LABOUR AND EMPLOYMENT SUMMARY 2012/13
Table of Contents
TUCKER’S INTRODUCTION TO THE WORK OF L&E ......................... 17
Overview and Historical Development ................................................................................. 17
Property and Social Relations of Production .............................................................................................18
Elements of Labour and Employment Law Chart ....................................................................................19
Theoretical Perspectives on Labour and Employment Law Chart.........................................................19
Challenges to Existing CB Regime ..............................................................................................................21
History of Canadian Labour and Employment Law (according to Tucker) .........................................21
Feudalism to Master and Servant Regime (1000-1562) ..............................................................................21
Master and Servant Regime to Liberal Voluntarism (1562-1870) ..............................................................22
Liberal Voluntarism to Industrial Pluralism ...............................................................................................24
Example of Minimum Standards: Development of Occupational Health and Safety Regulations ...26
Collective Bargaining Laws: History ..........................................................................................................27
Criminal Code of Canada s. 425 ..................................................................................................................29
Key Goals of Industrial Pluralism: Collective Bargaining ...........................................................................30
CH 1: ELEMENTS OF THE LEGAL REGIME ............................................ 31
The Elements ............................................................................................................................ 31
The Common Law Contract of Employment ......................................................................... 32
DEFINITIONS ................................................................................................................................................32
APPRENTICESHIPS .....................................................................................................................................33
THE ESSENCE OF THE K OF EMPLOYMENT: K of employment v. other Ks ...................................33
TYPES OF K OF EMPLOYMENT: TERM LENGTH ................................................................................34
WRITING REQUIREMENT .........................................................................................................................34
CAPACITY TO K ...........................................................................................................................................34
PURPOSE OF K .............................................................................................................................................35
REQUIREMENT OF FAIRNESS IN FORMATION OF K........................................................................35
Minimum Standards Legislation ............................................................................................ 35
The Collective Bargaining Scheme ......................................................................................... 35
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The Constitutional Framework ...................................................................................................................35
LABOUR RELATIONS IN THE FEDERAL SPHERE...............................................................................36
COMMUNICATIONS ..........................................................................................................................37
FISHING .................................................................................................................................................38
POSTAL WORK .....................................................................................................................................38
ABORIGINAL PEOPLES ......................................................................................................................38
TRUCKING/TRANSPORT ...................................................................................................................39
TWO TYPES OF PROBLEMS THAT ARISE IN DETERMINING FEDERAL OR PROVINCIAL
JURISDICTION ......................................................................................................................................39
Peace, Order and Good Government .........................................................................................................40
The Framework of Collective Bargaining ..................................................................................................41
Excursus – the Construction Industry ........................................................................................................41
Other Regulatory Mechanisms: public sector CB differs from private sector legislation .. 43
Other Regulatory Mechanisms: Using Public Interest as Justification to Stop Strikes ...... 43
CH 1: Application of the Charter of Rights and Freedoms to Employment Law
......................................................................................................................... 43
Overview ........................................................................................................................................................43
Background ....................................................................................................................................................44
Dunmore v. Canada (2001, SCC) ................................................................................................................46
Health Services and Support-Facilities Subsector Bargaining Association v. BC (2007, SCC): Charter’s
FoA includes protection of right to CB. Parts of the Bill-29 legislation violate workers Bill 29 rights and
cannot be saved under s.1. ............................................................................................................................50
GOING FORWARD: Legislative Changes and Fraser ..............................................................................55
Summary of three perspectives of commentators on the Dunmore and BC Health developments: ...56
CH 1: International Law Regimes ................................................................ 57
The International Labour Organization (ILO) ....................................................................... 58
Background and Overview ..........................................................................................................................58
Achieving Compliance with Conventions: General Obligations............................................................58
Achieving Compliance: Representations – Special Procedures ..............................................................58
Special procedures: Representations - FOA...............................................................................................59
Hard Law – complaints ................................................................................................................................59
2
Declaration of a Fundamental Principles and Rights at Work (1998) ....................................................60
Impact of ILO in Canada? ............................................................................................................................60
The North American Agreement on Labour Cooperation (NAALC) ................................... 60
Labour Principles...........................................................................................................................................61
Enforcement ...................................................................................................................................................61
Assessment of NAALC .................................................................................................................................62
CH 2: The Certification Process and Bargaining Unit Determination ..... 63
Establishing the CB Relationship: Basic Concepts................................................................ 63
Voluntary Recognition Provisions – as opposed to Election...................................................................64
The (Original) Aspirations of the Wagner Act Model ..............................................................................66
Effectiveness of Wagner Model ...................................................................................................................66
The Certification Process ......................................................................................................... 67
Legal Framework for Certification ..............................................................................................................67
Is the application timely?..............................................................................................................................68
Stages of the Certification Process...............................................................................................................71
Organizing Phase to Application .................................................................................................................71
Post-Application Phase to Election ..............................................................................................................72
Post-Election Phase ......................................................................................................................................72
Hypothetical ...................................................................................................................................................73
Bargaining Unit Determination: Appropriate Bargaining Units ......................................... 74
What is at Stake for the Union .....................................................................................................................74
What is at Stake for the Employer ...............................................................................................................74
Legal Framework for Deciding Bargaining Unit (and its Implications) – see 2-6 of CB .....................74
Labour Relations Board Policy (and its implications)  check this in text, differs from slide ..........76
Sack & Mitchell, Ontario Labour Relations Board: Law and Practice ........................................................76
United Steel Workers of America v. Burns International Security Services (1994) ...................................77
CLAC v. Port Hope [2005] ..........................................................................................................................78
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.....................................................80
Union Density and Workplace Size, 2009 ..................................................................................................80
Alternatives to Current Policy .....................................................................................................................80
CH 2: Unfair Labour Practices ...................................................................... 81
Basic Principles ..............................................................................................................................................81
Legal Framework: OLRA and Criminal Code........................................................................ 82
Privilege to Organize ....................................................................................................................................83
Protected Rights – ULP, ss 70-77 .................................................................................................................83
ULPs by TUs ...................................................................................................................................................83
Duties of TUs and Definitions .....................................................................................................................84
Enforcement – Complaint Process in s. 96 .................................................................................................84
Cases ................................................................................................................................................................85
Enforcement – Prosecution in s. 104 and s. 109 “pretty much a dead-letter, has never been
successful” ......................................................................................................................................................85
ULPs in CA Context ......................................................................................................................................86
Application of Legal Framework: Union Access ................................................................... 86
Union Access v. Employer Access ..............................................................................................................86
Adams Mine (1982) .....................................................................................................................................88
Application of Legal Framework: Employer Access ............................................................. 88
K-Mart Canada Limited (Peterborough) (1981, OLRB): exemplifies crude interference and shows ERs
which appear to not really worry about violating the LRA ..........................................................................88
4
Walmart Canada Limited (1997, OLRB) .....................................................................................................90
Compare policy: Union access versus ER access  Don’t take opposite tack on exam unless rly
sure ..................................................................................................................................................................91
Employer Economic Power – Anti-union Animus ...................................................................................91
Sobeys Letter.................................................................................................................................................92
Recap: Labour Relations Act, Union Access and Economic Power .......................................................92
Sobeys Letter to Employees – September 2008 .............................................................................................92
Effectiveness of Employer Resistance – “breezed through, he barely touched this” ..........................93
Remedies .................................................................................................................................. 93
Interim Relief – during organizing drive and so forth – see Section 98.................................................93
Section 96 Remedies ......................................................................................................................................94
Remedial Certification – s.11: The most powerful remedy a union can get – got in Walmart and
Kmart ...............................................................................................................................................................95
Significant Change to Certification Law in the Last Decade ...................................................................96
Balancing Competing Interests ....................................................................................................................98
CH 3: Who is an Employee?.......................................................................... 99
The Problem Stated ................................................................................................................. 99
A Paradigm Case of Employment (i.e factory setting) – Chart. The Problems arise when we get
Contractual Relationships that DON’T EASILY FIT into this paradigm – that’s what courts have to
rule on. ..........................................................................................................................................................101
Ready Mix Concrete v. Minister of Pensions and Insurance (1968) .........................................................102
Two interpretive approaches of thinking about defining EE ................................................................103
The Common Law .................................................................................................................. 104
Vicarious Liability: Important b/c ERs vicariously liable for EEs but not for Independent
Contractors. ..................................................................................................................................................104
671122 Ontario Ltd v. Sagaz Industries 2001 SCC ..................................................................................105
Notice of Termination .................................................................................................................................106
Social Wage Protection .......................................................................................................... 107
What is at stake? ..........................................................................................................................................107
Policy rationale for programs?...................................................................................................................107
Implications of policy context for test and its application, if any? .......................................................107
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Tax Cases ......................................................................................................................................................108
Thompson Canada v. Canada 2001 ............................................................................................................108
Workers Compensation ..............................................................................................................................108
Stork Diaper 1990 OWCATD ...................................................................................................................108
Approaches to Definition of “Employee”: Legal Formalist and Purposive ........................................109
Employment Standards Act................................................................................................... 110
Application of the Act .................................................................................................................................110
Exclusions – this is important, there are lots of exclusions, in the statute and in the regulations: ..111
No Contracting Out: s. 5(1) ........................................................................................................................112
Becker’s Milk (1973) ..................................................................................................................................112
Tucker on Purposive Approach to Definition of “Employee” and Becker’s Milk ...............................114
Machtinger v. HOJ 1992 (SCC)  read this case! ....................................................................................115
Managers: Generally No Hours of Work Protection ..............................................................................116
Collective Bargaining – Ontario Labour Relations Act ....................................................... 116
Statutory Definition and Application .......................................................................................................116
Toronto Drywall Services Ltd (1976, OLRB) ............................................................................................117
Tucker on Toronto Drywall Services ............................................................................................................118
Dependent Contractors – With the new “dependent contractor” amendment, the controversial
cases (i.e cases on the boundary) are now not about EE vs IC, but DC vs IC .....................................119
Toronto Star (2001, OLRB) .......................................................................................................................119
Tucker on Toronto Star ...............................................................................................................................120
Scope of Coverage .......................................................................................................................................121
PUBLIC POLICY: The Challenge Ahead – Labour Law Reform ..........................................................121
PUBLIC POLICY: Status of the Artist Act................................................................................................121
Exclusions ............................................................................................................................... 122
Managerial Employees ...............................................................................................................................122
CAS of Ottawa Carleton (2001 ..................................................................................................................123
Tucker on Managerial Exclusion ...............................................................................................................124
Confidential Employee Exclusion .............................................................................................................124
Transair Limited (1974) .............................................................................................................................124
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CH 3: Who is the Employer? ....................................................................... 125
Background ............................................................................................................................ 125
Contexts where, in addition to legal ER, we ask who is responsible for liabilities of ER .................125
Themes ..........................................................................................................................................................126
Common Law – Vicarious Responsibility............................................................................ 126
McKee v. Dumas 1976 Ont CA. ................................................................................................................126
Tucker on McKee .........................................................................................................................................128
Parent-Subsidiary Relations ................................................................................................. 128
Marks & Spencer/Peoples’ Department Store (1990) ................................................................................128
Factor Test from York Condominium (1977): Who is the Employer....................................................129
Employment/Temporary Help Agencies .............................................................................. 130
Collective Bargaining ..................................................................................................................................130
Pointe Claire v. Quebec 1977 SCC ............................................................................................................130
Tucker on Point Claire..................................................................................................................................133
Nike Canada ...............................................................................................................................................133
Summary of Temporary Help Agencies ..................................................................................................134
Related or Common Employers ............................................................................................ 134
Employment Standards ..............................................................................................................................134
550551 Ontario Limited v. Framingham 1991 Ont Gen Div (Bilt-Rite Case) .........................................135
Tucker on 550551 .........................................................................................................................................136
Lian J. Crew Group 2001 OR....................................................................................................................137
The Meaning of “intent of effect” ..............................................................................................................139
Nova Quest Finishing (upheld on appeal) .................................................................................................139
Limits of “related employer” approach in the ESA ................................................................................139
Possible alternatives ways of collecting unpaid wages..........................................................................140
Collective Bargaining ..................................................................................................................................140
Common Law...............................................................................................................................................140
Downtown Eatery v. Ontario 2001 Ont CA .............................................................................................140
Tucker on Downtown Eatery .....................................................................................................................142
Successor Employers.............................................................................................................. 143
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Common Law...............................................................................................................................................143
Major v. Phillips Electronics 2005 BCCA .................................................................................................143
Employment Standards Act – Sucessor Provisions ................................................................................144
Abbott v. Bombardier 2007 ONCA............................................................................................................144
Collective Bargaining ..................................................................................................................................145
CH 4: Introduction to Fairness ................................................................... 147
What do we mean by fairness? ..................................................................................................................147
CH 4: HUMAN RIGHTS LEGISLATION................................................. 148
Human Rights: Common Law, Arbitration, Legislation ..................................................... 148
Overview of the Ontario Human Rights Code .................................................................... 149
HARASSMENT............................................................................................................................................149
AGE ...............................................................................................................................................................149
ADVERSE IMPACT ....................................................................................................................................149
SPECIAL PROGRAMS – affirmative actions programs exceptions .....................................................150
EXCEPTIONS FOR SPECIAL EMPLOYMENT – section 5’s equal treatment clause not infringed
WHERE .........................................................................................................................................................150
Overhaul of HRC in 2006 ...........................................................................................................................150
Procedural Points: Where to go with a Complaint of Discrimination? ...............................................151
Duty to Accommodate ........................................................................................................... 152
BC v. BCGSEU 1999 SCC (Meiorin) ........................................................................................................153
Ramifications of Meiorin: ...........................................................................................................................156
Discrimination Cases: Where is the Point of Undue Hardship? ...........................................................156
McGill University Health Centre [2007 SCC]: TIME LIMIT NOT OK ..................................................156
Honda v. Keays (2008 SCC): TIME LIMIT OK ........................................................................................157
Quebec v. City of Montreal (2000, SCC) ...................................................................................................157
Note on Unions as Defendants ..................................................................................................................158
Hydro Québec v. Syndicat (2000 SCC) .....................................................................................................158
Racial Discrimination ............................................................................................................ 159
Introduction ..................................................................................................................................................159
Why do race complaints flounder? (Bhaduria) ..........................................................................................160
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Smith v. Mardana Ltd (No. 2) 2005 Ont Div Ct.......................................................................................160
OPSEU v. Ontario 2007 OGSBA (Dhanju) *should read this case ..........................................................161
Conclusions: Problem with Individualized Complaint System............................................................162
Sexual Harassment................................................................................................................. 162
Robichaud v. Canada 1987 SCC ................................................................................................................164
Equal Pay ................................................................................................................................ 166
Legislative Responses to Gender Wage Gap ...........................................................................................168
1. Equal pay for Equal Work ex: ESA s. 42.......................................................................................168
2. (“Pay Equity”) Equal pay for work of Equal Value ....................................................................168
Pay Equity Steps and Example ..................................................................................................................168
Problems in Pay Equity ..............................................................................................................................170
Exceptions to Pay Equity and Conclusions .............................................................................................171
England, Individual Employment Law, 2000 ............................................................................................171
Work Family Policy .....................................................................................................................................174
Employment Equity ............................................................................................................... 175
Action Travail v. CNR 1987 SCC .............................................................................................................176
Employment Equity Act (introduced in 1986, strengthened in 1995) ......................................................176
How effective has this regime been? ........................................................................................................177
CH 5: Introduction to the Rights and Duties in the Employment Relation178
Employer Duties/Employee Rights ...........................................................................................................178
Employee Duties/Employer Rights ...........................................................................................................178
CH 5: Duties of the Employer .................................................................... 178
Duty to Pay Remuneration .................................................................................................... 178
Establishing the Duty ..................................................................................................................................178
Reeve v. Reeve 1858 ER .............................................................................................................................178
Sprague and Wife v. Nickerson 1858 UCQB, Canadian Case ...................................................................179
Quantum Meruit ..........................................................................................................................................179
Timing of Payment ......................................................................................................................................179
Minimum Wages .........................................................................................................................................179
Starting point is CL: is there anything in the CL that limits the wage bargain? ........................179
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History of wage setting .......................................................................................................................180
Data on Minimum Wage ....................................................................................................................180
Statutory minimum wages .................................................................................................................181
Enforcement of ESA 2000: ..................................................................................................................182
Sickness .........................................................................................................................................................183
STATUTORY ENTITLEMENTS ........................................................................................................183
HUMAN RIGHTS (duty to accommodate) AND FRUSTRATION .............................................183
Dartmouth Ferry Commissioners v. Marks 1903 SCC..............................................................................184
Maternity and Parental Leave....................................................................................................................185
Maximum Hours and Overtime ................................................................................................................186
Liberal’s changes to ESA 2000 (effective March 1, 2005/6)  THIS IS THE CURRENT
EFFECTIVE LAW ................................................................................................................................187
Collective bargaining and hours of work ........................................................................................189
Vacation Pay (didn’t do this in class?) ......................................................................................................189
Duty to Provide Work ............................................................................................................ 190
COMMON LAW .........................................................................................................................................190
How can an employment K be terminated? ............................................................................................190
What about a TEMPORARY lay-off? Can employer unilaterally lay worker off TEMPORARILY
without pay? Also applies to temporary reductions in hours worked by employers. ......................190
Collier v. Sunday Reference Publishing 1940 KB ......................................................................................190
Devonald v. Rosser & Sons 1906 KB .........................................................................................................190
Stolze v. Addario 1997 Ont CA .................................................................................................................193
Kabiakman v. Industrial Alliance Life Insurance Company 2004 SCC: ...................................................194
Collective Agreements and the duty to provide work ...........................................................................194
Re James Howden & Parsons .....................................................................................................................194
Re UAW and Northern Electric 1971 LAC  With existence of certain protections when layoffs occur,
focus has shifted to figuring out when layoff occurs ..................................................................................195
Duty to Provide Work: Shortened Hours ................................................................................................196
Air-Care Ltd. V. United Steelworkers of America 1974 SCC ....................................................................196
Battlefords and District Cooperatives 1998 SCC .......................................................................................197
Canada Safeway 1998 SCC ........................................................................................................................197
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Duty to Provide Work: ESA .......................................................................................................................198
Duty of Good Faith ................................................................................................................ 199
Common Law...............................................................................................................................................199
Piresferreira v. Ayotte ................................................................................................................................199
Prinzo v. Baycrest ......................................................................................................................................202
Minimum Standards ...................................................................................................................................202
Collective Bargaining ..................................................................................................................................202
Municipality of Metro Toronto v. CUPE 43 .............................................................................................203
Collective Agreement Arbitration in Canada (Palmer & Snyder) .............................................................203
Employers’ Responsibility for Employee’s Conduct .......................................................... 204
Course of Employment ...............................................................................................................................204
Employers’ Duty to Provide a Safe Workplace .................................................................... 204
CH 5: EMPLOYEE DUTIES ........................................................................ 205
Duty to Obey .......................................................................................................................... 205
Common Law...............................................................................................................................................205
Laws v. London Chronicle 1959 ER ...........................................................................................................205
Walker v. Booth Fisheries 1922 OWN .......................................................................................................207
Collective Bargaining & Duty to Obey: general rule is to comply now and grieve later ..................207
Ford Motor Co. 1946 ..................................................................................................................................207
Kimberley-Clark 1973 ................................................................................................................................207
4 exceptions to the “work now, grieve later” rule ..........................................................................208
Statute ............................................................................................................................................................210
Duty to Exercise Skill and Care ............................................................................................ 210
In both CL and CB regimes ........................................................................................................................210
Common Law & ESA ..................................................................................................................................210
Douglas v. Kinger (2008 CA) ....................................................................................................................210
Collective Bargaining ..................................................................................................................................211
Aro Canada Ltd 1975 .................................................................................................................................211
Aro Canada and International Association of Machinists 1988 ................................................................213
Duty of Good Faith and Fidelity........................................................................................... 213
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Common Law...............................................................................................................................................214
Hivac Ltd. (1946 – British Court of Appeal) .............................................................................................214
(i) Duty of Good Faith – Content ...............................................................................................................215
(I [b]) Duty of Good Faith – Post-Employment: courts in general have been narrowing their view of
what is contained with the post-employment duty of EE to ER...........................................................216
RBC Dominion Securities v. Merrill Lynch: Manager while still at ER, organizing “mass departure” of
employees ....................................................................................................................................................216
(ii) Restrictive Covenants: used by ERs to try to get more protection from EE leaving, through the
power of K ....................................................................................................................................................218
Staebler Company Ltd. v. Allan .................................................................................................................218
Shafron v. KRG Insurance Brokers, [2009, SCC] ......................................................................................219
(iii) Remedies................................................................................................................................................219
Polyresins Ltd.............................................................................................................................................220
(iv) Inventions ..............................................................................................................................................220
Comstock Canada v. Electec Ltd (1991) .....................................................................................................220
(v) Whistleblowing ......................................................................................................................................220
IABSORIW v. Merk (SCC 2005) ..............................................................................................................220
SKIPPED? – Nov 13 2012 ............................................................................................................................221
Collective Bargaining ..................................................................................................................................221
United Brewery Workers and Pepsi-Cola ..................................................................................................221
De Havilland Aircraft of Canada Ltd. (1972) ............................................................................................221
Nipissing Hotel ..........................................................................................................................................222
CH 6: Faultless Terminations Without Notice .......................................... 222
Completion of the Contract ................................................................................................... 222
Ceccol v. Ontario Gymnastic Federation 2001 Ont CA ............................................................................222
Frustration .............................................................................................................................. 223
Death ....................................................................................................................................... 224
Bankruptcy ............................................................................................................................. 224
Dissolution of Firm ................................................................................................................ 224
Retirement .............................................................................................................................. 225
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CH 6: Termination by Notice ..................................................................... 225
Common Law Notice ............................................................................................................. 225
General Principles........................................................................................................................................225
Lazarowicz v. Orenda Engines Ltd. (1961, ON COA)..............................................................................226
Bardal v. Globe and Mail (1960 ON HC): WE ARE FOCUSING ON THE Q – HOW TO CALCULATE
AMOUNT OF REASONABLE NOTICE? ..............................................................................................226
Judicial Consideration of Specific Factors ................................................................................................227
Status .....................................................................................................................................................227
Cronk v. Canadian General Insurance 1994 CA .......................................................................................227
Minott v. Shanter 1999 Ont CA ................................................................................................................227
Honda Canada Inc. v. Keays, 2008 SCC ....................................................................................................227
Economic Conditions ..........................................................................................................................228
Freedom to contract: Harsh Terms & Unconscionability ..............................................................228
Ballpark Justice (this doctrine has been rejected) ............................................................................228
Near Cause ...........................................................................................................................................229
Aggravated and Punitive Damages for Wrongful Dismissal........................................................229
Wallace (1997): bad faith can be worthy of compensation, leading to increase in notice period  rejected in
Honda! ........................................................................................................................................................229
Fidler – sub-case, referred to in Keays ........................................................................................................230
Honda Canada v. Keays 2008 SCC ............................................................................................................230
Duty to Mitigate ...........................................................................................................................................232
Evans v. Teamsters Local Union 2008 SCC ..............................................................................................233
Statutory Notice Periods ........................................................................................................ 235
Individual termination (s.57) .....................................................................................................................235
Mass termination (s.58 & O. Reg 288/01 s.3) ............................................................................................236
Severance pay (in addition to notice, s.65) ...............................................................................................236
ESA Claims in Court ...................................................................................................................................237
CH 6: Termination by Action of the Employee ........................................ 237
Employee Obligation to Give Notice ................................................................................... 237
Voluntary Quits and Constructive Dismissal ...................................................................... 238
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Voluntary Quit or Dismissal? ....................................................................................................................238
Dowling Red & White ................................................................................................................................238
Constructive Dismissal or Quitting for Cause.........................................................................................239
Farber v. Royal Trust (SCC) ......................................................................................................................239
Issues in Constructive Dismissal ...............................................................................................................240
Wronko v. Western Investments ................................................................................................................240
Tucker on Constructive Dismissal ....................................................................................................240
Manner of Termination Damages – is there room for Honda damages in CD? .................................241
Mitigation in Constructive Dismissal: IF EE fails to accept the new terms, has there been a failure to
mitigate?........................................................................................................................................................241
CH 6: Termination for Cause...................................................................... 242
Termination for Cause at COMMON LAW ......................................................................... 242
Basic Principles ............................................................................................................................................242
Procedural Matters ......................................................................................................................................242
Onus and Post-termination reasons ..................................................................................................242
Condonation (Empey v. Coastal Towing Co Ltd., 1997) .....................................................................242
Obligation of good faith and fair dealing in manner of dismissal ...............................................243
Wallace v. United Grain 1997 SCC  Superseded by Honda! We just discuss it for history. .................243
Substantive Matters .....................................................................................................................................243
Probationary Employees: these rights continue to generate controversy ...................................243
Disciplinary Suspensions Without Pay ............................................................................................243
Haldane v. Shelbar 1999 Ont CA [lower court] ........................................................................................245
Carscallen v. FRI Corp 2004 Ont CA [lower court] ..................................................................................245
McKinley v. BC Tel [2001, SCC] ...............................................................................................................245
Cabiakman v. Industrial Alliance Life Insurance, 2004 [SCC] .................................................................245
Examples of Cause for Dismissal ..............................................................................................................246
Dishonesty ............................................................................................................................................246
McKinley v. BC Tel 2001 SCC: evidence of SOME dishonesty, but did it justify summary dismissal? ..246
Corso v. Nebs Business Products (2009 ON SC) ......................................................................................247
Sexual Harassment ..............................................................................................................................248
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Bannister v. GM (1999) .............................................................................................................................248
Simpson v. Consumers’ Association of Canada (2001, COA) ...................................................................248
Off Duty Conduct ................................................................................................................................248
Collective Bargaining ............................................................................................................ 249
George W. Adams, Grievance Arbitration of Discharge Cases: historically, narrow approach to EE
misconduct and favouring of ER’s interest; now eroding. Tucker: courts embracing that ER-EE
relationship is hierarchical..........................................................................................................................249
General Principles........................................................................................................................................250
Procedural Matters ......................................................................................................................................250
Onus and Post-termination reasons ..................................................................................................250
Condonation .........................................................................................................................................251
Probationary Employees ....................................................................................................................251
Disciplinary Suspensions ...................................................................................................................251
Insubordination ...................................................................................................................................252
Re Gardner-Denver 1974 LAC ..................................................................................................................252
Dishonesty ............................................................................................................................................253
Fraser Valley Library 2000 LAC ................................................................................................................253
Sexual Harassment ..............................................................................................................................253
Re C.U.P.E. and Office and Professional Employees' International Union, Local 491 (1982) .................253
Community Living South Muskoka v. Ontario Public Service Employees Union (Walla Grievance)[2000]
....................................................................................................................................................................254
Off-duty Conduct ................................................................................................................................254
Re Firestone Tire and Rubber .....................................................................................................................254
B.C. Telephone Co. and Federation of Telephone Workers of B.C. (BCSC) ...............................................254
Re Phillips Cables .......................................................................................................................................255
CL and CB Terminations Compared ........................................................................................................256
CH 7: Collective Action ............................................................................... 256
COLLECTIVE BARGAINING .............................................................................................. 256
1. Negotiation of CA: Duty to Bargain in Good Faith ...........................................................................256
General Principles................................................................................................................................257
United Electrical Workers of American v. De Vilbiss OLRB (1976) .........................................................257
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Duty to Disclose ...................................................................................................................................258
Westinghouse .............................................................................................................................................259
Consolidated Bathurst ................................................................................................................................259
AMAPCEO v Ontario (Government Services) 2012 CanLII....................................................................259
Facts: Ontario govt and OPSEU (another union) entered a CA that provided 2% increase in final year.
BUT had secret agreement for additional 1% increase in final year. .........................................................259
Held: the secret agreement was a false construct, entered into to try to deceive AMAPCEO and lower the
bargaining expectations. Constituted a a misrepresentation by the employer that violated its duty to
bargain in good faith...................................................................................................................................259
Canadian Pacific Forest Products ..............................................................................................................259
Legislative Responses: Mandatory Terms .......................................................................................260
A Minimum Standards Approach ....................................................................................................260
Royal Oak Mines (SCC, 1996) ...................................................................................................................261
Individuals in the System: intersection between the individual K of employment and CB regime262
Duty of fair representation .................................................................................................................262
Ford Motor Company of Canada, Ltd. (1973 OLRB) ................................................................................263
Walter Princesdomu (1975 OLRB) ............................................................................................................263
Individual Contract of Employment.................................................................................................263
Peterborough Lock (1953, Laskin) .............................................................................................................264
McGavin Toastmaster v. Ainscough 1975 SCC **confusing ....................................................................264
Weber v. Ontario Hydro 1995 SCC ...........................................................................................................266
Isidore Garon Ltee 2006 SCC .....................................................................................................................266
The So-Called Right to Strike: Rules Under Which Strikes and Lockouts Take Place.......................268
Statutory Controls on Strikes and Lockouts ....................................................................................268
Remedies for Illegal Strikes ................................................................................................................270
Remedies for Illegal Lockouts............................................................................................................270
Common Law...............................................................................................................................................271
Hersees of Woodstock Ltd. v. Goldstein (1963)(Ont. C.A.) .......................................................................273
Labour Injunctions ..............................................................................................................................274
Courts of Justice Act ..................................................................................................................................274
Domtar v. Lampi Ont HC ..........................................................................................................................274
16
Industrial Hardwood v. Industrial Wood and Allied Workers OnCA 1996..............................................275
Charter Rights ..............................................................................................................................................276
The “Right” to Picket ..........................................................................................................................276
Dolphin Delivery (SCC).............................................................................................................................276
Nfld Assoc of Public Employees v. AG 1986 SCC .....................................................................................277
BC Govt Employees Union v. AG BC 1988 SCC ......................................................................................277
RWDSU v. Pepsi Cola (2002)....................................................................................................................278
The Constitutional “Right” to Strike .................................................................................................280
Recent Developments .........................................................................................................................280
Reference Re Public Sector Employees Relations Act (Alta.) 1987 SCC ...................................................280
Concluding Observations ...................................................................................................................281
Task Force on Labour Relations: CB and Equity in the Distribution of Income .......................................281
TUCKER’S INTRODUCTION TO THE WORK OF L&E
Overview and Historical Development





This course discusses legislative CB schemes as part of the overall approach to the regulation of
employment relations, because:
o Most employment relations in Canada are regulated by the K of employment which is ruled
by CL principles as supplemented by legislation
o Percentage of workforce covered by CB schemes is shrinking
o It is no longer possible to treat the CL and min standards legislation as a subordinate
mechanism for determining the conditions of employment (increasingly they are a major
source of protection for vulnerable workers)
Until the 1950’s: CAN and US law schools used the phrase “labour law” to designate CB schemes,
and separate courses were offered for bargaining in the public sector, internal affairs of trade
unions, and individual contracts of employment
After WWII: collective bargaining in Canada took on its full form
By the mid-to-late 1970s: trend toward thinking differently about the material to be taught in L&E
law.
o Harry Glasgood: describes why there needs to be a normative/conceptual and practical
approach
o Normative: the break between the individual K of employment regime and the modern day
statutory CB regime was not as complete as the advocates of CB would have us believe (the
ideas from individual employment had migrated into the CB regime)
CB grew to cover about half the Canadian work force, but the other half’s employment relations
were governed by the individual K of employment
17

NOW: labour and employment is the law of WORK, but not all work is governed by this law
o Ex: care-giving in the familial context not governed by L&E law
Property and Social Relations of Production
KEY FEATURES

SOCIAL ORDER 
Slave Society
Core Relation of
Production
Slave
Master
Feudal Society
Serf
Lord
Independent
Commodity
Production
Note: this is not
capitalism if this is
the dominant
relation of
production.
ICP
Capitalism
Servant/Employee
ICP
Master/Employer
Ownership of Labour Power
None: they are objects owned by
others.
All: master has capacity/power to
command their work.
Some: at the command of the
master, not because of a K
relationship, but because of a
status relationship. But free to
work for themselves during off
hours.
Some: by virtue of status, the
master has the capacity to
command work of the serf.
All: individuals own their own
property and produce for
themselves (ex: farmer who owns
his labour power, means of
production, and sells products on
the market with other producers)
All: the self-employed or
entrepreneur is a modern
example.
All: you come to the labour market
as owners of your capacity to
work.
None: the employer does not own
anyone else’s labour capacity.
Ownership of Means
of Production and
Product
None
All
Some: have legally
enforceable claims to
raise sheep on the
manner commons, to
cut wood, to plant
crops, etc.
Some: Lord owns most
of the land
All
All
None: as the
employee, you come
without only your
ability to work, no
other asset.
All
GENERAL POINTS:
 Capitalism: when one class owns the means of production and presents its ability to work to
another class
 Our focus: legal regulation of work within capitalism (exchanges between employers and
employees that occur within capitalist labour markets)
 Two key components: contract and direction
18
o

K of employment: key because it establishes the relationship between the parties (as
opposed to status or birth in other social orders)
o Direction: the relationship of employment is at its core a relationship of subordination – the
employer determines when/where/how/etc the work will be done
Difference between capitalism and independent commodity production:
o ICP: work is not done for a wage, but just a mere exchange
o Capitalism: employer agrees to provide a wage to an employee for their labour – difference
is that the workers agrees to be under the direction of the employer (agrees to be
subordinate)
Elements of Labour and Employment Law Chart
COMPONENT
Creator
Administrator
Common
Law/Individual
K of
Employment
Courts
Courts—they oversee
the administrative
regime.
Minimum
Standards
Legislature
Administrative
tribunals, agencies,
ministries of
government, courts.
Statutory
Collective
Bargaining
Legislature
Administrative
tribunals (OLRB),
courts
Normative Foundation (what
legitimates the regime?)
 Freedom of K (the parties do not
need to enter into this particular K)
 Liberty, individual autonomy,
efficiency, and judicial prestige or
independence.
 Social justice values:
economically determined conditions
of work are not sustainable from an
employee’s perspective (the power
imbalance will dominate these
matters without further
intervention)
 Although parties could agree to
work for little or in dangerous
conditions is not sufficient – other
interests take precedence
 FOA, worker voice,
countervailing power under the Act
redresses inequality in the ER/EE
relationship.
Theoretical Perspectives on Labour and Employment Law Chart
Interests of
Labour and
Capital
RIGHT/UNITARY
(unregulated LM,
ERs and EEs
should be free to
negotiate their own
arrangements)
 Identical: profit
maximization.
 when the ER
does well, the EEs
do well.
LIBERAL
PLURALIST
LEFT/SOCIALIST
There are
reconcilable differences
(see Paul Weiler).
Recognition that
ERs and EEs do not
 Antithetical
 The goals of ERs is to
maximize profit and that drives
them to always seek more for
less. Workers are simply
19
Conflict
Distribution
of Power
 Deviant –
conflict is unusual
and unexpected.
 If workers want
to unionizing, they
are being disrupted
by agitators.
 Irrelevant – up to
EEs if they want to
improve their
human capital,
pick leisure over
work, etc
Goals of
Regulation
 Constitute and
protect labour
markets: EEs own
their capacity to
work and that ERs
own the means of
production
 k scheme will
assist
Preferred
Institutional
Vehicle
Common
law/Courts: have
historically valued
individual
autonomy
agree on all things:
they might have a
common interest in
maximizing the pie,
but not necessarily on
how to split it.
 Normal, but limited.
commodities that are there to be
exploited; to have as much
extracted from them as possible.
 ERs interest in rewarding
work is not a goal unless it
helps profit maximization.
 Inherent and Fundamental
 Individual K –
Unequal.
 CB –
Countervailing
power.
 Structurally Unequal
 ERs ownership of the means
of production gives them an
advantage over workers that is
not matched, even under CB
regimes, because the ERs have
the capacity to withdraw from
the market and live off their
capital.
 EEs don’t have the freedom
or time to withdraw (savings
are minimal – they cannot
survive without access to
income)
 Transformative: there are
severe limits on what regulation
can accomplish (need social
transformation)
 Modify the market
system to promote
mutual gains for ERs
and EEs.
 Enable EEs to
participate more fully
in the LMs as equal
player (helps interests
of ERs by reducing
conflict and
improving
performance)
Legislation/Admin
Agency:
Courts are regarded
as bad—insulate the
tribunals from judicial
interference. Heavy
Worker Self-organization/Political
action
20
use of privative
clauses.
Challenges to Existing CB Regime


Globalization and Neo-Liberalism:
o Free trade and deregulation limits the level of regulations (to make us more competitive) –
fear of a race to the bottom, and if we impose higher standards, capital will flee
o This has an impact on labour market actors
o Prospects for transnational labour market regulation?
Impact of Changing Labour Market:
o Growth in women’s labour force participation—explosion in the 1960s
o Growing workforce diversity
o Growth of precarious employment: ER strategy has been to increase part-time and
temporary work
o Changing organization of production: vertically integrated firms (such as auto plants) are
disintegrating - they are subcontracting out and breaking these into pieces (alters the CB
regime)
History of Canadian Labour and Employment Law (according to Tucker)

History is helpful for three reasons:
o Reoccurring issues: the way dilemmas are solved changes over time, but the same issues
come up in any social regime where labour is provided for others
o Helps to understand architecture of current CB legal model: how it got to be the way it is
o Canadian labour history is now being litigated: BC Health Services case held that CB was
protected by FOA, on three grounds:
 History of collective bargaining in Canada
 International law norms
 Charter values
o TUCKER: History of right to strike will be next contentious issue
Feudalism to Master and Servant Regime (1000-1562)
 Feudal Relations of Production: Lord and Serf
o Unfree status relation: Lord owned the capacity of the serf to work. A person was born into
a certain status, and by virtue of birth, they owed an obligation to provide service to an
employer. Didn’t own all of capacity to work but some of it.
o Hierarchical (between superior and subordinate): no pretence of equality, serf is clearly
subordinate to the lord, and under obligation to obey lord’s commands.
o Legitimated
 Functionally: system works by providing the means that people need to survive
 Ideologically: apparatus convinces people that this is the way things ought to be –
they accept the situation as the natural normal order of things. Conflicts existed but
were manageable for a period of time.
 Crisis and Rise of Master and Servant Regime
21
o
o
o
Rise of class of lordless and propertlyess workers: growing number of people who were
entitled to farm on a strip of land, produce for themselves and sell goods on the market
(were considered the lowest members of the social order)
Black death 1348: killed up to ½ the English population, caused large decrease in supply of
labour, landowners suddenly faced a sharp increase in competition for workers, labourers
had increase bargaining power and commanded higher wages
Responses: legal foundation of master and servant regime
 Ordinance of Labourers, 1349: considered to be the start of English labour law – made
employment K different from other Ks, made illegal any attempt on the part of the
workers to bargain collectively, fixed wages at pre-black death rates (made them
lower), required anyone under 60 to work
 Statute of labourers, 1351: reinforced the OL (above), set a maximum wage of
labourers, mandated able-bodied men and women to work, imposed harsh penalties
for those who remained idle
 Status of Artificers (apprentices), 1562: formed the basis of what came to be known as
the master/servant regime. It regulated the supply and conduct of labour by setting
wages of certain classes of workers, regulated the quality of people entering certain
professions by laying down rules for apprenticeships and restricting the free
movement of workers
Master and Servant Regime to Liberal Voluntarism (1562-1870)
 Key Features of Master and Servant Regime: coercive, paternalistic and protective
o Compulsory labour for idle
o Presumption of yearly hiring, no termination without permission (master had to go to
magistrate and get permission to terminate the servant)
o Restricted labour mobility (couldn’t leave parish without permission from master)
o Hours of work established by law (sunrise to sunset, typically)
o Wages fixed by magistrates (magistrates were supposed to take into account the cost of food
so that a servant could feed himself – idea of a living wage as minimum entitlement )
o Apprenticeships (for skilled trades)
o Criminal sanctions for employee breach of K (if servant left early or was disobedient)
o Wage recovery mechanism (workers could claim unpaid wages)
 Master and Servant in Transition: Early Nineteenth Century England
o Disappearance of wage fixing (ERs didn’t want it, began to leave it to the market, workers
appealed for reinforcement of wage fixing scheme because market fell below living wage)
o Presumption of yearly hiring defeated (and ER no longer needed to get permission to lay
worker off prior to termination)
o Criminal breach of K remains (increased use and greater harshness)
o Employment as domestic relation (hierarchical; servant has a legal duty to obey)
o Quasi-property in servant (ER could sue third party for injury to EE)
 “The reason and foundation upon which all this doctrine is built, seems to be the
property that every man has in the service of his domestics; acquired by the contract
of hiring, and purchased by giving them wages” (Blackstone, 1765)
o Expedited wage recovery (claiming unpaid wages)
 Worker Combinations under Master-Servant Regime (CB)
22
o


Initially treated as criminal conspiracy for an unlawful purpose: contrary to wage fixing
 Magistrates were supposed to set wages
o By 19th century, rationale shifted to restraint of trade
 When wage setting disappeared, courts continued to think of combinations of
workers as criminal conspiracies – were then seen as interfering with market forces
(preventing competition, collusion)
o Workers fought to restore terms/conditions they had previously enjoyed, very repressive
period
o Enactment of Combination Acts of 1799 and 1800:
 Stipulated that all combinations of workers were criminal conspiracies and
established draconian penalties for workers convicted of combining
o Strong legal controls on means used to advance combination’s goals
Master and Servant Law in CANADA
o Unfree labour marginal (slavery, sefdom, indentured labour): slavery existed in Canada, but
we never had slave societies like in southern US and Caribbean
 Master and servant regime was received with English law
 Confusion about what the law was
o Abolitionists in the late 18th century: Lord Simcoe had the legislature enact a law to provide
for the end of slavery in Upper Canada (after this slavery was essentially gone, and when
England abolished slavery later, no money had to be paid in Canada because it has already
disappeared)
o Reception: as English settlement took place, there were many mechanisms for reception
 CL: didn’t have to be formally recepted, was continually recepted
 Statutes: in Upper Canada one of the first Acts passed was a reception statute that
fixed Ontario statute law as it stood in England in 1792, and then it stopped
 English law of master/servant was received in Canada, both its paternalistic
elements (ability to go before magistrates to get wages owed) and its coercive
elements (punishment)
 Reception of Master/Servant Laws:
 Doubt was expressed about whether master/servant laws were properly
received, and in 1847 the local legislature enacted a statute that followed the
basic lines of the English version
 Upper Canada 1847 M&S Statute: criminal breach, wage recovery, no wage
fixing
Law on Combinations in Canada: unclear, no known convictions for simply combining wages
o From BC Health Services: The development of LR in Canada may be divided into three major
eras: repression, toleration and recognition. We are aware that such categorization may not
necessarily draw a perfectly accurate picture of the evolution of labour law in our country
(see Tucker, “The Faces of Coercion”). However, for present purposes, such categorization
provides a sufficient historical framework in which to summarize the evolution of our law
and to underline the flourishing of labour unions and CB as well as the historic openness of
government and society to those organizations over the past century.
o Tucker: argues that it is misleading to present the development of CB law as going through
this progressive development – when we look more closely at these regimes, it is more
23
important to see how each combines various elements of repression, toleration and
recognition/promotion (no straight line of progression)
 In BC Health Services they say the 19th century was the period of repression BUT if
you look at 19th century magistrates manuals, they said that the law of Upper
Canada was the English law as it stood under the Combination Acts. BUT the date
of reception was prior to 1799, so they were probably just copying English magistrate
manuals (hard to argue that the English Law of combinations formed part of the law
of Canada)
 More important: as small groups of workers began to appear in the early 19th
century, historians have not found a single case going to court in which workers
were prosecuted for combining for the purposes of improving employment
conditions (they were only prosecuted for committing offences in pursuit of
combinations, like assault/intimidation). To draw from the law that the early to mid
19th century Canadian law was repressive of worker self organization is simply
inadequate. In some quarters, particularly amongst highly skilled craft workers,
there were elements of promotion and recognition.
Liberal Voluntarism to Industrial Pluralism
 Rise of Liberal Voluntarism in Canada: Criminal Law & Combinations
o 1870’s: Industrial revolution led to growth of trade unions (movement by workers to
establish the 9 hour work day – prior to this the norm was 10 hour, 5.5 – 6 days/week)
o Turning point – strike against George Brown: Group of workers in Toronto went on strike
against the publisher of the Globe. GB was incensed, consulted with lawyer, brought
charges against those workers for criminal conspiracy (simply for the act of combining to
improve terms/conditions of employment – they hadn’t done anything like intimidating or
assault). Liberal politician was seeking to invoke the old doctrine, and this provided the
conservative government of Canada (led by Sir John A MacDonald) with an opportunity to
embarrass the opposition – led to the Trade Union Act of 1872
o Trade Union Act, 1872: immunity from criminal conspiracy prosecution for simple act of
combining to improve conditions (abolished notion that it was unlawful to combine)
 Tucker:
 Irony is that it wasn’t illegal before this statute, no one had been prosecuted,
but this act is seen as having legalized unions
 Also this is where the nuance of repression/toleration shows up – at the same
time the government passed the Criminal Law Amendment Act
o Criminal Law Amendment Act, 1872: further criminalization of means used to advance
combination’s goals (watching and besetting)
 Created a series of offences specific to worker combination activities – so when
workers combined, these were now criminal offences.
 Rather than depending on the general criminal law, we now had a statute that
specifically applied to workers in that situation, and it included threatening,
intimidation, and “watching and besetting” which is picketing.
 Example of the combination of repression and toleration – we didn’t go from a
repressive to more tolerant regime, it was just a different combination of the two
o Criminal law amendments, 1876: peaceful picketing was exempted
24
 Watching and besetting was no longer a form of unlawful behaviour
Criminal code, 1892: exemption omitted
 Oddly, when we created the CCC, the exception of watching and besetting was
omitted
 Tucker: drafter’s oversight, no evidence there was intention to re-criminalize
peaceful picketing, but judge read it as intending to make it criminal
 Mistake was allowed to remain and it wasn’t until 1930 that CCC was amended to
specifically exempt peaceful picketing
o Other points:
 Workers combinations still unlawful conspiracies in restraint of trade (members
could be sued)
 CA’s legally unenforceable (employer could change his mind tomorrow, and union
would have to resort to pressure tactics)
 Agreements between trade union members unenforceable
 Union not a separate entity apart from its members- can’t sue or be sued in its own
name (viewed as any other kind of voluntary association, just a K between members)
 PROBLEMS:
 If treasurer of union stole members funds, there was nothing union could do
civilly to go after that individual
 It was hard to get union property because you couldn’t name the union as the
party that you were suing
o We had established liberal voluntarism: CB was no longer a crime, people were legally
privileged to form unions (not a right, just a privilege), but the terms and conditions of those
conditions could not be enforced. Implications:
 If you joined a union you could be terminated if employer didn’t want to have union
members as employees
 Regime of freedom of contract – no duty to respect your choice to join union
 No duty to bargain with the union – regime of privileges without rights.
 Result: Unions formed in skilled worker industries – people couldn’t just walk of the
street and do the job. This limited spread of unions, kept it within narrow group of
trades.
Rise of liberal voluntarism in Canada: Demise of Criminal M&S statutes
o Criminal breach of K was limited to circumstances were breach endangered public, 1877
 Still in the CCC today
o Provincial M&S Acts continued: in aftermath of criminal breach of K legislation
 Included wage recovery
 Some also included penal breach provisions for employee breach of K
o This is a fundamentally a market-based regime: people contracted, those Ks were
enforceable, and workers were free to combine but they were subject to strict rules about the
means they could use to enforce the goals of their group
Liberal Voluntarism to Industrial Pluralism:
o Key theme: Polanyi’s “double movement” triumph of markets and their regulation
 “the great transformation” – as markets become the principle mechanism through
which social relations are regulated, social destructive tendencies immediately begin
o


