Cintas for wrongful dismissal, arguing that the termination clause contained in the contract was invalid. Waddell took the position that he was entitled to reasonable notice at common law, which he estimated at 12 months. According to Waddell, his move to British Columbia invalidated his written employment contract for two reasons. First, the contract made no mention of the British Columbia Employment Standards Act and hence, amounted to an illegal attempt to waive B.C.’s minimum provisions. Second, Waddell’s new duties as Director of Sales and Marketing in Vancouver were so significantly different from his original set of responsibilities that the employment contract was no longer applicable.

Judge Selwyn Romilly of the British Columbia Supreme Court dismissed Waddell’s claim. Judge Romilly held that the minimum notice provisions in the B.C.Employment Standards Act had in fact been respected in the employment agreement, and that Waddell’s duties had not changed to such an extent that the contract was no longer applicable.

B.C. Act need not be specifically mentioned in employment contract

According to Judge Romilly, the employment contract’s reference to the OntarioEmployment Standards Act did not amount to a waiver of the minimum requirements contained in the B.C. Act. Judge Romilly noted that the minimum notice provisions under the Ontario Act are no less than those provided for under the B.C. Act. In fact, the Ontario notice period is at all times equal to or greater than its B.C. counterpart. On this basis, the present case could be distinguished from those in which the employment contract could or did conflict with the minimum notice period contained in the provincial statute. In these latter cases, courts have been concerned "with placing the burden on employees for having to calculate the notice period to which they were legally entitled." This concern was not warranted in Waddell’s case, given that his contract specifically incorporated employment standards legislation which was consistent with that of B.C., his new place of residence.

Moreover, relying on the British Columbia Supreme Court’s decision in McCabe v. Simon Fraser Campus Radio Society, [1997] B.C.J. No. 1834 (Q.L.) (B.C.S.C.), Judge Romilly held that it was unnecessary to explicitly incorporate the B.C. Act in order for the employment contract to be enforceable in British Columbia.

The termination clause in the employment contract did not need to be specifically tied to the B.C. Act, as long as the substance of the clause was consistent with the legislation’s minimum standards. Since Judge Romilly had already concluded that B.C.’s minimum standards were not in jeopardy of being violated, Waddell could not rely on the omission of explicit mention of the B.C. Employment Standards Act.

Change in job duties did not cancel original employment contract

Judge Romilly rejected Waddell’s argument that his new position in Vancouver was so different from his original assignment that the employment contract was no longer applicable. In doing so, the judge distinguished several cases in which it was held that, since the employment contract described the specific position the employee was accepting, the foundation of the employment contract ceased to exist once the employee no longer held that position.

In this case, however, Waddell’s contract did not specify that he was to hold the position of District Sales Manager for Southwestern Ontario. In fact, there was evidence that the agreement between the parties contemplated Waddell’s transfer to Vancouver.

Furthermore, there was a lack of evidence to suggest that Waddell’s duties changed significantly upon his transfer to Vancouver. Although Waddell moved to another province, assumed a wider set of managerial duties, and enjoyed an increase in salary and commission, Judge Romilly found that all of these changes were contemplated under the original contract. As a result, the termination clause contained in this original contract was enforceable at the time of Waddell’s dismissal as Director of Sales and Marketing.

In the result, Waddell’s claim for reasonable notice at common law was dismissed.

Report submitted by Lancaster House Publishing in Toronto, Ontario.