25
o
o
to manifest themselves which leads to a second movement, to re-regulate those
relationships
 Evident in what happens to this regime of liberal voluntarism – people who were
adversely affected become mobilized either through:
 Collective action: union formation
 Political action: pressure on legislature to address concerns about the
difficulties they were experiencing
What emerges is industrial pluralism: a mixed system
 Mixed legally: mixture of CL, statute and effect of CAs
 Mixed economically: still free market, but regulations set limits on what markets
could do and tried to steer them to reach certain outcomes
 Normative pluralism: belief in values of autonomy and efficiency, but also the
values of worker choice, FOE, FOA – these two groups are in tension with each other
Produces renewal of legal regulation:
 Minimum standards and collective bargaining laws developed
 Compensation regime (1914): no-fault system. All worker had to establish was that
the injury was work related, and they became entitled to compensation payable
through a fund administered through the state, using revenue from payroll tax. This
was away from contractual, toward administrative regime.
Example of Minimum Standards: Development of Occupational Health and Safety
Regulations






This is an example of Polanyi’s double movement: OHS was the first reaction to the market based
regime
Industrial revolution (factory system of production) meant a large number of workers were in a
single workplace – exposure to new and more hazardous conditions (steam powered machinery,
etc led to injury)
Women and children had been working before this, but not in factory settings – concern that
women would be unable to conceive, moral danger that women and children would face
(vulnerable to corruption)
Workers tried to sue for compensation for injuries suffered at work (claim was that ER breached
duty to provide safe work environment – novel claims)
o Early judgments embraced market regulation (not their job to regulate the market, workers
could negotiate the terms of employment based on the hazards of the workplace). Legal
presumption that workers had already taken into account the dangers of the workplace in
wage determination (they assumed the risk)
Employers had three defences to negligence action:
o (1) Presumption that workers had voluntarily assumed risk
o (2) This presumption included risk of being injured by fellow servant/manager
o (3) Contributory negligence (if worker had done anything to cause injury then they were
barred from action).
o As a result it was almost impossible for worker to sue employer
Consequences:
o Employer had very little incentive to improve working conditions
26
o



A lot of workers were harmed and lost capacity to earn a wage, major concern in breadwinner family model because whole family suffered
o Darby Bergin, MP from Cornwall, first politician to support factory legislation: concern
about consequences of this to society, made a speech in parliament in 1988
 Critique of market regime: the unbridled pursuit of profit was causing horrific
consequences, exposing women/children to unacceptable workplaces, their lives
would be sacrificed by this pursuit of profit, and state had to step in and draw line to
stop it.
Legislative Responses:
o Provincial legislation was passed: it was a matter of property (although you could argue
that it was a criminal issue so should be federal)
o Factors Acts were passed: large number of statutes regulating different areas of work
 Failure to comply was a regulatory offence
 Enforcement was weak and limited, issue was ongoing
 Late 1970’s: omnibus legislation passed, ERs could be prosecuted
OHS is an example of a minimum standards regime that became entrenched within 10 years of the
creation of the market base regime (others took longer)
Employment Standard: another form of minimum standard
o Minimum wages, first provided just for women around WW1, had to be able to support
family unit
o Current employment standards emerged after WW2: standard wages across provinces
(more or less), maximum number of hours, regulation of overtime, anti-discrimination laws
(fairness)
Collective Bargaining Laws: History

Trade Dispute Legislation: 1870s – 1890s (rise of Liberal Voluntarism)
o Workers obtained FOA in the sense that it was no longer a criminal offence for them to join
together for the purpose of improving employment conditions, and it was no longer tortious
for workers to band together (basic FOA)
o This was FOA as a manifestation of freedom of K: they could contract together to agree to
terms/conditions by which they would sell their capacity to work
o Freedom of K was preserved in labour market: just as workers could decide who they
would associate with, so could ERs decide who to employ (everyone was free to do what
they wanted)
o Required coercion by the state: often bargaining would be a contest of strength – workers
would walk out and the state was NOT neutral
 Trade Union Legislation of 1872: limited the kinds of activities that workers could
engage in
 Scope of this varied over time – peaceful picketing was at times criminal/tortioius
(always a mixture of repression, toleration and support)
 Legislation often favoured ERs
o State also enacted facilitative legislation: tried to limit the impact of industrial conflict
 Earliest statutes were passed in 1870’s, wanted to create mechanism to resolve
disputes
27






If both parties asked for conciliation a statutory scheme provided a mechanism for a
board of conciliation, which would look into dispute and make recommendations
No obligation to accept conciliators view, just wanted to introduce a rational voice

Early 1900’s
o Federal government became increasingly concerned, specifically because of strikes
occurring in public utility industries (railway, coalmines, etc).
 This could deprive industry of resources needed to power machinery, bringing
industry to a halt – very serious impacts on national economy.
 Second industrial revolution at this time: away from crafts towards mechanized
mass production which required heavier investments of capital (ownership
becoming increasingly corporatized, so a strike was more serious)
o Government did two things:
 Passed a Conciliation Act (Industrial Disputes Investigation Act, below)
 Established an internal instructional infrastructure – Department of Labour,
dedicated to looking at the issues, providing intelligence to government, promoting
industrial peace
Industrial Disputes Investigation Act, 1907
o First element of more coercive scheme that restricted federal jurisdiction to public utilities,
and required that before parties could walk out they have to undergo process of conciliation
o Conciliator would look at the evidence and publish report with what would be fair – idea
was to introduce neutral person to promote a resolution, and the weight of public opinion
would put pressure on parties and hopefully avoid strike.
o If you struck without going through this process you could be prosecuted under the Act
o Effectiveness of the act varied:
 Railways could get costs of the dispute factored in, worked well
 Ineffective for coal industry, enormous competition, unstable industry
Other Random Points:
o During WW1 the government supported unions but didn’t make them mandatory – as war
ended groups wanted to institutionalize those principles, others wanted to go back to prewar regime, led to confrontations in post-war era.
o Winnipeg General strike (1919): virtually the entire city was on strike, ERs eventually took
over policing, operated as the government, lead to militia. Labour movement was largely
defeated, reverted to the way things were pre-war.
Snider decision, 1925
o Question of federal gov’s decision to create national labour policy was challenged, case went
to PC, PC held that labour and employment are matter of property and civil rights for
provinces and fed’s only jurisdiction in the area is with respect to federally regulated
industries.
o This prevents creation of national labour relations system and ensures future developments
take place provincially
Industrial Standards Acts - 1930s (result of Depression)
o During the depression, surges of union organizing (time of massive dislocation and workers
trying to protect their conditions). Government tried to react to both the depression and
industrial unrest.
28
o

One theory of the depression was that it was caused by under-consumption: workers were
not making enough to be able to buy the goods/services they were producing – too much of
the pie going to the elite
 View that if we promoted trade unions it would increase the consumption power of
the Canadian population and it would help pull us out of the depression.
o Industrial Standards Act provided that trade unions could have an agreement extended to
cover all employers in that industry in that local.
 This ensured that wages under the agreement would not make an ER uncompetitive,
it would reduce resistance and facilitate increase in living standards and workers
wages.
 Still little bits of this in Quebec, and tiny bit in Ontario (garment industry)
Freedom of Trade Union Association Acts – 1930
o Precursor: struggles between workers wanting unions and those resisting unions (auto,
steel, rubber) and unions pushing for more protection to facilitate their ability to enjoy
effective FOA
o The US 1935 Wagner Act – provided foundation for our current scheme.
 Notion was that there would be administrative mechanism through which group of
workers could apply to the board, and the board would go through process to
determine whether the majority of workers within a unit wanted to be represented
by a union.
 If there was majority support, then the union would be recognized as the bargaining
agent and the ER would be under a legal obligation to recognize that union as the
associate that represents workers and would have to negotiate in good faith with
that union toward establishment of CA.
 Also contained provisions that said ERs had to respect the freedom of workers to be
or not to be members of the union (couldn’t fire EE for joining) – protection against
ULP
o In Canada we didn’t get a Wagner-like regime, but we did get protection against ULPs
o FTUAA passed in various provinces – workers were to have a free choice of whether to
join union, was to be protected by right not to have ERs interfere with that choice
o See CCC s. 425 (below): it became a crime for ER to interfere with freedom of choice, to
dismiss EE from employment only because he was a member of a union, to
intimidate/threaten with loss of employment, etc – HUGE breakthrough (you had the right
to chose, not just the freedom, and there was a correlative duty on employers to respect that
choice)
Criminal Code of Canada s. 425
425. Every one who, being an employer or the agent of an employer, wrongfully and without lawful
authority
(a) refuses to employ or dismisses from his employment any person for the reason only that the person
is a member of a lawful trade union or of a lawful association or combination of workmen or
employees formed for the purpose of advancing, in a lawful manner, their interests and organized for
their protection in the regulation of wages and conditions of work, (b) seeks by intimidation, threat of
loss of position or employment, or by causing actual loss of position or employment, or by threatening
29
or imposing any pecuniary penalty, to compel workmen or employees to abstain from belonging to any
trade union, association or combination to
which they have a lawful right to belong, or (c) conspires, combines, agrees or arranges with any other
employer or his agent to do anything mentioned in paragraph (a) or (b), is guilty of an offence
punishable on summary conviction.


PC 1003, 1944; Post-War Statutory Collective Bargaining Legislation
o During WW2 there was a massive increase in union membership due to high levels of
industrial conflict . This threatened basic war industries, but instead of trying to work
behind the scenes facilitating arrangements, the government went one step further with
PC1003 which established a Wager-like regime in Canada.
o How it worked: If it was established that there was support among particular group of
workers, the group became the certified bargaining agent, and the ER was under a duty to
recognize that agent and to engage in good faith bargaining with it
 Once CA was established, no strikes or walk outs for the life of the agreement (so
once the ER singed, they got a guarantee of industrial peace)
o If bargaining failed, the old mechanism from IDIA was maintained – before parties went
on strike they had to undergo process of conciliation, and as in US scheme additional
elements were added:
 Conciliator acted as judge, looked at disputes
At the end of the war, question of what would happen – revert back to pre-war?
o Government support for a Wagner-like model was overwhelming, and as powers under the
Federal War Act receded, provincial governments passed similar legislation
o Some variation between provinces but the Wagner-like model was the fundamental model
that emerged during/after the war, and essentially is the model of the CB scheme we have
today under the Ontario Labour Relations Act.
Key Goals of Industrial Pluralism: Collective Bargaining
 Reduce industrial conflict
o End recognition strikes
o Postpone strikes and lookouts (if parties cannot agree, they must go through IDIA process)
o Prohibit mid-term strikes and lockouts (strikes prohibited through life of CA)
 Facilitate exercise of FOA
o Protect FOA with rights (no longer a bare privilege, but now a protected right –workers are
protected against interference by other private parties, like ERs)
o Mechanism for democratic choice by workers (it is a vote by which workers decide whether
to have a vote)
 Promote industrial citizenship
o CA is a constitution (where parties come together and bringing democracy into workplace)
o Provides workers with the right to the rule of law in the workplace (they can appeal to the
Charter to vindicate their claims to rights, and there is a neutral party (judge/arbitrator) who
determines what the law of the workplace is)
 Promote More quality
o Unions provide a countervailing power that allows for a set of more equitable arrangements
to be provided than otherwise would be if matter were left to individuals
30
CH 1: ELEMENTS OF THE LEGAL REGIME
The Elements


Three aspects of labour law:
o K of employment between employer and each employee
o Legislatively controlled collective agreement (CA) between employer and union
o Legislative intervention which affects creation of employment K, whether it is governed by
CL principles or CB statutes
Extent of unionization in Canada
o Trends from 1981 to 2004 (Morisette, Schellenberg, Johnson) “Diverging Trends in
Unionization”
 Since the early 80’s the proportion of Canadian workers belonging to labour unions
has declined considerably – this trend has affecte some groups of workers more than
others (men, younger workers, and those in goodsproducing industries like forestry,
mining, construction, and manufacturing)
 The demographic characteristics distinguishing unionized from non-unionized
workers changed significantly (in 1981 differences were evident by sex, in 2004 by
age)
 The proportion of unionized employees fell from 38% to 31% between 1981 and 2004
 The rate for men declined by almost 12%, compared with <1% for women, resulting
in a convergence of the two rates by the end of the period.
 Younger workers (under 35) experienced more pronounced declines than older
workers.
 Men in blue-collar jobs saw the largest declines and declines were larger among men
who had not completed a university degree than among those who had.
 Among both women and men, declines in unionization were greatest among
workers earning $15.00 to $19.99 per hour.
o “Solidarity Forever? An Analysis of Changes in Union Density” (Jackson and Schetagne)
 Examines the changes in union density from 1984 – 2002
 From 1997 – 2002, union coverage grew by 350,000 to 4.2 million Canadian workers,
but density fell by 1.5 percentage points, from 33.7% to 32.2%. Density has been
falling in Canada but, unlike the US, unions have still been growing in terms of total
numbers.
 Looking at private services, there has been an important shift of employment to
business services since 1984. This wide range of mainly low union density industries
has grown, from 5.5% to 10.2% of all jobs.
 The decline in union coverage has been much more pronounced among men than
among women.
 Looking at union density by industry, there has been a marked decline in
manufacturing since 1984, from one-half to one-third of all workers, and a sharp
decline in transportation.
 While union density is lower for part-time jobs, the proportion of women in parttime jobs has been falling, and union coverage of part-timers has been increasing in
both the public and private sector.
31




In the private sector, union coverage in large workplaces (500 plus) fell sharply, from
47.3% to 40.9%, while rising slightly (though to just 8%) in very small workplaces.
Union density in very large cities (particularly Toronto) tends to be lower than the
respective provincial averages. Relatively low union coverage in major urban areas is
of concern given that most job growth is taking place here, driven in large part by
immigration. Strikingly, union density for women rose in the majority of cities, while
falling almost everywhere for men.
Union density for workers of colour, Aboriginal workers, and workers with
disabilities rose slightly for all of these groups between 1996 and 2001.
Broad conclusions:
 Declining overall union density is a product of what is happening in the
private sector.
 Within the private sector, unions have done worst in traditional areas of
strength, and best in traditional areas of weakness. Thus, unions have done
best in private services as opposed to mining, manufacturing, transportation,
and utilities, and, probably relatedly, best in parttime jobs, and best in
smaller workplaces. The major exception is construction where union density
has increased.
 Union density has held up much better among women than among men.
High union density in public and social services combined with a high
concentration of women in such services explains the closing of the union
coverage gap between women and men.
 A small but growing source of weakness has been low and falling union
density in technical and professional occupations in the private sector and,
relatedly, in professional, scientific and technical services to business. To this
extent, the shift to the ‘new knowledge-based economy’ is undermining
union density.
 Changes in union density within industries seem to be more important than
‘structural’ shifts of employment between industries.
 Union density has held up better in provinces with relatively labour-friendly
governments. Of the larger provinces, Quebec and BC have been major
sources of union strength, and Ontario and Alberta have been major sources
of weakness.
The Common Law Contract of Employment

UBIQUITY: normally there must be a contractual relationship between employee and employer
before any of the incidents of labour law will be applicable
DEFINITIONS


K of employment: at CL is an agreement by one party (employee) to serve the other party
(employer) and consideration is the remuneration for services
Temporary Employees: CL makes no distinction btw probationary/temporary employees and other
employees
32



Crown employees: Persons who work for the government are considered to have K of employment
with the Crown even though many of the terms are dictated by statute and not the result of K
negotiations
Office holders: disputes relating to dismissal should be resolved according to the express or implied
terms of the K and any applicable statutes and regulations, without regard for whether the
employee is an office holder. A public authority which dismisses an employee is not subject to any
additional duty of fairness ( the words “office holder” have no magic to them) [Dunsmuir]
o BUT being an officer holder may mean bearing the burden of special obligations if the office
is director of the corporation
o “Officer” includes presidents, directors, secretaries, treasurers, GM’s [s. 1(1) BCA]
o “Officers” are defines as persons who have been appointed and have ascertained incomes
(ex judges) [s. 248(1) ITA]
Relationships where there is K of employment but are not categorized as employment relationships
for the purposes of labour law:
o “professionals” such as doctors, lawyers, engineers (exempted by CB statutes)
o CB statutes often don’t apply to agricultural and domestic workers, police, firefighters or
teachers
o Many persons who are legally classified as working under K of employment are excluded
from statutes which provide that employees shall be paid a prescribed minimum wage, shall
not work more than a prescribed number of hours, shall be given notice, entitled to
vacation, etc (typically domestic, agricultural and horticultural workers are excluded)
APPRENTICESHIPS





Can be a condition of admission to an occupational field, and employer as duty to instruct and
supervise
Used to be common for apprentice not to receive remuneration
Many incidents normally associated with K of employment do not apply: misconduct, neglect,
intoxication, incompetence, disobedience are not grounds for dismissal – absent covenant or custom
to the contrary termination is by mutual consent
If apprentice is wrongfully terminated he can sue for damages which would have been earned
during the apprenticeship, subject to the duty to mitigate and in some cases the value of future
prospects [Dunk]
Statutes govern the requirement of training, impose duties on employers to instruct and require
registration of apprenticeship agreements [Trades Qualification and Apprenticeship Act, RSO 1990]
THE ESSENCE OF THE K OF EMPLOYMENT: K of employment v. other Ks




determining whether it is a K of mutual cooperation or a K of services is pivotal in determining the
following issues:
How to distinguish between K of employment and other similar K (independent contractors (IC’s),
principals and agents, bailment agreements, landlord/tenant relationships)
Participants in the relationship may want to claim entitlement under a statutory scheme (like min
wage) which applies if he can establish that he is an employee
Third person may want to characterize relationship as employment if he is injured and wants to
find a suitable defendant (vicarious liability)
33


Landlord/tenant: where an employee occupies a dwelling of his employer, whether or not the
employer is a landlord may be an issue. Question is whether the occupation of the dwelling is
primarily for the employer’s interest (in which case employee is NOT a tenant under
landlord/tenant law). The issue is whether the character if the employment prevents employee
from claiming another status under law (different from other issues we see)
The way the issue of the essence of the K is approached dictate the law’s approach to rights and
obligations:
o Mutual cooperation: law will let parties settle their affairs
o Services owed by one party to another: obligations might include duties in respect of which
the parties did not contract
o Employer duties: to pay wages, to provide work, to provide safe work environment, to
provide employees with an indemnity for costs
o Employee duties: to obey orders, to act with skill and care, to act in good faith, to render up
profits to the employer, to indemnity the employer for costs, etc
TYPES OF K OF EMPLOYMENT: TERM LENGTH






Similar to other K’s:
o Agreement voluntarily entered into between two capable parties with the intention to create
legal relations
o Will have been an offer of terms, acceptance, and consideration must be proved before K can
be enforced
Difference between K of employment and other K’s: In ordinary K, performance will terminate the
K, but a K of employment is typically one of indefinite duration which terminates upon appropriate
notice being given
o NOTE: in recent years there has been an increase in precarious employment (temporary
employees, including foreign workers)
UK – presumption of yearly hiring: read K of indefinite duration as being yearly (no termination
until first year had lapsed) and after that it would continue to be yearly
o Weak presumption: could be rebutted easily (ex: showing period of wages)
o SCC (1898) rejected the notion that the presumption of yearly hiring was a rule of law and
held that the nature of the K had to be deduced from surrounding facts [Bain]
o UK COA (1969): presumption of yearly hiring no longer effective [Richardson]
Periodic hiring: length of period being ascertained by reference to the incidents of the K (especially
method of payment of wages) – but this is at variance with common understanding that the
relationship is a continuing one
PREVAILING view: K are to be treated as being of indefinite duration, terminable by reasonable
notice
Possible to have fixed term K: relationship cannot be terminated by either party until the specified
period expires, unless conduct amounts to repudiation.
WRITING REQUIREMENT

can be written, oral, or inferred by conduct
CAPACITY TO K

all adults have same capacity to enter into K – variations for minors and immigrants
34
PURPOSE OF K

cannot offend public policy
o K may be held void if the purpose of entering into it was to engage in conduct which
offends public policy (it contravenes criminal law, legislation, rules governing restraint of
trade, offends public morality) [Dann]
o Affect on K depends on the nature of the conduct and whether it can be severed from the K
o K may be held void if they require employee to go beyond what may be required of a
servant (ex slavery K is not enforceable)
o The law allows a man to contract for his labour but it does not allow him to attach to his
contracts of service any servile incidents – any elements of servitude as distinguished from
service [obiter in Davies, 1887]
REQUIREMENT OF FAIRNESS IN FORMATION OF K
o
o
HR Statutes: employers and employees are free to chose with whom they form an
employment relationship, and this gives employers a large advantage – countervailing this
is legislation which prohibits discrimination (no discrimination in hiring employees, no
discriminatory terms in K)
Fair Practices and CB: fairness in hiring must conform to HR statutes, and the union as a
party to the CA can insert clauses to increase its security (like stipulating that employer can
only hire union members and that new employees must join the union within 30 days).
Because unions can directly influence employment prospects, CB schemes make unions
subject to HR legislation and other constraints.
Minimum Standards Legislation



In addition to permitting union formation, statutes prescribed conditions and prohibit activities in
the employment relationship
Legislation envisions that people either individually or collectively can bargain the terms, unless
they fail to meet social standards – motivation for interference is to aid the party with weaker
bargaining power, the employee, but note that there is doubt as to whether it does so
Two main purposes of legislative intervention: (1) to provide minimum standards in relation to the
terms of employment and (2) to provide minimum conditions of safety in the workplace
The Collective Bargaining Scheme
The Constitutional Framework


JURISDICTOINAL ISSUES: arise when there is a national strike, the state wants to exercise
control over the participants in the dispute, but how can control be maintained if disputants do not
recognize the system’s jurisdictional boundaries?
o BNA Act does not deal with labour relations at all. S. 91 of the BNA Act empowers the
federal legislature to legislate with respect to matters not expressly reserved in s. 92 for the
provinces.
o As s. 92 does not deal with labour relations, argument that it falls within federal jurisdiction
BUT each province does have its own legislative scheme
HISTORY:
35
o
o
Industrial Disputes Investigation Act , 1907: Federal government introduced the Act
(exercising its residual power of peace, order and GG) which established a system of ad hoc
tripartite conciliation boards authorized to investigate and attempt to settle disputes.
Strikes were prohibited until a board had been appointed and had issued a report.
 Compulsory coverage: mining, transportation, communication and public utilities –
these threatened public interest.
 Voluntary coverage: Parties in other industries could bring their dispute to the
board.
Toronto Electric Commissioners v. Snider (1925, PC): conciliation board had been appointed
to resolve dispute and PC held that federal government did not have jurisdiction over
labour relations.
 Fed had jurisdiction (according to 91(2) of BNA) over trade and commerce but that
did not include particular disputants who engaged in it. Two reasons – another
provision would have been pointless if this were the case, and the IDI Act pertained
to property and civil rights, which was in the provinces’ jurisdiction pursuant to
92(13).
 PC also rejected argument that the IDI Act was a criminal statute (which is in fed
jurisdiction) on the grounds that the Act’s enforcement mechanisms were ancillary to
protecting property and civil rights.
 PC rejected the argument that the Act was one of POGG – it was not sufficient for a
law to be for the general advantage of the nation.
 To be in federal jurisdiction the law must have been implemented by one of the
heads of power listed in s. 91 – to encroach on the heads of power in s. 92, it would
only be constitutional in cases of extraordinary peril (like war) – not the case here
 IMPACT: now accepted that labour legislation is property and civil rights legislation
(CB has displaced contractarian individualism and from the beginning industrial
relations were connected to the quintessentially individualistic notion of civil rights
and property)
 NOTE: Snider has come before 12 Canadian judges, 10 of whom upheld the IDI Act’s
validity (citing criminal law, trade and commerce, POGG). Further, by 1932 all
provinces except PEI had enacted provincial legislation that adopted the federal
scheme (implication – this is a rejection of PC’s constitutional interpretations)
LABOUR RELATIONS IN THE FEDERAL SPHERE


Reference Re Hours of Labour (1925, SCC): power to enact labour relations legislation was held
concurrently by the provinces and the federal government. Provincial legislation could cover LR
where property/civil rights were involved, and fed legislation could cover LR falling within the
enumerated heads of federal power – so the IDI Act was valid in relation to federal matters
(Stevedores Reference, 1955, SCC).
Canada Labour Code: basic federal CB statute, today no question of its validity, is treated as
regulating interprovincial railways, telegraphs, shipping and telephones (NOT civil
rights/property)
o Part 1 of the Code postpones the right to strike/lock out until efforts have been made to
conciliate either between the parties or with a third party (who has some power)
36
o

Part 1 only applies to employees who are employed upon or in connection with the
operation of any federal work or to trade unions composed of such employees
o “federal work, undertaking or business” defined in s. 2: includes navigation/shipping,
railway, canal, telegraph, line of ships connecting provinces, ferry operating between
provinces, aerodromes, aircraft or air transportation lines, radio broadcasting station, a
bank, work declared for the general advantage of Canada (or 2+ provinces), and work
outside the legislative authority of the provincial legislatures.
o Part 1 also applies to Crown corporations, except those excluded by governor in council,
listed in schedule 1 of the Public Service Staff Relations Act. The PSSR Act governs
employment relations of employees of the government of Canada.
For fed to govern, it must be shown the parties are engaged in federal activity:
o Dispute btw railway and employees is clearly federal
o Companies engaged in mining uranium are closely connected to atomic energy work
(general advantage of Canada) and will be federal [Pronto Uranium Mines v. Ontario
Labour Relations Board and Ontario Hydro v. Ontario]
o Where work is wholly interconnected with a federal activity (like constructing buildings for
Customs and Immigration Department) it will be federal [Re Robertson-Yates Corporation]
o CLOSE TO THE LINE: federal company (Bell) owned most of the shares of a provincial
company (Northern Electronic) – held that because Bell could purchase its supplies
elsewhere, the relationship was not completely inseparable, and the argument that Northern
Electric should be brought within the federal scheme failed [Dunn]
COMMUNICATIONS




Company (CCSI) operating exclusively in Ontario installed structures used by federal undertakings
(Bell – cell services across Canada). Union applied for certification and employer argued that
Ontario LRB lacked jurisdiction. Held that the physical and operational connection btw sub and
federal undertaking was such that CCSI was an integral part of Bell and therefore federal
[Canadian Communications Structures Inc]
o NOTE: distinguished from Dunn on the grounds that CCSI supplied a much wider variety
of services than Northern Electric
A union applied to be certified for a unit of service technicians working on the installation and
servicing of a Canada-wide communications system. Application was dismissed on the ground
that the work was not an integral part of the system and did not come within the federal Code
[RCA Victor Employee’s Association]
Through interconnection with Bell equipment, a Bell telephone company offered interprovincial
and international services, and when a provincial regulatory agency postponed approval of a
project, the company claimed it was a federal undertaking within the meaning of 92(1)(a) of the
BNA. Quebec COA held that the company was integrated into a national telecommunications
network – a “sufficient operational link” to Bell and therefore federal [Quebec (AG) v. Telephone
Guevremont]
Union exercised its right to extend the term of a CA (according to the Social Contract Act) and
following Telephone Guevremont applied for certification as a federal undertaking – court held that it
within federal jurisdiction and as such the SCA had no application. However, the CA remained in
force for the purposes of the CLC [Thundery Bay (City)/Telephone Division and IBEW, Local 339]
37
FISHING


Canada LRB was prohibited from hearing applications for certification on the basis that the
regulation of matters incidental to the conduct of fishing business, such as labour relations, fell
under provincial jurisdiction [BC Provincial Council United Fisherman and Allied Workers Union
v. BC Packers]
Striking employees who picketed in boats in water at the entrance of the employer’s station were
accused of violating the Industrial Relations Act because none of the picketers had ever worked at
the station. Held that the provincial Board had no jurisdiction to issue a cease-and-desist order
with respect to picketing on waters within federal jurisdiction under s. 91(10) of the BNA. [Cove
Fisheries and BC Provincial Council]
POSTAL WORK




Employer operated under contract with Canada Post and also carried on business privately – Sask
COA held that the bargaining unit fell within provincial jurisdiction but SCC overturned holding
that where a company’s main business entailed work for Canada Post the limited use of a license
permitting it to transport household goods was insufficient to give it provincial jurisdiction [Letter
Carriers’ Union of Canada v. Canadian Union of Postal Workers]
Issue of whether federal jurisdiction extended to postal outlet inside a pharmacy – held that the
practical and functional relationship between the services provided by Canada Post and the
pharmacy was such that though in principal it was a provincial undertaking the franchisee was an
integral part of the core federal undertaking’s business [Canada Postal Corp and CUPW (Sheldon
Manly Drugs – the Shoppers Drug Mart Case)]
Canada Post contracted with private carriers to pick up, sort and deliver mail (work previously
done by union employees). Muir disputed federal Board’s jurisdiction. Board concluded that
postal services offered by Muir’s was indispensable to Canada Post’s parcel program and the links
between them were “multifaceted and continuous” and therefore there was a strong practical and
functional relationship – within federal jurisdiction [Muir’s Cartage Ltd. and CUPW]
Union challenge to the franchising of retail postal services to the private sector – Canada Post and
the pharmacy challenged the application on the basis of jurisdiction. Applying Shoppers, Canada
LRB affirmed jurisdictional competence [Rideau Pharmacy]
ABORIGINAL PEOPLES



Four first nations people owned a business which operated in Ontario on a reserve under license by
the Minister of Indian Affairs which received financial assistance from the federal ministry. SCC
held that the Canada LRB had no jurisdiction over a bargaining unit comprised of company
employees – despite 92(24) of BNA, the primary federal jurisdiction of First Nations people did not
extend to regulation of the company’s labour relations [Four B Manufacturing v. United Garment
Workers]
Pursuant to a federal grant, Band Council hired several members of the band resident on the
reserve to carry out home construction – relying on Four B, the Sask LRB granted the union’s
application for certification. On appeal it was held that direct participation of the Bank Council as
employer brought the employees within exclusive federal jurisdiction [Re Whitebear Band Council]
Musqueam Indian band incorporated Celtic Shipyard to build and repair vessels including
commercial fishing vessels used by Musqueam people and providing skills/training to members of
the band. It operated on land traditionally held by the band, but formal designation was pending.
Funds for the purchase of the lands were furnished by the band which had received federal grant
38
money. Half the company employees were from the band. When union brought application for
provincial certification, band claimed the company activities were inseparable from the band as a
whole. Citing Northern Telecom No 1 and Four B, Board decided the undertaking was an ordinary
industrial activity and that Musqueam involvement was not enough to remove it from provincial
jurisdiction [Celtic Shipyards v. Marin Workers and Boilmakers Industrial Union]
TRUCKING/TRANSPORT



recent deregulation in the federal sector has produced litigation
Union attempted under the CLC to certify drivers employed by three interrelated truck transport
businesses – Board decided to include in federal jurisdiction any extra-provincial operation that
was continuous and regular, but in this case the undertakings extra-provincial business was
sporadic [Exalta Transport Corp and General Teamsters]
Teamsters sought declaration from Alberta LRB whether Fastrate was provincial or federal – board
declared federal because it operated as a national freight forwarding company that picked up and
consolidated freight in one province and deconsolidated it in another. SCC disagreed (divided,
Rothstein majority) and held that the actual inter-provincial transportation was contracted out to a
separate firm, so despite the national scope of its operations, each provincial operation was under
provincial law and only the inter-provincial carrier was federally regulated (justified on the
grounds that federal jurisdiction should be narrowly interpreted as an exception to the rule of
provincial jurisdiction) [Consolidated Fastrate Inc v. Western Canadian Council of Teamsters]
o Binnie (minority) argued the living tree approach – arrangement of executive ahd legislative
powers entrenched in the constitution must be applied in light of business realities of 2009
and not frozen in 1867
o RESULT: narrowing of federal jurisdiction especially since businesses are increasingly
contracting out parts of their operations
TWO TYPES OF PROBLEMS THAT ARISE IN DETERMINING FEDERAL OR
PROVINCIAL JURISDICTION



(1) The enterprise is closely or inseparably connected to a federal enterprise but the actual activity of the
employees has provincial overtones
(2) The activities in question are partly federal and partly provincial in nature
Issue: should provincial labour legislation apply where the federal legislature has failed to address
a particular aspect of labour relations in a federal activity?
o In exercising power over navigation and shipping, federal government did not legislate
regarding labour relations – but argument failed that because property and civil rights are
involved, and by necessity work within provincial jurisdiction, provincial legislature should
apply.
o In Commission du Salaire Minimum v. Bell Telephone (the Minimum Wages case, 1966) the SCC
said “no”. The Quebec legislature had enacted min wage legislation, and it sought to make
bell liable for a levy under this scheme. Bell successfully argued that it was a federal
undertaking and that none of its ER-EE relationships could be regulated under provincial
legislation. This holding at the SCC established not only that provincial and federal
legislatures have concurrent power over LR, but also that the federal power is exclusive
where federal activity is concerned (counter to Re Hours of Labour where it was held that if
federal power was not used, provincial legislation could apply)
39
o
In Minimum Wages the court argued that the fed power to regulate LR stemmed from its
exclusive jurisdiction over s. 91 matters, inasmuch as the resolution of labour disputes was
essential to the regulation of such matters – any disputes about the conditions of work ought
to be subject to federal legislation. This was despite the fact that in Workmen’s Compensation
Board v. Pacific Railway (1919) it had been held that provincial workers’ compensation
legislation applied to a federal enterprise. SCC in Minimum Wages distinguished this on the
ground that the benefit had been conferred by statute and was therefore not accessible to
bargaining in the usual course of events.
Peace, Order and Good Government




In Snider it was held that the power given to Parliament to make laws with respect to POGG was
restricted to extraordinary situations of national peril (peculiar because the section specifically says
“not to limit the generality”) – but the scope of POGG has been enlarged since Snider
Munro v. NCC (1966): SCC upheld federal legislation aiming at providing a green belt around the
capital, permitting the fed to expropriate an Ontario resident’s property. Court said BNA Act gave
Parliament power to legislate with respect to everything not reserved to the provinces by s. 92 (sp
list in s. 91 was not exhaustive).
Federal Government’s 1975 anti-inflation legislation: set out to regulate the incomes of salary/wage
earners, as well as the prices of goods/services, through an administrative board. This legislation
was said to have overridden the existing LR schemes (federal and provincial). Argument was that
this left ERs and EEs left nothing to bargain about – inasmuch as this was for POGG, it would seem
to have been valid
Peter Hogg, Constitutional Law of Canada:
o The most recent application of the emergency doctrine is in the Anti-Inflation Reference
(1976) in which the legislation was upheld as an emergency measure (set
wages/fees/prices/profit)
o Scheme was temporary (Act automatically expired), there had been a period of over 20 digit
inflation in Canada, and this had been accompanied by high rates of unemployment
(emergency)
o Problem with the Act: the preamble did not assert the existence of an emergency (pointed
to conclusion, accepted by 2 dissenting judges, that the power existed under POGG and
there was no need to show an emergency)
 Factual material submitted was an economic study which was agreed to by
economists but not seriously challenged
o Laskin (majority) held that the court would be unjustified in concluding that Parliament
didn’t have a rational basis for regarding the Act as a measure which was temporarily
necessary to meet a situation of economic crisis imperilling the well being of Canada as a
whole
 Passage carefully disclaims any judicial duty to make a definitive finding that an
emergency exists – all the court needs to do is find a “rational basis” for the
emergency
 Not necessary for the proponents of the legislation to establish a rationale basis – the
opponents of the legislation have to establish the absence of a rationale basis
o Hogg: in a constitutional case where the validity of legislation depends on the social or
economic conditions of a country, it is impossible for the court to make definitive findings
40
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

Judicial restraint requires a degree of deference to the legislature, BUT the
formulations in the Anti Inflation Reference when read in the light of persuasive
factual material before the court which denied the existence of an emergency, make
it almost impossible to challenge federal legislation on the ground that there is no
emergency – this means the Parliament can use its power almost at will
o Tucker: when economic needs were seen to be adversely affected by the private ordering of
work conditions – no rhetoric, basic social belief about freedom of individual and/or CB, not
even traditional constitutional law precepts, were allowed to stand in the way
In the 1980’s and early 90’s (recession), virtually every jurisdiction in Canada passed legislation
constraining income, compensation and the right to strike, usually in respect of Public Servants gave rise to many Charter challenges (violation of FOA, FOE and equality rights)
CB was not legislatively endorsed from the inception of time – jurisdictional controversies tend to
suggest that everyone always agreed with the idea and fought for it, but not the case
The Framework of Collective Bargaining


The Ontario Labour Relations Act governs CB in the private sector
The Ontario Labour Relations Board (OLRB) administers the OLRA
Excursus – the Construction Industry

Alan Minsky, “Some Labour Relations Issues in the Constitution” (2001)
o It is often said that LR in the construction industry is different from the standard model
 Standard model based on a fixed workplace where EEs are engaged on an indefinite
term of employment
 In the construction industry, employment is sporadic and seasonal (frequent layoffs)
and this temporary nature of employment gives rise to a unique relationship
between tradesperson and union, which is typically more important than the
relationship between ER and EE
o The union provides referral to employment through its hiring hall, creates and operates
skilled trades/apprenticeship programs, creates benefits trust funds for health and welfare,
pension and other such purposes, collects the contributions to such funds required by the
CB from delinquent contractors, and administers the funds on a union only or jointly
trusteed basis
o Each building trades union represents a distinct group of skilled tradespersons that are
engaged in a particular trade or craft
o Arlington Crane Services v. Ontario: legislative reform has been an attempt to replace a
legislative model based on individual employer labour relations with a more appropriate
multi-employer model based on the unique features of the construction industry
o The players:
 Dominated by the 14 International building trades unions (headquartered in the US,
offices in Canada) – each represents a particular craft, generally affiliated with the
AFLCIO
 With few exceptions, bargaining has taken place on a union-by-union basis with
individual contractors or ERs organizations
41
o
o
o
o
o
o
o
o
A unique feature of the OLRA is the creation of the Ontario Construction Secretariat –
composed of representatives of the building trades unions and ERs organizations to
facilitate CB in the ICI sector
The acquisition of bargaining rights:
 Bargaining rights are acquired by one of two processes (not unique to construction
industry): by entering into a voluntary recognition agreement (VRA) with ER on
behalf of a defined group of EEs, or by applying to the Board for certification to
represent such EEs
 The twist in the construction industry is that such an agreement usually incorporates
by reference, the terms and conditions of the union’s prevailing or standard CA with
other contractors/ERs organizations applicable to its work in the geographic area and
sector in question
The nature of CB in the construction industry:
 Employers organization is entitled to apply to Board to represent unit of employers
whose employees are a particular trade union
 Employers organization is accredited with exclusive right to bargain with that trade
union to negotiate a single collective agreement binding upon all existing or future
employers whose employees are represented by he trade union in question
 This accreditation scheme did not reduce the number of collective agreements in the
ICI sector and thus the designation scheme was enacted in 1977
Designation scheme: Minister of Labour designated employee and employer bargaining
agencies who were vested with the exclusive authority to negotiate and conclude province
wide collective agreements in the ICI sector of the construction industry for a particular
trade/craft
Common employer provisions of the Act (s.1(4))
 Provision provides legal recourse to a trade union in situations where a sale of
business has not taken place but rather, where, the principles or officers of a
unionized contractor seek to carry on business on a non union basis
Recent changes to the Labour Relations Act impacting the construction industry
 Bill 31: Project agreements: (1) a proponent who believes that a construction project
is economically significant must initiate a process which contains a general descrip of
the project and a term that the agreement is in effect until the project is completed or
abandoned (2) no employees performing work to which the project agreement
applies shall strike and no employer shall lock out such employees while project
agreement is in effect
 Non-construction employer entitled to apply to the Board for a declaration
termination a building trades unions bargaining rights in the construction industry if
the non-construction employer did not employ any such employees engaged in the
construction work who are represented by the union
Special certification rules for construction sector: Card based certification where
membership cards submitted by the union due to mobile nature of workforce and emphasis
on project work
Minimizing residential home construction disruptions: Special bargaining scheme, in place
since 2001, prevents consecutive strikes from paralyzing residential construction
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Other Regulatory Mechanisms: public sector CB differs from private sector
legislation


CB legislation designed for the public sector (including schools, hospitals, police) is designed after
the private sector model but departs in several respects:
o Workers collective action is more restricted in the public sector (justified b/c these are often
monopolies – no competition in the market)
o Restrictions on the choice of bargaining agent or the subjects of CB
o Specific fact-finding and dispute resolution mechanisms
An enduring problem for any dispute resolution mechanism that substitutes compulsory
arbitration for economic sanctions is the criteria to be applied in establishing the CA – increasingly
arbitrators are taking the ability to pay into account
Other Regulatory Mechanisms: Using Public Interest as Justification to Stop Strikes
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Governments may use the public interest as justification to stop an otherwise lawful strike –
referred to as ad hoc legislation
Glasbeek, “Compulsory Legislation in Canada”
o These situations arise in areas where CB has been permitted, the normal negotiating
proceedings having faille and legitimate strike action has been taken.
o The legislative intervention is usually a short act which orders the disputing parties to
resume their working relationship. This means that striking EEs are commanded to return to
work.
o Usually there is a provision safeguarding the rights of the strikers, protecting them against
any reprisal actions that the ER might engage in to punish them for their conduct
o Sometimes once the parties have resumed normal operations, they are to attempt to settle
their own affairs by a certain date. Should they fail to reach agreement, they are then to
accept the help of a mediator, and if there is still no agreement, they will be made to subject
to arbitration.
Back to work measures have increased since the 50’s (provincial and federal) from an annual
average of .2 from 1950-1954 to an annual average of 2.3 from 2000-2002
Workers have sought to defend their right to strike by challenging the use of such legislation on the
grounds that it infringes the Charter (Retail, Wholesale and Dept Store Union v. Sask) but were
unsuccessful – BUT the BC Health Services decision has opened the door
CH 1: Application of the Charter of Rights and Freedoms to Employment Law
Overview


Charter operates in two ways:
o Direct operation: challenge certain actions as violating charter (*common in CB*)
o Indirect operation: Charter values ought to influence the way the courts or administrative
agencies interpret the law even if the Charter does not apply directly
Two dimensions of Charter invoked in this area:
o Equality rights (s.15)
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
o
In area of CB, the equality rights has been given short shrift by all courts including
SCC
 When you differentiate amongst workers either by occupational sector (agricultural
are different from other workers) these distinctions are based on occupation which is
NOT an analogous ground under s.15. When health workers raised equality
argument under s.15 in BC, it was pushed out.
FOA (s. 2(d)). Two large issues here:
 APPLICATION: Does the charter apply?
 Dolphin delivery: in conflict between private sector workers and private sector
ERs, there are barriers to invoking charter (different if government is
employer because then you have a government actor)
o Courts have suggested that the public/private distinction that
underlies DD is potentially vulnerable
 SCOPE: What is the scope of activities that is protected by this notion of FOA? How
narrow or broad is it?
 When the Charter came into force there was a recession, and the government
responded by passing legislation that restricted the role of CB and prohibited
strikes
 Unions claimed that kind of government action (legislation is definitely
government action, so Charter applied) violated the charter.
 Cases:
o Charter protected individual’s right to form associations BUT it did
not extend to protect the core activities of those associations (CB,
strikes – not covered). Just like FOA protects right to form golf clubs,
there is no right to golf.
o Groups not covered by statutory collective bargaining scheme: EEs
brought claims saying exclusion violated their FOA. Claims were
rejected and it was held that failing to give a group access to a
statutory scheme was not a violation of FOA
 In the period immediately after the Charter came into force, it didn’t look like
it would have a big impact on Canadian labour law (BC Health services – this
is an area for political determinations, court should stay out)
Background
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


The entrenchment of the Charter in 1982 triggered a great deal of litigation in L&E
The proclamation of the Charter coincided with a full-scale legislative assault on public sector CB
rights and a deep recession which gave ERs the upper hand in CB. Unions invoked FOA and FOE
guaranteed by the Charter to challenge legislative restrictions on the right to strike and CL
limitations on picketing.
Simultaneously, ERs and individual EEs launched legal challenges to some of the cornerstones of
the Canadian statutory CB regime: certification procedures, ULP provisions, and union security
arrangements, including the political use of compulsory union dues, were all impugned as
infringing Charter-protected rights and freedoms.
The Charter also affected the individual employment law regime: Workers and their advocates
challenged exclusions from protective legislation as infringing constitutional guarantee of equal
44
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




benefit and protection under the law, while ERs contested protective legislation and enforcement
mechanisms as unjustifiably limiting their fundamental rights and freedoms.
APPLICATION: Until recently the impact of the Charter on Canadian labour law has been minimal
b/c of the scope of the Charter’s application
o The threshold question that determines the impact of constitutional rights on L&E law, is
whether the Charter applies.
o The resolution of this question depends upon the judicial interpretation of the term
“government” in s.32 of the Charter.
The Charter clearly applies when private parties in a dispute invoke L&E related legislation, which
can also be challenged directly on the ground that it violates Charter-protected rights
Decisions and actions of tribunals: Slaight Communications
o SCC found that statutory authorities which exercise statutory discretion are subject to the
Charter. This means that the decisions and actions of statutory tribunals and statutory
adjudicators that impact on labour and employment relations are subject to Charter scrutiny.
The common law: Dolphin Delivery
o Case involved unlawful secondary picketing by a union.
o The Canada Labour Code is silent on the issue of secondary picketing (unlike provincial
statutes) so the ER obtained an injunction to restrain the picketing on the ground that it was
unlawful as it amounted to a tort recognized by the CL.
o When the union argued that the injunction violated its FOE, the issue arose as to whether
the Charter applied to the activities of private actors and to judge-made CL
o A unanimous SCC held that the Charter applies only to government and that for the
purposes of the Charter government does not include the courts (so Charter doesn’t apply to
the litigation based on CL between private parties OR to a court order enforcing CL rights)
o SCC noted that this was “a distinct issue from the question whether the judiciary ought to
apply and develop the principles of the common law in a manner consistent with the
fundamental values enshrined in the Constitution. The answer to this must be in the
affirmative.”
Whether the Charter’s guarantee of FOA included the right to CB: Professional Institute of the Public
Service of Canada (PIPS) v. Northwest Territories (Commissioner), [1990]
o A group of federal government EEs who were transferred to the NWT government and
legislation provided that a union could neither be certified nor obtain bargaining rights
unless it was incorporated
o The government had discretion to incorporate a union and refused so PIPS could not
bargain collectively on behalf of the transferred members
o Four of seven judges held that the FOA did not protect the right to bargain collectively and
that the government was under to constitutional obligation to provide a statutory scheme
o Sopinka J., “restrictions on the activity of collective bargaining do not normally affect the ability of
individuals to form or join unions.”
Narrow interpretation of FOA in LR context: Delisle v. Canada (Deputy A.G.), [1999]
o Delisle, a member of the RCMP and president of an informal EE association representing
RCMP officers, challenged the exclusion of members of the RCMP from the CB legislation
governing federal public service workers as a violation of FOA.
o Bastarache (majority) held that only the establishment of an independent EE association and
the exercise in association of the lawful rights of its members are protected under s.2(d) of
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
the Charter. The freedoms do not impose a positive obligation of protection/inclusion on the
government (except perhaps in exceptional circumstances)
 However, since the RCMP is part of the government it was open for Delisle or any
other party with standing to challenge directly under the Charter any actions by the
RCMP management which interfered with the EEs freedom to join an independent
EE association directly under s.2(d). But what precisely such protections against
unfair labour practices would look like it was far from clear.
In two recent cases, Dunmore and Heatlh Services the SCC has substantially altered its approach to
FOA and CB
Dunmore v. Canada (2001, SCC)
FACTS: Individual farm workers and union organizers challenged the exclusion of agricultural
workers from Ontario’s statutory labour relations scheme. Claim was that it was a violation of their
FOA and equality rights under the Charter. Specifically, they argued that the LRESLAA, combined
with the LRA, prevented them from establishing, joining and participating in the lawful activities of a
trade union.
HELD: the total exclusion of agricultural workers from the LRA violates s. 2(d) of the Charter and
cannot be justified under s. 1. At minimum, whatever protections are necessary to establish and
maintain employee associations should be extended to persons employed in agriculture in Ontario [not
necessary to consider a s.15 violation]
BACKGROUND: Historically, this group’s conditions/standards of work were seen to be quite low.
 1990: NDP elected, passed statute to allow for the formation of unions and CB in the agricultural
sector to take into account some of the special features of the industry (workers might strike right
before harvest, etc)
 1995: PC’s came in, repealed NDP laws, retroactively cancelled certifications/collective agreements
that had been negotiated. A union (UFCW) had been established, launched legal battle arguing
that their FOA and Equality Rights had been violated.
NOTE: the legislation did not prohibit farm workers from forming associations – BUT they were
cut out of statutory collective bargaining scheme.
Issue 1: in what ways, if any, did Dunmore change the scope of workers’ FOA?
 PRE-DUNMORE there were 4 propositions concerning the coverage of 2(d): Sopinka J. in
Professional Institute of the Public Service of Canada v. Northwest Territories (Commissioner), [1990,
PIPSC]:
o (1) It protects the freedom to establish, belong to and maintain an association
o (2) It does not protect an activity solely on the ground that the activity is a foundational or
essential purpose of an association (doesn’t protect CB)
o (3) It protects the exercise in association of the constitutional rights and freedoms of
individuals (people can associate with each other)
o (4) It protects the exercise in association of the lawful rights of individuals (not just their
constitutional rights)
o NOTE: None of this helps agricultural workers – they could form an association and attempt
to bargain, but it wouldn’t give them any kind of legal right to do so. Their exclusion is an
example of Liberal Voluntarism.
 NEW COLLECTIVE DIMENSION established in Dunmore:
46
o

There are actions that can only be exercised in association – they don’t have meaningful
analogies in terms of individual action.
o The purpose of s. 2(d) commands a single inquiry: has the state precluded activity because
of its associational nature, thereby discouraging the collective pursuit of common goals?
While the four-part test for freedom of association sheds light on this concept, it does not
capture the full range of activities protected by s. 2(d).
o The collective is "qualitatively" distinct from the individual: individuals associate not simply
because there is strength in numbers, but because communities can embody objectives that
individuals cannot. Limiting 2(d) to activities that are performable by individuals would
render these fundamental objectives, futile. In other words, certain collective activities must
be recognized if the freedom to form and maintain an association is to have any meaning.
o Examples:
 A "majority view" cannot be expressed by a lone individual, but a group of
individuals can form a constituency and distil their views into a single platform (this
is the essential purpose of joining a political party, participating in a class action or
certifying a trade union). To limit s. 2(d) to activities that are performable by
individuals would, in my view, render futile these fundamental initiatives.
 The press differs qualitatively from the journalist, the language community from the
language speaker, the union from the worker – in these cases the community
assumes a life of its own and develops needs/priorities that differ from the
individual
 In all cases, the community assumes a life of its own and develops needs and
priorities that differ from those of its individual members (a language community
cannot be nurtured if the law protects only the individual's right to speak – R. v.
Beaulac)
o Because trade unions develop needs and priorities that are distinct from those of their
members individually, they cannot function if the law only protects what might be "the
lawful activities of individuals".
FULL RANGE OF ACTIVITIES PROTECTED BY 2(D): court doesn’t cross the line, but still a
stepping stone
o The law must recognize that certain union activities - making collective representations to
an employer, adopting a majority political platform, federating with other unions - may be
central to freedom of association even though they are inconceivable on the individual level.
o This is not to say that all such activities are protected by s. 2(d), nor that all collectivities are
worthy of constitutional protection; indeed, this Court has repeatedly excluded the right to
strike and collectively bargain from the protected ambit of s. 2(d) (Alberta Reference and
PIPSC)
Issue 2: when, if ever, under Dunmore does the state have a positive obligation to protect FOA?
 ERs argument: the Charter doesn’t apply because the interference with the associational activities
of farm workers was not being carried about by government (it wasn’t the state that was firing
workers, it was private parties who were retaliating against workers who formed associations). But
can the failure to take positive action constitute government action that violates FOA?
47
o


Court moved away from the older view articulated in PIPS and Delisle that FOA required
direct negative restrictions and accepted that in some circumstances the government had
duty to protect FOA and couldn’t stand by and let employers do what they wished.
TEST: where under-inclusive legislation would infringe Charter protected rights, specifically FOA
o A Charter right is affected: Claims of under-inclusions should be grounded in fundamental
Charter freedoms rather than in access to a particular statutory regime.
o Evidence establishes that a lack of protection adversely effects enjoyment of Charter right:
you have to demonstrate that the absence of protection permits a substantial interference on
your Charter right (here, the failure to protect farm workers from adverse actions by ERs
interfered with their ability to enjoy FOA)
o Failure to protect against private action can be characterized as state action: A failure to
include someone in a protective regime may affirmatively permit restraints on the activity
the regime is designed to protect.
Limited to cases of under-inclusion? Could government repeal positive protection for all?
o Court hinted that this kind of argument does not require legislatures to enact private sector
labour relations statutes that protect FOA
Issue 3: Why did exclusion of agricultural workers from LRA violate FOA?
 Freedom to organize lies at core of FOA (para 37)
o Trade union freedom to organize lies at the core of Charter’s protection of FOA (right to
organize is highly values in Canadian legal system). Court notes that in the govt hearings
preceding the Charter’s enactment, the express right to unionize was opposed, on the
grounds that it was already covered by FOA.
 Note also frequent references to international conventions – ex: ILO
o SCC has adopted view that international law standards (particular those to which Canada
has indicated adherence) are valuable tools for court to interpret statutes
 Without protection agricultural workers are incapable of exercising their freedom
o The record shows that the ability to establish, join and maintain an agricultural employee
association is substantially impeded in the absence of statutory protection and that this
impediment is substantially attributable to the exclusion itself, rather than to private action
exclusively
 Exclusion reinforces private interference (this constitutes the state action)
Issue 4: Why did the exclusion fail section 1 analysis?
 Sufficiently important objective: protection of family farm and the need to maintain a competitive
agricultural sector (ensuring farm productivity)
 Proportionality:
o Rational connection: there is a connection between labour relation statutes and protection
for family farm
o Minimal impairment (FAIL):
 Government failed to establish that this is minimal impairment on FOA necessary in
order to address the concern of protecting the family farm/ensuring farm
productivity
 Might be less restrictive ways to do this (like in NDP’s legislation)
48
Scope of Positive Obligation
Para 67: I conclude that at minimum the statutory freedom to organize in s. 5 of the LRA ought to be
extended to agricultural workers, along with protections judged essential to its meaningful exercise,
such as freedom to assemble, to participate in the lawful activities of the association and to make
representations, and the right to be free from interference, coercion and discrimination in the
exercise of these freedoms.
Para 68: In choosing the above remedy, I neither require nor forbid the inclusion of agricultural
workers in a full collective bargaining regime, whether it be the LRA or a special regime applicable
only to agricultural workers such as the ALRA.
 TUCKER
o s.5 only lets workers join unions, and agricultural workers already had the right to assemble
 Lawful activities of association – also true before Dunmore
 Free to make representations – also true before Dunmore
o VALUE ADDED IN DUNMORE: “.. the right to be free from interference, coercion and
discrimination in the exercise of these freedoms” (the freedoms were in existence, they
needed rights, and this at least gave them the right to be free from interference)
o Arguably the CCC protected them: it is still a crime in Canada, but the CCC has never been
enforceable – it’s always taken a labour relations statute to effectively implement these
schemes
o WHAT WORKERS DIDN’T GET: a right to CB in the sense that employers were under a
duty to recognize or negotiate in good faith with associations formed by farm workers
 AFTERMATH: provincial government enacted the Agricultural Employees Protection Act (AEPA)
which minimally complied with Para. 67 – it protected against ULPs and intimidation, coercion and
discrimination
o Even said that were a representation was made an ER had to acknowledge that they
received it (beyond Dunmore)
o Contained certain restrictions about farm property
o It did NOT require agricultural ERs to recognize and bargain with unions that enjoy
majority support
o Then unions took the AEPA as completely useless in facilitating negotiations, and then they
brought a challenge against it (AG v. Michael Fraser)
 Fraser:
o The AEPA which came into force on June 17, 2003, excludes agricultural workers from the
LRA, but provides certain protections for organizing. The Respondent union and the
individual Respondents sought a declaration that the AEPA and s. 3(b.1) of the LRA, which
provides that the LRA does not apply “to an employee within the meaning of the
Agricultural Employees Protection Act, 2002”, were unconstitutional.
o The TJ dismissed the application, concluding that the AEPA met the minimum statutory
requirements necessary to protect the freedom to organize.
o The COA (in light of BC Health Services) allowed the appeal and declared the AEPA
constitutionally invalid. The Court concluded that the AEPA substantially impaired the
capacity of agricultural workers to meaningfully exercise their right to bargain collectively,
and that the violation of s. 2(d) of the Canadian Charter of Rights and Freedoms was not
saved under s. 1 of the Charter.
49
o
Government of Ontario appealed and SCC granted leave in 2009 (This case probably went
through SCC by now.)
Issue 5: Does the AEPA comply with the requirements of Dunmore?
 Most likely – gave workers almost exactly what SCC said the Charter required
 However, in aftermath of BC Health Services, the questions have changed – Does AEPA meet
combined requirements of Dunmore and BC Health Services?
The Harvest of Dunmore
 Widened the scope of 2(d) to include collective activities
 Recognized that the state may have positive obligation to protect Charter-protected rights against
interference by private actors
 Positive assessment of trade union freedoms
Health Services and Support-Facilities Subsector Bargaining Association v. BC (2007, SCC): Charter’s
FoA includes protection of right to CB. Parts of the Bill-29 legislation violate workers Bill 29 rights
and cannot be saved under s.1.
BACKGROUND: Chaoulli v. Quebec
 Chaouilli held that in some circumstances, if the Canada Health Act does not provide adequate care,
then it might violate people’s Charter rights (so healthcare privatization might be required).
 This opened up challenges to the public healthcare system, on a Charter rights basis.
 Government had been trying to address the problem of rising health care costs. It had been
experimenting with various ways of trying to address the situation. One response had been
privatization.
Bill 29:
 Facilitating privatization of ancillary health care jobs: this legislation facilitated the contracting
out of positions, so workers would not be employed by public institutions. The services would be
put up for bid and EEs would go from public to private sector. It wasn’t the health care services
that were being privatized, it was the ancillary ones – maintenance, food services, etc.
 Avoiding effects of pay equity obligations: the government of BC had just negotiated a pay equity
agreement with the public health care unions to bring up women’s wages which had been
historically undervalued, so wages were going to be increasing over a number of years. Privatizing
would get them out of the pay equity issue – no private sector pay equity legislation in BC (only a
public sector obligation to correct past inequality)
 Stripping existing collective agreements of protection against layoffs: the CA that the parties had
protected against transfers and K’ing out. They had bargained for limitations on the power of the
hospital.
 Limiting unions’ ability to negotiate over these issues in the future:
 Done without advance notice to or consultation with unions:
 This would contain health care costs on the assumption that the workers would be paid less, and
terms/conditions would be inferior to what they would have been in the public sector.
o Government went ahead and privatized thousands of healthcare jobs in the province. Most
of the new jobs were filled by the same people, but more part time work, lower wages,
fewer benefits, etc.
Workers’ approaches:
50
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Political: The legislation caused such uproar that there was discussion of a general strike. There
were public demonstrations, but the strikes never materialized (unions were concerned about
illegal strikes – political strikes are unlawful).
 Legal strategy: make a complaint to the ILO that this action was a violation of the FOA and the
conventions signed by the government. This was seen as merely symbolic, because:
o SCC decision came down in Newfoundland on pay equity agreement. Agreement had been
suspended by the province, arguing it couldn’t afford to pay. SCC said it does violate
equality rights, but saved by s. 1 due to the economic concerns.
o The Chaoulli decision also suggested that the court was sympathetic to giving provinces
more options in relation to the health care problems provinces were facing.
BASIC HOLDING:
 Charter’s protection of FOA includes protection of right to CB
 Some sections of Bill 29 violated workers’ CB rights
 Most of those violations were not demonstrably justifiable under s. 1 of the Charter.
Reasons for Charter Protection: four grounds
1) Rejection of Court’s earlier justifications for holding that FOA does not protect CB (cases from 20
years ago are deemed to be misguided – Alberta Reference and PIPSC can no longer stand and the
rationale for excluding inherently collective activities has been overtaken by Dunmore)
o CB is not a “modern” right but a fundamental freedom: Tucker: note that the CB history the
Court provides is not necessarily accurate, although it’s helpful for the purposes of this case.
o Judicial deference does not preclude court from insuring that labour policy reflects Charter
values: less judicial deference is required if this is a common law principle and not a matter
of statutory interpretation
o FOA has a collective dimension (Dunmore): collective bargaining is not reducible to
individual rights.
o Possible to protect the procedure of collective bargaining without protecting its outcomes:
lower courts had made errors in conflating the two.
o Need for a contextualized approach.
2) Positive Ground For Protection (why CB should be included): Constitution FRAMERS’
INTENTIONS
o History of Canadian labour law demonstrates that “association for the purpose of collective
bargaining has long been recognized as a fundamental Canadian right that predated the
Charter”; the framers of the Charter intended to include it in s. 2(d)
o Note: generally the courts have refused originalist arguments for interpretation of the
Charter.
3) Positive Ground For Protection (why CB should be included): INTERNATIONAL LAW
o Broad claim (para 78): “Canada’s current international law commitments and the current
state of international thought on human rights provide a persuasive source for interpreting
the scope of the Charter.”
o Tucker:
 There is a very heated debate among Canadian scholars on international labour law
and the ILO and how the ILO’s conventions on FOA and CB should be interpreted.
There is also debate on how accurate the SCC’s analysis of those conventions is.
51

There are two significant ILO conventions on FOA: Convention 87 (on FOA) and 98
(on CB). Canada only ratified 87, not 98, which may be why the SCC only mentions
the former. Critics of this aspect of the decision have said that there’s a lack of
honesty in the analysis because the SCC fails to acknowledge the lack of ratification
of the CB convention. The failure to deal with this is a flaw in the decision—the court
ought to have addressed it more directly, even if 98 has no bearing (and that’s
debatable as well, as Canada is a member of the ILO).
 The SCC is essentially arguing that Canada’s obligations as a member of ILO
override: that by virtue of membership in ILO, members must recognize the
right to bargain collectively. Again, this bangs up against the fact that Canada
has not ratified 98 and the SCC’s lack of acknowledgement of that. And the
duty to bargain is less clear.
4) Positive Ground For Protection (why CB should be included): CHARTER VALUES
o Charter values require us to recognize CB.
o The right to bargain collectively with an ER enhances the human dignity, liberty, and
autonomy of workers by giving them the opportunity to influence the establishment of
workplace rules and thereby gain some control over a major aspect of their lives, namely
their work.
 Intrinsically valuable
o CB also enhances the Charter value of equality. One of the fundamental achievements of CB
is to palliate the historical inequality between ERs and EEs.
o A constitutional right to CB is supported by the Charter value of enhancing democracy. CB
permits workers to achieve a form of workplace democracy and to ensure the rule of law in
the workplace workers gain a voice to influence the establishment of rules that control a
major aspect of their lives
 Tucker: “The Supreme Court of Canada Wants You to Join a Union.” It’s upholding certain rights
that have been curbed by democratically elected individuals. It’s a bit ironic that the courts,
historically the protectors of individuals, have stepped in to protect the collective.
o What explains the shift? Working people have tended to suffer losses in terms of statutory
rights in employment and labour in this era.
Critique of Historical Approach: Tucker
 Whiggish history of progress misses the important point that labour regimes contain a mix of
repression, toleration and recognition/promotion. The over-generalized whiggish perspective
masks the ongoing role of repression/restraint in modern statutory schemes.
o The SCC has framed our history is self-congratulatory when it is actually failing with
respect to dealing with the emerging realities of today’s economies.
o Union activity is largely a public sector activity today, while the private sector is dwindling.
 Continual ‘elision’ of CB as a social practice, legal privilege and legal right creates a false sense of
the extent to which the right to CB is historically embedded in Canadian society
o You need to understand the difference between social practice, legal privilege and legal
right and their different dimensions—calling it all a “right” is misleading.
 The practice of bargaining collectively has been present in Canada from the early
19th century. Workers formed associations and collectively bargained.
52

o
o
o
Workers got the formal freedom to bargain collectively in 1872 when the Trade
Union Act took away the taint from collective bargaining.
 The right in a formal sense to bargain collectively, though, only really rose in WW2.
It doesn’t predate collective bargaining schemes, it is a creature of collective
bargaining schemes.
Tucker takes issue with the statement in para. 50: if you mean that the right to CB goes back
to well before WWII, that’s simply wrong. It is true that Canadian workers have historically
engaged in the activity of CB, but that doesn’t mean that it was not a crime or a tort to do so.
The right to CB arises when there is a correlative duty on ERs not to interfere with the
privilege. That does not come about until later.
FOA was first recognized as a legal right in the 1930s. CB moves from being a protective
right to one that has correlative duties on employers to recognize such unions. That
occurred only by statute and only happened at WWII and beyond.
Scope of Protection:
 Note the strong contrast in the judgment between a) the expansive rhetoric and b) the restrictive
scope of the protection provided.
 “Freedom of association” protects “the right to unite, to present demands to...employers
collectively, and to engage in discussions in an attempt to achieve work-related goals. Section 2(d)
imposes corresponding duties on government employers to agree to meet and discuss with them. It
also puts constraints on the exercise of legislative powers in respect of the right to collective
bargaining”
 Focus is on state action: Imposes duty on government to negotiate in good faith.
 Limits use of state power to interfere with collective bargaining,
 But court spends more time elaborating limits of right.
Limits:
 Must be state action: government as employer or government as legislator (para. 88)
 Right to collective bargaining does not guarantee the particular objectives sought through
associational activity: process not outcomes (para. 91)
o Therefore, no bar on contracting out, Tucker says.
 Does not guarantee access to any particular model of CB : how much of the Wagner Act model
(which dominates) is going to be constitutionally entrenched? See Fraser.
 The right to CB does not protect legislated labour rights: if your rights are rooted in the CA and
the legislation interferes, that’s a violation. If you rights are rooted in statute and the government
amends the statute, that may not be a violation.
o This suggests that unions should incorporate certain statutory rights (that would normally
be a given) into the CA so that they are protected in the event of changing legislation.
o Note that sometimes CAs also contain a commitment on part of the government to take
certain legislative action, such as the provision of retraining services, etc.
 Does not protect all aspects of associational activity; rather only protects against “substantial
interference”. Two inquiries:
o (1) Importance of the matter affected to the process of CB
 If the CA governed the lunchroom space and legislation eliminated those terms, that
would not be substantial.
53
o
(2) Manner in which the measure impacts on good faith negotiation and consultation. In
making whatever changes were made, did the government leave space for some form of
bargaining consultation and negotiation?
 In this case, the government never talked to the union about alternative methods for
obtaining the results they wanted to achieve.
 The government did not bargain in good faith in this case.
Application: 3 step analysis
1. Does the legislation interfere with collective bargaining?
a. LIMITS: must be state action, does not guarantee objectives, does not guarantee access to
a particular model of CB, does not protect legislated labour rights (only ones in the CA)
2. Was the interference so substantial as to violate Charter-protected freedom of association?
a. How important was the matter affected to the process of CB?
b. Did the government leave space for some bargaining/consultation?
3. Section 1 analysis.
Section 1 Analysis: Justification of Infringement
 Pressing and substantial objective (preserving health care)
 Means adopted are rationally connected to achieving the objective (reducing worker rights is
rationally connected)
 Minimal impairment (government fails to demonstrate that they considered less intrusive
alternatives; absence of consultation with unions undermines government’s case).
o The absence of consultation seems to be the centre of the analysis—which raises the
question: if the government had given more notice and opportunity for discussion, would it
have been acceptable?
Implications:
 Educative value: strong language about the contribution of CB to achieving Charter values of
equality, autonomy, democracy
 Collective bargaining: understood as embracing a limited right to a process of good faith
negotiation – is protected against substantial government interference
o Legislation that significantly interferes with important existing CB rights will be held to
violate FOA – provided that it is not preceded by consultation process that respects duty to
bargain
o Ditto legislation that prohibits or significantly limits future collective bargaining over
significant issues
Matters to Be Determined:
 Does FOA also protect the right to strike? The labour trilogy had an individualized notion of FOA
and said that the right to strike was not protected. But since the trilogy was criticized here, will the
right to strike, just like CB, be given protection?
 Can the Charter be used successfully to challenge the scope of bargaining restrictions in the public
sector?
 Can the Charter be used successfully to challenge exclusions from public sector CB legislation?
54
o
Part-time teachers in Ontario colleges and the RCMP were once excluded from CB schemes
but have now been included since this decision.
 Do minority public sector unions have a right to bargain collectively?
 Implications of greater judicial activism for freedom from compulsory association?
o Will we see the courts being more open to looking at cases where individuals complain
about being forced to pay union dues, etc.
 Does government have a positive obligation to impose a duty of good faith bargaining in the
private sector (eg. Dunmore II—Fraser). Does the government have to provide them with access to
some kind of mandatory CB scheme?
o If it is truly a fundamental right, then yes. You’d have to find that the failure to provide
access to a statutory framework for collective bargaining is a violation of 2(d).
o We’d have to see if the workers can do it without the access. If they can’t, then the
government inaction (with respect to failing to impose a duty to bargain) is causally related
to their inability to exercise their common law rights.
o Dunmore just said that legislation needed to be passed so that employers couldn’t
discriminate against employees who wish to join a union. There was no obligation to
bargain.
o Might have trouble with the larger argument, since it could be about asserting a right to an
outcome of collective bargaining.
Takeaway: The right to CB is a limited right: (1) the right is to a process and does not guarantee a
certain substantive or economic outcome (2) the right is to a general process of CB, not a particular
model of LR, nor a specific bargaining method (3) the interference must be substantial so that it
interferes not only with the attainment of the union members’ objectives (which are not protected) but
also with the very process that enables them to pursue these objectives by engaging in meaningful
negotiations with the employer
GOING FORWARD: Legislative Changes and Fraser


Legislative changes:
o Extension of statutory CB rights to part time and casual workers in New Brunswick, part
time community college teachers in Ontario, and home care workers in Quebec
o In 2009 RCMP officers successfully challenged the constitutionality of regulations requiring
collective representation to occur through the Staff Relations Representation Program (See
Mounted Police Association of Ontario v. Canada (Attorney General), 2009)
 Legislation was introduced in the summer of 2010 to permit RCMP officers to
unionize and to bargain wages. The legislation does not permit strikes or lockouts.
Most important case to date: Fraser v. Ontario (Attorney General) (2008, COA), the follow-up to
Dunmore.
o In a unanimous decision by Chief Justice Winkler, the court held that the effect of BC Health
Services was to open up the possibility that under some circumstances s. 2(d) may impose a
positive constitutional duty on government to protect the right to collective bargaining as
well as the right to organize.
o Has the COA gone too far in stipulating a model? Will SCC say we have to give the
legislature more scope/freedom to design a statutory CB scheme? We will find out how
much more constitutionalization the SCC is prepared for.
55


The Dunmore test has since been expanded by the SCC judgment in Baier v. Alberta, [2007] and it
requires five enquiries:
o (1) Are the activities for which the appellants seek s. 2(d) protection associational activities?
o (2) Are the appellants seeking a positive entitlement to government action, or simply the
right to be free from government interference? If the former, then the three so-called
“Dunmore factors” must be considered.
o (3) Are the claims grounded in a fundamental freedom protected by s. 2(d), rather than in
access to a particular statutory regime?
o (4) Have the appellants demonstrated that exclusion from a statutory regime has the
purpose or effect of substantially interfering with the freedom to organize or the right to
bargain collectively?
 CONTROVERSIAL: At a minimum, the following statutory protections are required
to enable agricultural workers to exercise their right to bargain collectively in a
meaningful way: (1) a statutory duty to bargain in good faith; (2) statutory
recognition of the principles of exclusivity and majoritarianism; and (3) a statutory
mechanism for resolving bargaining impasses and disputes regarding the
interpretation or administration of collective agreements
o (5) Is the government responsible for the inability to exercise the fundamental freedom?
o The court easily answered the first three enquiries positively. In answering the fourth
inquiry, the court found that the AEPA did not meaningfully provide access to collective
bargaining. The court concluded by finding that the government was responsible for the
agricultural workers’ inability to engage in collective bargaining by its failure to include
them in an adequate statutory scheme.
o Court dismissed equality rights argument and the s. 1 argument (case is on appeal to the
SCC)
Two questions that will have to be answered:
o If the state fails to do more to protect CB – are they implicated?
o Assuming they can get over the hurdle, the next question is what is the obligation of the
state in terms of protecting CB? How much of the Wagner Act model is a minimal
constitutional requirement? At the minimum (BC Health) there has to be a duty to bargain
with a group of farmers that want to. The question is whether there has to be a certification
process based on majority/exclusivity. COA said yes, and SCC will have to address it.
Summary of three perspectives of commentators on the Dunmore and BC Health
developments:


Two hands clapping:
o Public sector unions: have the most to gain from constitutionalization, because they most
face direct government interference with CB (like in BC Health), and this requires
government to come up with adequate justification, so they will be more reluctant to
interfere
o Private sector unions: have less to gain
Opponents
o Governments: it limits their freedom of action to take what they might see as measures that
are necessary in response to what they might perceive to be a crisis
56


BUT If they are right and there is a real crisis that needs to be addressed, then they
should be able to make a section 1 argument
 In many instances SCC has been willing to accept the kinds of arguments about a
fiscal crisis without inquiring too deeply into the government’s actions
o Brian Languille: pluralist position, industrial relations are best left to political process or IR
experts, have been wary of courts getting involved. If courts become too prescriptive it will
handcuff the ability of governments to make schemes that adapt to changing environments.
Will get locked in to Wagner model.
Sceptics:
o Harry Arthurs: the real constitution of Canada is not the Charter but the economic
constitution created by free trade agreements and other instruments – it is the economy and
its structures that is the fundamental problem.
 Giving workers more rights to FOA will not reverse the decline that we are seeing in
the world of CB (Charter can’t stop the race to the bottom)
o Tucker: agrees. The existing model of CB is faring poorly, so even if we constitutionalize
more of it, it doesn’t seem that it will make a lot of difference. However, for the area of
public sector CB which is now where CB is most significant, this decision reigns in more
egregious actions that Canadian governments had been resorting to frequency over past
number of years.
CH 1: International Law Regimes



Two major international law schemes that affect Canadian labour law: ILO and NAALC
In thinking about these influences, differentiate between hard law influences and soft law
influences
o Hard law: arrangements that are legally binding and enforceable. If those laws are not
compelling Canada to behave in particular ways then a pure formalist you would say the
regimes are a failure.
o Soft law: law can influence how governance occurs – the notion that you can steer/influence
direction of government by other kinds of instruments
Two principal motivations for international labour standards
o Social revolution factor: fear that if labour market produced outcomes that were viewed
negatively by working people then they would rebel and destabilize regimes or potentially
overthrow them
 After WWI there was a period of turmoil, crucial factor for shaping development of
ILO
o Social dumping factor: concern that if markets are opened up to international competition
you can generate a race to the bottom unless there is a global set of rules that prevents
people from cutting labour standards in order to gain a competitive advantage
 International arrangements are required to stop the race from the bottom
 This was clearly the motivating factor in the NAALC. When this was negotiated in
1993 no one in Canada or the US could claim that there was a danger of a working
class revolt, so this was the justification used
57
The International Labour Organization (ILO)
Background and Overview







Established in aftermath of WWI (in shadow of industrial revolution)
Approximately 175 Member States
188 Conventions
o Member states are only bound by the conventions they ratify
o Canada has ratified 30 conventions (very selective about which conventions it ratifies)
Process: when a complaint is received, the ILO appoints an investigatory committee, which studies
the complaint and issues a public report setting out its findings
ILO’s role: establishing international labour standards
o Until recently principal way it did this was to pass conventions
o It also achieves compliance with conventions through soft law mechanisms
Over the years the number of complaints has increased due to the more frequent use of laws
suspending the right to strike.
Problems with system: lack of publicity, it takes years to process complaints
o As a result by the time the determination is made the dispute that gave rise to it is over
Achieving Compliance with Conventions: General Obligations


States are expected to bring domestic law into conformity with conventions it ratifies and to remain
in compliance
o When Canada ratified the Maritime Labour Convention, it amended the section of the
labour code that governed maritime labour law to make it conform
o Problem: federal government has power to ratify but not implement outside its jurisdiction:
Canada could implement the Maritime Labour Convention because it has jurisdiction over
shipping
o BUT Canada doesn’t have jurisdiction over things that are provincial – this gives Canada a
reason not to ratify
Performance is supervised by requirement that states submit periodic reports on compliance;
labour and employer groups provide observations; ILO bodies examine and comment
o Reporting requirement is a self law mechanism: requires bodies to submit periodic reports
where they tell the ILO if they are in compliance with ratification
o ILO was built on tri-partism: government, EE groups/unions, and the ILO
 Therefore EE group observations are also provided along with the government
report
o ILO examines those reports and governing bodies can issue comments about what is going
on
 This generates pressure on states to help insure compliance with conventions
Achieving Compliance: Representations – Special Procedures

ILO makes distinctions between complaints and representations (what we think of as complaints
are technically representations)
o Formal complaints rarely occur, also not possible for a labour group to make a complaint to
the ILO, it can only make a representation
58

If complaint does not involve FOA:
o Goes to Committee of Experts on Application of Conventions and Recommendations
(CEACR); Committee makes non-binding recommendations without formal adjudication,
which are reported to the Governing Body (The Governing Body is the executive body of
the International Labour Office)
o Governing Body issues a report and might in their response say the government is not in
compliance with convention and suggest certain measures
o Documents are produced on annual basis, and that’s the end of it
Special procedures: Representations - FOA



If representation involves FOA there is a separate mechanism (because of the importance of FOA in
ILO, and because complaints about FOA are the most common)
Two conventions in ILO regarding FOA: 87 (Freedom of Association, ratified by Canada); 98
(Collective Bargaining, not ratified by Canada ). Also:
o ILO Constitution
o Declaration of Fundamental Principles (binding on all members whether they ratified or not,
it is the fundamental principle of recognition of FOA and CB)
Mechanism:
o Representations go to Committee on Freedom of Association
 Can be made against both ratifiers and non-ratifiers
 The Committee investigates the complaint and makes a determination about
whether there has been a violation (applies broad principles)
 Promotes compliance by making recommendations to Governing Body
o No enforcement powers
 ILO attempts to achieve compliance with FOA and CB – this occurs almost entirely
through soft law mechanisms, for the most part ILO does not have the power to
compel member states or even ratifiers of conventions to comply with its
principals or conventions
Hard Law – complaints





Rarely used
Limitations on who can file complaint (as opposed to representations)
o Must be filed by either another member state that has ratified the convention OR the ILO
Governing Body (so if you made a representation through the CEACR or the CFA and the
government didn’t respond, the Governing Body could launch a formal complaint)
o If you wanted formal complaint against Canada, government of England would have to file
it
Can be referred to a Commission of Inquiry (3 independent experts);
o has happened 11 times in history of ILO
If country fails to comply with Commission decision can take case to International Court of Justice
o once – 2000 against Myanmar
o court has formal sanctioning powers of some sort
So there is formal hard law, but it plays almost no role in ILO
o Almost all of what ILO does is trying to exert influence through other mechanisms – but no
teeth
59
o
Some people in the ILO began to take the view that the route of promulgating conventions
was running out of steam
Declaration of a Fundamental Principles and Rights at Work (1998)



Rationale: the rate of ratification was abysmal and the idea was to identify most crucial
international labour norms that we want to advance, led to the DFPRW
Four basic principles
o Freedom of association and effective recognition of the right to CB
o Elimination of all forms of forced or compulsory labour
o Effective abolition of child labour
o Elimination of discrimination in respect of employment and occupation
This is a supportive role, but not a punitive or compulsory one, not hard law at all
Impact of ILO in Canada?


Direct
o Has not inhibited violations of conventions ratified by Canada: increase of representations
made against Canadian governments for violations of FOA:
 pre-1982 16 complaints
 1982-2005 64 complaints (US 10, UK 9)
o Complaints and reports of violation receive little publicity
o Findings and recommendations made long after violation occurs
 In BC Health Services there was complaint filed, but a lot of time had passed before
finding and momentum had died down
o In 44 cases ILO found Canada had violated FOA or CB
 Governments have largely disregarded these findings
 ILO conference asked to meet with Canadian delegation to discuss pattern of
violation, but nothing changed out of it
o Hard to think that these processes have had significant influence
Indirect
o Most significant influence: how ILO principles by the Committee on FOA (where
representations go related to FOA) have influenced the Canadian courts – clearly SCC has
chosen to make them influential
 Influence on courts – Dunmore and BC Health Services
o Change in dominant discourse?
o If it wasn’t for the courts embrace of these principles one would have to say that at least in
Canada, influence of ILO is minimal
The North American Agreement on Labour Cooperation (NAALC)


Side deal to NAFTA: came into force Jan. 1 1994
o Bill Clinton had to deal with both corporations and unions, and needed union votes.
Compromise was to support NAFTA as long as there were side agreements to promote
labour and environmental rights
Endorses 11 Labour Principles (see below)
60
o
o


#4-11: technical principles
These are just principles – questions is of their scope and to what extent can they be
enforced
o Principles are supposed to be promoted through cooperative activity by the 3 states
Soft Law: promotion through Commission of Labor Cooperation
o Represents Canada, US and Mexico
o Publish reports comparing the laws of countries and provide general encouragement to get
the countries to bring their domestic labour laws into conformity with the 11 principals
o Mostly education and promotion
Hard Law: provides complaint procedure, but limited to failure to enforce existing laws, not failure
to bring domestic law into compliance with Labour Principles
Labour Principles
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
Freedom of association and protection of right to organize
Right to bargain collectively
Right to strike
Protection against forced labour
Prohibition of child labour
Minimum wages; hours of work and other labour standards
Non-discrimination
Equal pay for equal work
Occupational health and safety
Workers’ compensation
Protection of migrant workers
Enforcement




Three tier mechanism:
o You cannot complain about the failure of the government to have laws that comply with
the 11 principles – entirely left to promotional side
o You CAN complain about failure of government to enforce the laws it has passed that
implement one or more of these 11 principles
Governments don’t have to comply with the principles, but if they have laws that relate, their
failure to enforce those laws could be subject matter of complaint
The Commission for Labour Cooperation works with the National Administrative Offices (NAOs)
established in each country to implement the agreement and serve as a national point of contact
o In Canada, the Office for Inter-American Labour Cooperation within the Labour Branch of
Human Resources and Skills Development Canada acts as the Canadian NAO.
Tier 1:
o Complaint to NAO: of a counry other than the country you want to claim is not enforcing its
own laws (so if Mexico isn’t enforcing its laws, bring complaint to Canada/US)
 Office decides whether to accept the complaint (is it failure to enforce a law or failure
to have a law at all?)
o If complaint is accepted, public hearings are held: complainants are invited to present
concerns, governments will appear, publicity generated around the issues
o Report & recommendations: issued after the hearings
61
o


Ministerial consultation: can result from the report, the ministries of labour get together and
talk about the issue (end of Tier 1)
Tier 2:
o On the books but only hypothetical because nothing has ever made it past Tier 1
o Tier 2 can only occur if one of the labour ministers has decided that a complaint ought to go
to Tier 2
o Diplomatic matter – dicey thing for a minister of one country to insist that the issue in
another country has not been satisfactorily dealt with
o Complaint goes to the Evaluation Committee of Experts:
 restricted to principles 4-11: FOA complaints cannot go to Tier 2, only nonenforcement of technical labour standards
 focus is on patterns of practice
 matter must be trade related & covered by laws in both countries
o Committee of Experts makes recommendations, and this is where Tier 2 ends
Tier 3:
o If the complaint was not satisfied in Tier 2, theoretically it can go to the hard law mechanism
in Tier 3, where the matter would be referred to an arbitration panel
o BUT complaints can only go to Tier 3 if they relate to child labour, minimum wages & OHS
o Requires 2/3 ministers of labour to push the complaint forward
o Requirements: persistent pattern of failure to enforce the law; complaint is trade related &
covered by laws in both countries
o Fines can be levied: arbitration panel can impose a fine up to .007% of the volume of trade
between the countries
Assessment of NAALC






1994-2006: 35 complaints (Mexico 22; US 11; Canada 2)
o Since peak year 1998, declining usage of formal complaint mechanism (most complaints
were filed within the first five years)
o No case has gone beyond Tier 1 ministerial consultation
Hasn’t produced much in the way of law reform within the countries
Arguably complaints have had some political impact but evidence is thin
Also arguably has stimulated development of transnational labour cooperation and creation of
transnational advocacy networks (Buchanan & Chaparro, 2008)
Motivation for NAALC: NAFTA and Mexico
o Mexico’s labour laws would be the least favourable
o On the books, Mexico had very progressive labour laws – their constitution that came out of
revolution in early 20th embraced very progressive principles
o Concern was that actual enforcement of Mexican law was weak
Are there more effective transnational mechanisms?
62
CH 2: The Certification Process and Bargaining Unit Determination
Establishing the CB Relationship: Basic Concepts




General Points:
o Normally this course looks at the THREE STRANDS of the employment regime: CB,
individual K, minimum standards. Here, we just focus on CB and the establishment of a CB
relationship (nothing comparable in individual K of employment and minimum standards)
o Trade union formation and organization is a prerequisite to the certification process and the
Act sets out to promote these processes
Navigating the legislation:
o 3 parts of the legislation
 Sections that make it an offence for ERs to engage in conduct that obstructs the
creation of independent TUs (s. 70, 71, 72, 73, 76)
 Sections that make it an offence for a TU to engage in conduct which impedes or
prevents individuals from exercising their free choice as to representation, or from
asserting their rights with a TU has been accepted as a Bargaining Agent (BA) (s. 71,
73, 74, 85)
 Sections that make it an offence to “fail to bargain collectively”. The Act requires BC.
(Illegal strikes and lockouts and some supporting actions are therefore prohibited) (s.
17, 46, 78, 79, 81, 82, 83, 86)
o The LRA provisions governing the recognition of TUs fall into two categories:
 1. Certification procedures
 2. Unfair labour practices
The bargaining unit:
o Defines the constituency of EEs from which a union must obtain majority support in order
to be certified.
o Defines the group of EEs that can engage in collective action, for the purpose of CB.
o In exchange for the legal obligation that ERs are required to recognize unions for the
purpose of CB, unions give up whatever ability they have to determine their formal
bargaining structures
The certification process:
o Requires a union to sign up at least 40% of EEs in a unit as members
o Once the union has sufficient support, it can apply to the Board for certification
o Then the Board inquires as to whether the unit of EEs organized by the union is appropriate
for the purpose of CB, and if so, it holds a vote.
o If the majority of employees voting support the union, the union is certified and can then
compel the ER to meet with it, with the purpose of attempting to conclude a CA.
o During the period in which the union is seeking to sign up members, ERs are prohibited
from engaging in a number of ULPs.
 By and large, these ULPs cover interference with lawful union activity.
DEFAULT POSITION
 Everyone starts out with basic individual K of employment, which is supplemented by minimum
standards regime  you have to OPT INTO the CB regime.
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o
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BUT IT IS a false assumption that this is the natural order of things.
 Why could we no operate from a model where it was the reverse? Is one really more
natural than the other? Notice that we’ve got other countries with very different
models that are still economically successful (eg: Germany, who requires a worker’s
council for all workplaces.) This could be considered a more democratic way of
working.
Collective Bargaining (CB) occurs primarily through “certification under the LRA” (Wagner Act
model)
But also:
o Informal arrangements
 Employee consultation  amounts to procedures where EEs have their concerns
channelled through and listened to.
 Eg. Magna
 Informal Collective Bargaining (eg Osgoode Hall Faculty Association until 2012)
 They were not formally certified but bargained collectively
 No individual faculty challenged this
o Statutory mandates
 Representation Plans (OHS – JHSC; RCMP – SRRP)
 SRRP: doesn’t formally engage in CB; but a mandated body that represents
the EEs
 Collective Bargaining (Teachers)
o Voluntary recognition: where the company recognizes the union as the body capable of
engaging in CB on behalf of EEs without the union certifying.
 Some limitations on the power of these unions compared to certified unions: s.76:
where a voluntary recognition, the union can be challenged. When challenged, it has
to demonstrate that it has the support of the union.
 Recently aided by neutrality agreements; eg. Framework of Fairness Agreement
between CAW & Magna International. (Magna has resisted formal certification of its
workforce.)
Consider: why do we universally have health and safety (H&S) but not universal CB?
o Canada: >20 workers, must have H&S committee: >20 workers, H&S rep elected by workers
or appointed by union.
Voluntary Recognition Provisions – as opposed to Election
o
o
o
Provision for ERs to voluntarily recognize union as exclusive bargaining agent of EEs.
 After this recognition step takes place, the union has much the same rights as if the
union was certified through election.
 Provision in the Act protects them from other unions coming in for the first year.
 In most instances ERs do not voluntarily agree to recognize a union
Protection against sweetheart deal in s.66 of the LRA: where an ER and a union that has
NOT been certified enter into a CA or a recognition agreement, the Board may upon
application of any EE in the BU during the first year that the CA/RA is in operation, declare
that the trade union was not entitled to represent the EEs of the BU
Recently, move to get away from statutory mechanism
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o
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Union approaches ER and gets it to agree not to oppose unionization and to recognize the
union voluntarily if they can demonstrate enough support – no certification process
o Recently aided by neutrality agreements, like controversial Framework of Fairness
Agreement between Canadian Auto Workers and Magna
 CAW had been trying to organize at Magna for years, they reached an agreement
where Magna agreed not to oppose attempts by CAW to organize employees at
various plants, and that if CAW won an election and the majority of workers
decided to be represented, Magna would recognize CAW as the bargaining agent
 In doing so, CAW made a number of concessions – they wouldn’t strike and
there was provision made for union representation that meshed with Magna’s
existing regime of employee representation
 Some questioned whether representation would really be independent, or if they
would have to go through hurdles to get Magna’s approvals (example: about
who would be steward)
Other mechanisms for a collective voice in Canada:
o Informal arrangements
 OHFA: Osgoode Hall Faculty Association represents full time tenured and tenure
stream faculty – when the York group was certified, OHFA got itself carved out, said
they had their own concerns, LRB accepted. Osgoode faculty were non-unionized
by establishing an association – no certification, no voluntary recognition, operates at
the edges of the law. Could possibly make a claim that they had been/should be
voluntarily recognized. This is a defacto CB relationship, outside of any kind of
formal/legal framework. Institutional mechanisms established for dispute
resolution, etc, but have no formal legal status. Could argue the terms are
incorporated into the individual Ks.
 PACT (Westjet): Pro-Active Communication Team, since 1999 has acted as the
recognized EE organization throughout our Company, representing the interests of
all non-management positions. Takes a pro-active approach to resolving issues and
the needs of EEs.
o Voluntary meetings with EEs, hear concerns and get the benefit of their insights
o Within limited spheres, formal requirements for workers to have a voice – OHS
 Required ERS to establish joint OHS committees where there would be equal
number of ERs and EEs – form of mandatory institutionalization around an issue
that was seen as very important
 Outside OHS, no other required democratic aspects to the workplace
Industrial Citizenship (pluralists): EEs have the right to form and join unions and to engage in
actions such as strikes in pursuit of higher wages and better conditions of employment
o Tucker: the absence of worker voice is a problem, IC should be widespread. The absence of
some kind of vehicle is a failure to give rise to democratic values – there is a democratic
deficit.
o SCC: collective voice is important – “a constitutional right to collective bargaining is
supported by the Charter value of enhancing democracy. Collective bargaining permits
workers to achieve a form of workplace democracy and to ensure the rule of law in the
workplace. Workers gain a voice to influence the establishment of rules that control a major
aspect of their lives.” (BC Health Services)
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What other counties to (other than formal CB):
o In social democracies in western Europe they require that there be work councils
o Legal requirement that if the company is certain size there has to be employee
representations
o In Canada, outside of OHS the road in is through establishing a CB relationship, typically
done by union conducting organizing drive in workplace, obtaining majority support
amongst appropriate bargaining unit, getting certified as exclusive bargaining agent –
Wagner model
The (Original) Aspirations of the Wagner Act Model
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Collective bargaining would spread and become the dominant model for establishing terms and
conditions of employment
o Individual regime would only exist at the margins – workers would gain power
Through CB, workers would gain countervailing power to promote greater economic equality
(which would promote productivity)
o Workers would get fruits of the process, and that a lot of industrial conflict would end,
particularly by reducing unnecessary industrial conflict by substituting certification for
recognition strikes
o CB would spread and become the dominant model for establishing terms and conditions of
employment
o Regime would reduce unnecessary industrial conflict, especially recognition strikes
o Previously, EEs had to strike to show that they had the support of the EEs for the union
 Nowadays, recognition strikes are rare.
Effectiveness of Wagner Model
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Recognition strikes have been eliminated.
Countervailing power produced a union advantage, but it is in decline.
o In post war model, unions could negotiate for terms/conditions that were superior to those
of non-union workers. However, in modern times the size of union advantage has been
steadily decreasing – still there, but less significant.
o Union density decreasing: in aftermath of Wagner regime union density peaked at 37%, and
there has been a sharp decline in the private sector in recent years.
 For-profit unionization down to 16%, public sector still >30%
o Previously unions would exert an upward pressure on non-unionized workers because ERs
had to compete – in modern era the reverse is taking place
Spread of CB has been historically uneven
Why has unionization decreased?
o Weakened labour laws: is this a purely economic phenomenon, or have changes in the legal
regime contributed?
o Flawed model: does the model no longer fit the existing economic reality? Is there now a
fundamental mismatch?
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The Certification Process
Legal Framework for Certification


Since the default is no collective representation (except OHS), for most workers, the path into some
form of CB is through organizing and getting union certified.
Coverage of LRA limited to EEs:
o Some workers deemed not to be EEs – S. 1(3): no person shall be deemed to be an EE:
 (a) who is a member of the architectural, dental, land surveying, legal or medical
profession entitled to practise in Ontario and employed in a professional capacity; or
 (b) who, in the opinion of the Board, exercises managerial functions or is employed
in a confidential capacity in matters relating to labour relations
 Professionals are barred on presumption that they have enough bargaining power.
Other statutes apply to doctors, people in confidential capacity are excluded due to
conflict of interest.
 Definition of EE – s.1(1): includes a dependent contractor
 Meant to cover people who didn’t have status of EE, but weren’t independent
Ktr’s either. It was a policy decision to give this people access to CB.
o
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NOTE CB is an exception to free market economy: In a free market economy, it is
exceptional to allow people to join together and act collectively. We do not allow a group of
business people to form an association and require people to bargain with them as a single
entity: that would be unlawful combination (we have anti-competitive behaviour statues).
Act also deemed not to apply to some sectors (ss. 3 & 4)
o Non-application of the Act – s. 3: This Act does not apply, (a) to a domestic employed in a
private home; (b) to a person employed in hunting or trapping; (b.1) to an employee within
the meaning of the Agricultural Employees Protection Act, 2002; (c) to a person, other than
an employee of a municipality or a person employed in silviculture, who is employed in
horticulture by an employer whose primary business is agriculture or horticulture; (d) to a
member of a police force within the meaning of the Police Services Act; (e) except as
provided in Part IX of the Fire Protection and Prevention Act, 1997, to a person who is a
firefighter within the meaning of subsection 41 (1) of that Act; (f) to a member of a teachers’
bargaining unit established by Part X.1 of the Education Act, except as provided by that
Part, or to a supervisory officer, a principal or a vice-principal; (g) Repealed (h) to an
employee of a college of applied arts and technology; (i) to a provincial judge; or (j) to a
person employed as a labour mediator or labour conciliator
o Crown agencies bound – s. 4: This Act binds agencies of the Crown other than, (a) agencies
in which are employed Crown employees as defined in the Crown Employees Collective
Bargaining Act, 1993; and (b) colleges of applied arts and technology established under
the Ontario Colleges of Applied Arts and Technology Act, 2002.
 The LRA binds the crown subject to another statute which modifies the legislation
for public sector provincial EEs (public sector EEs have the right to strike)
o Union main player, not EE: A CB relationship is between an ER and a trade union, so the
majority of provisions deal with what a TU can and cannot do (union brings application for
certification, union enters into agreement with ER, NOT the individual EE)
Applicant must have trade union status, ss. 1(1),15
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o
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Applications must be made by unions: individual workers don’t have standing to make an
application.
o Definition of “trade union” – s.1(1): means an organization of employees formed for
purposes that include the regulation of relations between employees and employers and
includes a provincial, national, or international trade union, a certified council of trade
unions and a designated or certified employee bargaining agency
 Demonstrates that the Act only applies to employees
 In order to participate in the scheme, union must establish TU status
 There is a provision in the Act that says once a TU is certified, it doesn’t have to
repeat it
o Unions not to be certified – s.15(1): The Board shall not certify a trade union if any
employer or any employers’ organization has participated in its formation or
administration or has contributed financial or other support to it or if it discriminates
against any person because of any ground of discrimination prohibited by the Human
Rights Code or the Canadian Charter of Rights and Freedoms.
 In other words: Organizations that are not independent of ER and TUs that
discriminate on prohibited grounds are disqualified from being certified
Application must be timely
Is the application timely?


Two policies that underlie the timeliness requirement
o Union security: where there is an incumbent union, it has protections from being
challenged
 Also protects unions from being de-certified by the members of the bargaining unit –
not absolutely but they get protections in terms of time (gives period where union
can be sure its status as bargaining agent is secure)
o Employer efficiency: makes sure ERs are not subject to constant unionizing drives – when
there is an active organization going on drives can have a disruptive affect, so only
permitted at certain times
There are a series of provisions that limit when certification application can be brought, mostly in
s.7
I. Incumbent Union
A. Union can seek to be certified only during open period ss. 7 (2-6), 67
 Once certified, no challenge for a year – S. 7(2): Where a TU has been certified as BA of the EEs of
an ER in a BU and has not entered into a CA with the ER and no declaration has been made by the
Board that the TU no longer represents the EEs in the BU, another TU may apply to the Board for
certification as BA of any of the EEs in the BU determined in the certificate only after the
expiration of one year from the date of certification.
 Once recognition agreement has been signed, no challenge for a year – S. 7(3): Where an ER and a
TU agree that the ER recognizes the TU as the exclusive BA of the EEs in a defined BU and the
agreement is in writing signed by the parties and the parties have not entered into a CA and the
Board has not made a declaration under section 66, another TU may apply to the Board for
certification as BA of any of the EEs in the BU defined in the recognition agreement only after the
expiration of one year from the date that the recognition agreement was entered into.
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o This is subject to s. 66 (see below)
If CA is for less than three years, TU can only be challenged in last three months – S. 7(4): Where a
CA is for a term of not more than three years, a TU may apply to the Board for certification as BA
of any of the EEs in the BU defined in the agreement only after the commencement of the last
three months of its operation.
If CA is over three years, can only challenge after 33 months or in last three months of each year
after that – S. 7(5): Where a CA is for a term of more than three years, a TU may apply to the Board
for certification as BA of any of the EEs in the BU defined in the agreement only after the
commencement of the 34th month of its operation and before the commencement of the 37th
month of its operation and during the three-month period immediately preceding the end of each
year that the agreement continues to operate thereafter or after the commencement of the last
three months of its operation, as the case may be.
If CA allows for successive form, can only challenge in last three months of those terms – S.
7(6): Where a CA referred to in subsection (4) or (5) provides that it will continue to operate for a
further term or successive terms if either party fails to give to the other notice of termination or
of its desire to bargain with a view to the renewal, with or without modifications, of the agreement
or to the making of a new agreement, a TU may apply to the Board for certification as BA of any of
the EEs in the BU defined in the agreement during the further term or successive terms only
during the last three months of each year that it so continues to operate, or after the
commencement of the last three months of its operation, as the case may be.
Negotiations – S.67:
o When you are in a period of conciliation, there can’t be another certification application
brought
o Similarly if union is on strike another certification application cannot be brought
o None of these are absolute – all bar certain periods of time
B. Bargaining rights may also be terminated in following circumstances:
 Generally decertification periods correspond with certification periods, but provisions for
certifications that were obtained fraudulently, if union is sitting on rights and not acting, etc)
 Employees vote to decertify during open periods, s.63:
o (1) If a TU does not make a CA with the ER within one year after its certification, any
of the employees in the BU determined in the certificate may, subject to section 67, apply
to the Board for a declaration that the TU no longer represents the EEs in the BU
o (2) Any of the EEs in the BU defined in a CA may, subject to section 67, apply to the
Board for a declaration that the TU no longer represents the employees in the bargaining
unit,
 (a) if CA is not more than three years, only after the commencement of the last
three months of its operation;
 (b) if CA is for more than three years, only after the commencement of the 34th
month of its operation and before the commencement of the 37th month of its
operation and during the three-month period immediately preceding the end of
each year that the agreement continues
 (c) in the case of a CA referred to in clause (a) or (b) that provides that it will
continue to operate for any further term or successive terms if either party fails
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to give to the other notice of termination, only during the last three months of
each year that it so continues
Certification obtained fraudulently, s. 64: (1) If a TU has obtained a certificate by fraud, the
Board may at any time declare that the TU no longer represents the EEs in the BU and, upon
the making of such a declaration, the TU is not entitled to claim any rights or privileges flowing
from certification and, if it has made a CA binding upon the EEs in the BU, the CA is void.
Union fails to give notice or bargain, s. 65:
o (1) If a TU fails to give the ER notice within 60 days following certification... the Board
may, upon the application of the ER or of any of the EEs in the BU, and with or without
a representation vote, declare that the TU no longer represents the employees in the BU
o (2) Where a TU that has given notice fails to commence to bargain within 60 days from
the giving of the notice or, after having commenced to bargain but before the Minister
has appointed a conciliation officer or mediator, allows a period of 60 days to elapse
during which it has not sought to bargain, the Board may, upon the application of the
ER or of any of the EEs in the BU and with or without a representation vote, declare that
the TU no longer represents the EEs in the BU.
Illicit voluntary recognition, s. 66: Where an ER and a TU that has not been certified as the BA
for a BU of EEs of the ER enter into a CA or a recognition agreement, the Board may, upon the
application of any EE in the BU or of a TU representing any EE in the BU, during the first year
of the period of time that the first CA between them is in operation or, if no CA has been
entered into, within one year from the signing of such recognition agreement, declare that the
TU was not, at the time the agreement was entered into, entitled to represent the EEs in the BU.
II. Prior Unsuccessful Application, ss. 7(9-10.2), 10(3)
 Protection for ERs – s. 7: bars on applications following unsuccessful applications
 Withdraws app before vote – 7(9): Subject to subsection (9.1), if the TU withdraws the application
before a representation vote is taken, the Board may refuse to consider another application for
certification by the TU as the BA of the EEs in the proposed BU until one year or such shorter
period as the Board considers appropriate has elapsed after the application is withdrawn.
 Withdraws a second time before vote – 7(9.1): If the TU withdraws the application before a
representation vote is taken, and that TU had withdrawn a previous application under this section
not more than six months earlier, the Board shall not consider another application for certification
by any TU as the BA of any EE that was in the BU proposed in the original application until one
year has elapsed after the second application was withdrawn.
o Exception – 7(9.2): subsection (9.1) does not apply if the TU that withdrew the application is
a TU that the Board is prohibited from certifying under section 15.
o Exception – 7(9.3): despite sub (9.1) the Board may consider an application for certification
by a TU as the BA for EEs in a BU that includes an EE who was in the BU proposed in the
original application IF (a) the position of the EE at the time the original application was
made was different from his or her position at the time the new application was made; and
(b) the EE would not have been in the BU proposed in the new application had he or she
still been occupying the original position when the new application was made.
 Withdraws after vote – 7(10): If the TU withdraws the application after the representation vote is
taken, the Board shall not consider another application for certification by any TU as the BA of any
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EE that was in the BU proposed in the original application until one year after the original
application is withdrawn.
o Exception – (10.1): Despite subsection (10), the Board may consider an application for
certification by a TU as the BA for EEs in a BU that includes an EE who was in the BU
proposed in the original application if, (a) the position of the EE at the time the original
application was made was different from his or her position at the time the new application
was made; and (b) the employee would not have been in the BU proposed in the new
application had he or she still been occupying the original position when the new
application was made.
o Exception – (10.2) Subsection (10) does not apply if the TU that withdrew the application is
a TU that the Board is prohibited from certifying under section 15.
S. 10(3): If the Board dismisses an application for certification under this section, the Board shall
not consider another application for certification by any TU as the BA of any EE that was in the BU
proposed in the original application until one year after the original application is dismissed
Stages of the Certification Process

NOTE: an election is required to get certified – significant change under Conservatives in 1995
o Until 1995 Ontario’s certification procedure was based on a system of card-count
certification.
o If union could demonstrate that over 55% of the EEs in the proposed unit belonged to the
union by presenting signed membership cards, it was certified
o If the union failed to so demonstrate, a representation vote was conducted
o A large number of certifications were won on the basis of membership evidence –
members preferred to wait until they could succeed in obtaining the 55%
o Automatic certification on the basis of membership evidence is no longer available in
Ontario: in every case a representation vote must be held
 the Liberals restored it for the Construction industry in 2005 (s. 128.1)
Organizing Phase to Application
 Issues of unfair labour practices arise here: what kind of access does the union have to the
proposed BU, and what is a fair way for ER to oppose unionization and what is an unfair way to
oppose it?
 Union signs up members of target group, and then makes application
o Union provides proposed BU and membership evidence to the Board, only proposed BU to
the ER
o If the union has the support of at least 40 per cent of the EEs, the Board will order a
representation vote to be held (s. 8(2)) within 5 days.
 Typically unions actually wait for majority before applying, for strategic reasons.
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Membership cards are evidence of membership (for purposes of obtaining 40%), but
these are not given to ER because of the concern that there might be unfair treatment
that would undermine the EEs freedom of choice
 In the application the TU is required to supply a written description of the BU (s.7
(12)).
o The Board may dismiss an application for certification on the application of an interested
party (either the ER or an EE in the proposed BU); it may do so where the union has
contravened the Act, or a representation vote would not express the true wishes of the EEs
(s. 11(2)). If no such allegation arises, the vote must be held.
o Membership evidence must indicate on its face that the EE has voluntarily become a
"member" within the meaning of section 1(1) of the Act
How the Act minimizes the potential for ER interference in the vote:
o Section 8(5) states that, unless the Board otherwise directs, the representation vote shall be
held within five days after the day on which the application for certification was filed.
o When disposing of an application for certification, the Board shall not consider any
challenges to the membership evidence provided by the union (s. 8(9)).
Prior to a representation vote, the union is permitted to withdraw its application for certification
under such conditions as the Board may require. The Board has a discretion to bar the union from
making another certification application in relation to that group of employees for up to one year
(ss. 7(8), (9)) (above)
Post-Application Phase to Election
 Union applies: proposed BU & provides membership evidence to board and employer
 Employer may propose alternative BU:
o 8.1 (1) If the ER disagrees with the TU’s estimate, included in the application for
certification, of the number of individuals in the unit, the ER may give the Board a notice
that it disagrees with that estimate
o If the ER disagrees with the description, it may within 2 days of receiving notice of the
union's certification application, furnish the Board with its own description of the proposed
unit (s. 7(14))
o Examples:
 if union has included assistant managers in proposed definition of BU, employer can
claim its misclassified
 Dispute over whether FT and PT EEs should be in the same unit
 Once the board has determined the voting constituency, it reviews the membership evidence
 If union has 40% membership in its proposed BU, Board orders vote within 5 days, but may seal
ballot boxes pending resolution of disputes (s.8(7))
o S.8(7): The Board may direct that one or more ballots be segregated and that the ballot box
containing the ballots be sealed until such time as the Board directs (see hypothetical below)
o The reason they postpone the decision about the appropriate BU is because they want to get
to a decision quickly – the longer the delay, the lower the odds of the union winning (due to
the ability of the ER to influence the outcome of the certification process)
Post-Election Phase
 If no employer objection to BU or estimate: count vote
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o Union only requires a majority of those who voted to be certified (10(1))
If employer proposed alternative BU. or challenged BU membership, STEPS:
o (1) Board holds election but segregates votes and seals ballot boxes (8(7))
o (2) Board determines appropriate bargaining unit definition (9(1))
o (3) Board determines BU membership (based on the info provided under 7(13)) (8.1(5)(7))
 This is the percentage of individuals who appear to be members of the union at the
time the application for certification was filed
o (4) If the percentage of union membership is less than 40%, the board shall dismiss the
application for certification and if the ballot boxes were sealed, the Board directs that the
ballots be destroyed without being counted (8.1(5)(7))
o (5) If the percentage of union membership is greater than 40% and the ballot boxes were
sealed, the Board shall direct that the ballot boxes be opened and the ballots counted and
the Board shall either certify the trade union or dismiss the application for certification.
After voting: If in the representation vote the union receives more than 50 per cent support, the
Board must certify the union as the exclusive bargaining agent of employees in the bargaining unit
(s. 10(1)). If the union does not secure majority support, the Board must dismiss the application.
Hypothetical
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Union organizes FT Osgoode faculty, wants to be certified BA
o Union only wants FT in BU, wants to exclude adjuncts
o There are 50 FT total, the union signs up 35, way above 40%, so they make application
Union applies for BU of FT faculty, including Associate Dean (AD)
Within 2 days, York claims BU should include 50 PT faculty and that AD should be excluded as
managerial
o York doesn’t want to have to deal with two separate groups, so they want the total size to
be 100 (with adjunct, without AD who is arguably a manager)
OLRB determines voting constituency (all FT & PT faculty), holds vote w/in 5 days but segregates
ballots
After vote, the Board determines BU:
o if its FT & AD, then initial membership level was 35/50 (>40%), so the Board counts ballots
and certify the union if it obtains a majority
o if its FT, AD, & PT then initial membership level was 35/100 (<40%) so the Board tosses
ballots – not interested in what the result was
Discussion of vote segregation:
o When the union has lost a vote there is a bar to reapplying – could make the argument that
by not counting the votes you are potentially denying the chance to form a unit
 S.10(3) provides that if the union brings it to a vote and they lose, there is a
mandatory one year ban on all unions
o Logic in the vote segregation rule was that you are only entitled to get to a vote if you have
40% so this maintains the integrity of the 40% hurdle.
o These provisions were tightened up to tilt in ERs interest in the Conservative revamping of
labour law in 1995
Two issues to think about:
1) How to determine appropriate BU?
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2) What is the appropriate framework in which an organizing drive takes place?
Bargaining Unit Determination: Appropriate Bargaining Units
What is at Stake for the Union
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
Cohesive group: one factor they take into account is how cohesive the group, because the more
cohesive the more capacity/clout to make gains when it comes to bargaining
o In Kraft, it was a group with key skills – may have power in small numbers
Competing concerns for unions:
o Need to organize/certification: if you aim too big, you may not get representation at all
 Problem: unit for purposes of certification is also the unit for purposes of bargaining,
so this can result in tensions that are difficult to resolve – the kinds of units that can
be successfully organized are not always the ones that can be successful for
bargaining
 Example: Michelin Tire – wanted to unionize its 2 separate plants – union
knew there would be complexity in organizing – a special law was passed to
help them coordinate organization.
o Need to be able to exert pressure/bargaining structure: if the group is too small (and there
are no specialized skills) the union may have little power
o Consider the benefits & challenges of size: w/ increased size comes more difficult
certification but more bargaining power.
o Cost of Servicing: unions are businesses and there are costs associated with hiring
negotiators, drafting CA’s and handling grievances and if the group is too small, the union
dues won’t cover it.
What is at Stake for the Employer
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Competing concerns for employers:
o Undue fragmentation: if there are many units they might try to piggy back on one another,
too much effort/complication
o Strategy: ER might prefer one group to make it hard for union to succeed at certification,
but this might not necessarily be the group they want to bargain with
Tucker: Board takes these tensions (that the group for certification is the same as the group for
bargaining) into account, but some have argued this is a problem with the model. They argue that
there should be a way to break these two issues apart – a way to bargain with a group that is not
the one certified.
Legal Framework for Deciding Bargaining Unit (and its Implications) – see 2-6 of CB
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The statute does not give a lot of guidance when it comes to the appropriate bargaining unit – most
of what happens depends on Board policy
Definition of bargaining unit – (s.1(1): “bargaining unit” means a unit of employees appropriate for
collective bargaining, whether it is an employer unit or a plant unit or a subdivision of either of
them
o Another example of the Act only applying to EEs
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o
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“whether it is an employer unit a plant unit or a subdivision of either of them”: A multiemployer unit is not permitted by implication (this is fundamental in the statute).
 Ex: If the employees of ford, GM and Chrysler wanted to bargain as a single unit, it
would not fit within the definition. This doesn’t permit the actual negotiating from
going on in that manner, but that would only happen voluntarily, the formally
certified BU wouldn’t be set up in that way.
 The largest possible unit is an all-employee unit of the employer in the province
(can’t be outside b/c it would not in Ontario’s jurisdiction), but usually they end up
being smaller than this
 Exception for construction industry: necessary because of the needs specific to the
industry
Power of board – 9(1): the Board shall determine the unit of employees that is appropriate for
collective bargaining, but in every case the unit shall consist of more than one employee and the
Board may, before determining the unit, conduct a vote of any of the employees of the employer for
the purpose of ascertaining the wishes of the employees as to the appropriateness of the unit.
o “in every case the unit shall consist of more than one employee”: issue of including private
workers in domestic homes – most of them work alone for private employer
o The board “may conduct a vote of the employees” to get their preferences: EEs get
consideration, but not binding on the board
Specific rules 9(3) – (5), 14
o Craft workers – s.9(3): Any group of EEs who exercise technical skills or who are members
of a craft by reason of which they are distinguishable from the other EEs and commonly
bargain separately and apart from other EEs through a TU that according to established TU
practice pertains to such skills or crafts shall be deemed by the Board to be a unit
appropriate for CB...
 History: This goes back to the roots of trade unions – workers used to organize based
on skill (bakers, iron moulders). If those workers want to bargain separately they are
deemed to be appropriate if that’s what they wish to do.
o Professional engineers – s.9(4): A bargaining unit consisting solely of professional
engineers shall be deemed by the Board to be a unit of employees appropriate for CB, but
the Board may include professional engineers in a BU with other EEs if the Board is
satisfied that a majority of the professional engineers wish to be included in the bargaining
unit.
 Deemed to be appropriate if they wish, but can chose to be part of broader unit.
o Dependent contractors – 9(5): A bargaining unit consisting solely of dependent contractors
shall be deemed by the Board to be a unit of employees appropriate for CB but the Board
may include dependent contractors in a BU with other EEs if the Board is satisfied that a
majority of the dependent contractors wish to be included in the bargaining unit.
 These are not traditional employees but seem to be more employee-like than
traditional business people – may have distinct set of interests not shared by ER.
o Security guards – s.14:
 Definition: guards who monitor other EEs or who protect the property of an ER.
 History: there used to be a rule that prohibited unions that represented other
workers from organizing security guards
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Rule now: unions can organize security guards (CAW could do it) but the ER can
bring a challenge
14(4): If the ER objects, the TU must satisfy the Board that no conflict of interest
would result from the trade union becoming the bargaining agent or from including
persons other than guards in the bargaining unit.
Labour Relations Board Policy (and its implications)  check this in text, differs from slide
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The Board attempts to group together EEs who share a community of interest, and if the parties
agree on the unit then it will normally be accepted
If the parties do not agree, the Board can consider (factors):
o The nature of work performed
o The conditions of employment
o The skills of the EEs
o Functional coherence and interdependence of work groups
o The history of CB for this group and for groups in similar circumstances
o The organizational structure of the ER
o Wishes of EEs & ER
o Concern about undue fragmentation
The Board has determined thousands of bargaining units, and in so doing has developed settled
policies concerning the appropriate unit for particular classifications of employees and industrial
groups. The Board has a statutory responsibility to give the parties an opportunity to make
submissions but the Board's policies reflect its accumulated experience, and a heavy onus lies on
any party seeking to persuade the Board to deviate from the "standard units" which have been
established to be appropriate.
o More recently, the Board is showing that it is willing to be flexible with bargaining units.
They are starting to have the view that the units were created at a certain point in time in a
certain society and when the economy had a standard structure. The onus, while still heavy,
has been reduced.
Sack & Mitchell, Ontario Labour Relations Board: Law and Practice
Standard Units:
 Distinction made between office and production units: initially Board ruled that interests of
office and production EEs were so divergent that they should not be included in the same unit.
Now the situation has evolved to the point where the Board will not automatically require that
exceptional circumstances be shown to warrant a unit comprising both groups (in Motor Coach
Industries Limited, the Board held that an all-inclusive unit was appropriate). The Board has
recognized the increasing difficulty in making distinctions between production and office EEs
in high tech industries.
o Standard production unit: all EEs in (municipality) save and except foremen, persons
above the rank of foreman, office and sales staff (now the rule excluding foreman, the
lowest level of manager, is a rebuttable presumption)
o Standard office unit: usually described as “all office EEs” or “all office and clerical EEs”
or “all office, clerical and technical EEs”. In dealing with white-collar units, the Board
has developed few general principles – mostly case by case.
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Standard sales unit: little organizational activity has been directed to sales personnel, except in
the retail sales field (ie supermarkets, department stores). In this setting the Board has included
office and sales staff in a single unit.
 Professional employees: subject to the Act unless specifically excluded or they fall within the
managerial/confidential information categories (professional engineers, librarians, etc). Board
has stated that the mere exercise of professional or technical skills does not itself justify a
separate bargaining unit. The Board outlined criteria which distinguish professionals from
other EEs – the job of a professional is technical and is based on systematic knowledge acquired
through long training that the professional adheres to.
 Tag-end unit: although most EEs are caught by other mechanisms, the Board will include a
catch-all unit to ensure that no one is deprived of CB rights. The remaining unorganized EEs
should be included in one unit to avoid unnecessary fragmentation.
 Tucker: Board was crystallizing concerns about communities of interest among EEs and taking
into account the nature of the work performed – this led to a fair amount of fragmentation on
many levels
Particular Classes of Employees:
 Managerial, confidential personnel: excluded
 Salaried employees: not relevant
 EEs engaged in composite activities: whether EEs who perform BU and non-BU work are included
in the union depends on whether they share a community of interest with the EEs in the BU and
whether their exclusion would deprive them of CB rights
 Female EEs: not relevant
 Seasonal EEs: not the Board’s practice to exclude them
o In Tobacco industry, Board’s practice was to include seasonal EEs with permanent EEs
where the certification was made during the season
o Mar-Brite Foods: Board departed from this by including seasonal EEs in the BU applied for in
the off-season
 Casual, short term, temporary and probationary EEs and trainees: term of employment is not
relevant – Board has said that the use of the word “casual” is inappropriate, and generally they are
included in the same unit as permanent EEs
 Part-time EEs and students:
o Board’s practice was a strict separation of part-time and full-time EEs on the basis that PT
had a separate community of interest from FT and therefore they should be in separate
bargaining units
o To and fro on this in policy and in law, NDP amended law to try to promote less
fragmentation, and the policy of the Board was to become more relaxed about standard
bargaining units and to allow for more variation
o Board has said it is no longer evident to them that assertions about the lack of community of
interest as between full and part time EEs ought to continue to be elevated to the level of a
labour relations axiom – the evidence of the proliferation of combined PT/FT units has not
caused serious labour relations difficulties (see Burns)
United Steel Workers of America v. Burns International Security Services (1994)
 In Hospital For Sick Children, the Board noted: WE ARE TROUBLED BY THE FACT THAT A
LARGELY ADMINISTRATIVE AND POLICY-LADEN DETERMINATION HAS MUSHROOMED
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IN SOME CASES INTO AN ELABORATE, EXPENSIVE, AND TIME-CONSUMING PROCESS FOR
DECIDING A RELATIVELY SIMPLE QUESTION: DOES THE UNIT WHICH THE UNION SEEKS
TO REPRESENT ENCOMPASS A GROUP OF EMPLOYEES WITH A SUFFICIENTLY COHERENT
COMMUNITY OF INTEREST THAT THEY CAN BARGAIN TOGETHER ON A VIABLE BASIS
WITHOUT AT THE SAME TIME CAUSING SERIOUS LABOUR RELATIONS PROBLEMS FOR
THE EMPLOYER
o If the unit applied for meets that simple test, it serves no purpose to litigate alternative
bargaining unit configurations
All employees share a "community of interest" by virtue of working for the same employer, and
"real life collective bargaining" seems to be able to accommodate groups with quite different duties
and conditions, who one might still argue had a separate "community of interest".
Both in Hospital for Sick Children and in later cases, the Board has explored the tension between
bargaining structures that facilitate organizing (one of the goals of the Statute), and bargaining
structures that are likely to be more stable and effective in the long-run (another goal of the Act).
o The former objective points to smaller employee groupings which are more readily
organized.
o The latter goal points to broader-based bargaining units that have the organizational mass
and bargaining power to survive over time and in changing market conditions
These goals must be harmonized within a framework that now recognizes (as early Board "policies"
might not) that there is no single unique and indisputably "appropriate" unit. There are degrees of
appropriateness; or to put the matter another way, sensible, alternative ways in which one can
define the bargaining unit without triggering (as the Board in Hospital for Sick Children put it)
"serious labour relations problems".
A trade union need not seek to represent the MOST comprehensive or MOST APPROPRIATE
bargaining unit; and as the applicant or moving party, the union has a degree of flexibility in
deciding what unit to organize. As long as the unit it seeks does not generate serious labour
relations difficulties for the employer, it will be granted the unit that it applies for. The focus is
on concrete problems rather than the sometimes nebulous concept of "community of interest".
CLAC v. Port Hope [2005]
 The OLRB extracted 10 factors relevant to bargaining unit determination from the Sick Kids case:
1. Whether the employees have a community of interest having regard to the nature of the work
performed, the conditions of employment, and their skills.
2. The employer's administrative structures.
3. The geographic circumstances.
4. The employees' functional coherence, or interdependence or interchange with other employees.
5. The centralization of management authority.
6. The economic advantages to the employer of one unit versus another.
7. The source of work.
8. The right of employees to a measure of self-determination.
9. The degree of employee organization and whether a proposed unit would impede such organization.
10. Any likely adverse effects to the parties and the public
Board’s Policy in General: Standard Bargaining Units versus Flexibility
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The labour union doesn’t have to propose the most appropriate unit – in deciding whether unit is
appropriate, Board should be asking whether it passes a minimum standard of appropriateness
Board recognizes the tension between bargaining structure that facilitates organizing and those that
are likely to be stable and effective in the long run – how to balance these considerations?
NOW: Still fragmented
o No multi-employer units
o Few province-wide units (usually restricted to single plant or employees within single
municipality)
o Example: York university example of fragmentation: York university faculty association,
York university staff association, CUPE 3903 (which has two units – contract faculty and
TA’s), CUPE 1356 (security and parking employees), Operating engineers unit
o Most bargaining units being certified by the board are extremely small (average size is 16
EEs)
ISSUE OF UNION DENSITY: How can unions possibly organize and bring in new members at a
rate that keeps up with turnover in market and changes in employment patterns?
o As large employers shrink and percentage of employees who work for large employers
shrink, the task of organizing becomes increasingly daunting. It’s very hard to organize if
you have to go on an employer by employer basis.
o Workplace size is also shrinking – only in large workplaces do you have more extensive
union coverage
o Board policy supports the difficult environment for unions to survive in
o Economic trends may play a role: in Ontario the proportion of workers employed in small
establishments (fewer than 20 EEs) increased from 16% in 1978 to 24% in 1986, and the
national share of employment of firms with over 500 employees declined from 40.1% in 1983
to 36.4% in 1991
Another issue that affects BU determination is the desire of EEs to unite with whomever they like:
o EEs may wish to preserve religious, political or cultural distinctions (Boards refuse this)
o Example in which WORKERS choice was overruled: In 1985 Canada Post applied for
amalgamation of the Canadian Union of Postal Workers with the Letter Carriers Union of
Canada. The amalgamation would have allowed CP to re-categorize workers and to
exclude thousands of EEs from CB. The CLRB allowed the application, saying that they
wanted to allow the ER to conduct its operations in as reasonable and logical a manner as
possible while protected EEs rights.
o The common thread is the need to guard against fragmentation of the EEs among more than
one bargaining unit
Large bargaining units v small bargaining units
o Small bargaining units generally less powerful
o Large bargaining units expensive to manage
o Where capital has overcapcacity -- ER could pit one production facility against another – try
to get concessions out of the unions
CLASS notes September 27 – Union Churn
The default model of our economy is no unionization. Also, there is constant churn of new companies
and companies going out of business. Every time a unionized business folds, the union loses members.
So if just had the force of churn, and no new unionization, then union density would fold (assuming
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the unionized companies weren’t growing extremely rapidly). Hence, unions must constantly be
organizing and growing in order to stay in the same proportion, because of this churn.
The large unionized firms are not on the whole expanding their employment, on the whole they are
shedding employment. You go to heavily unionized industries – auto, steel, etc. – large employers with
thousands of workers. Proportionately, these industries have less workers today than they did in the
1960s. New employment is primarily coming from SMEs these days.
Most of the new bargaining units, as seen in the table below, are smaller. And so a lot of resources are
expended to obtain only a few new members. The bargaining power of these new BUs is relatively low.
The old structure may not fit the new SME-driven job growth in the economy. The old model worked
best in industries dominated by large players.
Size of Bargaining Units in Certification Applications Granted
Union Density and Workplace Size, 2009
Size of workplace
% of all employees
% union coverage
<20
33.5
13.3
20-99
33.6
29.7
100-500
20.6
40.9
500+
12.7
52.2
Tucker  the old model is going to result in continued decreasing unionization in private sector.
Continued decreasing trend will occur unless the model changes.
Alternatives to Current Policy
1) Mandatory province-wide bargaining; new units incorporated into existing agreements (ICI
Construction industry) 
2) Post-certification amalgamation of bargaining units on application
3) Decree system [where there is Centralized Bargaining – terms applicable across all workplaces
in sector]
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Quebec: The Collective Agreement Decrees Act was enacted in 1934 as a compromise
between a minimum wage law and legislated collective bargaining rights. Essentially,
the Minister of Labour gained the authority to extend some provisions of collective
agreements (especially monetary clauses) to non-union workers in the same economic
sector. The purposes of the legislation were first to improve the working conditions of
non-union workers by extending to them some of the benefits contained in collective
agreements. It also protected unionized workers against competition from lower-paid
workers in non-union companies
France: 90% union coverage, 9% membership – because decrees cover entire industries,
most workers covered by the union terms covering the sector but do not actually belong
to the union. This may have the implication that the union members are disadvantaged
via having to pay union dues but receiving much of the same benefits as others – Tucker
speculating.
CH 2: Unfair Labour Practices
Basic Principles
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Question: what is the legal framework within which union and ERs operate?
o Generally, ERs want to dissuade workers from choosing the CB regime, and unions want to
organize
o Think about what the situation was in the context of liberal voluntarism – what has changed
to address the problems in that regime?
Liberal Voluntarism: latter part of the 19th century
o Workers had a legal freedom to join a union (it ceased to be a crime/tort to do that)
o BUT this freedom was NOT protected by any rights. ER still had right to choice if they
would use unions; they had right to manage their companies as they saw fit. We also
respected ER property rights, ERs could exclude others from their property, such as 3rd
party organizers. ER also enjoyed freedom of speech.
o So, because of this, the freedom to form a union wasn’t really that meaningful, because they
faced danger of losing their jobs or facing some other negative consequence. And so the
argument is for freedom of K to be meaningful, we have to protect it.
o But the whole idea of right means that there is a duty. It means there is a duty of necessity
on employers. And when you put a duty on employers you are effectively putting limits on
their:
 Freedom of K, freedom of speech, other freedoms.
o So really, in order to protect the freedom of association of EEs, restrictions had to be put on
the freedoms of ERs under liberal voluntarism, and that was justified under the belief that it
was more needed to protect the freedom of association of EEs. There were a series of
tradeoffs in the LR statutes through the years in Canada, leading up to today.
o So the question is how much protected space is appropriate? What is a Fair Labour Practice
versus an Unfair Labour Practice?
o Like agricultural workers in Dunmore – had no rights protection to facilitate their exercise of
the legal freedom to join an association that they enjoyed under the law
Freedoms under Liberal Voluntarism and ERs clashing rights:
o Freedom of K:
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ER can chose not to engage in contractual relationship with workers who joined
unions (and could threaten to terminate)
 Why its problematic for both parties to have freedom of K: Unequal power
relationship
 ERs ability to inflict harm is significantly greater than the power of the individual
worker, and workers subject to this regime can’t make a free choice about whether to
engage in CB
o Freedom of speech:
 ERs can express their opposition to the union
 Why its problematic for ER to have FOS: different power structure
 ER has a very powerful voice, and can exert a substantial influence on EE (as
opposed to the unions which can’t do anything to the EE)
 Absence of restraint on FOS here can affect the ability of others (like EEs) to enjoy
their FOS
o Private property rights:
 ERs can keep people from coming onto their premises – affects ability of union
organizers to contact EEs
 Most EEs have to come onto ERs property to work – ER has ready access to those
EEs because they are compelled to be present
o Managerial rights:
 ERs can direct what EEs do/do not do while on the premises
 Affects ability of EEs to engage in union activities while on premises and ability to
freely choose whether they want to be in CB regime or not
Industrial Pluralist Argument: Liberal Voluntarism didn’t give a REAL freedom of choice to EEs,
so it was necessary to change the law to try to offset some of those structural imbalances of power
o Employer access/freedom had to be limited (of contract, of speech, property rights,
management rights) to create space where employees could make a real decision
o We want to look at the legal freedom constructed to provide that additional speech, and
arguably make the choice a more democratic process
Purpose of ULP: lend some force to the freedoms expressed in s. 5 and 6 of the OLRA
Legal Framework: OLRA and Criminal Code
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OLRA
 Privilege to Organize, s. 5
 Protected Right – ULP, ss. 70-77
 Enforcement
 Complain Process, s. 96
 Prosecution, s. 104, 109
Criminal Code, s. 425
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Privilege to Organize
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Privilege to organize – s. 5: Every person is free to join a trade union of the person’s own choice
and to participate in its lawful activities.
o This is a restatement of liberal voluntarism – freedom to do something
Membership in ERs organization – s.6: Every person is free to join an employers’ organization of
the person’s own choice and to participate in its lawful activities
The innovation of the OLRA was that they not only gave you a freedom but also gave you
protected rights, defined in unfair practices portion of the Act (s. 70-77)
Protected Rights – ULP, ss 70-77
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ERs not to interfere with unions – s.70: No ER or ERs organization (or anyone acting on their
behalf) shall participate in or interfere with the formation, selection or administration of a TU or the
representation of EEs by a TU or contribute financial or other support to a TU, but nothing in this
section shall be deemed to deprive an ER of the ERs freedom to express views so long as the
employer does not use coercion, intimidation, threats, promises or undue influence.
o ERs are not supposed to interfere with an EEs decision about whether to join a union (*scope
here subject to interpretation*) BUT they can make their views known, provided that their
expressions do not cross over into coercion
ERs not to interfere with EEs rights – s.72: No ER, ER organization (or anyone acting on their
behalf)
o (a) shall refuse to employ or to continue to employ a person, or discriminate against a
person in regard to employment or any term or condition of employment because the
person was or is a member of a TU or was or is exercising any other rights under this Act;
o (b) shall impose any condition in a K of employment or propose the imposition of any
condition in a contract of employment that seeks to restrain an EE or a person seeking
employment from becoming a member of a TU or exercising any other rights under this Act;
or
o (c) shall seek by threat of dismissal, or by any other kind of threat, or by the imposition of a
pecuniary or other penalty, or by any other means to compel an EE to become or refrain
from becoming or to continue to be or to cease to be a member or officer or representative of
a TU or to cease to exercise any other rights under this Act.
o This was passed in the 1930’s, and prohibits: discrimination, imposition of terms of K that
bar joining a union, or threats of dismissal or any other kind of threat (there are parallel
provisions for unions)
o Aim is to create protected space where workers can make free choices
No interference by ER with bargaining rights – s.73(1): No ER, ERs organization (or anyone acting
on their behalf) shall, so long as a TU continues to be entitled to represent the EEs in a BU, bargain
with or enter into a CA with any person or another TU or a council of trade unions on behalf of or
purporting, designed or intended to be binding upon the EEs in the BU or any of them.
ULPs by TUs
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Unions not to interfere with ERs organizations – s.71: No TU (or anyone acting on their behalf)
shall participate in or interfere with the formation or administration of an employers’ organization
or contribute financial or other support to an employers’ organization.
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No interference by union with bargaining rights – s.73(2): No TU or council of TUs (or anyone
acting on their behalf) shall, so long as another TU continues to be entitled to represent the EEs in a
BU, bargain with or enter into a CA with an ER or an ERs organization on behalf of or purporting,
designed or intended to be binding upon the EEs in the BU or any of them.
Intimidation and coercion (anyone) – s. 76: No person, TU or ERs organization shall seek by
intimidation or coercion to compel any person to become or refrain from becoming or to continue to
be or to cease to be a member of a TU or of an employers’ organization or to refrain from exercising
any other rights under this Act or from performing any obligations under this Act.
Persuasion during working hours (anyone) – s.77: Nothing in this Act authorizes any person to
attempt at the place at which an EE works to persuade the EE during the EEs working hours to
become or refrain from becoming or continuing to be a member of a TU.
Duties of TUs and Definitions
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Duty of fair representation by TU – s.74: A TU or council of TUs, so long as it continues to be
entitled to represent EEs in a bargaining unit, shall not act in a manner that is arbitrary,
discriminatory or in bad faith in the representation of any of the EEs in the unit, whether or the EEs
are members of the TU or of any constituent union of the council of TUs, as the case may be.
Duty of fair referral by TUs – s.75: Where, pursuant to a CA, a TU is engaged in the selection,
referral, assignment, designation or scheduling of persons to employment, it shall not act in a
manner that is arbitrary, discriminatory or in bad faith.
Definition of ERs organization – s. 1(1): means an organization of ERs formed for purposes that
include the regulation of relations between ERs and EEs and includes an accredited ERs
organization and a designated or accredited ER bargaining agency
Enforcement – Complaint Process in s. 96
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Most complaints are directed toward ER ULPs b/c unions don’t exert the kind of power that ERs do
Inquiry into complaint – 96(1): The Board may authorize a labour relations officer to inquire into
any complaint alleging a contravention of this Act.
Duties of the officer – 96(2): The labour relations officer shall forthwith inquire into the complaint
and endeavour to effect a settlement of the matter complained of.
Officer reports to board – 96(3): The labour relations officer shall report the results of his or her
inquiry and endeavours to the Board.
Remedy for discrimination – 96(4): Where a labour relations officer is unable to effect a settlement
the Board may inquire into the complaint and where the Board is satisfied that the person
complained of (ER, ERs organization, TU, council of TUs, EE or other person) has acted contrary to
this Act it shall determine what that person shall do or refrain from doing with respect thereto and
such determination (without limiting the generality) may include, despite the provisions of any CA:
o (a) an order directing the person to cease doing the act or acts complained of;
o (b) an order directing the person to rectify the act or acts complained of; or
o (c) an order to reinstate in employment or hire the person or EE concerned, with or without
compensation, or to compensate instead of hiring or reinstatement for loss of earnings or
other employment benefits in an amount that may be assessed by the Board against the
person(s) jointly or severally.
Burden of proof (reverse onus) – 96(5): On an inquiry by the Board into a complaint under
subsection (4) that a person has been refused employment, discharged, discriminated against,
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threatened, coerced, intimidated or otherwise dealt with contrary to this Act as to the person’s
employment, opportunity for employment or conditions of employment, the burden of proof that
any ER or ERs organization did not act contrary to this Act lies upon the ER or ERs organization.
o Persuad: complainant had adduced very little evidence in support of the allegations, but the
Board held that this section places a burden on ER to show that it did not conspire with
union or representatives (reverse onus can assist workers in prosecuting complaints)
Filing in court – 96(6): A TU, council of TUs, ER, ERs organization or person affected by the
determination may file the determination, excluding the reasons, in the prescribed form in the
Superior Court of Justice.
Effect of settlement – s. 96(7): Where a proceeding under this Act has been settled, and the terms of
the settlement have been put in writing and signed by the parties, the settlement is binding upon
the parties who agreed to the settlement and a complaint that the parties who has agreed to the
settlement have not complied with the terms of the settlement shall be deemed to be a complaint
under subsection (1).
No certification – 96(8):The Board shall not, under this section, certify a trade union as the
bargaining agent of employees in a bargaining unit.
Cases
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Barrie Examiner: to substantiate a complaint alleging ULP, it is sufficient to show that the ERs
action was in part directed against lawful union activity
o Given the requirement that there by absolutely no anti-union motive, the effect of the
reverse onus is to require the ER to establish on a BOP two facts:
 (1) that the reasons given for the discharge are the only reasons
 (2) that these reasons are not tainted by any anti-union motive
United Rubber: complaint under s. 96 that ER dismissed A for union activity. Board found that it is
incumbent on the ER to prove on a BOP that it did not have knowledge of union activities and
could not have been motivated by it OR that in spite of its knowledge it acted without anti-union
motive. It did not have to prove “just cause” to the degree that would be required in a grievance
arbitration.
Canadian Paperworkers Union: alleged that C’s layoff following his participation in a certification
hearing was motivated by anti-union animus (C had lost his driver’s license due to a DUI, but it
would not affect his work). He had received permission to be absent from work during the
certification hearing, where the company president asked about the loss of license. Board held that
the decision to eliminate him was at least partly motivated by C’s participation in the hearing and
ordered restatement.
Enforcement – Prosecution in s. 104 and s. 109 “pretty much a dead-letter, has never been
successful”


Union can seek the consent of the Board to prosecute an ER, ad if they got consent they can move
forward (remember CCC provisions, although no successful use)
Offences – s. 104: Every person, TU, council of TUs or ERs organization that contravenes any
provision of this Act or of any decision, determination, interim order, order, direction, declaration
or ruling made under this Act is guilty of an offence and on conviction is liable,
o (a) if an individual, to a fine of not more than $2k; or
o (b) if a corporation, TU, council of TUs or ERs organization, to a fine of not more than $25k
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
Consent – s.109(1): No prosecution for an offence under this Act shall be instituted except with the
consent in writing of the Board.
o (2): An application for consent to institute a prosecution for an offence under this Act may
be made by a TU, a council of TUs, a corporation or an ERs organization among others, and,
if the consent is given by the Board, the information may be laid by any officer, official or
member of the TU, council of TUs, corporation or ERs organization among others.
Criminal code – s. 425: Every one who, being an ER or the agent of an ER, wrongfully and without
lawful authority (a) refuses to employ or dismisses from his employment any person for the reason
only that the person is a member of a lawful TU (b) seeks by intimidation, threat of loss of position
or employment, or by causing actual loss of position or employment, or by threatening or imposing
any pecuniary penalty, to compel workmen or EEs to abstain from belonging to any TU, association
or combination to which they have a lawful right to belong, or (c) conspires, combines, agrees or
arranges with any other ER or his agent to do anything mentioned in paragraph (a) or (b), is guilty
of an offence punishable on summary conviction.
ULPs in CA Context




Where a CA is in existence a ULP may also be a breach of the CA
Legislation requires a grievance process culminating in arbitration in this situation
Burdens and remedies differ depending on whether grievance arbitration or LB mechanism is used
An ER may contend that it dismissed with just cause, but if the behaviour is not obviously serious,
it may have trouble discharging the burden to disprove anti-union animus
Application of Legal Framework: Union Access
Union Access v. Employer Access



How does the union or ER get access to the constituent parties in order to get their vote?
o ER: Unlimited access to EEs (knows their names and contact information)
o Union:
 Starts with no access and no information.
 Union not entitled to get their names or info by law.
o PIPEDA: legislation regulating privacy rights in the private sector – it imposes restrictions
on the ability of organizations to share the private information they have collected.
o Unions have tried other ways to get the info – Stewart case: union approached a consultant
to assist them in getting information, consultant approached EE who turned out to be loyal,
consultant was charged with theft. Property question was whether there was property in
the list of names – SCC said no, there is no property “as such”.
UNIONS contacting workers at home:
o Not entitled to their names/info by law
o BUT S.13 of OLRA: Where EEs of an ER reside on the property of the EE, or on property to
which the ER has the right to control access, the ER shall, upon a direction from the Board,
allow the representative of a TU access to the property on which the EEs reside for the
purpose of attempting to persuade the EEs to join a TU (must make application to the
Board)
UNIONS contacting workers at work: non-EE union organizers
86
o

ERs property: rarely
 ER does not have to provide access to its property (ERs right to exclude as a property
right combined with s.77 suggest that a non-EE organizer has no legal right to enter
the workplace)
 S.77 of OLRA: Nothing in this Act authorizes any person to attempt at the place at
which an EE works to persuade the EE during the EEs working hours to become or
refrain from becoming or continuing to be a member of a TU
 NOTE: ER could permit it, and there is an exclusion in s. 13 (above)
 NO Board has held that under s.70 (rule against interference) it is unlawful
interference with organizing activities to deprive union organizers of access to ER
property. It would be a very high burden on a union to establish that an ER’s
deprivation constituted interference. Even if the union could show that it didn’t
interfere with production, they would still be unlikely to win a claim of interference.
o Entrances to ERs property:
 Public property: yes, subject to general law
 Privately owned, publicly used: department stores, malls
 Situations where the access to the place of work is surrounded by private
property that is used by the public
 Can union organizers stand on the entrance of mall?
o Harrison v Carswell: trespass stands at full force. Owner maintains
right to exclude. Later, Eaton’s case.
o Eatons v. RWDSU (1985):
o Union filled complaint that Cadillac Fairview was interfering – that
they were a party acting on behalf of the ER, and interfering, as is
barred under s.70.
o OLRB said this is different than Harrison. Harrison is common-law
case. In order to create space for this protected activity to occur,
property rights can be restricted. The union is acting within the
powers given to them under the LRA. The OLRB held that the
shopping mall owner’s property rights, even if exercised in a nondiscriminatory manner, were subject to the OLRA and that
organizational efforts should be permitted. The mall owner not
allowed to exclude – have to permit the organizers to access
restaurants and other such facilities – could only refuse access if it
could be proven that trade union activity was interfering with the
normal course of business.
o OLRA by implication imposed restrictions on private property rights
– but it didn’t restrict ERs PP rights, just the mall owners rights
 Making the initial contact often occurs at the entrance to ERs place of business –
as long as they are not creating a nuisance by obstructing then that will be lawful
activity
UNIONS contacting workers at work: in house employee organizers
o These are EEs who take a lead role
o During work hours: rules prohibiting presumptively valid (s.77)
87


In other words, ER entitled to restrict activity during working hours while workers
are at work
o During non-working hours: rules prohibiting presumptively invalid
Unions are still largely left on their own in order to make contact with EEs
Adams Mine (1982)
(a) No-solicitation or no-distribution rules which prohibit union solicitation on company property by
employees during their non-working hours are presumptively an unreasonable impediment to selforganization…such rules may be validated by evidence that special circumstances make the rule
necessary…to maintain production or discipline
(b) No-solicitation or no-distribution rules which prohibit union solicitation by employees during
working hours are presumptively valid…in the absence of evidence that the rule was adopted for a
discriminatory purpose or applied unfairly…
Ratio: EEs can discuss unionization on company property during non-working hours (unless it
disrupts business).
Application of Legal Framework: Employer Access

ERs start from a position of virtually unlimited access – they know who the EEs are, they have the
right to speak to them, so the issue is limiting ER access.
o Tucker: “The starting line is opposite.”
o So what labour laws do is try to limit the access that ERs would otherwise enjoy.
o Issues centre around the use of surveillance, group meetings (captive audience meetings),
individual meetings etc.
K-Mart Canada Limited (Peterborough) (1981, OLRB): exemplifies crude interference and shows ERs
which appear to not really worry about violating the LRA
Facts: two EEs agree to take on lead role as union organizers. Initial organizing takes place in secret,
but Kmart finds out that drive is taking place (note: sometimes companies hire private security firms to
investigate union activity, although it is not clear what happened in this case). ER then started to
mobilize, and did three things:
 SURVEILLANCE: Kmart put the two leading organizers under surveillance (“very intense
surveillance, described by labour board in great detail in their decision. Nb. There is nothing unlawful about
surveillance and that the Labour Board says that there is legitimate role for surveillance, done properly, in the
workplace. So what’s wrong with the surveillance in K-Mart? It’s operationalized in a way that is meant and
effectively intimidate and isolate the workforce. Meant to communicate to the workforce that there will be an
adverse effect from partaking in the union activity. Adds a stigma to those that would partake in the union.”)
o “Tucker: some level of surveillance for the purpose of just monitoring if organizing activity was
happening during labour hours would not be unlawful.”)
o
The law:
 Normally surveillance of a general nature is permissible
 It has been held that video surveillance (where was this surveillance?) is covered by
privacy legislation and can only occur with consent of EEs, except in exceptional
circumstances (like security concerns)
 Putting EEs under “overt surveillance” (and isolating them from their co-workers) is
an obvious attempt to discourage them (and other EEs) from joining the union – this
is an excessive use of ER access and an ULP
88
o

Application: Kmart had management trainees constantly watching these two women,
listening to their conversations – way over the line  a ULP
o Chilling effect: when EEs are made the object of "official" surveillance there tends to be a
chilling effect on the ability to both those being surveyed and those who are aware of the
surveillance, to express themselves freely in support of the activity being watched
GROUP MEETINGS: K mart organized a series of small meetings attended by senior management.
o
o
o
o
“The simple action of having the group meetings and expressing to the workers the preference to
remain ‘union-free’ is not unlawful.’ Para 34: The act protects the right of the ER to represent re a
union. Nothing wrong with expressing opinion to remain union-free.”
“SO – when is the line crossed? What did Kmart do that took what otherwise would have been a
lawful practice and turned it into an unfair labour practice? Factors like: presence of upper
management, language used, frequency of the meetings, small meetings, soliciting employee input in
a manner that was intimidating and isolating, was organized in a way where union-supporting EE’s
could be identified and punished.”
“Para 34: Free to communicate its feelings, so long that it does not do so in a way that... coercion and
undue influence on its employees. However NONE of these are absolute lines! It all HAS TO BE
LOOKED AT IN THE TOTALITY OF THE CONTEXT, on a case-by-case basis. No single indicia of
when the line is crossed.”
“These are sometimes called “captive audience meetings” or “forced listening”: management has
called the meeting and forced EE’s to listen to their views on the matter.”
o

The law:
 There is nothing wrong with ERs having group meetings and expressing their
preference to remain non-unionized per se, BUT even if ER tells EEs they can leave,
the reality is that they won’t – the audience is captive.
 Legitimate expression of desire to remain non-union is okay – but this crossed the
line
o Application:
 Size of meetings made it hard to leave: it would be very hard to get up and leave
that kind of meeting (captive audience)
 Small groups made it more coercive: small meetings transform an expression of
opinion into intimidation because the EEs were singled out
 Intimidating environment: National Human Resources manager from head office
held the meeting, sends a message that ER is taking it very seriously
 Reoccurring meetings: increased intimidation factor, not simply an expression of
opinion
 Meetings contained implied threats: if you support the union, things will get worse
INDIVIDUAL MEETINGS: managers engaged with individual EEs and helped them do their
work
o The law:
 no bright line rules here, nothing wrong with managers asking EEs if they have any
concerns
o Application:
 Fox, the national representative, was there every day, asking EEs about unions

“It was so frequent that it became harassing. The repetition and solicitation of the views
resulted in an intimidating behaviour.”

This become undue influence – depriving employees of space/freedom to make a
choice about whether they want a union
89
Held: ER had engaged in ULP – they violated the Act by the overt surveillance of the two organizers,
by intimidation and undue influence in both the form and content of the group meetings, by
intimidation and undue influence in the conversations with EEs and the extended presence of Mrs. Fox
in the Peterborough store, by the attempt to deter four employees from giving evidence in Board
proceeding and by discharging Mr. Hurle because of his union sympathies. Board certified the union.
“Board conclusively was of the opinion that K-Mart went way over the legal lines.”
Walmart Canada Limited (1997, OLRB)
Facts: organizing drive took place at Walmart. Lots of momentum at first. After management, mgmt
implements a “plan of action. Few additional cards signed. When union made the application, they
lost the vote 43-150 (Union lost over half their initial signups).
Issue: was whether they lost because of ULPs. Note that this is very different from the Kmart case.

“Clear in Wal-Mart that Walmart got legal advice and tried to be very careful not to engage in ULP.”


SURVEILLANCE: no surveillance took place.
GROUP MEETINGS:
o Walmart starts and ends the day with group meetings – part of the culture of the company.
o
o
o
“At these meetings, Walmart expresses its preference to remain union-free.”
“ER brought in senior management to the meeting, called EEs to attend, etc. -- but Labour Board said
they did NOT cross the line to ULP.”
“Comparative to K-Mart: the meetings were larger.”
o


Unionization was frequently brought up, but EEs were free to bring up anything that
concerned them.
o Nothing per se wrong with having group meetings – it will depend on other intangible
factors, such as whether they called specially for talking about unionization.
SPEECH MADE BY EMPLOYEE:
o EE who supported Walmart spoke about the bad things that ER would do if they unionized
o ER cannot remain silent if EE says it will do bad things – it has to distance itself from those
kinds of expressions and clarify its position
INDIVIDUAL MEETINGS: possibly what caused Walmart to lose the case.
o After the group meetings, four managers would circulate (did this for the five days leading
up to the vote) and in the course of conversation with EEs they would learn who supported
the union and who did not (contrary to the Act) – sent message that issue was important to
the company
o Board held that the systematic conduct of the ER in circulating amongst the EEs and
engaging them in individual and group discussions regarding the union, and the company's
refusal to answer any questions with regard to what the store would do if the union was
successful, was a breach of s 70 of the Act.
o Para 42: Board says it is very risky for ERs to engage in this kind of activity because those
individual meetings tend to cause intimidation and the sense that the ER is watching (not
condemned outright)


“Board does not say this was ULP but it was very risk and brings you very close or over the
line”
WRITTEN SUBMISSIONS BY ASSOCIATES: Walmart asked EEs to submit written questions
(using a “Question Box”) and then distributed the responses, gave some vague answers
o “Tucker: KEY part of the case!”
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o
Board held that the company's failure to answer the questions of associates with regard to
the issue of store closure would cause the average reasonable EE to conclude that the store
would close if the union got in
o Given that the inside organizers told management that this was in fact happening, and
management did not change its approach, the company intended EEs to draw this
conclusion.
o It is illegal for the company to say that the store would close, and by not alleviating EEs
concerns by answering the question, the company was intentionally fuelling employee
concerns.
Held: Walmart committed ULPs and Board ordered certification.
Compare policy: Union access versus ER access  Don’t take opposite tack on exam unless
rly sure
“Tucker: union and ER do not have anywhere close to even domain over access to employees.”
Employer Economic Power – Anti-union Animus


Terminations:
o Clearly ULP to terminate an EE because he joins or exhibits sympathies toward a union
(outright prohibition in the Act)
o Problem: can be difficult for unions to establish the reason why someone was terminated,
because ERs might not say why they were fired (might point to other reasons, economic
downturn, etc)
 Because of this, reverse onus under 96(5) that says in those circumstances the ER has
to satisfy board that they did not act pursuant to an anti union animus
o ERs usually try to either
 establish that they had no knowledge of the campaign, or
 to try to establish that they had some other grounds for the termination, and it
wasn’t tainted by anti union animus
Altering terms and conditions:
o Unlawful for ER to threaten to make things worse for EE
o Kmart: statements were made that said if they unionized the ER would become less flexible
in accommodating individual needs (like needing time off, etc)
o Walmart: in the written submissions by EEs, Walmart answered a question about changes in
profit sharing by stating that it would depend on what the ER and the union agreed to. It’s
an accurate statement of the situation, so it’s hard to argue that it is threatening language.
o

“If ER says “if there is a union things are likely to become worse for you” is likely to cross the line.”
Also important to consider the context of the situation. Courts and boards recognize the power
imbalance between ERs and EEs and the inherent subordinate nature of the relationship.”
Shutting down or moving:
o In Ontario, an ER threat to shut down operations in the event that a group of EEs unionize is
clearly a violation of the LRA – clearly intimidation. “A unionized ER need not remain in
business but cannot shut down because of anti-union-animus. Must show either reason.”
o
Walmart: rampant fear amongst employees that ER would shut down
 There are no unionized stores
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



o
When Walmart entered into agreement to buy Woolco stores, they didn’t take over
any of the unionized stores
EE who made the anti-union statement legitimately feared they would close (and
Walmart didn’t correct him)
“Question 1: Will the store close if unionizes?” Walmart response: associate-submitted
question about store closure was that it would be inappropriate to comment
“Question 2: Some people said it would be illegal to close the store because of unionization of
the store. Walmart Response: not factually true. Depends on factual circumstance and
application of law to the facts.”
 “Policy: Is this fair? It is not technically inaccurate but does not give a complete
picture of the law. They have left out an important piece of information.”
Legality of store closure:
 It is not illegal for the store to close after it unionizes as long as it can establish that
there was no anti-union animus and it closed for good economic reasons
 Walmart: didn’t answer the question of whether it would close. What should it have
done with this question? Because of the fear that was present, they could not be
silent on the issue – had to state positively that they would not close to avoid ULP
(could leave it open that they might close for other reasons)
Sobeys Letter
 Statements as to what will happen if there is unionization, must be carefully crafted. Threats, as
above in anti-union animus, are generally barred. Cannot say you will close the store if
unionization. Can make statements of fact but not threats or veiled threats.
Recap: Labour Relations Act, Union Access and Economic Power




OLRA didn’t do all that much to provide unions with more access to EEs than they had enjoyed
previously – they still face the barriers of private property rights (limits to going on property) and
management rights (access to contact information)
OLRA did impose restrictions on ERs ability to use their unlimited access by virtue of the
employment relationship
o EEs have to come onto ERs premises to do their work and ERs can compel meeting
attendance – required limitation (see Walmart and Kmart)
Some provisions try to respond to ERs superior economic power: limits on the power to terminate,
alter the terms/conditions of employment, or close down operations
Does the OLRA go far enough? Empirical and normative question
o Empirical: does current law allow ERs to continue to exert what might be characterized as
an undue influence on EEs?
o Normative: what should the stance of the state be with respect to CB? Should the state say
its policy is to promote CB’s, or should it take a more neutral stance?
Sobeys Letter to Employees – September 2008
 Written as a response to the organizing drive by UFCW
 Questionable parts: suggesting it would only be a cost to EEs (not a benefit), comment about the
auto industry (possibly threatening)
 Tucker: in an environment where job insecurity is widespread, EEs start from a position of
insecurity and fear, and it doesn’t take much to remind them of that
92
o

This is probably not unfair, as long as it just reminding EEs about the economic
environment that they operate in, and pointing out that the company has been doing well
o Not a threat, just a reminder about what people know is the reality of the economy
o A ULP suit would probably not be successful
No bright line, have to look at overall picture: no surveillance, no group meetings – and who’s to
say they read the letter?
Effectiveness of Employer Resistance – “breezed through, he barely touched this”




Where ERs chose to resist unions, they do so to a high degree of effectiveness, even without
engaging in ULP
Terry Thomason & Silvana Pozzebon, “Managerial Opposition to Union Certification in Quebec and
Ontario”
o Survey of union organizers in 1992, their view of effectiveness of ER opposition tactics:
 Increase in ER resistance reduces the probability of successful certification
 Small group meetings, use of threats and inducements, “firing a union organizer
(even if they are reinstated)” are most effective tactics
 Distribution of anti-union literature is not effective
Chris Riddell, “Union Suppression and Certification Success” (2001)
o Linked data study of ULPs and Certifications in BC, 1987-88
o Presence of alleged ULPs reduces probability of certification by 21%
Karen J. Bentham, “Employer Resistance to Union Certification” (2002)
o Questionnaire sent to employers in 8 Canadian provinces covering 1991-93 found:
 88% of ER respondents limited ability of EEs to communicate among themselves or
with union; 68% communicated with EEs, most commonly through captive audience
speeches; 29% tightened supervision or monitored EEs; 12% committed ULPs
 Training managers and limiting communication were most effective tactics in
reducing probability of success
 More aggressive tactics, like ULPs, had little effect on certification success, but
substantially increased likelihood of first contract bargaining difficulties and early
decertification
o Implication is that fair labour practices (like hiding EE cards, having group meetings,
sending letters) have been found to be quite successful in resisting unionization
Remedies


Remedy must be timely in order to be effective, but under current law complaints can take a long
time to process b/c of witnesses, legal manoeuvring, etc
40% of ULP complaints take more than 3 months to be resolved by the board, 25% take more than 5
months to be resolved, so there is obviously a timeliness problem
Interim Relief – during organizing drive and so forth – see Section 98

Orders that the Board can make, mitigates the timeliness problem – s.98(1): On application in a
pending proceeding, the Board may,
93
o


(b) subject to subsections (2) and (3), make interim orders requiring an employer to reinstate
an employee in employment on such terms as it considers appropriate
o (c) subject to subsections (2) and (3), make interim orders respecting the terms and
conditions of employment of an employee whose employment has not been terminated but
whose terms and conditions of employment have been altered or who has been subject to
reprisal, penalty or discipline by the employer
o These orders are made only on the basis of an allegation, and then down the road the Board
will make a decision about whether the termination was motivated by anti-union animus
When the powers might be exercised – 98(2): The Board may exercise its power under clause (1)
(b) or (c) only if the Board determines that all of the following conditions are met:
o 1. The circumstances giving rise to the pending proceeding occurred at a time when a
campaign to establish bargaining rights was underway.
o 2. There is a serious issue to be decided in the pending proceeding.
o 3. The interim relief is necessary to prevent irreparable harm or is necessary to achieve other
significant labour relations objectives.
o 4. The balance of harm favours the granting of the interim relief pending a decision on the
merits in the pending proceeding.
Process:
o If employee wants to allege ULP, they file a complaint under s. 96 of the OLRA
o Board turns it over to an officer, who investigates and tries to effect a settlement (significant
# of complaints are settled in this way)
o Reverse onus clause with regard to complaints alleging terminations and other sanctions so
ER bears the burden of establishing that they didn’t terminate someone b/c of unionizing
activity
o If board finds there was ULP, there are the provisions about remedies
Section 96 Remedies




“General power – section 96(4-5)?”
Cease and desist: stop doing the activity complained of
Power to reinstate: If not exercised on interim basis, Board can order the employee terminated b/c
of anti-union animus to be reinstated
o Compensation: lost wages can be ordered
Broad power to rectify: try to undo the harm caused by ULP
o Posting notices: prominent places in the workplace that state that the company has been
found to have committed ULP’s, stating it will cease and desist (happened in Walmart and
Kmart)
 NOTE on FOE: sometimes ER will be required to state that they will no longer
engage in the activity, but this violates FOE. Courts have held that it is a justifiable
infringement (a statement that you will obey the law is seen as acceptable)
o Access orders
 Normally unions struggle to access EEs, but once a ULP has been committed, the
Board can order that unions have access they would not normally be entitled to –
entering ERs premises, conducting meetings with EEs
 In Kmart, it was ordered that if people from head office were holding a meeting they
would have to give notice to union and union could send representatives
94

o
o
ER can be required to provide union with list of names and contact info of EEs so
union can send material and advise them
 The positive entitlement to access almost only comes about as a response to the
commission of an ULP
Damages
 Board can order damages – apart from compensating EEs who lost wages, they’ve
also said that other forms of compensation should be ordered
 Kmart: according to the Board the two EEs that were subject to the strict regime of
surveillance suffered intangible harm for which they should be compensated – NOT
punitive (no such power under s. 96) but it is compensation for a monetizeable harm
 Compensation can be ordered to unions for organizational costs incurred as a result
of the ULP – in a large campaign this can be a substantial amount of money
Resumption of production
 Situations where ER shuts down or contracts out the work and was motivated by an
anti-union animus
 There are only a few instances where Board has issued that kind of order (extreme
cases)
 Tucker: orders like this are probably not effective, because trying to enforce would
be impossible. Last case he knows of was 1999.
Remedial Certification – s.11: The most powerful remedy a union can get – got in Walmart
and Kmart





After Walmart, provincial government took away power of board to remedial certify. (But later
Liberal government brought this power back, when they were elected.)
The remedies above are not always good enough to correct the harm where an ULP has been
committed
o Theoretically, once the orders are given, EEs should be expected to make their true feelings
known
o BUT it may be impossible for true wishes to be ascertained in normal ways
o In Kmart and Walmart, remedial certification was ordered
S. 11 says union can be certified where it has not established that it has majority support
Section 11 Requirements:
o #1 BREACH: 11. (1) Subsection (2) applies where an ER, an ERs organization (or someone
acting on their behalf) contravenes this Act and, as a result,
o #2 EEs CAN’T EXPRESS WISHES: (a) the true wishes of the EEs in the BU were not likely
reflected in a representation vote; or
o (b) a TU was not able to demonstrate that 40 per cent or more of the individuals in the BU
proposed in the application for certification appeared to be members of the union at the
time the application was filed.
Issue is the impact that the breach had on the ability of EEs to express themselves
o In Kmart the violations were so egregious, it wasn’t that difficult for the board to find the
impact
o In Walmart it was more of a challenge because it wasn’t a flagrant violation. The essence of
the complaint was that the ER hadn’t answered the question of whether it would shut down
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


if it was unionized – compared to Kmart, not flagrant. But Board said the violation had a
very substantial impact – in an environment where there was rampant fear, the failure to
answer the question had a substantial impact, and on that basis the Board ordered the EEs
be certified notwithstanding that the union was able to win support through election.
#3 Although union doesn’t need to have a majority, it has to have sufficient support so that in
the Board’s eyes it can carry out the function of CB
o Can look at the level of support before ULPs took place, even if it evaporated
o Need some indication that given the chance a union might be able to win a majority and
sustain itself
o Success of remedial certification: in more than half of the cases, the union has successfully
established a CB relationship – so the remedy can work
Aftermath of Walmart: Conservative government of Ontario amended the OLRA by eliminating the
board’s power to order remedial certification, as well as its power to reinstate dismissed union
organizers on an interim basis.
o These changes had a negative impact on the success of union organizing.
o Board had rectification powers, so it could order another election (without the 40% initial
support)
o BUT there was no instance in which a union obtained a remedial election that it was able to
win (so the other remedial powers of reinstatement, access orders, posting could not
overcome the harm)
o The Liberal government restored these powers to the board in 2005 – BUT with a provision
that says remedial certification should only be awarded when nothing else will do
#4: Remedial certification can only be ordered when the Board is satisfied that no other remedy
would be sufficient to counter the effects of the ULP
o This rarely is an impediment when the other three requirements are met
If ERs are seen as having committed an ULP based on an economic threat:
o This type of threat is seen as having undue influence on EEs
o When it comes to the question of remedial certification, boards have said that economic
threats follow employees into the voting booth substantively – so nothing in the rectification
powers that will undo economic threats
o Sobeys managed to raise economic threats very subtly
Significant Change to Certification Law in the Last Decade



Switch from election to card counts (can no longer be certified by card counts alone)
o Most statutes had provision allowing unions to be certified if they could establish that more
than 50% of the members of the BU had become members of the union
Since that time, most Canadian jurisdictions require that the union win an election, and this is seen
as moving us toward the US version of the Wagner act (mandatory election provision)
What’s the case for having mandatory elections as the norm?
o We associate elections as being democratic
o If there is an election, there has to be a public statement that there is an organizing drive
taking place, which means that the ER will have a window of opportunity to present its side
o In a card count system, if union was really good at doing it covertly, then it could have
signed up enough people before ER even know it was happening, and there would be no
opportunity to get its opinion out to the EEs
96


What’s the case for saying we ought to have a card count system?
o Remember the legal framework within which organizing campaigns occur – could you say
that an election held under those rules is free and fair in the way that we generally asses
elections in a democracy?
o Assume two parties: union party and ER party
 One side has the voters list, and the other side doesn’t (has to try to assemble it from
scratch)
 One candidate can compel you to come to a one-candidate meeting, where they have
the opportunity to express their views
 One candidate had the opportunity to fire you, and the other doesn’t
o These are all the reasons why people are critical of the election model – you impose a
paradigm of free and fair elections, but you ignore the underlying legal realities in which
union elections take place – they are skewed in terms of access and the ability of one party
to influence the electorate
o Because of these defects, card counts are viewed as being a legitimate alternative
o Tucker: what if ERs were prohibited from speaking at all? This is never something we
would accept, but worth thinking about
Evidence about moving from card counts to mandatory elections:
o Sara Slinn, (2004)
 Switch to mandatory voting reduced the likelihood of applications being successful
by 21.%
 Also influenced characteristic of applicants:
 More public sector applications
o

 public sector much weaker resistance to unions
 More applications for large bargaining units increased
 Fewer applications for part-time units
o Chris Riddell (2004)
 Switch to mandatory elections accounts for virtually of all decline in union success
rates that occurred between 1984 and 1992
o There has been a steady decline in certifications, rapidly declining union density in the
private sector – could be due to both changes in labour law and changing economic
conditions
Tucker: this raises a lot of questions
o
“The reduction in unionization isn’t just to do with the model. It is more fundamental than that.
Unions cannot possibly organize large numbers of small bargaining units in pace to keep up with the
growth of the workforce in the private sector.
 2 questions:
 Empirical: what could be done to turn it around?
 Normative: should government be adopting policies that favour unionization?
Should they be adopting policies that discourage unionization? OR, are there policies
that can be or should be formulated that are neutral to unionization? It used to be
official policy to encourage unionization, but that’s not the case anymore. te
o
o
If the goal is to increase union certification and promote CB, our scheme doesn’t do it
It cannot be properly viewed as neutral because it gives ERs an advantage (access and
mandatory elections)
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o
This raises normative questions: what kind of laws should we be thinking about? Depends
on what you think the appropriate public policy should be.
o
“No provision for electronic voting; election held on ER premises; polls typically only open for 1-2
hours  these all restrict the opportunity people have to vote.
Compare to normal political election. If we observed the conditions we have in labour elections in a
national government election, would we say it was fair? The ER has so much higher ability to engage
with and speak to the EEs as compared to the organizers. In the context of certifications, the system of
card-counting doesn’t actually fit very well. The campaigning powers of the two parties is very
different.
So really, we have 2 systems, neither perfect. We have to make a decision between the two
alternatives.
NB under LRA no minimum # of people need show up to the election. Could have 10,000 workers but
only 100 show up to election  51 enough to form union.”
o
o
o
Balancing Competing Interests





One of the difficulties faced by unions is the protection accorded to ERs rights
Oil, Chemical and Atomic Workers' International Union v. Syncrude Canada Ltd. and Gulf Oil
Canada Ltd. (1978): union complained that ER had interfered with the formation of a TU
(newspaper report covered an ER conference where a management scheme had been discussed
which sought to exclude the possibility of unionization). The Board dismissed the complaint and
held that the mere expression of the ERs preference through the news media did not constitute
wrongful interference – S. 70 of the LRA specifically protects ERs FOE.
Ed Klassen Pontiac Buick GMC (1994) Ltd. v. Teamsters: When the Board issued notice of
application for certification, the ER conducted department meetings where he expressed
disappointment at having let the EEs down, and encouraged vote in such a way as to enable
everybody to remain friends. The union filed an ULP complaint. According to the Board, ERs
cannot use captive audience meetings to imply the negative impact of unionization on the business
BUT the Act specifically protects the right of an ER to communicate statements of fact or opinion
reasonably held about the business, including its relationship with the EEs, even where such
statements cause the union to lose support. The complaint was therefore dismissed.
Seafarers' International Union v. Dome Petroleum Ltd. (1978): union wished to approach EEs
working on the ER vessels in the Arctic. The ER refused them access. The CLC permits unions
access not only to EEs living in isolated locations on premises owned or controlled by their ER, but
also on premises controlled "by any other person". The Board exercised its discretion to order that
the union be given access, even though boarding a ship without the owner's consent constituted
trespass under the Canada Shipping Act.
o NOTE the reoccurring problem – in order to organize, EEs must be contacted, and the best
place to do that is often at the place of work. Except in the context of remote work locations,
OLRB does not specifically authorize union organizers to enter onto ER premises and the
refusal of the ER to allow such access is not held to be an ULP.
Where ERs place of business is surrounded by private property:
o Mall owners generally do not allow organizers to conduct organizing activity on their
property.
o See R.W.D.S.U. v. T. Eaton Co., [1985, OLRB, affirmed by COA]
o OLRA s. 77 specifically states that nothing in the Act entitles any person to promote or to
discourage unionization during working hours.
98
o


Employers may challenge the right of EEs to discuss unionization during non-working
hours if such discussion interferes with its legitimate business interests (see United
Steelworkers of America v. Adams Mine, 1982)
o As a consequence, where employers are uncooperative, meetings have to be organized offsite.
ERs right to deploy capital:
o Plourde (SCC): unions in Quebec cannot challenge retaliatory shutdowns with the benefit of
a reverse onus clause – the freedom to reduce its labour force in response to an economic
downtown is a complete answer to a ULP
o Toronto Typographical Union No. 91: a six member BU was certified by the Board in 1979 and
within three months of certification, two of the EEs were terminated and two more were laid
off. The union filed a section 96 complaint alleging violation s. 72(a) of the Act. Board found
that ER demonstrated to its satisfaction that a significant downturn in business had required
the company to reduce its costs and to take other measures in response ("legitimate business
reasons" to lay off)
Contracting out
o Issue often arises in the context of the privatization of nursing, cleaning, and maintenance.
o Service Employees International Union, Local 204 v. Kennedy Lodge Inc, (1984): union was the
certified BA at a nursing home for 144 workers. ER decided to contract the work of 92
nursing aides and health care aides. The main reason for this was to avoid the CA wage rate.
The Board held that since ER had chosen to have a core function performed on its premises
by a subcontractor with the resulting termination of a large number of BU EEs, it had
terminated these EEs in violation of the Act. The Board also held that ER and the contractor
were related ERs within the meaning of the Act, and that therefore the contractor was also
bound by the CA.
CH 3: Who is an Employee?
The Problem Stated


This section brings us back to looking across all dimensions: CL, minimum standards, and the
OLRA and looking at how issues are resolved in each schemes
One of the most fundamental questions in labour law is: who is an employee?
o The predominant relation of production in capitalism is ER-EE.
o Most labour law is built on the platform of the K of employment (which gives you EE
status).
o The definition of EE determines the scope of labour law coverage – the point where labour
law begins and commercial/general contracts end.
 The answer to this question often determines who is covered by labour law.
o There is uncertainty at the margins! Ex: Independent K’tor vs EE
o Can be beneficial to workers NOT to be an EE in the tax regime – you can avoid taxes in
some circumstances if you are seen as an independent contractor (more deductions are
available)
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o


A bright-line distinction between EEs and workers who provide service pursuant to other
Ks (eg independent contracting) is and has been elusive
Another question: does the legal category of independent contractor corresponds to the economic
reality of truly being an entrepreneur?
o If so, they are not really in need of the protections that labour and employment law typically
offer
o To the extent that there are people being classified outside of the employment category but
who ought to be covered from policy perspective, this creates tension
o Decision makers ask if the category can be stretched to capture people who ought to be in
the regime
Statistics of the Self-Employed
o Of total employed, 84% are employed by others, and 16% are self employed (up from 10% in
71)
o There are two categories of self-employed persons: employers (people who have businesses
that employ other people, what we think of as an entrepreneur) and own account (in
business for themselves, do not hire others, make up 2/3 of self employed)
o “The self-employed are very heterogeneous. Some are very independent – have many
clients or high demand skills. Some are very dependent – few clients, low demand skills,
similar relationship to ER-EE  they are much like ER-EEs but lack the protections.
o Some labour and employment lawyers are in the role of advising ERs how the structure K’s
that create independent Ktor relationships as opposed to creating employment Ks.
 Reason: independent Ktor avoids some of the burdens of the ER-EE relationship.
o So the majority of self employed are own account and they are disproportionately female
 own account self employed people are worse off than employers on a whole
 their incomes are lower on average, they are less likely to have access to benefits etc
 the vulnerable own account self employed tend to be those that need protection of
labour laws – and often come forward to claim those protections
100

ISSUE: People who are just selling their own services (with no EEs) – are they actually
entrepreneurs?
o Large number of people in janitorial and trucking areas, who find themselves in worse
positions than paid employees– classified as self employed but not the same as employers
o They are not entitled to min wages, hours of work laws, don’t have access to EI, etc
o Not protected by things that are designed to protect vulnerable workers
A Paradigm Case of Employment (i.e factory setting) – Chart.
The Problems arise when we get Contractual Relationships that DON’T EASILY FIT into
this paradigm – that’s what courts have to rule on.
Employee
Service
NOTE: A consultant also has
a duty to provide services
and a right to be paid (so
Remuneration same as above) but this is not
enough to make him an
employee.
Ownership of
the:
Control
Employee has
duty to provide
service
Right to receive
remuneration
for the service
they’ve
provided
Employee does
not any tools,
shows up
wearing own
clothes only
Employer has a
right to obtain
those services
Duty to provide
remuneration
Final product:
Who owns the final product?
Employee has
no right to the
final product
What rolls off the
assembly line is
owned by the
employer
Planning: Who plans the
production process?
No planning
done by
employee
Employee
executes
according to
employer’s
orders
Employee is
only entitled to
his pay, and as
All planning done
by employer
Means of production:
Who owns the tools that are
used in the production
process?
Execution: who determines
how the work will be done?
Chance of
Profit/Risk of
loss
Employer
Employer owns
all tools,
equipment
Independent
Contractor
Independent
Ktor: could be
like ER-EE or,
could be
expected to
bring own
tools
Employer dictates
Employer has all
the profit loss –
pays employee no
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long as he
works he gets it
– no chance of
profit loss




matter how
well/poorly the
business does
Above case is the paradigm employment relation, but problems arise when we move away from it
Small changes: it will still be an employment relationship. Ex:
o Calculating remuneration by the piece, not by hour

o If ER provides profit sharing mechanism
o When team is responsible for planning and carrying out the work – starts to look less like
employment relation
It can reach a point where it doesn’t look like employment anymore
o Internal subcontracting: each group assembles a business, bids on contracts to assemble
products, and groups aside how to assemble the products and share whatever profit they
make on the contract – this doesn’t look like employment anymore
o If an ER wanted to avoid having EEs, it could start structuring the relationship with other K
that allow the same result but without having EEs
What if we take a K and write “contract for services” at the top?
o You don’t change the category by changing the label
o Look at the substance of the agreement to determine what the actual relationship is from a
legal point of view
o The fact that the parties have described a relationship in a particular way (and intended to
create a certain kind of relationship) might be something that a judge would think is an
important factor, but subjective intent is not determinative
Ready Mix Concrete v. Minister of Pensions and Insurance (1968)
Facts: Company made and sold concrete and introduced scheme of delivery by drivers called “ownerdrivers” – Latimer was part of this scheme. His contract stated that he had to purchase, maintain, repair
and insure a truck. He paid all running costs, did not work set hours and did not get instructions
concerning method of driving trucks, routes or discharge. Company retained control over major repairs
to the truck. Contract declared Latimer to be an independent contractor.
Analysis: The modern trend is to approach the definition of the term “employee” in a more
purposive approach.
Court identified 3 types of tests:
(1) Montreal Locomotive 4 part test
(most widely used, see below)
(2) Organization test (proposed by Denning, rejected here)
Question: to what extent is the person integrated into the organization.
The more they are, the more likely they are employees
(3) Economic realities test
(used in the US. Question: to what extent is this person reliant on the other party?)
All three tests are open ended.
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Two interpretive approaches of thinking about defining EE
Legal formalism
1.
2.
Legal Realism /
Purposiveness
3.
4.
5.
Term ‘employee’ has a determinate meaning
Role of court is to elaborate a test that adequately captures the meaning of the term and
that can be applied to patrol the boundary between employees and non-employees
Term ‘employee’ is indeterminate
Instead of trying to define a test to apply against each set of fats, the meaning of EE
depends on the purpose for which it is being used.
Role of the court is to clarify the purpose so we can draw the boundary in the right
place
MacKenna: Contract of service exists if three conditions are fulfilled
(1) servant agrees that, in consideration for remuneration, he will provide his own work and skill in
performance of a service for the master
This alone is not sufficient
(2) he agrees, expressly or impliedly, that in the performance of the service he will be subject to other’s
control in a sufficient degree to make that other master
this is necessary but not sufficient condition of a contract of service
control always exists in degrees, what is relevant is the level of freedom that EE has
Tucker: he has a lot of control over what he does, but is still an EE
(3) the other provisions of the contract are consistent with its being a contract of service
Montreal Locomotive (1947): 4 factors
Facts: all funds necessary for the enterprise were provided by the government, which
bore all financial risks. Enterprise was subject to the governments control in making
armaments and received a fee for each unit.
Issue: was enterprise acting as governments agent or as an independent contractor
Analysis:
Although simpler tests had been previously applied (like control test), in the complex
conditions of the modern industry, more complicated tests have been applied
Fourfold test: (test also outlined in Becker Milk case below)
(1) control:
(2) ownership of the tools/means of production
(3) chance of profit
(4) risk of loss
Economic Realities Test: US v. Silk (1946)
Facts: In this case, the unloaders provided only picks and shovels – they had no
opportunity to gain or lose except from the work of their hands and simple tools, Silk
was in a position to exercise all necessary supervision over their simple tasks
Issue: whether the men were employees “as a matter of economic reality”
Factors: consider degrees of control, opportunities of profit or loss, investment in
facilities, permanency of relation and skill required in the claimed independent
operation (see chart above)
103
Analyzes the case in a way similar to a Legal Realism/purposive perspective– are
these the kinds of people intended to benefit from the legislation, are the
individuals within scope of group that Act was intended to protect or benefit?
Held: the drivers were held to be independent contractors – they had a lot of
responsibility for investment and management, thus were more like small business men.
They owned their own trucks, hired their own held etc
The distinction is not controlling – it is the total situation including the risk undertaken,
the control exercised, the opportunity for profit from sound management
The above case law shows that the common law test is not to be restricted to power of
control “over manner of performing service” but is wide enough to account of
investment and risk
Held: The obligations imposed on Latimer are more consistent with a contract of
carriage than with one of service – ownership of the assets, the chance of profit and
risk of loss in the business of carriage are his and not the company’s
Tucker: is there a pattern about how this problem is solved depending on the context?
Does it influence the way these tests are applied and where the lines are drawn?
Who is an EE in common law, employment standards, and in collective bargaining law?
The approaches in these areas have similarity but also have differences.
The Common Law
What is at stake of
whether the individual is
an EE?
If the K says it is not an
ER-EE relationship, is that
enough?
Intent of parties
important?
If we think context makes a difference, then what hinges on this distinction?
Vicarious liability and notice of termination
Nope.
What the parties intended to create is relevant but not hugely probative. Despite
the subjective intent there may have been a failure to do so because
substantively, the parties may have failed to do it.
Vicarious Liability: Important b/c ERs vicariously liable for EEs but not for Independent
Contractors.


Describes the event when law holds one person responsible for misconduct of another because of
their relationship (strict liability because it requires no proof of wrongdoing on part of person who
is held liable).
Policy Rationale for underlying VL (from Sagaz):
o
Risk creator should bear costs when harm materializes
o
London Drugs:
104

o
1. masters tort theory: ER is vicariously liable for acts of EEs because acts are
regarded as being authorized by ER so that EEs acts are acts of the ER
 2. servants tort theory: ER was the EEs superior and therefore in charge of the EE
 3. Other policy considerations: compensation (provides victim with a remedy),
deterrence (creates incentive to more closely monitor EEs) and loss internalization
(hybrid of the two)
Bazley:
 1. provides a just and practical remedy to people who suffer harm as a
consequence of wrongs perpetrated by an EE
 “deep pockets” justification on its own does not accord with an inherent
sense of what is fair – it must also seem just to place liability for the wrong on
the ER
 ER puts in the community an enterprise which carries certain risks – when
those risks materialize and cause injury to a member of the public despite
ERs reasonable efforts, it is fair that organization that creates the enterprise
and risk, should bear the loss
 a person who employs others to advance his own economic interest should in
fairness be placed under a corresponding liability for losses incurred in
course of the enterprise
 2. deterrence of future harm as employers are often in a position to reduce
accidents and intentional wrongs by efficient organization and supervision
671122 Ontario Ltd v. Sagaz Industries 2001 SCC
 Analysis (Major J): In order for vicarious liability to apply:
o 1. worker must be an EE of the ER (independent contractors not covered)
o 2. tortious conduct must have been committed by EE during course of employment
 Test for discerning EE vs. independent contractor:
o Wiebe Door Services v. MNR 1986: the original criterion of the employment relationship was
the control test but that has “an air of deceptive simplicity” – the test depends on the exact
terms of the K and has broken down completely in relation to high skilled and professional
workers who possess skills far beyond ability of their ERs to direct
o Conclusion: “There is no one conclusive test which can be applied to determine whether a
person is an employee or independent contractor.”
 It is impossible to give a precise definition of the distinction – look at total relationship
between the parties (all possible factors that have been referred to in the cases) – not all
factors will be given the same weight in each case
o Although there is no universal test to determine status, a persuasive approach to the issue is
that taken in Market Investigations, where the central question is “whether the person who
has been engaged to perform the services is performing them as a person in business on
his own account”
 If yes: then contract is contract for services (IC), if no: then contract is a contract of
service (EE)
Ratio: In making the IC/EE determination, the level of control the ER has over the worker's activities
will always be a factor. Other factors to consider include: (1) whether worker provides high own
equipment (2) whether worker hires his own helpers (3) the degree of financial risk taken by the
105
worker (4) degree of responsibility for investment and management held by the worker (5) workers
opportunity for profit in the performance of his tasks
NOTE: These factors are not exhaustive and their relative weight will depends on facts of each case
Tucker: the Court is mixing formalistic and purposive approach. And notice the court fails to actually
define a test here.
Tucker:
 For VL, control would be key, because you want the ER to have control over the actions of the
person who caused the harm, or the policy wouldn’t be effective.
o Control speaks to the ability of ER deter future harm, to be able to fairly say EE acts are ER acts
 Court rejects the option of a single factor control test because control varies considerably, and
sometimes in IC situations the contract is very specific, but it’s not enough to make the person an
EE.
 So while this looks like a policy driven application, the court pulls back and says they won’t get
stuck by putting too much weight on control, and other factors could be introduced in the future.
 This case is read as endorsing a purposive approach to determining who is an EE, and at the end of
the day they ask whether it is appropriate given policy considerations to impose VL, and if it is
appropriate, then they will tend to find that the person who caused the harm is an employee
 The category of “employee” is just a label we are attaching to people in certain circumstances
because we think it is appropriate to do so (legal nominalism)
Notice of Termination
What’s at stake?

At CL, courts have taken the view that with
respect to reasonable notice, Ks of
employment (indefinite duration) require
reasonable notice unless there is cause –
gives EEs security.




With ICs, courts take the view that there is no
obligation to give reasonable notice
o Just an ordinary, commercial K
BUT SEE MCKEE’S  DEPENDENT CONTRACTORS deserve notice!
Carter v. Bell (1936):
o COA held that Ks could not be neatly divided into two categories, Ks for service and Ks of
service, but rather found that: “There are many cases of an intermediate nature where the
relationship of master and servant does not exist but where an agreement to terminate the
arrangement upon reasonable notice may be implied.”
o Just because you are not an EE it doesn’t preclude an implied right to notice
o Case was dormant for a while and then began being picked up
McKee v. Reid’s Heritage Homes (2009):
o The court re-affirmed the existence of an intermediate category, and elaborated on the
approach to determining who is a dependent contractor (NOTE: in definition in OLRA of EE
includes DC)
o Step 1: determine whether a worker is a contractor or an EE (Sagaz)
106

o
o
From Belton, the exclusivity of the worker is seen as a factor weighing in favour of
EE
 If contractor, go to next step
Step 2: determine whether worker is IC or DC
 At this stage, worker exclusivity is determinative as it demonstrates economic
dependence
POLICY: There are some people in contracting relationships who are economically
vulnerable, and even though they can’t stretch the term EE to encompass them, they can
break out of that conceptual limitation by creating this other category (DC) – extension of
protection
Social Wage Protection
What is at stake?
 Entitlement to a variety of statutory benefits/liability to pay cost
o Ex: workers compensation, EI, CPP, etc
o The point of entry to most of these is being an “employee”
o At stake for EE: entitlement to benefits under these schemes
o At stake for ER: if they employ EEs they are liable to pay payroll taxes, EI, CPP, etc (incentive to
avoid having EEs)
 NOTE: ICs can buy workers comp, but not possible to buy into EI or CPP
 Before statutory protection, CL said that if EEs knew risk then it was their problem – they could save
money for a rainy day or buy their own insurance
Policy rationale for programs?
 The sense that the people who are economically vulnerable should be protected by these schemes
because they need protection the most
o People tend to spend money now rather than save for later (too optimistic about the future)
o Concern that in the absence of these things people’s abilities to afford them would be limited
(many have little cushion so to impose an obligation to purchase private insurance would be
difficult)
 Incentive for ERs to maintain safe work employment as there is a measure of accountability
 Arguments against:
o The liabilities that ERs pay are actually paid by EEs through lower wages
o Paternalistic
Implications of policy context for test and its application, if any?
 Has legislature defined EE or otherwise specified who is covered?
o Legislature has not done a good job of defining who is covered (should be clearer)
o Very general definitions
 Has decision-maker (court or administrative tribunal) taken context into account in drawing line?
o Adjudicator often has only a criteria of ER vs. EE
o Courts do almost no purposive analysis – tendency for formalistic analysis
o Ready Mix Concrete: it must be shown that he has “freedom enough” in the performance of these
107
obligations to qualify as an independent contractor
 TUCKER: what is missing from this, as opposed to Sagaz, is asking what the policy was that
underlies the definition – you have to put it together with what the law ought to be
achieving and incorporate the policy considerations.
o Tax cases (Thomson): court tends to give the taxpayer some leeway to organize their affairs (less
purposive application of the law) – logic is that if legislature wants to close the loopholes, they
can
 In contrast, in the Workers Comp cases, it is more likely that WCB will be concerned with
extending WC benefits to people (more likely to adopt an expansive approach even if it’s
not purposive)
Tax Cases
Thompson Canada v. Canada 2001
Facts: For years newsies were classified as ICs, but eventually some tried to organize as EEs under CB
laws and were successful (a group in Manitoba, delivering the Winnipeg Free Press). Revenue looked
at this, and said if they were EEs for the purpose of CB then Thomson should be remitting EI, CPP, and
payroll taxes. Thompson challenged, and Federal court said for the purposes of the statute they were
not EEs but were in the business of buying/selling papers.
Analysis: Court applied the four fold test and found that newspaper carriers were ICs, and that if the
government wanted to close the loophole, they could
Tucker: this is surprising because the LRB had found that the same group of newspaper carriers were
EEs for the purposes of CB: so you can be an EE in one context and not in another.
Workers Compensation

WCB is very concerned about the erosion of coverage (% covered has declined from 90 to 80%)
o Concern that people who have lost coverage are at the low end of the economic spectrum
o More likely to adopt an expansive approach even if it’s not purposive
o Exception – Stork Diaper (below): driver gets into car accident and third party wants to claim
driver was an EE because then the only remedy is worker’s comp. Court uses a business
realities test (like Sagaz – many factors). Here it was not about compensation but third
party liability, so there was no discussion of policy rationales.
 Ontario Workplace Safety and Insurance Act defines “worker” as:
o s.2: “worker” means a person who has entered into or is employed under a contract of service
or apprenticeship and including the following...
o s.9: A person deemed to be a worker of an employee by a direction or order of the Board
 NOTE that Board has the power to deem people to be EEs
o s.10: A person deemed to be a worker under s.12
o s.12: Allows ICs and sole proprietors to apply for individual coverage
 It has been proposed that anyone selling their labour in the construction industry should be covered
regardless of whether it is a contract of employment or an IC – because they are marginally
independent and economically vulnerable on the whole
Stork Diaper 1990 OWCATD
Facts: Work related injury to a delivery driver for Stork Diaper who had been hired under a K. Third
party argued that driver was an EE (so his only remedy would be workers comp). No EI, CPP
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payments made, no tax withheld, no overtime paid. Driver did not own the truct, wore company
uniform, was given a route but not told in what order to make deliveries.
Issue: Is the worker an EE or an IC?
Analysis: In order to determine whether worker is an employee or independent contractor, the
following factors must be considered: (“business reality” test)
1. Ownership of equipment used in work or business: significant capital investment in tools and
equip are indicia of independent contractor status
2. The form of compensation paid to the worker or independent contract (ie: whether a fixed rate is
agreed to or a variable remuneration with an attendant prospect of profit or risk of loss): true
independent operator generally had prospect of variable profit or loss
3. Business indicia: business structure used, advertising, business card, telephone listings etc
4. Evidence of coordinated control as to “where” and “when” the work is performed: is there actual
interference with the work activity? Does the right exist to direct the work activity?
5. The intention of the parties, often evidenced by an agreement: intention of the parties is a
significant factor
6. Business or government records which reflect the status of the parties: tax records, OHIP, workers
comp premiums, insurance plans, financial statements
7. The economic or business market: If a person’s skill is highly marketable, those services may be
provided to a number of purchasers on an irregular basis – suggestive of independent operator. Also a
long standing relationship with one employer is suggestive of worker classification
8. Existence of the same or very similar services supplied to an employer by a person who is
classified as a worker under the Act: if working conditions and duties are similar to those performed
by existing workers, then likely to also be considered a worker
9. Substitute service: if contracting person has power to send another person in his place to act as a
substitute it is an indication of independent operator
10. Degree of integration: assessment of the degree to which service is integrated into overall business
process vs. a service that is dispensable or “accessory” to the overall process
 This list is not exhaustive and no one factor is determinative by itself
 It is the substance of the relationship, not the form, that determines characterization
 Question to ask: What is the true nature of the service relationship between the parties, having
regard to all relevant factors impacting on the relationship?
 Tucker: no talk about purposive approach, tribunal adopts a broader approach to EEs
Approaches to Definition of “Employee”: Legal Formalist and Purposive
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It is possible to be an EE in some cases and not in others – this happens because there is pressure
that operates on the definition.
o Because the definition of “employee” so often provides the gateway into the regime, often
relationships will be constructed for the purpose of preventing entry into that regime
o For inappropriate purposes: taking advantage to avoid the downsides of EEs but still get the
benefits
o For legitimate purposes: both parties benefit from it
o We are more concerned with the cases where this has been structured in a one-sided social
relationship – worker would be better off as EE
Two kinds of approaches taken by courts/adjudicators:
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o
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Legal formalist approach: the court or the adjudicator sets out a definition (like Montreal
Locomotive four part test – control, ownership of tools, change of profit/loss) and then applies
that formula to the facts and come to a conclusion
 Like in Ready Mix Concrete and Thomson (tax case)
o Purposive: legal category of employment is fuzzy at the edges, and in order to decide where
to draw the line we ought to take a purposive approach – need to ask why we are deciding
whether someone is an EE or an IC?
 Keeps an eye on the social realities between these actors.
 Articulated in Sagaz and McKee v. Read’s Heritage Homes
Dealing with the tensions in other ways:
o Some statutes confer a power on a tribunal to deem people to be EEs for the purpose of the
act (workers comp act, Manitoba labour relations act)
 An administrative body looks at the field and as a matter of policy says that the
group ought to be covered (power is there, although not used that much, and when
it is used it likely is used on people who would have been covered under a
purposive approach anyway)
o Legislation could become far more explicit about who is covered, other than using the
generic term “employee”
 Historically, labour statutes prior to 20th century listed who the statute applied to
 When they took away the list, litigation arose to determine who was covered
Employment Standards Act
Application of the Act
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Who the act applies to – s.3(1) Subject to subsections (2) to (5), the employment standards set out
in this Act apply with respect to an employee and his or her employer if,
o (a) the employee’s work is to be performed in Ontario; or
o (b) the employee’s work is to be performed in Ontario and outside Ontario but the work
performed outside Ontario is a continuation of work performed in Ontario
Definition of “employee” – s.1(1) “employee” includes:
o (a) a person, including an officer of a corporation, who performs work for an employer for
wages,
o (b) a person who supplies services to an employer for wages,
o (c) a person who receives training form a person who is an employer, as set out in
subsection (2), or,
o (d) a person who is a homeworker
o TUCKER: inclusive definition, leaves some space to add persons not included
Definition of “employer” – s.1(1) “employer” includes,
o (a) an owner, proprietor, manager, superintendent, overseer, receiver or trustee of an
activity, business, work, trade, occupation, profession, project or undertaking who has
control or direction of, or is directly or indirectly responsible for, the employment of a
person in it, and
o (b) any persons treated as one employer under s.4
o TUCKER: responsible for what?
Definition of “wages” – s.1(1) “wages” means
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o
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(a) monetary remuneration payable by an employer to an employee under the terms of an
employment contract, oral or written, express or implied,
o (b) any payment required to be made by an employer to an employee under this Act, and
o (c) any allowances for room or board under an employment contract or prescribed
allowances,
o but does not include,
o (d) tips and other gratuities,
o (e) any sums paid as gifts or bonuses that are dependent on the discretion of the employer
and that are not related to hours, production or efficiency,
o (f) expenses and travelling allowances, or
o (g) employer contributions to a benefit plan and payments to which an employee is entitled
from a benefit plan;
TUCKER: this is all very circular – employees work for wages, wages are payable to an employee.
Presumably the drafters assumed that we know when we have Ks of employment so no need for
elaboration
NOTE: Always be attentive to exclusions!! ESA is filled with them.
Exclusions – this is important, there are lots of exclusions, in the statute and in the regulations:
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Statutory: s 1(2), 3(2) – (6) of the Employment Standards Act
o Reg 285/01 also add additional layers of exclusions
Persons receiving training – S.1(2): For the purposes of clause (c) of the definition of “employee” in
subsection (1), an individual receiving training from a person who is an ER is an EE of that person if
the skill in which the individual is being trained is a skill used by the person’s EEs, unless ALL of
the following conditions are met:
o 1. The training is similar to that which is given in a vocational school.
o 2. The training is for the benefit of the individual.
o 3. The person providing the training derives little, if any, benefit from the activity of the
individual while he or she is being trained.
o 4. The individual does not displace EEs of the person providing the training.
o 5. The individual is not accorded a right to become an EE of the person providing the
training.
o 6. The individual is advised that he or she will receive no remuneration for the time that he
or she spends in training.
Exception, federal jurisdiction – s.3(2): This Act does not apply with respect to an EE and his or her
ER if their employment relationship is within the legislative jurisdiction of the Parliament of
Canada.
Exception, diplomatic personnel – s.3(3): This Act does not apply with respect to an EE of an
embassy or consulate of a foreign nation and his or her ER.
Exception, employees of the Crown – s.3(4): Only the following provisions of this Act apply with
respect to EE and his or her ER if the ER is the Crown, a Crown agency or an authority, board,
commission or corporation all of whose members are appointed by the Crown...
Other exceptions – s.3(5): This Act does not apply with respect to the following individuals and
any person for whom such an individual performs work or from whom such an individual receives
compensation
o 1. A secondary school student who performs work under a work experience program
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o
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2. An individual who performs work under a program approved by a college of applied arts
and technology or a university.
o 3. A participant in community participation under the Ontario Works Act, 1997.
o 4. An individual who is an inmate of a correctional institution
o 5. An individual who performs work under an order or sentence of a court
o 6. An individual who performs work in a simulated job or working environment if the
primary purpose in placing the individual in the job or environment is his or her
rehabilitation.
o 7. A holder of political, religious or judicial office.
o 8. A member of a quasi-judicial tribunal.
o 9. A holder of elected office in an organization, including a trade union.
o 10. A police officer (with one exception)
o 11. A director of a corporation (with some exceptions)
o 12. Any prescribed individuals. 2000, c. 41, s. 3 (5); 2006, c. 19, Sched. D, s. 7.
Dual roles – s.3(6): Where an individual who performs work or occupies a position described in
subsection (5) also performs some other work or occupies some other position and does so as an EE,
nothing in subsection (5) precludes the application of this Act to that individual and his or her ER
insofar as that other work or position is concerned.
No Contracting Out: s. 5(1)
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No Contracting Out of Employment Standards – s.5(1): Subject to subsection (2), no ER or agent of
an ER and no EE or agent of an EE shall contract out of or waive an employment standard and any
such contracting out or waiver is void.
These are non-waivable employee rights – you cannot voluntarily agree to give up your entitlement
to any of the standards that are provided for
As long EE is within the limitation period, he can bring a claim for breach of ESA, and it is no
defence for ER to say that EE waived his rights or accepted less
Becker’s Milk (1973)
Issues:
 Whether four individuals who worked for Becker’s Milk were, within the meaning of the ESA, EEs
 If they were EEs, whether the only work the four individuals did was supervisory/managerial in
character (because if YES, then they would be excluded from the provisions of the ESA, ex: with
respect to maximum hours of work and such)
o
Notice that at that time, it was a question of the “ONLY WORK”. At that time, the managerial exemption was
stricter. Now, the person may perform non-managerial tasks on an irregular or exceptional basis – their work
just needs to be managerial in character.
Analysis (Carter)
 Scope of the ESA
o Act states that services must be supplied to an ER in order for a person to be considered an
EE
o Definition of ER contemplates a relationship in which some control is directed or asserted
over the person rendering services (control test is the traditional test used to distinguish
between the employment situation and the situation where work or services are supplied by
an IC)
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o
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The Employment Standards Act does exclude from its ambit those persons in the business of
supplying services.
Purpose of the ESA
o Establishes minimum standards of employment
o Four-fold test to determine employee vs. independent contractor (Montreal Locomotive)
o (1) Control – a number of things to consider (elaboration on this factor from Lambert v.
Blanchette)
 (a) degree of supervision, both as to the method of doing work and the times at
which it is to be done
 (b) the manner of the payment may indicate whether a sufficient degree of control
is present – if person is paid proportionate to the amount of work done vs. lump
sum, this would indicate that person is an independent contractor
 (c) the fact that a person may employ others to perform the work undertaken may
also indicate that the person undertaking the work is doing so as an independent
contractor
 (d) manner in which a K for services can be terminated may indicate a degree of
control – employment contract can be terminated for cause where independent
contractor contract usually only terminated where work undertaken is being
performed unsatisfactorily
 Thus, minimum employment standards should be imposed where a person
controls the work situation of another
o (2) Ownership of tools
 In a situation where person provides both equipment and his labour to perform a
job, it is difficult to treat them as protected under ESA as their remuneration usually
reflects both value of the use of the equipment and labour
o (3) & (4) Chance of profit & Risk of loss
 These are both complementary
 Where remuneration is derived from the profit of doing business, then clearly that
person must be treated as an independent contractor
Application of the four-four test to this case
o Profit and risk of loss:
 Individuals were not in business of buying and re-selling goods, they were not
responsible for loss of inventory, performance was not a risk. Thus, work situation
for these individuals does not contain profit and risk of loss
o Control:
 Accountability for loss of stock points to a significant degree of control being
exercised by the company over the individuals, performance bond was a method
by which company asserted control over individuals
 Since arrangement requires individual to donate 100% of his time to interests of the
company, individuals are in the store for most of the time that store is open – thus,
individuals discretion to control hours of work is little
 Individuals had little discretion in ordering inventory
 Individuals were trained by the company, which indicates that this was not a
situation of people in the business of contracting labour
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Close control is asserted by the company over individuals by a very efficient
accounting system – company insures that a cash deposit is made daily and
inventory checks are done
 Maintained a high level of financial oversight: franchisors want to maintain a high
level of control because they have a brand name, want uniformity across their
operations etc
 Thus, with regard to control asserted over the individuals by the company, it is
concluded that store help are EEs
o Ownership of the tools
 Company retains ownership of the place of business, fixture contained in that
place of business and all merchandise sold at the place of business. Company also
holds an insurance policy on all assets.
 Individuals do no supply any of the tools, but merely provide their own labour
HELD: degree of control asserted by company, absence of any real chance of profit or risk of loss
and absence of ownership of tools leads to conclusion that these individuals are EEs entitled to
EPA protection
o Carter doesn’t have a hard time saying when these four factors are applied, even though it’s
not a traditional EE relationship, it falls on the EE side
Problems with decision:
o Inconsistent results: based on the four part test, this could easily have been characterized a
little differently and Carter could have said that they were not EEs but rather business
people in a franchise relationship
o Lack of consideration of the policy context in the Court’s decision: what is the policy
context within which we are trying to make this determination? Carter does not really say
much about that (see below)
o Can the legal category of EE provide a proper basis for determining entitlement?
Alternatives?
o Are we hoping too much that adjudicators will push out the definition of “employee” from
the traditional definition? What about a rebuttable presumption that own account self
employed individuals (OASE) are included?
Tucker on Purposive Approach to Definition of “Employee” and Becker’s Milk
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The idea that “employment” could have different meanings in different contexts would have been
seen as revolutionary – challenging accepted wisdom.
o BUT it only really begins to develop later on, where a more purposive approach to legal
terms came to be more widely accepted as a legitimate approach for adjudicators to take.
The more important question is less the choice of the test, than its application
o Is this CL test applied formalistically in this instance or is there any evidence that the
decision maker is attuned to the purposes of the act and to the social reality of the
relationship of the parties who are before them?
o It’s hard to say when you read Becker’s whether those considerations were rumbling beneath
the surface. No passage that says ‘here is some extensive discussion of the purposes of the
ESA and why we might want to take a more expansive approach to this factors to determine
who is an employee’
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Carter’s only reference to the purpose of the Act: “This interpretation (of scope of ESA, above)
appears consistent with the purposes of the legislation. The Employment Standards Act is
legislation establishing minimum standards of employment for the Province of Ontario. The statute
governs such matters as hours of work, overtime pay, minimum wages, equal pay for equal work,
vacations with pay, and termination of employment. The subject-matter of the legislation indicates
that the Legislature did not contemplate the regulation of the supply of services by independent
businessmen but, rather, was concerned with those situations where the supplier of services was
tied to another by an employment relationship.”
Why is it problematic to apply ESA standards in a contract between two independent business
people?
o It would be like telling them how to run their business – policy wise it doesn’t make sense
o If parties are truly independent, you can’t hold the hiring party responsible for the work the
other does (not enough control to impose the obligations)
If you added a purposive element, it makes the case even stronger
o Most likely, when the signed the Ks they thought of themselves as entrepreneurs, but
quickly discovered that they were making less than the worst off employee in Ontario
o If you look at the social reality of the relationship, there was significant inequality both of
information and bargaining power – they were vulnerable to exploitation in the provision
of their services
o Thinking purposively, are these the kinds of people that need the kinds of protection that
the ESA provides? Tucker suspects this is also feeding into the decision in this particular
case.
Today, you are much more likely to see these considerations being played out more openly in the
decision making process, because adjudicators have been given permission to do this (by Sagaz)
o If the SCC can take a purposive approach, then presumably this extends to any adjudicator
who has to determine who is an employee.
Adjudicators also have the benefit of Machtinger (SCC, top of page 34): “Work is one of the most
fundamental aspects in a person's life, providing the individual with a means of financial support
and, as importantly, a contributory role in society. A person's employment is an essential
component of his or her sense of identity, self-worth and emotional well-being. I would add that
not only is work fundamental to an individual's identity, but also that the manner in which
employment can be terminated is equally important.”
o Emphasis on the centrality of employment to individuals – we are dealing with human
beings and we have to protect this as a decent society – the ESA is there to protect
vulnerable people whose core interests might be adversely affected (so ESA should be
interpreted liberally)
Now the purposive approach is more available to lawyers and adjudicators
Machtinger v. HOJ 1992 (SCC)  read this case!
 Court took a protective focus for interpreting the ESA
o the general intention of the ESA is the protection of EEs (who are often in an unequal
bargaining position) and to that end it institutes reasonable, fair and uniform minimum
standards
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Therefore, an interpretation of the Act which encourages ERs to comply with minimum requires
of the Act, and so extends its protections to as many EEs as possible, is to be favoured over one
that does not
“Work is one of the most fundamental aspects in a person's life, providing the individual with a means of
financial support and, as importantly, a contributory role in society. A person's employment is an essential
component of his or her sense of identity, self-worth and emotional well-being”
Thus, “EE” is interpreted expansively with regard to people who are in dependent economic
relationships and have some of the characteristics of employment
NOTE: this case does not solve all of the issues that arise, but it does suggest that a particular kind
of purposive approach in drawing the distinction should be used.
Factors:
o Capital investment
o ETc.
Holding: Is an independent contractor, largely due to the large capital investment.
Intent of the parties is seen as merely a secondary factor, because it would be too easy of a way to
get out of the ESA.
Managers: Generally No Hours of Work Protection
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O Reg 285 - 7? 8?
Tucker: why do we exclude managers from hours of work protection, getting compensated for overtime, etc?
The usual rationales are that managers have more bargaining power and that they are being compensated in
other ways. But consider how this actually applies in the real world: is it fair to make the Tim Horton’s
Assistant Shift Supervisor EXEMPT from all these protections? Sometimes ERs try to inflate who is a manage
so that more people can be fit into this umbrella.

Interesting because we think of these rights as non-waivable – but if the price is right, you can sell
your entitlement by taking a title
In some sectors, excessive hours is normatively okay – you want to work a certain numbers to get
ahead, and because you get paid enough, we let it slide (this is a judgment we’ve made)
Sometimes managers are only one step removed from ordinary EEs, so in some circumstances they
might be less well off than those they manage (might even be paid less on an hourly basis)
Some sensitivity to danger of ERs fleeing their obligations by classifying people as managers:
exception only applies to people who are truly performing managerial functions and if more than
a trivial part of their work requires them to do non-managerial tasks then they are covered by the
legislation
In these decisions the tribunals ask – what is the essence of the managerial function, and how much
of the persons time is devoted to non managerial functions?
The exception is generally viewed as putting the burden on the ER to show that the managers come
within the exception, and the essence of managerial function is having a
control/authority/disciplinary function
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Collective Bargaining – Ontario Labour Relations Act
Statutory Definition and Application
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Act applies to EEs (always start with definitions)
Definition of “employee” – s.1(1): says that it includes a “dependent contractor”
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o
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No attempt to define who is an EE for purposes of LRA beyond use of term “dependent
contractor”
POLICY of no coverage for ICs:
o We don’t allow independent business people to use the shield to engage in unfair
competition
o If you are truly independent we do not allow you to conspire with others to determine a set
price
o When it comes to EEs, because the imbalance of power, we’ve decided that the workers
should be allowed to combine for the purpose of restricting wage competition (furthers
public policy goals)
Exclusions from employment status – s.1(3): Subject to section 97, for the purposes of this Act, no
person shall be deemed to be an EE,
o (a) who is a member of the architectural, dental, land surveying, legal or medical profession
entitled to practise in Ontario and employed in a professional capacity; or
o (b) who, in the opinion of the Board, exercises managerial functions or is employed in a
confidential capacity in matters relating to labour relations.
o These people would otherwise meet the definition, but are deemed not to be EEs
Exclusions from application of Act – s.3: This Act does not apply, (a) to a domestic employed in a
private home; (b) to a person employed in hunting or trapping; (b.1) to an EE within the meaning of
the Agricultural Employees Protection Act, 2002; (c) to a person, other than an EE of a municipality or
a person employed in silviculture, who is employed in horticulture by an ER whose primary
business is agriculture or horticulture; (d) to a member of a police force (e) to a person who is a
firefighter (f) to a member of a teachers’ bargaining unit or to a supervisory officer, a principal or a
vice-principal; (g) Repealed (h) to an EE of a college of applied arts and technology; (i) to a
provincial judge; or (j) to a person employed as a labour mediator or labour conciliator.
o Most of these excluded groups have access to other CB schemes, although not all (domestic
workers do not)
Board has historically provided little guidance about who is an EE
Toronto Drywall Services Ltd (1976, OLRB)
Facts: Drywall Ks were not entered into prior to the commencement of the work (Ks made after some
work has been completed, held that they were not Ks but merely methods of calculating payment).
This was a perfect market (set price that everyone knows) – does it matter that the K was signed
afterward? Drywallers were heavily dependent on one or two clients, it wasn’t required that they
purchase their drywall from the constructor, no on-site supervision, were held responsible for defects.
Issue: Applicant is seeking certification with respect to a BU of painters and painters apprentices who
work for the ER, and wants to include drywall tapers
Analysis:
 NOTE: at the beginning of the judgment, Board indicates that the application was filed prior to the
enactment of the dependent contractor provision – so it had been passed since but it wasn’t in force
at the time. Tucker thinks that the same policy concerns that drove the legislature to create the DC
provision were in the mind of the adjudicator.
 Factors:
o The employer exercised a measure of control over the individuals
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o
Although the individuals determine their own hours of work, ER had power to move them
around
o ER exercised control over these individuals since it had retained the power to require them
to correct any unsatisfactory work at their own expense – there is no evidence of limitation
on this power
o The individuals owned their own tools – however these tools were minor in nature
o The employer supplied and delivered to the job sites the material which the workers
required to perform their work
 Application of TEST: (from Montreal Locomotive)
(1) control - In this case, there is little supervision by the employer
(2) ownership of the tools – the individuals provide and own their own tools
(3) chance of profit – the individuals receive a payment from ER each week in the form of a cheque.
These are considered as wages and not “profits” in the commercial sense of the word
(4) risk of loss – the individuals have no risk of loss as the ER pays for the materials used and the
individuals receive sufficient materials for their immediate use
Judgment:
 Rejects single control test: the more sophisticated fourfold test is a more probative and realistic
approach that the heavy reliance on control which counsel for the respondent has advocated.
 Board declared that painters, painters apprentices and drywall tapers all be included in the BU
Tucker on Toronto Drywall Services
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It was set up as a relationship that could arguably be defined as sub-contracting (on its face)
However, court defined it differently, said that reality it was an employment relationship
o Workers were paid by the piece, but it was incentive to work faster
o Even though they used their own tools it was not a significant capital
o No hunting down customers to increase profits
o They could work for other people but if they weren’t available they wouldn’t get rehired,
thus a dependent relationship
Based on factors, could easily justify either of the two outcomes: independent or dependent
o Is there some kind of purposive analysis that informs the way that tribunals applies these 4
factors? In this case, there is some reference to this
 Para 20: “In the instant case the Board is not being asked to determine liability for
infringement of copyright, or whether certain expenses may be deducted in
computing taxable income or whether a certain docker was under a contract of
service, but rather in the context of labour relations certain persons are employees
for the purpose of The Labour Relations Act. In our view the more sophisticated
fourfold test which Lord Wright suggested is a more probative and realistic
approach that the heavy reliance on control which counsel for the respondent has
advocated.”
o BUT court really doesn’t tell us what difference it makes since it is for purposes of LRA.
Must ask - what is the rationale for the collective bargaining scheme? Why is it desirable to
bring people into the scheme who could perhaps not meet the test for EE but who arguably
should be included?
o Need to allow some people to bargain collectively
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o
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Goes back to the notion of vulnerability and trying to identify those who should be allowed
to bargain collectively, if we allow people to get out of scheme by calling people who work
for them “independent contractors”, we are getting away from the purpose of the Act
o In a marginal case, where people are really little business people and are in a vulnerable
kind of situation, Board wants to take the definition to the extent that they can apply it in a
more expansive way, and bring those people into the regime
Conflicts in the market at that time:
o Both EEs and ICs were working as drywallers at the time
o This created horizontal conflict between these two groups (led to violent confrontations)
o One goal of labour law is to achieve industrial peace and smooth over conflict
o The conflict undermined the capacity of unionized workers to collectively bargain because
ERs could easily access another group who were e not EEs for the purpose of the Act, but
who could be organized to perform the services in a similar way
Here, there was little purposive reading – but it was arguably lurking
o We might ask ourselves whether the board was applying the test in a formalistic way, or
whether in the process there was an indication that they had in their heads the context in
which they were deciding it – if they were letting the context affect their decisions
Dependent Contractors – With the new “dependent contractor” amendment, the
controversial cases (i.e cases on the boundary) are now not about EE vs IC, but DC vs IC

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In 1975, the LRA was amended to apply to persons called “dependent contractors”
o This was a response to perceived limits to the legal category of EE
Definition of “employee” – s.1(1): includes a dependent contractor
Definition of dependent contractor – s.1(1): “dependent contractor” means a person, whether or
not employed under a contract of employment, and whether or not furnishing tools, vehicles,
equipment, machinery, material, or any other thing owned by the dependent contractor, who
performs work or services for another person for compensation or reward on such terms and
conditions that the dependent contractor is in a position of economic dependence upon, and under
an obligation to perform duties for, that person more closely resembling the relationship of an
employee than that of an independent contractor
o If you are in a situation that is more EE-like, then you are a DC and covered by the Act
o This expands Act beyond its traditional reach
Dependent contractors are an appropriate unit for collective bargaining – s.9(5): A BU consisting
solely of DCs shall be deemed by the Board to be a unit of employees appropriate for CB but the
Board may include DCs in a BU with other EEs if the Board is satisfied that a majority of the DCs
wish to be included in the BU
o This opened up the scheme so it could apply to people who are not in an employment
relationship
Toronto Star (2001, OLRB)
Facts: Carriers signed Ks identifying them as ICs, provided and maintained their own vehicles, were
charged a wholesale price for the papers they distributed and credited with their retail sale price.
Workers did not wear uniforms, were free to use substitutes and could organize their route as they saw
fit. Star required paper to be delivered during certain hours.
Analysis
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
Act contemplates a continuum between a person who is properly described as an IC and a person
who is properly identified as an EE
 What critically distinguishes an IC from an EE is the degree of economic dependence which each
has upon their employer
 Distinguishing between EE and IC: non exhaustive list of factors
o Algonquin Tavern 1981 Board set out factors that would be helpful to consider: (pg 45)
 The use of substitutes
 Ownership of instruments, tools, equipment or supply of materials
 Evidence of entrepreneurial activity
 Economic mobility or independence, including freedom to reject work
 Whether individual can be said to be carrying on an independent business
 The degree of specialization, skill or expertise involved
 Control of the manner and means of performing the work
 Magnitude of contract amount, terms and manner of payment
o In Journal Le Droit 1985 Board divides the above factors into 3 categories:
 1. identification of the employer with the individuals whose status is disputed
 2. ownership of the materials used by the individual
 3. financial arrangements between employer and individual
o in The Citizen board stated that actual economic dependence upon ER is not the critical
determinant, rather the economic dependence must flow from the terms and conditions of
the relationship (whether the structure of the relationship btw the worker and the ER could
lead to the conclusion that the worker is economically dependent on the ER)
 duration of the relationship of dependent may be a relevant consideration
 those whose economic dependence is on-going and of indefinite duration suggests a
relationship of economic dependence
 KIND OF DEPENDENCE IS THE CENTRAL CONSIDERATION
o Another relevant factor is whether the service provider only serves one customer (may
suggest economic dependence)
o Profit factor:
 Must consider the context with that employer in determination of whether the
contractor is capable of making a profit or suffer a loss
 What the contractor does in his time away from ER is irrelevant
o The essential enquiry concerns the relationship between the ER and the individuals
 Is that a relationship of dependence?
 What happens within the work period?
 It is the regularity of the work which matters
Judgment: Board found carriers to be EEs
Tucker on Toronto Star

Board is grappling to apply the DC provision to a situation of workers delivering newspapers who
were set up as “little business people”
o Board is very attuned to the context about the changing work and increase in self-employment:
talk about the development of labour market and how this poses a challenge to labour law
(more workers being set up as ICs)
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o

Very close to the line, ultimately the Board is taking a purposive approach (difficult case,
took two years for Board to make judgment)
Multi-factor test:
o No magic formula, they just apply many factors to determine where workers fall on the
continuum
o The board’s focus is on the STRUCTURE of the relationship, and whether it produces
ECONOMIC DEPENDENCE
 ICs can still have one or two clients (and thus be economically dependent but not
DCs).

Board: Paper deliverers have time/opportunity to work for other people, during the
other hours of their days, is not determinative!
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
The appropriate Context for determining if they are IC/DC/EE is during the time of
relationship with the particular ER, not totality of contractors activities, i.e not the
worker’s entire day but the time in which they are “at work”.
 We want to look at the legal structure of this particular relationship and ask whether
it gives rise to economic dependency
Result of the case: the Star decided to get out of the business of newspaper delivery – workers could
still do the job, but they would not be Star EEs, they would be EEs of the individual subcontracting
companies
o ERs ability to rearrange their businesses can deprive DC/EE of the benefits of the Act
Scope of Coverage



Study looked at how extensive the coverage is for different categories of workers (ICs, DCs, EEs) in
different areas [governance (CL, Civil Law, ESA, CB), social justice (HR, pay equity, OHS), Social
Revenue and Social Justice (Workers Comp, CPP, EI, Tax)]
Some areas of social justice law do reach to IC’s:
o HR law: it is prohibited to discriminate in business
o OHS regulation: if you are bringing IC’s onto your premises you are still responsible for
H&S
o So in some areas we have imposed obligations beyond the K of employment
Because of the propensity of ESA tribunals to apply an extensive definition, more people are caught
PUBLIC POLICY: The Challenge Ahead – Labour Law Reform

If we were to reconstruct labour law, on the platform of contracts for the performance of work:
o Need to develop workable distinction between workers and entrepreneurs
o Need to consider specific public policy justifications to expand or contract coverage
o Need to make schemes effective for all covered workers
PUBLIC POLICY: Status of the Artist Act

What it is:
o The Artist Act was created to protect a group of people who would traditionally not fall
under the “employee” definition. (Rather, they would be ICs.)
o It applies to professional ICs who are:
 authors of artistic works,
 performers, and
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 contributors to production of performing arts .
A tribunal defines sectors: An administrative tribunal defines sectors and certifies associations
most representative of artists in that sector.
The legislation recognizes that there are people who merit protection: that while they are not in
an employment relationship, they still merit protection of legislation.
o This is an attempt to break out of the notion of limiting collective action.
Those who fit the stated definition of artist under the Artist Act are able to: establish associations,
get certified, and then negotiate agreements (allows CB in atypical type relationships).
Exclusions
Managerial Employees
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Managerial exclusion to participation in CB (OLRA) – s.1(3): no person shall be deemed to be an
employee, (b) who, in the opinion of the Board, exercises managerial functions
In applying the managerial exclusion, the Board developed certain norms/standard exclusions:
o Craft units: non-working foremen were excluded, working foremen included
o Industrial units: lowest level of foremen would be considered managerial and therefore
excluded
Other possibilities:
o Separate Managerial Bargaining Unit: Does it make a difference?
o Collegial-style management: Does it make a difference? See CAS.
Why are low level managers not entitled to bargain with EEs? Two rationales from District of
Burnaby (1974):
o Conflict of interest/loyalty rationale: ER wants to have the undivided loyalty of its senior
people, and their decisions will have important effects on the economic lives of EEs
(discipline, termination, promotion) – they need their eyes/ears exercising control
o Allowing managers to participate it would undermine TU independence rationale:
excluding managers is designed to protect EEs as well, because having managers in TUs
would be bringing managers’ concerns into the union rather than keeping the TU truly
independent.
 NOTE: historically (and currently) ERs have tried to support weak unions, and a
logical agent for this effort would be managers
 Could also innocently weaken the unit, b/c many managers are promoted from EEs
(so they would want to be cooperative with the ER)
Factoring Test: City of Thunder Bay (1981)
o No definition of the term "managerial function" in the OLRA, nor are there any specified
criteria to guide the Board in reaching its opinion (task has fallen to the Board itself)
o In the case of "first line" managerial EEs:
 the important question is the extent to which they make decisions which affect the
economic lives of their fellow EEs thereby raising a potential conflict of interest
with them.
 The right to hire, fire, promote, demote, grant wage increases or discipline EEs are all
manifestations of managerial authority, and the exercise of such authority is
incompatible with participation in trade union activities as an ordinary member of
the bargaining unit.
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o
o
In the case of more senior managerial personnel:
 Their decision-making may have a less direct or immediate impact on BU EEs
 the Board has focused on the degree of independent decision-making authority
over important aspects of the employer's business.
 Persons making significant executive or business decisions should be considered a
part of the "management team" even though they do not exercise the kind of direct
authority over EEs which is characteristic of a first line foreman.
Board seeks to determine the nature and extent of the individual's authority as well as the
extent to which that authority is actually exercised.
 It is not sufficient if an individual has only "paper powers" contained in a job
description or a "managerial" job title, if managerial functions are not actually
exercised.
 Even if workers have a special place on the "team" and have a role to play in coordinating and directing the work of other EEs it does not mean that they exercise
managerial functions in the sense contemplated by section 1(3)(b) especially when
most of their time is spent performing functions similar to those of other
individuals in the BU and there is little or no evidence of the kind of conflict
which section 1(3)(b) is designed to avoid.
CAS of Ottawa Carleton (2001)
Facts: The bargaining unit applied for constituted a group of persons who are employed in various
positions with the Children’s Aid Society but who can all be described generally as "supervisors".
Analysis:
 Board looked at the rationales for the exclusion from Burnaby and the factoring test from Thunder
Bay
o Tucker: some argue (but they are wrong) that as soon as workers are in a union it puts them
in an adversarial relationship with the ER, and in an environment where ER wants absolute
loyalty from managers, they cannot be put together in a BU.
 As noted in many earlier cases, involvement in the discipline and discharge of EEs is perhaps the
most critical indicia of true managerial authority.
 Factors:
o Board must have regard to the nature of the industry, the nature of the particular business,
and individual ERs organizational scheme.
o There must be a rational relationship between the number of superiors and subordinates
o Consultation or "input" should not be confused with decision-making
o Neither technical expertise nor the importance of an EEs function can be automatically
equated with managerial status
 Non-traditional managers: “effective recommendations”
o There may be individuals who have no formal managerial position or title, but who
nevertheless make recommendations affecting the economic destiny of their fellow EEs
which are consistently followed by superiors, that it can be said that the effective decision is
made by the challenged individual.
o This type of recommendation is characterized as an "effective recommendation" and the
inclusion of these persons in the BU would raise the very kind of conflict of interest which s,
1(3)(b) was designed to avoid (and so are excluded from the BU)
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Application:
 In the present case the supervisors are clearly the "eyes and ears" of the ER
o only members of management who really monitor the work and conduct of EEs and they
are therefore the ones who are in a position to identify and express management concerns.
 In this workplace it is rare that misconduct results in a disciplinary response
o ERs committed to the principle of "interactive management"
o Supervisors are expected to counsel EEs, and to record both the conduct which is of concern
and the fact of the counselling (but records are not forwarded to human resources)
 BUT despite the less traditional disciplinary style they play at least as significant a role in
monitoring EE performance and initiating disciplinary responses where required
o They play a significant role in performance appraisal, which has an impact on the
promotion and retention of employees, and in hiring
 Also important is the fact that they are engaged full-time in supervisory work and do virtually
no bargaining unit work.
o This, more than anything else, differentiates them from the category of "team leader" (from
Thunder Bay, EE who only has paper power)
Judgment: Managerial – excluded from BU.
 “The presumption that there is an inherent conflict between the interests of ERs and any ability to bargain
collectively by those to whom it delegates some of its authority, even in a separate BU, has been challenged by
some commentators who bemoan the focus on conflict and adversity of interests which underlies our present
system, but it remains a central tenet of the statute under which this application for certification has been
brought...”
Tucker on Managerial Exclusion
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

There has been a proliferation of designation of EEs as having managerial titles.
o People who have some responsibility, but who also are an integrated part of the unit that
performs the work.
This happens for two reasons:
o Artificially: so that ER can avoid CB or Employment Standards
o Culturally: rigid top-down model isn’t the best way to structure the business
If managers do not hire/fire/impose discipline, should they be allowed to participate in the scheme?
o CAS listed factors to consider (nature of industry, etc), and excluded the individuals from
the BU
o They were still excluded even though:
 They would be in a different BU (so no conflict)
 It was a collegiate-style management system (not adversarial)
Confidential Employee Exclusion
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
Persons employed in a confidential capacity are also excluded from the application of CB legislation
S.3(1) of the OLRA: for the purposes of this Act, no person shall be deemed to be an EE (b) who, in
the opinion of the Board... is employed in a confidential capacity in matters relating to labour
relations
Transair Limited (1974)
Fundamental principles which help this Board to make a determination of the CI exclusion:
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The confidentiality exclusion in labour relations has nothing to do with the competitive position
of an ER:
o Most EEs are privy to all types of information: processing data, manufacturing devices or
trade secrets which could be detrimental to the competitive position of their ER if revealed
o The only effective protection for an ER in that case is the expected cultivated loyalty of all
EEs
"... in matters relating to industrial relations." means having access to information relating to
matters like K negotiations:
o People who get together and decide on behalf of management the range of salary increases
that the bargaining team will be mandated to operate within at the negotiations
o People who plan the strategy which ER will use in the pursuance of its interests before the
Board
o People who discuss the disposition of grievances (plan or know what compromise will be
offered to a grievor)
The access to this information must not be incidental or accidental (part of an EEs regular duties)
o If the main function of the EE is not related to matters relating to industrial relations, that EE
cannot be excluded.
o ERs must be fair – if they decide to openly discuss IR matters where they could be
overheard by an unauthorized person, it is no cause for excluding that person
Disclosure of the info to which these persons have access must have an adverse effect on the
interests of the ER.
o The interests of the ER concerned here must be interests in industrial relations
o Example: disclosure by an EE of info he has access to concerning secret manufacturing
process to competitors might well be a breach of confidence and loyalty on the part of that
EE but has nothing to do with industrial relations.
It is an absolute necessity for an ER to be capable of operating efficiently and therefore to have
the essential number of EEs administering industrial relations to assure efficient management in
this connection.
o EEs who are solicited for and accept functions with a company which make them an
essential part of that autonomous team which has to administer labour relations will be
deprived from any CB right
CH 3: Who is the Employer?
Background
Contexts where, in addition to legal ER, we ask who is responsible for liabilities of ER
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The borrowed servant
Parent-subsidiary arrangements
Employment agencies (triangular relationships between agency, EE and ER)
Related employers
o Complex corporate networks (where entities are legally distinct)
o Sub-contracting (supply chain regulation has become of increasing concern)
Successor employers
125
Themes

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Conflict between labour protection and corporate commercial norms
o When labour law reaches out and tries to be more effective, it can run up against the norms
of corporate/commercial/bankruptcy law
o There can be an express statutory adjustment between these two bodies of law, or tribunals
try to draw the line
Contractual nexus or imposed status?
o Like in employment status – does ER status require a K of employment, or can it arise in the
absence of any contractual relationship between parties?
o In some circumstances legislatures are prepared to override the contractual nexus and
impose the obligations of an ER, or even legal ER status, on an entity that does not have a
legal relationship with the worker
Approaches (paradigms)
o 1. Formalistic – define ER and see if individual fits within it
o 2. Purposive approach:
 Why do we want to know? What is the policy issue at stake?
 To decide whether it would be better to identify A or B as ER for purposes of
advancing the policy in this area of the law
To establish an employment relationship, normally there must be a contract between
identifiable individuals
Common Law – Vicarious Responsibility


Situations arise where a person who is under a K with employer A is sent to B to do some work
Courts have traditionally approached this type of situation by asking “in whose employ the servant
was at the time he inflicted the injury”
o Context is the “borrowed servant”
 General rule is that general ER is vicariously liable – supported by K nexus and linked to policy
rationale
McKee v. Dumas 1976 Ont CA.
126
Commercial Contract
Eddy Forest Products
(General Employer)
Daoust
(Temporary Emp
Collective Agreement
Dumas
(Borrowed Servant)
(Driving Daoust's Truck)
Facts: Eddy is owner and operator of pulp and paper mill. Eddy enters into K with Daoust to haul
lumber from timber limits to its mill. Dumas, the senior employee of Eddy, was assigned to fill the
vacancy. Daoust was to reimburse Eddy for Dumas’s wages, however Dumas was to be paid by Eddy.
Dumas remained on Eddy’s payroll, any complaints about Dumas were lodged with manager of Eddy.
Upon reporting to Daoust, Eddy was assigned a shift, instructed as to route maintenance and advised
how to operate the vehicle. While hauling lumber, Eddy collided with a train causing damage of
$650,000 to Canadian Pacific.
Issue: whether Eddy or Daoust is vicariously liable for the negligence of Dumas, or whether both are
liable
 NOTE: Highway Traffic Act Liability:
o Daoust, as owner of the vehicle driven by Dumas, is liable for negligence under the HTA
o However, CP also sought judgment against Eddy for negligence of Dumas
CA Analysis:
 Fleming, Law of Torts: In the course of performing the stipulated work, if the EE injures
someone, the general ER (Eddy) retains responsibility, unless he can establish that the effect of
the transfer was to constitute his EE for this event the as the servant of the hirer
o Over the past fifty years, the burden has become increasingly stringent so that it can only be
discharged in quite exceptional circumstances
o Reason for this bias: the general ER, unlike the hirer, has selected the servant for the task
and thereby makes himself responsible for the manner in which the work is carried out
o The onus is on the general ER to show that it is someone else who remains VL, must show
that temporary employer (on BOP) had assumed the control and was in position to
supervise
 Trial judge erred in the conclusion he arrived at by applying the organization test
o Having regard to the fact that authority to hire, fire, suspend or reprimand Dumas rested
with Eddy, that he was still being paid by Eddy and was entitled to all benefits from his K of
employment with Eddy, TJ erred in finding that Dumas was certainly integrated into the
business of Daoust and no longer integrated into the business of Eddy
 Court applied multi-factoral test
127
o
The only real connection that Dumas had with Daoust was that he was driving a Daoust
vehicle
 Although Dumas was given certain instructions by Daoust, the right of the ER to
direct the manner in which work should be done is only one factor in the
determination
o Court looked at who selected the EE (Eddie), who had general control over work
performance (Eddie)
 Importance of policy when applying doctrine of vicarious liability
o Doctrine of vicarious liability is a matter of policy and thus, no one criteria can be decisive
o Doctrine cannot parade as a deduction from legalistic premises, rather, it should have its
basis in policy considerations (Fleming)
 Can both employers be held liable?
o From the early 19th century, the court have said that liability must rest on one or the other
but never on both
o Since Daoust is liable in any event to the plaintiff by Statute, it is unnecessary to determine
this on appeal
Judgment:
 Eddy selected Dumas for the task, Eddy put him behind the wheel, Eddy maintained control of any
disciplinary action, Eddy paid Dumas
 It cannot be said that the heavy burden on Eddy to shift liability on Daoust has been met
Tucker on McKee
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
Judge used a purposive analysis to figure out who should be ER
o he enters into discussion that foreshadows discussion in Sagaz
Since adoption of VL is a matter of policy, neither one of the criteria advanced can be decisive
o in terms of goals of VL, this makes sense and also is in line with the contractual relationship
o Dumas has no contractual relationship with temporary employer
o It fits better with paradigm that general employer is liable – general approach
Unclear whether court rejects organization test or disapproves of trial judges application
o Court favour a multi-factor approach but Tucker says it doesn’t look that different from
organization test
At the end of the day, main focus is who exercises the most control over the actual performance
of the work, because from a VL standpoint this is what’s important
o Who was in the best position to control the individuals behaviour, because that is the person
who would have incentive to take precautions to ensure employees performed carefully
Parent-Subsidiary Relations
Marks & Spencer/Peoples’ Department Store (1990)
Marks and Spencer Canada Inc.
(Parent)
Peoples Department Store
Subsidiary/Division
Marks and Spencer
Subsidiary/Division
D'Aillard's
Subsidiary/Division
Employees
Employees
Employees
128
Facts: As a result of the closing of People's Department Store in Kapuskasing, two long-service EEs lost
their jobs. Issue: whether the EEs were entitled to severance pay under the ESA on the grounds that the
payroll of the employer exceeded the $2.5 million threshold for entitlement. The ES Officer
determined that the claimants' ERs payroll did exceed this figure on the grounds that Marks and
Spencer was the ER, not People's, which operates as a division of Marks and Spencer. People’s
applied for a review on the basis that it was the ER and its payroll did not cross the threshold.
Analysis:
 “the central relevant consideration in this case is the employment relationship that existed on a
regular basis between these Claimants and the people who exercised control and direction of their
work".
 Definition of ER in the Act: “employer” includes, (a) an owner, proprietor, manager,
superintendent, overseer, receiver or trustee of an activity, business, work, trade, occupation,
profession, project or undertaking who has control or direction of, or is directly or indirectly
responsible for, the employment of a person in it
o TUCKER: Isn’t it fair to say that Marks, as parent, is indirectly responsible for the
employment of a person?
 They have created a division which has hired EEs – this is not direct responsibility
for employment of a person, but doesn’t it meet the test of being indirectly
responsible?
 Taking the definition to include parent/sub is quite a bit removed from the broadest
conception.
 For labour law to have more bite, we need to transgress the notion that corporations
are separate legal entities and we would have to encroach on freedom to structure
businesses in any way – corporations want to able to shut down one corporations
without having the losses attributed to the parent (and we as society let this happen)
 Rather than significantly challenging the structures, the Board limits the widest
reach of the ESA to conform to those corporate law norms.
 Board asks : was People’s truly integrated into Marks, or was it operating more or less as an
independent entity?
o If independent, EEs will not be able to get to the parent
 Held: People’s (sub) is ER, not Marks (parent)
Factor Test from York Condominium (1977): Who is the Employer
1. The party exercising direction and control over the employees performing the work.
2. The party bearing the burden of remuneration.
3. The party imposing discipline.
4. The party hiring the employees.
5. The party with the authority to dismiss the employees.
6. The party which is perceived to be the employer by the employees.
7. The existence of an intention to create the relationship of employer and employees.
129
Employment/Temporary Help Agencies
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Employment, temporary help and “manpower” service agencies supply labour to enterprises
In these situations, a problem arises in identifying the employer
In terms of day to day performance of work, client gives direction to the worker, client sets the
hours
Agency makes deductions for income tax purposes, but on a day to day basis, client oversees
performance of work
For purposes of Minimum Standards, Workers comp, Payroll deductions, EI, Common law, it is
the agency who is responsible
For common law, vicarious liability would depend on factors referred to in Dumas
For common law, termination is controlled by agency
Agency
Client
Worker
Collective Bargaining
Pointe Claire v. Quebec 1977 SCC
Facts: city hired a temporary EE through a personal agency to work for 6 weeks as a receptionist and
then for 18 weeks as a clerk. Contract of employment was between agency and EE. During two work
assignments, EEs wages were determined and paid by agency which submitted invoice to city. EE
performed her work under direction and supervision of a manager working for the city. General
working conditions were dictated by the city. If EE had not been qualified or there were problems, city
would have informed agency to take action. Union submitted request to office of labour commissioner
under s.39 of Labour code to have temporary EE included in the BU (union doesn’t want incentive to
try to expand the use of temp employees as a way of avoiding having workers who are covered by a
CA)
130
Issue: determining the real employer in a tripartite relationship in the collective labour relations context
SCC Analysis (Lamer):
 Is the labour court’s reasoning (that the city is the real ER by focusing on the question of which
party had control over temporary EEs working conditions and performance of her work) patently
unreasonable?
 Based on definition of “employer” and “employee” in the Labour code, it has been established that
the employer-employee relationship is defined by 3 essential elements:
o 1. performance of the work
o 2. remuneration
o 3. legal subordination of the employee to the employer
 Quebec case law:
o Dominant approach is to look at issue of legal subordination (which is a question of who
exercises actual control of the day to day work)
o In the context of these triangular employment relationships, in most instances it is the client
that is actually exercising most control over day to day work, as they are the ones who are
directing and supervising the actual performance of the work
o BUT if client was dissatisfied, agency would have to terminate employee.
o Lamer says single factor approach is too narrow, need more factors, not enough to have
control factor as single factor test.
 Although labour court judges have given predominant weight to legal subordination test, a more
comprehensive approach is more appropriate in the context of a tripartite relationship
o Hopital Royal Victoria v. Vassart 1990 (key case for comprehensive approach)
 Court said that it could not solely rely on the legal subordination test
 “In a tripartite situation, the test of actual control over work performance is much
too rigid and does not take account of other fundamental aspects that are
obviously important. Any interpretation of the concept of “employee” must remain
consistent with the tripartite context.”
o Lamer agrees with the more comprehensive approach
 Comprehensive approach:
o “According to this more comprehensive approach, the legal subordination and integration
into the business criteria should not be used as exclusive criteria for identifying the real
employer. In my view, in a context of collective relations governed by the Labour Code, it is
essential that temporary employees be able to bargain with the party that exercises the
greatest control over all aspects of their work-and not only over the supervision of their
day-to-day work. Moreover, when there is a certain splitting of the employer's identity in
the context of a tripartite relationship, the more comprehensive and more flexible approach
has the advantage of allowing for a consideration of which party has the most control over
all aspects of the work on the specific facts of each case”
o NOTE: this produces the same result as the rejected legal subordination test – although it is
the agency that recruits the individuals to work and then assigns them the jobs, actually
pays them, and exercises discipline, it is the client who has day to day supervision and
exercises control over the immediate conditions]
 Held: On the comprehensive test (which SCC prefers), court finds client is ER
 The following list is not exhaustive, rather it lists some factors pertaining to the employer-employee
relationship:
131
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

o (1) the selection process
o (2) hiring
o (3) training
o (4) discipline
o (5) evaluation
o (6) supervision
o (7) assignment of duties
o (8) remuneration
o (9) integration into the business
Canadian cases addressing this issue:
o most decisions of agencies (OLRB, CLRB) have noted that the essential test for identifying
an ER-EE relationship in a tripartite context is that of fundamental control over working
conditions
o application of this test leads to an analysis of which party has control over: selection, hiring,
remuneration, discipline and working conditions of temporary employees and to a
consideration of the factor of integration into the business
 in the final analysis, application of the test involves an examination of a series of
factors that are similar to those suggested by the comprehensive approach set out in
Vassart
o in applying this test, the OLRB and CLRB have generally concluded that the client is the
temporary employee’s real employer
Is the Labour Courts reasoning patently unreasonable? NO!
o According to the judge, the complete subordination of the employee to the city went to “the
heart of the traditional employer-employee relationship”
o The court used a comprehensive approach by not basing its decision solely on criterion of
legal subordination
o The approach taken by the court is not inconsistent with framework in Vassart
o The judge gave greater probative value to the working conditions and legal
subordination but he also considered other factors such as the role of the agency and city
with respect to remuneration and discipline and the specific facts of the case
o The Labour Court is a highly specialized agency with expertise in labour and is protected by
a privative clause
Is the result patently unreasonable? NO!
o Would application of the city’s CA to the EE would create a problem?
 if CA applies, temporary employees wages would have to be the same as those
established by the CA and that does not raise any major difficulties
o Issue: the agency assumed its responsibilities as an ER under the ESA, and the city argued
that since the definition of ER is practically the same under both statutes, it would be
inconsistent for two separate entities to be the ER of the same EE
 However, Lamer does not find any inconsistency in the application of the two
statutes - each has a distinct object and its provisions should be interpreted on the
basis of their specific purpose
 Not patently unreasonable for there to be different ERs depending on the context
132
Tucker on Point Claire




Why is it better to hold client as employer rather than agency, from the perspective of CB?
Goals of LRA is to facilitate CB by creating arrangements where it is possible for workers to
enter into regime, are we better off in a world in which agency or client is identified as employer?
o If we chose the agency as employer for purposes of LRA, would that advance the goal of
facilitating the establishment of relationships?
o Fluctuation issue: assume that all EEs of the agency are permanent EEs – they agency would
have a number of workers under K, and it would send them to jobs as work became
available.
 Problem if they were considered EEs of agency (not client): very hard to organize
them
 Temporary help agency is largely non-unionized
o In this case, there is an obvious benefit to recognize the already unionized entity as ER,
because it takes the temporary EEs and puts them into a CB system – you just insert them
into a regime, and they are covered by something that exists AND it prevents ER from
having an exit strategy by increasing usage of temporary employees (two benefits to doing it
this way)
Note weakening of the contractual basis of employment, in favour of status
DISSENT: this is a patently unreasonable result because the employment relationship is a
contractual relationship and it’s wrong to identify er in order to advance some purposive CB
o Courts need to focus on the legal relationships between the parties
o In the model, the K
of employment exists between agency and worker
o Issue: is employment a contract or a status?
 LHD says that it is a contract
 Majority departs from this and looks at is as a status – even in the absence of a K, can
impose the status of ER in order to advance purposes of employment and labour law
Nike Canada
Facts: UFCW attempting to organize workers at Nike. Nike employed 70 full and part time employers
at warehouse but also relied heavily on temp agency workers. 180 temp workers at warehouse at time
of attempted organization.
 Nike recognized that temp workers were their EEs and argued that since union had not signed up
temp workers, the 40% threshold had not been met
 Board decided, similar to Point Claire, that Nike was ER and it exercised effective discipline over
the workers (Nike effectively determines pay rate)
 Thus, there was not enough support gained by the union
 Tucker:
o If we go back to the York Condo test, it points to Nike as ER
o Whenever ER has mixed group of own EEs and temps, depending on seasonality and other
short term demands, will a union ever be able to organize in this kind of environment? It’s
much more difficult. So what initially looked like a decision that was favourable to
unionization in the context of Point Claire (where they were protecting the integrity of
the unit by including temps), in a context where the same test is used to determine BU, it
can hurt the ability to organize.
133
Summary of Temporary Help Agencies
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The tripartite relationship, for purposes of CB scheme, does not work well
o there are very few bargaining units of temp employees
Making the client the ER, except in context of client that is already unionized, creates significant
impediments to union who wants to certify EEs because need support of full time EEs and part
time EEs (who probably don’t have an interest in being unionized due to their short term
employment)
o If union does not get all the people doing similar work into one unit, union will be
unsuccessful
The result of the Point Claire approach is that we have a situation where a person has more than
one employer depending on why you’re asking
o In Quebec and Ontario, for the purposes of ESA, the agency is their employer
o For the purposes of CB they may have different employer
o The split of obligations between two entitles (ESA with agency, CB with client) creates
practical problems
o Courts/tribunals have been loath to hold that two separate legal entities are jointly and
severally liable as employers
o CL has picked up on some of the development in statutory law and incorporated that
into the CL
This also signals a further dilution of the notion that employment is essentially a contractual
relationship
o There is no employment K between worker and client – no direct contractual
relationship between these parties whatsoever
o Nevertheless, the courts have said that this is not an impediment to impose the status of
ER on a client in order to make them responsible under a particular statutory scheme
o So employment relationship is one you can contract into, but in the absence of this it can
be a status imposed on you by virtue of statutory scheme or another legal power either
vested in the tribunal or arguably imposed under the CL – the K nexus is being
weakened
Related or Common Employers
Employment Standards



When there are several entities who could be ER, our approach has been to choose one of them to
be responsible for the obligations.
But that approach has its limitations within the context that we saw above, and also has problems
in other contexts.
ESA allows employers to be treated as one –
o 4(1): Subsection (2) applies if,
 (a) associated or related activities or businesses are or were carried on by or through
an employer and one or more other persons; and
 (b) the intent or effect of their doing so is or has been to directly or indirectly defeat
the intent and purpose of this Act.
134
o
4(2) The employer and the other person or persons described in subsection (1) shall all be
treated as one employer for the purposes of this Act.
550551 Ontario Limited v. Framingham 1991 Ont Gen Div (Bilt-Rite Case)
Facts: Bill-Rite filed for bankruptcy. On behalf of Bilt-Rite employees, Director of the Employment
Standards filed claim for unpaid wages, termination pay and severance pay.
 Martin Silver Holdings, of which Martin silver was the sole shareholder, owned 40% of the shares
of Bilt-Rite.
 Sylvia Silver Holdings, of which Sylvia was the controlling shareholder, owned 50% of shares of
Bilt-Rite.
 550551 Ontario Ltd owns the land and premises which housed the manufacturing facilities of BiltRite.
 Martin Silver personally owned 50% of the share of 550551 and the other 50% were owned by
Sylvia.
 EEs were left with $4M of unpaid wages and termination/severance obligations.
 Union made complaint to ES branch who hires accountants – they are related entities, and we think
that under the provisions of the ESA this meets the definition of related employers.
 The asset was found to be related ER, and as soon as the family got the preliminary report, they
immediately stripped it of its assets, placed mortgages on it, and turn it into a shell itself.

ISSUE: there was a finding that Martin and Sylvia Silver are also personally related employers, and
therefore personally responsible, so the question before the court is – what is the reach of the
related employer provision?
o Yes we can pierce corporate veils, and bring in all the other companies, but can we bring in
the real people, real human beings, who are operated the scheme?

Legal Test: common ownership, common control, close functional interdependence
o Sufficient to show that they are related businesses – no need to prove intent to defeat the Act
(effect sufficient)
o The court accepts that they can be treated as related companies.
135
o


Allows integrated horizontal operations to be treated as common ER but draws the line at
piercing the corporate veil to reach real persons.
Note court’s characterization of such a move as “confiscatory legislation.”
o The word "individual" in s. 12 relates to a sole proprietorship. If it was the intention of the
legislature to engulf citizens in their personal capacity, outside a sole proprietorship, and
outside the corporate veil, in what is little short of confiscatory legislation they must do
so in clear unambiguous language. We conclude that the legislature did not use clear
enough language to denote such personal responsibility. The order relating to Mr. Silver
has thus been based in our judgment on an erroneous interpretation of the word
"individual" in s. 12. In that respect only, the order to pay must be set aside.
Should individuals be allowed to shield themselves behind corporate forms to avoid their
contractual obligations to employees?
Lower level decision:
 Ministry of Labour: By operation of s.12 of the Act, Framingham found all the applicants to be the
“employer” of the former employees of Bilt-Rite and to be jointly and severally liable for such
amounts
 Mr. Framingham’s decision:
o He stated that “subject to any information that you may bring to my attention” he believed
that the applicants “may be treated as one employer pursuant to s.12 of the ESA”
o 550551 owned land and the manufacturing plant which it leased to Bilt-Rite at less than
market value
o In our view, there was adequate factual underpinning for the officer to decide that the
numbered company was related to Bilt-Rite pursuant to s.12
Tucker on 550551




550551 is important because among the web of companies, it is the only company that has any
assets, and also the Silvers personally had some assets
o In the interim, Silvers strip 550551 of its assets by putting a $6M mortgage on it
Tension between remedial logic (law wants to protect and ensure that employees can collect wages
to which they are entitled) vs. norms and logic of corporate and commercial law (corporation is a
legal person that is distinct from shareholders, directors and distinct from other persons and legal
entities)
Thus, need to ask, when two vectors come into conflict, where does the line get drawn?
Section 4
o 4(1)(a): Court doesn’t say anything about 4(1)(a) because this is a paradigm case where
everyone would agree that there are associated activities
 When you have a web of companies all involved in production of a single product,
that will almost always be seen as a paradigm case of associated or related activities of
businesses carried on through one or more persons
 Thus, first branch of s.4 has been met
 Court states that remedial thrust of ESA overrides the norms of corporate commercial
law
 Case of Solomon v. Solomon has been eroded by purposive social legislation
 This supports protective thrust of ESA
136
o 4(1)(b): Court says that you only have to establish that the arrangements have the effect of
avoiding the purposes of the ESA (prevent workers from wages, severance etc to which
they are entitled)
 do not have to show intent of the arrangement
 reinforces the broader remedial thrust of the legislation
 weakness of the regime: in the time that a judgment is being made, legislation does not bar entity
from stripping its assets (employment officer now allowed to freeze the assets)
Note:
 The above case was decided under pre ESA 2000 law and s.4(4) now specifically limits shareholder
liability
 the requirements for finding that companies are related is now found in s.4(1)
 in PlateSpin Canada Inc 2005, the adjudicator articulated the test for applying the new section
(s.4):
o Are or were associated or related activities, businesses, works, trades, occupations,
professions, projects or undertakings carried on by more than one corporation, individual,
firm, syndicate or association or any combination thereof?
o Did any corporation, individual, firm, syndicate or association found to be associated or
related employ the claimant during the period of time for which benefits are claimed or the
violation of the Act or regulations took place?
o Was the intent or effect of carrying on associated or related activities to directly or indirectly
defeat the true intent and purpose of the Act?
Lian J. Crew Group 2001 OR
Facts: P responded to an ad to sew garments at an hourly rate. Action seeks declaration that Eliz (D)
breached the ESA – claiming unpaid wages, overtime, vac pay and punitive damages. Venator is a
large retailer of private label apparel, one of the stores within its division is Northern Elements who
gets supplies from Presido. Presido in turn subcontracted with Kenny’s who in turn subcontracted with
Eliz World. Plaintiff produced “Northern Elements” garments ultimately sold by Venator for which she
was not paid. Plaintiff produced clothing that was ultimately sold by Modern Times (another company
who subcontracted work that was eventually done by Eliz World). There is no common ownership or
management with the clothing manufacturers or with any of the subcontracting companies – retailers
contracted at arm’s length.
137
Contract
of
Homeworker
s
Kenny’s
Presidio
Commercia
l Contract
E.
Knitted
J. Crew
Yee Tung
Garment
Analysis (Cumming)
 ESA: Purpose of ESA is to protect interests of EEs by compelling ERs to comply with minimum fair
and reasonable standards
 Given its remedial purpose, ESA should receive a fair, large and liberal construction and
interpretation
 s.1 defines “employer” but s.12(1) expands its meaning to include persons who are “associated or
related” to the principal employer when the intent or effect of such an arrangement is to defeat
either direct or indirectly the true intent and purpose of the ESA
o Under s.12 liability is based on the relationship of the “associated or related” ER to the
principal ER rather than its relationship to the EE
 s.12 applicability TEST (Referee Brown in Re Refac Industrial) 4 requirements to be met
o There must be two or more business entities involved in the in the form of a corporation,
individual, firm, syndicate or association or any combination thereof
o The person claiming to be an employee of a common employer must have been or must
presently be an employee of one of those business entities during the relevant period of
time for which the benefits are claimed or the violation of the legislation took place
o Businesses must be associated or related (doesn’t capture arm’s length)
 Various cases have looked at whether or not the “associate or related” test is met,
criteria include:
 common management or directing mind
 common financial control
 common ownership
 existence of a common trade name or logo
 the movement of employees between two or more business entities
 the use of the same premises or other assets by the entities
 transfer of assets between them
138
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



whether there is a common market or customers served by the two or more
entities
 one must look to the facts to determine if there is a functional interdependence
amongst the business entities such that there is a complementary and integrated
structure
o The intent or effect of the arrangement must be to defeat, either directly or indirectly, the
“true intent and purpose” of the ESA
Requirements applied to this case:
o It is conceded that the first two requirements are met
o None of the criteria for #3 have been met in this case!!
o There is no evidence to suggest that it was the intent of any of the defendants in structuring
their activities, either directly or indirectly, to defeat the true intent and purpose of the ESA
Conclusion: Ds did not have a contractual relationship with Eliz World, there is no evidence that
they benefited from failure of Eliz World to comply with ESA, they did not even know Eliz World
or the plaintiff, there is no evidence of vertically integrated business relationships and no evidence
that any of the defendants are “associated or related” to Eliz World
Judgment: In the absence of intervention by legislation or regulation, businesses have the freedom
of action to determine the type and extent of the business activity carried on, even if it is in their
own self interest. The structural problem of the industry as a whole and possible solutions are
considerations of legislators, while courts role is limited in interpreting and applying s.12
Tucker
o This was an attempt to push the boundaries of the related employer provisions from web of
companies to one in which there are entities which are otherwise unrelated to each other but
have supply contracts with each other
o s.12 does not apply to supply chains as they lack integrated elements
o is it an accurate description of what has occurred here when judge says that “courts role is
limited in interpreting and applying s.12”
o Para37: “A K is one factor to consider the ER-EE relationship but it cannot be determinative
otherwise it would be too easy for ERs to evade their obligations through contractual…”
The Meaning of “intent of effect”
Nova Quest Finishing (upheld on appeal)
 The mere fact that EEs of bankrupt division are deprived on their statutory entitlements because of
the corporate structure of their employer is insufficient
 Must show some connection between the relationship of the companies and the insolvency (eg.
used to take assets out of the failing company)
o Meaning the connection must be responsible for EEs not getting paid
Limits of “related employer” approach in the ESA




relatedness requirement does not reach arms-length sub-contracting
intent or effect requirement read restrictively
o need to show something more specific than manner of organizing had effect of denying EEs
protection
cannot be used to pierce the corporate veil and make beneficial owners responsible
ESO lacks power to issue interim orders preserving assets
139
Possible alternatives ways of collecting unpaid wages






Courts think that because these are exceptional liabilities, they need to be read narrowly
1. Business Corporations Act
2. ESA
o part XX - directors liability
 to the extent that director allows failure to pay wages, they can be prosecuted,
however need to get consent
 if you prosecute and get conviction, court may assess any amount owing to the
employee
o part XXV - allows prosecution
3. Lien laws?
4. bankruptcy – wage priority
o Bill C-55 created Wage Earner Protection Program (WEPP) for employees whose employers
have gone bankrupt, allowing them to claim unpaid wages from the government for up to
$3,162
o Wage claims are given superior priority and stand ahead of secured creditors
5. wage protection funds
Collective Bargaining


to protect trade union bargaining rights from mere change in form rather than substance, collective
bargaining legislation provides that associated employers under common control and direction
may be treated as a single employer for collective bargaining purposes
Brant Erecting and Hoisting 1980 OLRB
o Where legal entities carry on related business activities under common control or discretion,
the Board is empowered to pierce the corporate veil
o s.1(4) ensures that the institutional rights of a TU, and the contractual rights of its members,
will attach to definable commercial activity, rather than the legal vehicles through which
that activity is carried on
o purpose of s.1(4) is to preserve the established bargaining rights and collective agreement
when a “business” is transferred from one employer to another
o to ensure that the industrial relations status quo is preserved, legislature has provided that
where two employers carry on related economic activities, under common control and
direction, whether or not simultaneously, they can be treated as one for the purposes of the
Act
o However, s.1(4) is discretionary
Common Law
Downtown Eatery v. Ontario 2001 Ont CA
Facts: HG and BG owned and operated two clubs through a consortium of companies. HG hired A but
A received pay checks from BG. A was dismissed and brought an action for wrongful dismissal against
BG. Several years after commencement of action, there was a major reorganization of companies and
BG ceased to do business. A was successful in trial and was granted judgment against BG but was not
paid anything. Sheriff seized assets but D claimed that it belonged to him and brought action against A.
140
A defended action and counter claimed against HG and BG personally, and all the companies they
controlled
CA Analysis
 At trial, the judge takes the traditional view of the issue—absence of a contractual relationship with
these other entities means you have no claim.
 Common law jurisprudence for common employer doctrine: ( Sinclair v. Dover)
o First issue is one of determining with whom plaintiff contracted for employment
 there is no reason for an inflexible notion of a contract in a modern employment
relationship – the old fashioned notion that no man can serve two masters fails to
recognize the realities of modern day
o As long as there exists a sufficient degree of relationship between the different legal
entities who apparently compete for the role of employer, there is no reason in law or in
equity why they ought not all to be regarded as one for the purpose of determining
liability for obligations owed to those employees who, in effect, have served all without
regard for any precise notion of to whom they were bound in contract
 What constitutes a sufficient degree of relationship depends on details of such
relationship, including factors such as:
 Individual shareholdings
 Corporate shareholdings
 Interlocking directorships
 Essence of that relationship will be the element of common control
o Gray v. Standard Trustco 1994 Ont Gen Div: For purposes of wrongful dismissal, an
individual may be held to be an employee of more than one corporation in a related group
of corporations – one must find evidence of an intention to create an employer/employee
relationship before the individual and the respective corporations within the group
o Jones v. CAE 1991 Ont Gen Div: The true employer must be ascertained on the basis of
where effective control over the employee resides…employment relationship is not simply a
matter of form and technical corporate structure
o In all three cases, court found that other company was a common employer
o Thus, the question becomes, “where effective control over the employee resides”
 Court of Appeal approves “common employer doctrine”:
o Critical of the TJ for focusing on the absence of employment. “A contract is one factor to
consider in the employer-employee relationship. However, it cannot be determinative; if
it were, it would be too easy for employers to evade their obligations to dismissed
employees by imposing employment contracts with shell companies with no assets.”
 Rejects contract nexus as essential to establishing employment relationship
o Because it is so easy to create shell companies, the CL also needs a protective and remedial
thrust. We adopt the notion of “related employers” into the common law itself so that it can
pierce the veils of different companies when needed.
 Application to the Case
o When A was dismissed, there was a highly integrated group of companies which together
operated all aspects of the club
o The club could have easily been operated through a single company but chose not to
 It is a perfectly normal arrangement and nothing suspicious about their choice
o Although employer is entitled to establish complex corporate structures, law should be
141
vigilant to ensure that permissible complexity in arrangements does not work an injustice
in the realm of employment law
o A did his best when he was dismissed, he sued his employer, but later found out that
company had no assets but yet, night club continued in business
 A decided to try to collect his money through the other companies and the common
employer doctrine provides support for his attempt
 Should A’s judgment be enforced against the successor merged companies created by the
reorganization?
o Yes! Management stated that they were careful to protect the positions, seniority and
benefits of current employees when re-organizing
Judgment: A’s true employer was a consortium of companies which operated the club
Tucker on Downtown Eatery
 there is no statutory obligation to treat a number of interrelated companies as a single employer
 court adopts the “common employer doctrine” – treat a number of interrelated companies as a
single employer
o contract status: rejects contract nexus as essential to establishing employment relationship
 overrides the idea that employment is simply a contractual relationship
 a contract is one factor to consider in the employer/employee relationship however it
cannot be determinative as it would be too easy for employer to evade their obligation by
setting up contracts with shell companies that have no assets
 thus, employer employee relationship exists as a matter of status in order to fulfill and
support the protective dimensions of labour and employment law (common law rights of
employees to sue for wrongful dismissal and collect for wrongful dismissal)
 thus, relationship can arise either by contract or by status
o overrides corporate norm of distinct legal personality
 courts are prepared to override corporate and commercial norms by treating entities that
are otherwise legally distinct, and deem them a common employer resulting in joint and
several liability
 Tucker thinks that if this was done through a supply chain (Lian J Crew), then court would
have a harder time doing this
o interpretation of norms between statute and common law
 interactions between components of regimes
 CL courts will draw on CB regime to determine norms in the common law
 may see arbitrators in CB regime making reference to common law
 growth of related employer in statutory scheme have made judges more willing to
recognize it in common law
 NOTE: the related ER provisions for CB are structured in a way that gives the labour board
a discretion as to whether or not two or more entities are related and should be treated as a
single employer.
142
Successor Employers
Common Law

The sale of a business amounts to a constructive dismissal of EEs triggering right to notice or pay in
lieu of notice.
 What are the impacts on the employees and the potential liabilities of the purchaser and seller?
o When a sale of business occurs, the EEs are entitled to treat that event as terminating their
contracts of employment, which would trigger their right to termination pay. Anyone who
didn’t want to take a job could come after you to say they want their notice, etc.
 Possible outcome: EEs stay on with new ER
o In many instances, this will occur.
o In absence of express agreement court will be reluctant to imply that new ER assumes
complete liability; EE fully accepts new contract in place of old.
 How seller can ensure liabilities are severed (and EE can’t pursue CL claim against it):
o Novation: three party arrangement
 In absence of express novation agreement, court will be reluctant to imply novation,
 but they will do it in appropriate circumstances.
o If vendor wants to be relieved of an obligation to pay notice to EEs who are taking
employment with new employer, the vendor would want to get an express agreement for
novation
 This is an express contractual relationships with EEs to be hired, such that they
waive rights to old ER and look to new ER exclusively.
 From perspective of employees, should not make an express contract unless they are protected
o EEs would be concerned about liquidity of ER – what if ER goes bankrupt?
o If EEs accept novation and new ER goes bankrupt, their entitlements would be
compromised
 For non-unionized employees, if you don’t accept new employment then can sue old employer
for not giving notice if you weren’t given notice
o This may be better for the EE if he is not sure about employment with new employer, also
depends on employees skills and abilities in the market if they don’t take the new
employment
Major v. Phillips Electronics 2005 BCCA
 Vendors liability will depend on whether there was novation
 Novation: a trilateral agreement by which an existing contract is extinguished and a new one
brought into being in its place – assent to the discharge of the old obligations and substitution of
the new is essential
 3 part test for determining if novation has occurred: (there is continuity in transfer)
o 1. the new debtor must assume the complete liability
o 2. the creditor must accept the new debtor as principal debtor and not merely as an agent or
guarantor; and
o 3. the creditor must accept the new contract in full satisfaction and substitution for the old
contract
143
Employment Standards Act – Sucessor Provisions



ESA has successor provisions: s.9, 10
Sale of business – S. 9:
 Preserves continuity of employment if EE hired by successor (purchasing ER steps
into shoes of vending ER)
 Purpose is to ensure that accumulated period of employment of EE will be carried
from one ER to the next when a sale takes place
 If EE not hired by successor, selling ER liable for termination/severance pay
 IMPORTANT: Provision covers contracting out
o 9(1) If an employer sells a business or a part of a business and the purchaser employs an
employee of the seller, the employment of the employee shall be deemed not to have been
terminated or severed for the purposes of this Act and his or her employment with the seller
shall be deemed to have been employment with the purchaser for the purpose of any
subsequent calculation of the employee’s length or period of employment.
o Definitions – s.9(3) “sells” includes leases, transfers or disposes of in any other manner,
and “sale” has a corresponding meaning.
Special provision for building services providers – s.10:
 s.10: special provisions regarding contracting in of building services; more liability
on successor if does not hire existing workers
 s. 10 was enacted to protect workers who may lose their jobs when the contractor
that employs them is replaced by another
o 10. (1) This section applies if the building services provider for a building is replaced by a
new provider and an employee of the replaced provider is employed by the new provider.
o No termination or severance – 10(2) The employment of the employee shall be deemed not
to have been terminated or severed for the purposes of this Act and his or her employment
with the replaced provider shall be deemed to have been employment with the new
provider for the purpose of any subsequent calculation of the employee’s length or period of
employment.
Abbott v. Bombardier 2007 ONCA
Facts: Bombardier transferred the group for which EEs worked to CGI. CGI offered full time
employment and recognized each EEs original date of hire with Bombardier. Appellants were given 8
weeks notice that their employment with Bombardier would terminate and they would receive offers
from CGI. All employees accepted the offers and started work . A few months later, the employees
sued Bombardier for severance pay. Bombardier brought motion to have claim dismissed and was
successful. Employees appealed.
Analysis (by the court)
 Trial judge should have used the “going concern” test in determining whether Bombardier/CGI
transaction amounted to the sale of a part of a business within the meaning of the ESA
o Test used to determine whether transition amounted to a sale: “whether the effect of the
transaction was to put the transferee in possession of a going concern, the activities of which could
carry on without interruption”
 EEs argued that this was, in pith and substance, a transfer of assets with an option to hire EEs
(and therefore they were not caught by s.9)
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o





NOTE: EEs are trying to argue that they are NOT covered by the successor rights in the ESA
so that they can go after their former ER – important feature of the ESA
o They tried to do this by limiting the scope of s.9 provisions by drawing a distinction
between the sale of a business and contracting out of work
Court disagrees with EEs for 2 reasons:
o 1. the ESA is remedial legislation intended to set minimum standard for terms of
employment and thus should be given a “fair, large and liberal construction and
interpretation as will best ensure the attainment of the object of the Act according to its true
intent, meaning and spirit”. Purpose of s.9 is to protect minimum standards related to
length of employment where business continues to employ the employees of the vendor
following the sale.
o 2. while “going concern” test had been used, we are not persuaded that that means it is
appropriate that the same test should be used for the OLRA
 OLRA regime is aimed at providing continuity of relationships between unions
and employers in the sale of a business while purpose of ESA is to protect
individual rights and preserve continuity of seniority
Employees main issue was that they were entitled to a pension plan at Bombardier but had no
similar plan with new employer
o Bombardier showed evidence that EEs were compensated (upward salary adjustment) in
order to make up the difference
Judgment: evidence by EEs did not rise to the level of demonstrating a fundamental or radical
difference in their employment
Tucker:
o Employees argued that where there is a sale of a business, successor rights should apply,
where there is contracting out, successor rights should not apply
 Here EEs argued that they were contracted out, they did not have a new ER
o Court said importing this concept into the ESA actually limits the protection of the Act
 Want to keep the protection broad because it protects EEs and this argument would
undermine the protection of s.9
o Successor rights operate when there is a sale OR contracting out, provided the ER hires the
old EEs
 Therefore, court said the contracting out/sale distinction is not appropriate
o EEs were double dipping: they have not lost their job with CGI but are trying to find a way
to collect now notice and entitlement pay from former employer although they didn’t lose
their job and there was continuity
Court held: s.9 applies whether it is a sale or a contracting out
o Did not want to import from CB law a distinction between contracting out or sale
Collective Bargaining
 Role is to preserve bargaining rights when there is the sale of a business
o The OLRA recognizes the necessity in preserving the bargaining rights and collective
agreements in a sale of business (s.69)
 Interpretation of “sale of a business” highly contentious point
o Distinction between sale and “contracting out”
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




o For most of the jurisdictions in Canada, the view has been that the successor rights provisions
of the OLRA only applies where there has been a sale of a business, and does not apply when
there is contracting out.
Two conceptualizations
o Functional approach: certification attaches to work function
 Employees who distributed the newspaper, that is the function to which certification
attaches, and so whether the delivery of that function moves by sale or contracting out
makes no difference
 Wherever work goes, certification follow
 Only jurisdiction that follows this approach is QC
o Instrumental approach: certification attaches to a business
 It only follows the business
 If a business is sold, then certification follows
 But if business is not sold, then certification does not follow
 This approach is predominant outside of QC
Two companion SCC cases: Ivnahoe Inc and City of Sept-Iles v. Quebec (2001)
o While much of the discussion in those cases revolves around questions of the standard of
review and specific features of the Quebec Labour Code, the Supreme Court of Canada
indicated its willingness to give labour boards more scope to interpret the successor rights
provisions of their respective statutes. In these cases, the court effectively allowed the Quebec
Labour Court to use a functional approach.
 What will be the effect of this?
Ex: if Toronto Star had only contracted out distribution function, then there would be no successor
rights if union wanted to continue to represent those employees, would need to go out and organize
them again
The question of whether there has been a sale must be decided by the Board
o Since the details of a transaction involving the sale or transfer of a business are within the
knowledge of the employers privy to it, the trade unions are confronted with problems of proof
o To remedy this, Ontario imposes a duty upon employers to adduce at the hearing all relevant
facts to their knowledge
There are two crucial elements that board must find if successor rights are to apply to a sale of
business—both are defined in s.69(1)
o “business” includes a part or parts thereof
o “sells” includes leases, transfers and any other manner of disposition, and “sold” and “sale”
have corresponding meanings.
The SCC undermined the functional approach in Union des Employes de Service , Local 298
(Bibeault) (1989)
Beetz J:
o the successor rights provision to apply an alienation of an undertaking must occur which
consists of self-sustaining organization of resources through which activities are carried on
o The transfer of subcontracting arrangements between subcontractors does not fall within this
scope
o This holding now represents the dominant approach of labour relations boards
Conclusion
146
 Labour board does not restrict employers on how to run and structure their businesses
 But in some circumstances, in order to advance protective functions of labour law, it attaches
label of ER or imposes obligations of ER on an entity that does not have contractual relationship
o Ex: clients of employment agencies are held to be employers, web of companies operating a
business are held to be a single entity who are jointly and severally liable for obligations of
employer
o Ex: Directors are held personally responsible for unpaid wages under the ESA, lien laws where
owner of a property would be responsible to workers who made improvements to the property
even though workers were hired by a construction company
o Preserve continuity of employment even when there is no express contractual agreement—CL
rule
 However, there are also limits to the protection
o In absence of express statutory provision, shareholders are not personally responsible for debts
of corporation, employer obligations not attached to supply chain situations and in the context
of collective bargaining, sharp distinction is drawn between sale of business (certification
follows) and contracting out (certification does not follow)
CH 4: Introduction to Fairness
What do we mean by fairness?


If relationships are only governed by K of employment, and ER discriminated against women,
older people etc, would EEs have any legal remedy? NO!
Our courts have held that there is no tort of discrimination so we must look to legislative
interventions to correct a shortfall in the CL regime
Why don’t we simply leave it like that and let the market work as it does?
Argument against regulation (minority view):
Argument for regulation (majority
view):
market punishes ERs who discriminate against EEs
o Notion of reputation harm (its unpopular to even if in the long run the market
discriminate)
would work, nobody wants to wait for
o Assuming there is no difference in the
it, and as a society we have made it
capacity of people, if ERs are not hiring on
clear that it is unacceptable to allow for
certain grounds they are limiting their pool
discrimination
of candidates and not getting the best value
o A large consensus emerged
for their money
after WW2 that legislative
initiatives were required

Architecture of labour law:
o The law has drawn sharp distinctions between human rights (defined as anti-discrimination
on enumerated grounds) and other claims in the workplace (economic and social rights),
which are dealt with elsewhere
o Non-HR aspects of bad treatment are dealt with in Employment Safety and Work Standards
acts
147
o
o
Do we have an underlying conception that the rights that we call human rights have more
normative value than other kinds of economic and social rights?
 This distinction is important because the implication is that some things are
unacceptable, and other things may be negotiable (like long hours).
 There is more cachet, more power, to the term human rights, as opposed to other terms
like economic/social rights. So the things that we term human rights has
implications to how these rights are assessed and treated by Courts of Law. A society
could exist where its conception of “human rights” included “economic/social
rights” – one conception isn’t more right than another.
Tucker: distance between CB rights and HR rights has been narrowed
 BC Health Services: the right to CB is now seen as a fundamental part of FOE, which is
a fundamental right and freedom of a higher order than it used to be (when the SCC
said it was merely a statutory right not worthy of constitutional protection).
 The right to a healthy and safe work environment is cast as a fundamental right, not
just social/economic right, and it is unacceptable to expose EEs to risk as a result of
going to work.
 What about living wages? There is the notion that it is unacceptable to have a min
wage that provides workers with less than a living wage. There are always
challenges to these boundaries and it is not clear to Tucker exactly where we stand,
but he thinks the boundaries are much less rigid and clear than they were 20-30
years ago.
CH 4: HUMAN RIGHTS LEGISLATION
Human Rights: Common Law, Arbitration, Legislation
 before the enactment of HR legislation there was no legal route for challenging invidious forms
of discrimination such as discrimination based on race or sex
 in 1951 Ontario enacted the Fair Employment Practices Act
 Seneca College v. Bhaduria, [1981]: Laskin held that there was no common law right or civil action for
an individual to vindicate claims of discrimination. Laskin stated that the statutes provide a
comprehensive administrative and adjudicative regime for the protection of such rights.
o Although Bhadauria is still “good law”—it is a precedent that has not been overturned—it has
been eroded
 HR statues provide, in theory, an expeditious procedure for pursuing an HR complaint
o However, they are severely underfunded and have a very poor reputation
 The advent of equality rights in the Charter has provided EEs who can establish that the Charter
applies, with a method of pursuing discrimination complaints in the courts.
o More significantly, although the Charter has likely influenced the courts’ willingness to take on
the issue of human rights at work, it is possible to raise a human rights complaint as an
ancillary action to a common law action (ie tied into a wrongful dismissal)
 In Parry Sound Social Services 2003 SCC stated:
o HR legislation and other employment related statutes establish a floor beneath which an
employer and union cannot contract
 s.48(12)(j) of the LRA provides:
o arbitrator the power to “interpret and apply HR and other employment related statutes
148
despite any conflict between those statutes and the terms of the collective agreement”
Overview of the Ontario Human Rights Code
 came into force in June 2008
 amendments did not affect substantive grounds of discrimination
 Part I: deals with freedom from discrimination
o s.5 deals with employment.
o Newly added words bar discrimination on gender identity.
o s.6 trade unions are also covered by OHRC and prohibited from engaging in discrimination
o s.10 specifically deals with constructive discrimination: a right is infringed where something on
its face is not discriminatory but has an adverse impact on a particular group
o Section 12: delineates some scope provisions
o s.14 allows affirmative action programs to be exempt from being challenged as a violation
 Part II:
o Bona Fide Occupational Requirement
o Duty to accommodate
 OHRC provides that every person is entitled to equal treatment with respect to employment
without discrimination on the grounds of race, ancestry, place of origin, ethnic origin, colour,
citizenship, creed, sex, sexual orientation, record of offences, marital status, family status or
disability [s.5(1)]
HARASSMENT
 S. 5(2): Every person who is an EE has a right to freedom from harassment in the workplace by the
ER or agent of the ER or by another EE because of race, ancestry, place of origin, colour, ethnic
origin, citizenship, creed, age, record of offences, marital status, family status or disability.
o Prohibition is only on prohibitive grounds (not generally)
o When violence in the workplace started to get more publicity (killings occurred) there was an
amendment passed of OHSA which required ER to establish policies to prevent harassment in
the workplace generally
 Section 7: sexual harassment
AGE
 S.10(1) “age” means an age that is 18 years or more
o Effective Dec 12, 2006, the upper limit of 65 years of age was eliminated and ERs no longer have
the ability to require EEs in the province to retire at 65 unless:
 there is a BFOR,
 the EE does not meet the job requirements, and
 the EE cannot be accommodate without imposing undue hardship on the ER
ADVERSE IMPACT
 S. 11(1): A right of a person under Part I is infringed where a requirement, qualification or factor
exists that is not discrimination on a prohibited ground but that results in the exclusion, restriction
149
or preference of a group of persons who are identified by a prohibited ground of discrimination and
of whom the person is a member, except where,
o (a) the requirement, qualification or factor is reasonable and bona fide in the circumstances; or
o (b) it is declared in this Act, other than in section 17, that to discriminate because of such
ground is not an infringement of a right
 A facially neutral rule with a discriminatory impact constitutes a violation of the HR code, unless
you can establish that there was a bona fide occupational requirement (more on this in Meiorin)
SPECIAL PROGRAMS – affirmative actions programs exceptions
 14. (1) A right under Part I is not infringed by the implementation of a special program designed to
relieve hardship or economic disadvantage or to assist disadvantaged persons or groups to achieve
or attempt to achieve equal opportunity or that is likely to contribute to the elimination of the
infringement of rights under Part I.
 These programs can be cleared with the commission and operate without being subject to claims
EXCEPTIONS FOR SPECIAL EMPLOYMENT – section 5’s equal treatment clause not
infringed WHERE
 24. (1) The right under section 5 to equal treatment with respect to employment is not infringed
where,
o (a) a religious, philanthropic, educational, fraternal or social institution or organization that is
primarily engaged in serving the interests of persons identified by their race, ancestry, place of
origin, colour, ethnic origin, creed, sex, age, marital status or disability employs only, or gives
preference in employment to, persons similarly identified if the qualification is a reasonable
and bona fide qualification because of the nature of the employment;
o (b) the discrimination in employment is for reasons of age, sex, record of offences or marital
status if the age, sex, record of offences or marital status of the applicant is a reasonable
and bona fide qualification because of the nature of the employment;
o (c) an individual person refuses to employ another for reasons of any prohibited ground of
discrimination in section 5, where the primary duty of the employment is attending to the
medical or personal needs of the person or of an ill child or an aged, infirm or ill spouse or other
relative of the person;
o (d) an employer grants or withholds employment or advancement in employment to a person
who is the spouse, child or parent of the employer or an employee;
o (e) a judge or master is required to retire or cease to continue in office on reaching a specified
age under the Courts of Justice Act;
o (f) a case management master is required to retire on reaching a specified age under the Courts
of Justice Act;
o (g) the term of reappointment of a case management master expires on the case management
master reaching a specified age under the Courts of Justice Act; or
o (h) a justice of the peace is required to retire on reaching a specified age under the Justices of the
Peace Act.
Overhaul of HRC in 2006
 Under old system: (1960’s – June 30th,
2008) – enormous delays and backlogs
 Under new regime (came into force Jun 30, 2008):
o This was a controversial reform
150
o After a complaint was filed, HRC
could refuse to accept it if they
thought it was frivolous (took 10%)
o Once they accepted the claim, it
went into an investigation stage
where it could stay for a long time
(about 60% of complaints got
resolved at this level)
o If HRC couldn’t settle the case,
they had to either dismiss it (10%)
or send it to adjudication (only 5%)
 By this point about 15% of
complaints were withdrawn
o It would take 2 years until a
complaint got to a tribunal, and the
adjudication could take 1-2 years
o If a violation was found to have
occurred, the board had broad
remedial power to award
monetary compensation not
exceeding $10,000 for mental
anguish
o Complaints about the system:
 Delay – took exceptional
amount of time for cases to get
processed
 Concern that people were
being pushed too hard to settle
 Concern that commission itself
was so bogged down in trying
to address complaints that it
didn’t have the time/resources
to deal with larger issues
o
o
o
o
o
o
 New model was to have a sharp division
between HR tribunal and HR commission
 Tribunal has the power to develop its own
rules/procedures by regulation, which
include dispute settlement process to
resolve disputes before actually going to a
hearing
Individual complaints go directly to a new HR
tribunal (bypass commission)
 Tribunal has broad remedial power
Individual complainant has carriage of the
complaint – they are responsible for taking it
through the process
 The legislation also created the HR legal
support center which has a mandate to
provide services to applicants – specialized
forum for getting legal aid to pursue HR
complaints.
The $10,000 limit was eliminated
Time limits for filing complaints have been
extended
Advantages:
 Freed up commission to pursue larger
goals: Anti Racism Secretariat and
Disability Rights Secretariat
 Alleviated the lengthy delays that were
associated with the resolution of individual
complaints under the old system
Disadvantages:
 Privatization of HR: before it was a public
matter and commission carried it through,
but now it is the complainants’
responsibility
 Fear that the commission will not be given
the resources to pursue its larger mandate
Procedural Points: Where to go with a Complaint of Discrimination?
 NON-UNION EMPLOYEES
o Anyone can go to an HR tribunal by making an application under s. 34
 34. (1) If a person believes that any of his or her rights under Part I have been infringed, the
person may apply to the Tribunal for an order under section 45.2,
 (a) within one year after the incident to which the application relates; or
 (b) if there was a series of incidents, within one year after the last incident in
the series
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 This is as long as the only complaint is discrimination
o You can also raise an HR issue as a collateral matter if you are bringing another cause of
action
 S.46.1: If, in a civil proceeding in a court, the court finds that a party to the proceeding has
infringed a right under Part I of another party to the proceeding, the court may make either
of the following orders, or both:
 1. An order directing the party who infringed the right to pay monetary
compensation to the party whose right was infringed for loss arising out of
the infringement, including compensation for injury to dignity, feelings and
self-respect.
 2. An order directing the party who infringed the right to make restitution to
the party whose right was infringed, other than through monetary
compensation, for loss arising out of the infringement, including restitution
for injury to dignity, feelings and self-respect
o No common law action of discrimination [Seneca College v. Bhadauria (1981 SCC)].
 You cannot go to court with an action based solely on discrimination, but if you have a
separate action the court can deal with the matter
 UNIONIZED EMPLOYEES
o They can pursue HR complaint through the grievance arbitration process
 Grievance arbitration: OLRA s.48(12) gives arbitrators jurisdiction to interpret and apply
employment-related legislation. In Parry Sound (SCC 2003) the arbitrator was required to
apply Human Rights Code.
 There must be arbitration as a mechanism for resolving disputes in collective agreements
and they all make provision for arbitration of work related disputes
 You can’t make CL claims for violation of CA except in very limited
circumstances
o Under old law, HR commission could refuse complaints from unionized employees because
they had another avenue – under current Act the commission does not have that power to
refuse BUT if you take a claim through grievance application you cannot also take it through
HR tribunal
o HRT cannot refuse to hear a complaint from a unionized employee (although it may defer a
complaint if grievance is pursued and ultimately dismiss a complaint if it is satisfied that
another tribunal has appropriately dealt with the subject matter, ss. 45, 45.1).
Duty to Accommodate
 Direct vs. Adverse Effect Discrimination (this distinction has been abolished by case below)
o Direct: standard is discriminatory on its face
 it is justifiable as a BFOR, if:
 1. honest and good faith
 2. reasonably necessary and does not place unreasonable burden on those to
whom it applies
o Adverse: facially neutral standard, discriminates in effect
 justifiable if:
 1. rational connection between job and standard
 2. individual cannot be accommodated without undue hardship
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BC v. BCGSEU 1999 SCC (Meiorin)
Facts: Tawny Meiorin was hired as a forest fighter by the BC govt and although she did good work, she
lost her job 3 years later when the govt adopted a new series of fitness tests for forest fighters. Their
motivation for developing and requiring the tests was bona fide  a relatively unfit male firefighter
had collapsed on the job while running and died. (But were the standards discriminatory?)
Issues:
 Did the govt improperly dismiss her from the job?
 Did the aerobic standard that led to her dismissal unfairly exclude women from forest firefighting
jobs?
Analysis (McLachlin)
 The conventional approach to applying HR legislation
o requires the tribunal to decide at the outset into which of the two categories (1) direct
discrimination – standard is discriminatory on its face (2) adverse effect discrimination – where
the facially neutral standard discriminates in effect
o if a prima facie discrimination of either form is established, the burden shifts to the ER to justify
it
 The divergent approaches taken by the arbitrator and the CA suggest a more profound difficulty
with the conventional test itself
o the complexity and unnecessary artificiality of aspects of the conventional analysis attest to the
desirability of now simplifying the guidelines that structure the interpretation of HR legislation
o Rather than allowing standards to remain and asking whether individuals can be
accommodated within those existing standards, what the HR system should be doing is
focusing on the standards themselves and seeing if those standards have incorporated notions
of accommodation and equality
 Seven difficulties with the conventional approach
o (1) Artificiality of the distinction between direct and adverse effect discrimination
 distinction between a standard that is discriminatory on its face and a neutral standard that
is discriminatory in its effect is difficult to justify, simply because very few cases can be so
neatly characterized
o (2) Different remedies depending on method of discrimination
 the malleability of the initial classification under the conventional approach would not
matter so much if both routes led to the same result, but the potential remedies may differ
o (3) Questionable assumptions that adversely affected group always a numerical minority
 it could be argued that it is sometimes okay to leave an ostensibly neutral standard in place
if its adverse effects are felt by only one or a few individuals
 however, if a rule has a substantially discriminatory effect on prohibited ground, it should
be characterized as such regardless of whether the claimant is a member of a majority or
minority group
o (4) Difficulties in practical application of employers’ defences
 court has been criticized for drawing difficult distinctions between the elements an
employer must establish to rebut a prima facie case of direct discrimination and the
elements an employer must establish to rebut a prima facie case of adverse effect
discrimination
 in practice there may be little difference between the two defences
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o (5) Legitimizing systemic discrimination
 distinction drawn by the conventional analysis between direct and adverse effect
discrimination may serve to legitimize systemic discrimination or discrimination that
results from the simple operation of established procedures of recruitment, hiring and
promotion, none of which is necessarily designed to promote discrimination
 conventional analysis bars courts and tribunals from assessing the legitimacy of the
standard itself
o (6) Dissonance between conventional analysis and express purpose and terms of HRC
 an interpretation that allows the rule itself to be questioned only if the discrimination can be
characterized as “direct” does not allow these statutes to accomplish their purposes as well
as they might otherwise do
o (7) Dissonance between HR analysis and charter analysis
 the conventional analysis differs in substance from the approach this Court has taken to
s.15(1) of the CCRF
 Advantages of a unified approach
o avoids the problematic distinction between direct and adverse effect discrimination
o requires employers to accommodate as much as reasonably possible the characteristics of
individual employees when setting the workplace standard and
o takes a strict approach to exemptions from the duty not to discriminate, while permitting
exemptions where they are reasonably necessary to the achievement of legitimate work related
objectives
 COURT: “Employers designing workplace standards owe an obligation to be aware of both the differences
between individuals, and differences that characterize groups of individuals. They must build conceptions of
equality into workplace standards.”
 Elements of a unified approach – TEST: Once established that a standard is prima facie
discriminatory  An employer may justify the impugned standard by establishing on the balance
of probabilities that a prima facie standard is a BFOR
o (1) the standard is rationally connected to the performance of the job
 without a legitimate general purpose underlying the inquiry, the standard cannot be a
BFOR
 process: identify the general purpose of the impugned standard and determine whether
it is rationally connected to the performance of the job
 the focus at this stage is the validity of the more general purpose
 where the general purpose of the standard is to ensure the safe and efficient performance
of the job (essential elements of all occupations ) it will likely not be necessary to spend
much time at this stage, BUT where the purpose is narrow, this may be a more important
part of the analysis
o (2) the ER adopted the standard in an honest and good faith belief that it was necessary to
the fulfillment of that legitimate work related purpose (no intention of discrimination)
 This addresses the subjective element of the test which, although not essential to a
finding that the standard is not a BFOR, is one basis on which the standard may be
struck down
 It is important to note that the analysis shifts at this stage from the general purpose of
the standard to the particular standard itself. It is not necessarily so that a particular
standard will constitute a BFOR merely because its general purpose is rationally
IN most cases
hinges on Step
3: first two
pretty low
thresholds
154
connected to the performance of the job.
o (3) that the standard is reasonably necessary to the accomplishment of that legitimate
work related purpose (to show that the standard is reasonably necessary, it must
demonstrate that it CANNOT formulate standards that will accommodate individual EEs
sharing the characteristics of the claimant without imposing undue hardship upon the ER)
 Central Okanogan School District: “The use of the term “undue” infers that some hardship
is acceptable – it is only 'undue' hardship that satisfies this test".
 It may be ideal from the ERs perspective to choose a standard that is uncompromisingly
stringent. Yet the standard, if it is to be justified under the HR legislation, must
accommodate factors relating to the unique capabilities and inherent worth and dignity
of every individual, up to the point of undue hardship.
 Dealing with adverse effect discrimination in Central Alberta Daily Pool, Wilson
addressed factors that may be considered in assessing undue hardship:
 1. Financial cost of the possible method of accommodation
 2. Relative interchangeability of the workforce and facilities
 3. The prospect of substantial interference with the rights of other EEs
 The skills, capabilities and potential contributions of the individual claimant and other
like him must be respected as much as possible
 Some questions to consider in the analysis include:
 (1) has the ER investigated alternative approaches that do not have a discriminatory
effect?
 (2) if alternative standards were investigated and found to be capable of fulfilling the
ERs purpose, why were they not implemented?
 (3) is it necessary to have all EEs meet the single standard in order for ER to
accomplish its legitimate purpose or could standards reflective of group or
individual differences and capabilities be established?
 (4) is there a way to do the job that is less discriminatory while still accomplishing
ERs legitimate purpose?
 (5) is the standard property designed to ensure that the desired qualification is met
without placing an undue burden on those to whom the standard applies?
 (6) have other parties who are obliged to assist in the search for possible
accommodation fulfilled their roles?
 A rule or standard must accommodate individual differences to the point of undue
hardship if it is to be found reasonably necessary
Judgment: Meiorin has demonstrated that the government’s aerobic standard is prima facie
discriminatory and the government has failed to establish that it is a BFOR. Found that development of
standards was flawed.
Tucker
 Case abolishes difference between adverse and direct effect discrimination
o CRUCIAL POLICY POINT: Focus on building equality into standards. The standards
themselves should recognize that there is diversity in the population and the standards should,
where possible, accommodate those standards.
o Court creates a unified approach for determining whether discriminatory standard is BFOR. It
doesn’t matter whether it is facially discriminatory or adverse impact discrimination.
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Ramifications of Meiorin:
o Accommodation for differences must be built into standard – male employment norms can be
challenged
o Onus on employer to establish it would suffer undue hardship if it were required to adopt a
more inclusive standard than the one being challenged
o Duty to accommodate does not require ER to change working conditions in a fundamental way
 The major place this has come up is DISABILITY DISCRIMINATION CASES
o This has led to elaborations that weren’t dealt with in Meiorin
o Issue #1:What constitutes a disability? Who can claim they have a disability?
 Statutory definitions tend to be broad and have received liberal interpretations from SCC.
 Quebec v. City of Montreal (below): SCC embraces liberal and expansive approach.
 This has come up in recreational drug use cases, which have created a lot of jurisprudence
 In ON, arbitrators have tended to take position that person who is a recreational drug user
can file a claim of discrimination under the HR code if they are terminated because they
have had a positive drug test, not on the basis that the drug use is disabling, but because it
is perceived to be a disability (as a physical limitation) by their ERs and so the Human
Rights Code applies
 On the other hand, in Alberta, the court has taken the view that recreational drug use is not
a disability and ERs are free to discriminate against people based on drug use, and can
require drug tests (as long as they are not addicts they could be discriminated based on
this)
o Issue #2: when are standards prima facie discriminatory?
 What happens when people who have chronic disabilities have long term difficulties
meeting attendance requirements? See McGill and Keays below
o Issue #3: where is the point of undue hardship?
 See Hydro Quebec, below
Discrimination Cases: Where is the Point of Undue Hardship?
 An issue that did not get much attention was: what is the point of undue hardship?
 Statutory factors: 11(2): The Tribunal or a court shall not find that a requirement, qualification or factor
is reasonable and bona fide in the circumstances unless it is satisfied that the needs of the group of which
the person is a member cannot be accommodated without undue hardship on the person responsible for
accommodating those needs, considering the cost, outside sources of funding, if any, and health and
safety requirements, if any
 CL factors: have identified similar factors – safety of worker and others, financial cost of making
changes, size of employer (in small place can be more of a burden for employer), impact on rights of
other EEs, issues of seniority (couldn’t automatically say that a seniority provision trumps an
obligation to accommodate, but it could be taken into account)
 Hydro Quebec (see below): SCC limited how far ERs can be required to go
McGill University Health Centre [2007 SCC]: TIME LIMIT NOT OK
 Dealt with agreement between a union and ER to an automatic termination clause where:
o an EE, if they did not return to work within a fixed period of time (2 years),
o after a leave of absence due to illness or disability,
o  would be automatically terminated.
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 Held:
o Majority held that such a clause is prima facie discriminatory and not defensible as a BFOR.
However, where the clause was a generous one, it did allow that an arbitrator might take it into
account in determining whether there had been reasonable accommodation.
 Dissent:
o Abella, in dissent, said that the provision in question (which she saw as generous) was not on
its face prima facie discriminatory and didn’t have to be justified as a BFOR (her concern was
that if generous clauses were struck down it might leave EEs with LESS protection).
o Concerned that if Court struck down such clauses that it could leave EEs LESS protected.
Honda v. Keays (2008 SCC): TIME LIMIT OK
 Facts: Keays was working for Honda and had chronic fatigue syndrome. Honda had a long history
of trying to accommodate him, he was off on a long-term disability leave for several years and then
benefits ran out, so he tried to return to work. Honda had a program in place that was designed to
provide accommodation and get people with disabilities back into the work force. Part of this
required a medical note for every absence, which was not required by people outside of the
program. Keays would bring the notes but they were perfunctory (patient called me today and said
he was too tired to work). Honda was frustrated, said Keays had to go to their doctor, he refused
and was terminated.
 Issue: was it prima facie discriminatory to ask for the medical notes?
 Held: SCC said it was NOT prima facie discriminatory and that the program was itself an
accommodation, so Keays lost on that point. Trial judge was fundamentally wrong. Consider the
similarity of this ruling by SCC to Abella’s dissent in McGill.
o Amusingly, lower court had been very different  had awarded PUNITIVE DAMAGES against
Honda, saying that it was a prima facie discriminatory program.
 TUCKER: The window has now been opened about when a provision is on its face prima facie
discriminatory. There will be more litigation around this because it’s a way for employer to avoid
needing the BFOR defence (if its not prima facie discriminatory then it doesn’t have to be justified)
Quebec v. City of Montreal (2000, SCC)
 HANDICAP DEFINITION:
o A “handicap” may be the result of a physical limitation, an ailment, a social construct, a
perceived limitation or a combination of all of these factors. Indeed, it is the combined effect
of all these circumstances that determines whether the individual has a “handicap” for the
purposes of the Charter.
o Courts have to consider not only an individual’s biomedical condition, but also the
circumstances in which a distinction is made.
 In examining the context courts must determine whether an actual or perceived ailment causes the
individual to experience the loss or limitation of opportunities to take part in the life of the
community on an equal level with others
o The fact remains that a “handicap” also includes persons who have overcome all functional
limitations and who are limited in their everyday activities only by the prejudice or stereotypes
that are associated with this ground: British Columbia (Superintendent of Motor Vehicles) v. British
Columbia (Council of Human Rights), [1999] 3
 A “handicap” may exist even without proof of physical limitations or the presence of an ailment.
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o The “handicap” may be actual or perceived and, because the emphasis is on the effects of the
distinction/exclusion/preference rather than the precise nature of the handicap, the cause and
origin of the handicap are immaterial.
o Further, the Charter also prohibits discrimination based on the actual or perceived possibility
that an individual may develop a handicap in the future.
 These guidelines are not without limits.
o The emphasis is on obstacles to full participation in society rather than on the condition or state
of the individual, ailments (a cold, for example) or personal characteristics (such as eye colour)
will necessarily be excluded from the scope of “handicap”, although they may be
discriminatory for other reasons.
 As with distinctions based on the other enumerated grounds, distinctions based on “handicap”
are not necessarily discriminatory.
o The applicants will have the burden of proving (1) the existence of a distinction, exclusion or
preference, in this case the dismissal and the refusal to hire; (2) that the distinction, exclusion or
preference is based on a ground enumerated in s. 10, in this case handicap, and (3) that the
distinction, exclusion or preference has the effect of nullifying or impairing the right to full and
equal exercise of human rights and freedoms.
o Under s. 20, the onus is on the ER to demonstrate that the impugned measure is justified
because it is based on aptitudes or qualifications required for the job.
Note on Unions as Defendants
1. OHRC guidelines stipulate that a CA cannot act as a bar to the provision of accommodation to which
an EE might otherwise be entitled
 if the union takes the position that the CA prevails, it may be added as a respondent to a complaint
 In Board of School Trustees v. Renaud 1992 SCC: SCC held that a union shared the employer’s duty to
accommodate an employee under HR legislation
Hydro Québec v. Syndicat (2000 SCC)
Facts: EE had serious physical and mental health issues, missed over 100 days per year, no prospect
that the she would improve over time, and she was terminated by ER. It was a unionized workplace so
grievance was brought by union on behalf of EE.
Lower courts:
a) Arbitrator says that the termination as for just cause (EE couldn’t perform requirements of job)
b)Quebec COA reversed it, said ER failed to establish that it was impossible to accommodate the
person or people like him, without undue hardship.
c) SCC: what is the standard?
 Court rejects the high standard set out by COA:
o The test is not whether it was impossible for the ER to accommodate the EEs characteristics.
o The ER does not have a duty to change working conditions in a fundamental way, but does
have a duty, if it can do so without undue hardship, to arrange the EEs workplace or duties to
enable the EE to do his or her work.
 Court says because of the individualized nature of the duty to accommodate, rigid rules should
be avoided
o If a business can, without undue hardship, offer the EE a variable work schedule or lighten his
or her duties to ensure that the EE can do his work, it must do so
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



o in a case involving chronic absenteeism, if the ER shows that, despite measures taken to
accommodate the EE, the EE will be unable to resume his or her work in the reasonably
foreseeable future, the ER will have discharged its burden of proof and established undue
hardship.
Para 18: If the characteristics of an illness are such that the proper operation of the business is
hampered excessively or if an employee with such an illness remains unable to work for the
reasonably foreseeable future even though the employer has tried to accommodate him or her,
the employer will have satisfied the test
o Tucker thinks this is disjunctive
o First part: if absenteeism hampers business operations excessively, then employer can terminate
without it being discrimination  this fits within traditional undue hardship
o Second part: court does not add undue hardship in the second part
 Court is pushing back against view of duty to accommodate which was putting too much
pressure on employers
Para 16: ER does not have a duty to change the working conditions in an fundamental way – stuff
about undue hardship… Tucker seems interested in this…says his separation may be artificial…
Para 19: The duty to accommodate is perfectly compatible with general labour law rules
o Including the rules that ERs must respect EEs fundamental rights and the rule that EEs must do
their work
o The employer’s duty to accommodate ends where the employee is no longer able to fulfill the
basic obligations associated with the employment relationship for the foreseeable future.
 If there is a fundamental part of the job that you can’t perform, that satisfies duty to
accommodate
 In this para courts are trying to make the tension disappear from the formulation but
Tucker thinks that there is a tension between the competing interests is visceral
TUCKER
o Viewed as a retreat of the court from a strong promotion of Human Rights in the workplace
agenda which they were seen to have been pursuing in earlier judgments
o Clear message of the court: do not need to fundamentally alter the job to accommodate – that
would be undue hardship
 this is without employer having to show specifically the costs of the accommodation
o how does one establish whether a rule is prima facie discriminatory?
 A rule that requires an attendance rule (ie: need to attend work on a regular basis) is not
prima facie discriminatory (Hydro Quebec)
Racial Discrimination
Introduction


Different from discrimination cases: not about the duty to accommodate (although possible that it
could be a lack of accommodation for cultural differences)
It is more difficult to succeed in cases of race discrimination, as opposed to claims on other grounds
such as disability or gender: demonstrated by statistics that look at number of cases brought and
outcomes.
o In a Canada wide study, it was found that only 31% of 84 complaints on the basis of race were
successful
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o




88.4% of race discrimination cases reached the Board of Inquiry stage but were not taken any
further
Question is why? – why do race based complaints have a more difficult time than others?
o Blatant racism is less common than in the past (racism today tends to be more subtle)
o Many occasions victim can’t point to a racist comment or statement that was made, but they
are trying to establish something that happened to them that was tainted by racial or
ethnic prejudice.
o Comparison to ableist:
 Probably easier to point to something in a standard that has adverse impacts on
someone with disabilities – as opposed to pointing to a person, an individual -more difficult to prove/establish discrimination by a person as opposed to written
standard
o Taboo on talking about race in Canadian society
There is a distinction between motivation/intention and race simply as a factor
o There is no need to establish motivation/intention
o As long as you can establish that race was a FACTOR in a decision, it is sufficient
But, there seems to be confusion in this by adjudicators. The two cases below show why it can be
difficult for race-discrimination claims to succeed at the level of an individual complaint
o In practice, often misplaced emphasis on motive (Smith)
o Also difficult to prove racial prejudice or stereotypes played a role (Dhanju)
Also, discriminatory standards/BFOR not usually an issue
Why do race complaints flounder? (Bhaduria)
 Discrimination is hard to prove
 Constructive determination is probably harder to determine
o It deals with circumstances that are not, on their face, discriminatory, but which result in
discrimination
o No intent is required
 It is difficult to show disproportionate impact on a group where the experience of the group is small or
the history is short
 In cases such as this one, where requirements under scrutiny are personal characteristics like an ability to
communicate or a sense of humour, they are hard to define and harder to analyze
 Qureshi v. Toronto Board of Educ:
o Complainant alleged that certain cultural characteristics such as reserve and reticence, attributable
to his ethnicity and place of origin, were motivating factors in refusing to hire him
o Board of Inquiry: the interviewers unintentional failure to give proper consideration to cultural
differences between complainant and the successful applicant constituted discrimination on a
prohibited ground
o Board of Educ appealed and was successful
 Court stated that the criteria applied in the selection process were BFOR
o Appeal to the Ont. CA was allowed and it restored Board of Inquiry’s decision
Smith v. Mardana Ltd (No. 2) 2005 Ont Div Ct
Facts: at the time Smith was terminated, owner said that it was just that there was no work available
and later admitted that he was being dismissed due to an incident with a customer. Supervisor had
made racist comments toward Smith.
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Issue: whether the finding that race was NOT a factor in the dismissal by the tribunal is sustainable
Analysis
 The Code is remedial legislation, aimed at remedying the effects of discrimination, not focused on
punishing the individuals involved in discriminatory practices
 It is not the motivation or the knowledge of the employer that is in issue, it is the effect of the
discrimination on the complainant
 Court says that tribunal was pre-occupied by motivation and thus failed to adequately consider
whether race was a factor in the decision
Held: based on the evidence, it was NOT credible that race was NOT a factor (because of the
supervisor, this was a racially charged workplace)
Tucker:
 The law in Smith is very clear – we are not just concerned with racially motivated behaviour
o It is a broader inquiry – was some action taken that was tainted or affected by racial or ethnic
prejudice?
o Tribunal was overly concerned with racial motivation, and in looking for it they dismissed the
case.
o Issue of evidence: how do you establish that racist attitudes affected a decision? At Smith could
point to the blatantly racist comment by the supervisor, which tipped the balance in his favour.
But what happens when that isn’t present? This is the problem that arises.
OPSEU v. Ontario 2007 OGSBA (Dhanju) *should read this case
Facts: P was sent for training, consultant alleged that he didn’t benefit from it, and he was terminated
Analysis:
 If discrimination played ANY PART then it breached the CA provision (restatement of HR Code),
BUT the onus is still on the union to prove that the action was tainted by racist
stereotypes/discrimination:
o From Re Damani:
 It is not necessary for the union to prove that discrimination on the basis of race was the
sole or even a major reason for ER conduct detrimental to the grievor. If discrimination on
the basis of race played any part in the ERs treatment of the grievor, then it breached the
CA
 The presence and effect of racist attitudes may be difficult to detect and prove. It does not
follow, and the union does not suggest, that proof is therefore unnecessary, or that the mere
allegation of racial discrimination shifts the burden of disproving the allegation to those
accused of it.
 A subjective belief on the part of P is not sufficient – you cannot only feel that you were a victim,
you have to demonstrate it
 It is OK for the ERs reasoning to be flawed. The not-permitted reasoning is DISCRIMINATORY
reasoning.
o From Re Damani:
 In order to make an inference that race played a role, judge must be convinced that the
explanations offered by the employer were complete fabrications.
 As long as the ER relied on some non-discriminatory reasoning, however flawed such
reasoning may be, a finding of racial discrimination does not arise.
 You have to show some taint to meet the burden of proof and argue the case
161
 Arguments
o on one hand, it seems unfair that the ER accepted info from the consultant about deficiencies on
the part of EE and relied on that to discontinue the knowledge transfer but did not inform the
EE
o on the other hand, the ERs explanation that the EE was not confronted with his errors and
deficiencies because that would have led to an argument with the EE is understandable
 Judgment
o Even if I disagree with the appropriateness or fairness of the ERs actions, at best it would
establish poor judgment on the part of the ER but does not lead to inference of racial
discrimination
o The sole basis for the unions position in this case is the evidence that no visible minority
occupied a position above the rank of SO4 (but there are only 3 positions)
 Tucker
o unlike Smith, this was a more subtle claim that there were negative stereotypes which were
operating, and not blatant past racism
o how do you prove that there are stereotypes in decisions where there is no proof?
o In any individual case, proving racism was a factor is an incredibly difficult hurdle to have to
overcome
 Arbitrator says that the fact that someone subjectively believes that they are victim of
racism is not in itself racism
o Employer gave a rationale for the decision which was not very compelling
 Is that evidence of racism? Arbitrator says that is not good enough
o BUT we know that racial minorities do not do as well when you hold other factors constant
 Here, P had a masters in science (which other applicants didn’t) yet he wasn’t “qualified” to
meet the training
 They undervalued his degree either because where he got it or who he is. Very difficult to
establish that that has taken place.
 Essentially if ER can give nothing to provide that their decision was reasonable, then the
only thing left is racism – but if they can point to SOMETHING, even if its ILLOGICAL, it
shifts the onus back to plaintiff who has to show on a BOP that the action was tainted.
Conclusions: Problem with Individualized Complaint System
 Need mechanisms that don’t look at individual claims, but look at workplaces systemically (as seen
in work equity measures)
o Look across categories of workforce to see if population hired is reflective of pop in which they
are living
 Whether there are barriers hindering individuals from advancing, getting jobs etc
o Systematically want to identify and address the barriers
 Leaving it to a completely individualized complaint system leads to very little progress due
to difficulty in trying to prove evidence
Sexual Harassment
 Three forms of sexual harassment:
o sexual coercion
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o sexual solicitation
o gender harassment
 broadest definition of harassment
 read to include derogatory comments, pictures or anything that creates a poisoned
atmosphere
 Prohibition on
 Sexual solicitation by a person in position to confer benefit – 7(3):
sexual harassment –
Every person has a right to be free from,
s.7(2): Every person
o (a) a sexual solicitation or advance made by a person in a position
who is an employee
to confer, grant or deny a benefit or advancement to the person
has a right to freedom
where the person making the solicitation or advance knows or
from harassment in the
ought reasonably to know that it is unwelcome [sexual
workplace because of
solicitation]; or
sex by his or her
o (b) a reprisal or a threat of reprisal for the rejection of a sexual
employer or agent of
solicitation or advance where the reprisal is made or threatened
the employer or by
by a person in a position to confer, grant or deny a benefit or
another employee
advancement to the person [sexual coercion]
[gender harassment]
 Prohibits reprisals and threats where person reasonably ought to know that they are sexual
o Deals with sexual harassment, sexual coercion, unwanted sexual attention
o Now more of a focus on abuse of power or exercise of power in sexual harassment
 Background:
o Industrial revolution: women working outside the household, no male supervision, concern
that they would be morally corrupted (preyed on by male co-workers)
o Sexual harassment as social phenomenon was only named as a problem in the context of the
3rd waive of feminism in the 70’s
 Many authors wrote about this, “the secret oppression”
o Began to get legal responses to this. Appearances in the Ontario Human Rights Code:
 S. 5: equal treatment with respect to sex
 S.7(3): prohibition on sexual coercion or unwanted sexual solicitations
 S.7(2): prohibition on gender harassment
 Issue becomes: what constitutes harassment?
 NOTE: SCC says that any HR code that prohibits sexual discrimination also
by implication prohibits sexual harassment
 Gender harassment: the central question is – has a poisoned workplace been created for that
person?
o Ex: porn displayed in the workplace. Used to be common, now would be caught by this.
o Jennifer L. Berdahl, Sexual Harassment of Uppity Women:
 study conducted that found that the women who were most likely to be sexually
harassed were not those who met stereotypical gender norms, but were those
women who most violate feminine ideals by trying to do jobs done primarily by
men or who behaved in a way that was stereotypically male (ex: assertive) and was
not only focused on sex, but gender, and attempts to maintain unequal relationships
o Thus, less about sexual conduct, more about gender inequality.
 Legal remedies provided in HRC
163
o

Procedure of HRC: delay issues (not just with sexual harassment, but with all kinds of HR
complaints)
o Obstacles to complaint success:
 Proof – don’t always have witnesses
 Standards of conduct – much of that has been resolved over time
 Less dispute about what the boundaries are
o Vicarious liability of employer (also see notes under vicarious liability section above and
Robichaud)
Tucker: issues that have arisen with regard to sexual harassment (union v. non-union)
o Existence of employment rights doesn’t mean that they are easily enforced: one of the roles
that unions play is to provide institutional support and a vehicle to pursue employment
rights
o In the unionized context, sexual harassment claims are much more likely to be brought as
grievances – dealt with faster than going through HR process
o Unionized EEs get better support and are also better protected – much more likely to file a
complaint about their rights at work than a non-unionized EE
 Despite legislation that prohibits retaliation against EEs for exercising or asserting
their rights under employment legislation, it is only unionized EEs who feel that
they will be able to get the benefit of that protection because there is a union that will
stand behind them. If they are terminated or discriminated against, the union can
pursue that as a grievance, and in the context of grievance arbitration, they can get
reinstatement which can be an effective remedy.
o Non-unionized EEs don’t have the option of grievance arbitration (only exists for unionized
employees): they have either the HR tribunal or CL claims
o CL claims: a person who has experienced SH or gender discrimination can, if they haven’t
been fired, claim that the action constitutes a constructive dismissal. They can treat the
situation as if they had been fired because of the ERs breach of K and claim whatever notice
or other damages for termination of employment.
o the other way SH gets into the CL (and also gets into grievance arbitration) is when the
harasser is terminated or disciplined by the ER – in grievance cases the harasser might say
there was no just cause, and arbitrator has to decide if harasser was unfairly treated, and if
fired they can bring wrongful dismissal action
o Study from Rotman: most sexual harassment isn’t about sex at all, but is instead about
trying to push women into subordinate positions in the workplace. Based on the
researcher’s studies, it was those women who most defied the norms and conventions of
femininity that suffered the HIGHEST levels of discrimination.
Robichaud v. Canada 1987 SCC
Facts: Robichaud filed a complaint with CHRC in Jan 1980 that she had been sexually harassed,
discriminated against and intimidated by her employer and that Brennan, her supervisor, was the
person who had sexually harassed her
Issue: Whether an employer is responsible for the unauthorized discriminatory acts of its employees in
the course of their employment under the Canadian Human Rights Act
SCC Analysis:
 Purpose of the Act:
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o to give effect to the principle that every individual should have an equal opportunity with other
individuals to live his or her own life without being hindered by discriminatory practices based
on certain prohibited ground of discrimination
o Act’s main approach is not to punish the discriminator, but rather to provide relief for the
victims of discrimination
 Intention of employer not relevant
o The motives or intentions of those who discriminate are not relevant
o It would be extremely difficult in most circumstances to prove motive and motive would be
easy to cloak in the formation of rules which create injustice and discrimination by the equal
treatment of those who are unequal
 Vicarious liability issue and “in the course of employment”
o The individual who was the harasser can be a party to a complaint but in many instances, the
victim would also want to be able to get at the ER (who is not the doer)
 Could ER be held legally responsible for the actions of its supervisory EEs?
 Normal standards of VL impose a limit on the scope of the liability (impugned conduct
must occur within the scope of EEs duties) – but clearly people aren’t harassing as part of
their duties
 SCC said this context is not the same as regular VL context
o SCC: the goal of this legislation is remedial, not punitive, and it is about putting an end to these
kinds of practices.
 The entity in the best position to do something about this is the ER. Even if EEs have gone
rogue it is ER who can develop policies/procedures to change work environment and
provide internal mechanisms to get EEs concerns addressed.
o ER responsible for all acts of their EEs “in the course of employment”
 statute contemplates imposition of liability on ERs for all acts of their EEs “in the course of
employment” (so the action was in some way related or associated with the employment)
 A supervisor’s responsibilities do not begin and end with power to hire, fire and discipline
– rather supervisors are charged with the day to day supervision of the work environment
and with ensuring a safe, productive, workplace
 It is precisely because the supervisor is understood to be clothed with the ERs authority
that he is able to impose unwelcome sexual conduct on subordinates
 Remedies of Act reinforce its purpose
o s.4 provides that a discriminatory practice may be the subject of a complaint under the Act,
states that anyone who is found to be engaging or to have engaged in such a practice may be
made subject to an order under s.41 and 42
o the remedial objectives of the Act would be blunted if the above remedies were not available as
against the ER (as opposed to just the harasser)
o If Act is concerned with effects of discrimination rather than its causes, only an ER can provide
the most important remedy – a healthy work environment
Judgment: Brennan had sexually harassed Robichaud and that the employer was strictly liable for the
actions of its supervisory personnel
Tucker:
 NOTE: sexual harassment policies in the workplace
o Having a policy beforehand does not mean that ER would not be liable
o This is strict liability, so policies in place would not be a defence
165
o


But the fact that there are preventative/proactive policies in place would be taken into
account in determining the remedy imposed on the ER
Result in Robichaud:
o Purposive and functionalist approach
o This is not a punitive, but rather, corrective statute
o Goal of legislation is to eradicate sexual harassment – best way to accomplish that is by
making employers vicarious liability without applying “within the course of
employment” limitation
o Employer is in the best position to adopt workplace practices and enforce standards that
would lead to elimination of these practices
Aftermath of the case:
o In any large organization, ERs have adopted a sexual harassment policy that establishes
behaviour for EEs and a complaint mechanism which ERs can resort to
o Sanitized work place article, Yale Law Journal 2003
 This has led ERs to emphasize regulation of sexual conduct if that were the problem
which leads to a sanitized workplace where normal interactions that might occur
(innocent sexual interactions in a regular workplace are prohibited)
 Created an artificially sanitary environment
 Issue is that there is gender inequality – unequal power between men and women and
these responses of sanitizing conduct does not get to underlying issue of gender
inequality
 And if we aimed to have a workplace where inequality was resolved then we would not
have to worry about regulating the interactions that occur between individuals because
what makes those interactions dangerous is the unequal power contact
Equal Pay
 Pay Equity and other equal pay laws try to address gender wage gaps
 (Note that there other wage gaps—minorities, aboriginals, etc.)
 Employment equity addresses market segregation as it affects women, visible minorities, First
Nations, and persons with disabilities.
 Statistics:
o Wage gap has narrowed (comparisons between full year, full time workers)
 1880: women earned 50% of what men earned
 1967: 58%
 1995: 73%
 2000: 71.1%
 2006: 86% (based on an average of hourly wage)
o Gap is not uniform across the labour market
 gap increases with age
 was decreasing with educational attainment, but since 1996 wage gap greater for university
educated women than for all women, and gap has grown from 75.9% to 69.8% in 2000
 smaller gap for single women than married
 smaller gap for unionized women than non-union
 Trends in the wage gap:
o Note annualized data not good for comparison as men tend to work more, thus would distort
166
comparisons  thus most studies compare hourly wages
o Differences in pay rates for women doing the same work as men are diminishing
 Downturns in male-dominated industries like NA manufacturing
 Faster growth in women’s earnings than men earnings
 In the past, many companies had a men’s wage list and a women’s wage list. It was
predicated on the idea that men should be paid more because they had families to support
and their wages should reflect their responsibility. And also the idea that men were more
productive.
o Differences in human capital are diminishing
 More women graduate from university now, and women do better
o Differences in hours worked, continuity in labour force etc.
 Because of the family/work relationship and the way family responsibility is unevenly
distributed (taking care of kids and sick family), men devoting more time to career, could
explain part of it
o Horizontal segregation: Men and women working in different jobs – men are in certain kinds
of occupations, women are not spread evenly across the labour force and are concentrated in
certain kinds of industries
 Why is it that work that is predominantly performed by women might be less well paid
than work predominantly performed by men?
 Cultural values – think of men bringing in a family wage
 Market explanation – jobs that men work in are jobs that have a lower supply due to their
dangerous and unpleasant character
 Increasing % of women in traditional male occupations ex: managerial and professional
BUT note low women % in upper echelons of these groups.
 Substantial industrial segregation remains ex: high paid manufacturing, construction
transportation v. low paid clerical, personal services
 Equal pay laws accept differences of horizontal segregation and try to address those
differences
o Vertical segregation: Women crowded in lower end of occupational hierarchies. Why might
that be the case?
 If women are crowded into pink occs  then supply and demand mean women will be
crowded in lower end
 Historically women crowded into jobs with low unionization less protections and
structure for workers
o Lack of social recognition of the skills used in female-dominated jobs, resulting in undervaluing
of pay – the social recognition of skills is a process that is subjective and can be flawed
o
 Note flaws of public policy
o The gendered pay equity schemes, and past studies, often mask the intersectionalities of our
society. Public policy, in general, often fails to recognize intersectionalities of gender + race etc.
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Legislative Responses to Gender Wage Gap
1. Equal pay for Equal Work ex: ESA s. 42
 Tried to resolve the issue where men and women were doing similar kind of work, however, the
issue was that there were many situations where women and men were doing very different types
of work.
 Hence “Pay Equity” legislation logically follows 
2. (“Pay Equity”) Equal pay for work of Equal Value
 This legislative response was due to the fact that men and women had different types of jobs – thus
need a way to compare the value of the work as don’t have a comparison of the same type of work
 2a. Complaint driven: Canadian Human Rights Act
o Embraced in ILO Constitution 1919; ILO Convention 1951; ratification by Canada in 1972
o Then appeared in federal legislation in 1977
o If you feel like you are in a workplace where there is not equal pay for equal value, then you
can complain to HR tribunal
o More complaints in 1980s and on –
 Most cases involved large numbers of women – public sector, or large federally regulated
companies.
o But the difficulty with the complaint model is that these large cases took forever.
 E.g. PSAC: it took 16 years of litigation until a settlement was reached with Treasury Board.
Resulted in payout of 3.5 billion to women.
 Bell Canada took 14 years to settlement.
o Litigation is long and costly. For the most part really only available to women in large
unionized workplaces or with other resources.
 2b. Proactive legislation – Ontario Pay Equity Act
o Legislation was first enacted in Ontario in 1988
o Basic principle is articulated in s.4(2):
 Goal is to address the historic undervaluation of women’s work that contributes to pay
inequality in horizontally segregated workplaces
 Discovered by comparing the wage rates of male and female job classes with similar value
as determined by a gender neutral process
o Remedied by requiring employer to take raise the wage rate of female job classes to wage
rate of male job class with equal value
Pay Equity Steps and Example
 1. Identify the establishment
o We are NOT looking across the economy but within particular work establishments
o Under the Act [s.1(1)], an establishment means “all of the employees of an employer employed
in a geographic division or in such geographic divisions as are agreed upon under section 14 or
decided upon under section 15”
 This means that you can’t even look across the province (notion that there may be differences
in pay based on location)
o There can be more than one pay equity plan per establishment (unionized and non-unionized) so
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the range can be even narrower
2. Identify the job classes performed
o Identify job classes by grouping together jobs with similar qualifications and similar
duties/responsibilities
3. Determine the gender composition of each job class
o See if you have male or female job classes
o Female job classes are made up of 60%+ women  why were these percentages chosen?
o Male job classes are made up of 70%+ men
3.5. Quantify the job rate
o the job rate is the highest paid person in each job class
4. Determine the gender neutral value of each job class
o Value jobs based on skill required, effort, responsibility and working conditions
5. Ask if there is are male and female job classes of equal value
6. Compare compensation of female job classes with male job classes of equal value
o Based on the highest rate of compensation within the job class
o If there is a male and female job class of equal value and the male job class is paid more, the
female job class is entitled to the male rate
 In below example, if cashier wasn’t a Female Job Class, then they would NOT benefit
from a Pay Equity Adjustment. The Adjustment is applied only to Female Job Classes.
o If there are more than one comparator job class with equal value, use the one with the lowest
rate
o Once the comparison has been established the ER has obligation to raise the rate in the
female job class (apply it to everyone) by applying 1% of their provincial pay role to closing
the gap.
 ER can’t just lower the male rate.
Example: Supermarket
Job Class
Gender
Gender Neutral
Job Rate
Pay Equity Adjustment
Composition
Value
Cashier
62% F
10
$8.00
$1.50
Stock Clerk
74% M
10
$9.50
None
Butcher
70% M
16
$16.00
None
Baker
65% F
14
$12.00
None
Candlestick
50% W
Invaluable
Priceless
For everything else
Maker
Steps:
1)
2)
3)
4)
5)
there’s….
Identify the establishment (supermarket)
Identify job classes performed (cashier, stock clerk, butcher, baker, candlestick maker)
Look at the gender composition of each job class (see chart, % of M/F)
Determine gender neutral value of each job class (see chart)
Ask if there is a male job class that has an equal gender neutral value to female job class(es)
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a. Cashier (value of 10, F) = Stock Clerk (value of 10, M)
b. No equivalent male job class for Bakers (so not entitled to an adjustment)
6) Compare rates of equal male and female job classes
a. The cashiers are entitled to a pay adjustment b/c they have the same value as the stock
clerks, a male job class, and the clerks are paid more
Problems in Pay Equity
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Work-family policy
o Result of the differences in the care-giving responsibility that partners assume
o There is no national daycare policy in Canada
o Pregnancy/childbirth leave
 Under ESA, for pregnancy and childbirth, these are leaves that apply only to women.
We have provided entitlements for women to take leave provided they have been
employed for 13 weeks prior to seeking that leave they become entitled to a leave for
17 weeks. Under the ESA the important thing to remember is that it doesn’t give
entitlement to paid leave, rather it gives entitlement to unpaid leave for which the
employer cannot penalize the employee. That is – cannot fire or cut pay and must
continue to accrue seniority.
o Parental leave:
 Can begin leave after child is born or after adopted child is taken into custody.
Again, under Employment Insurance Act it is linked to an entitlement under the
EIA. The length of parental leave at 35 weeks.
o Something about differences between Quebec and rest of Canada
 It’s known that leave can effect career trajectories despite legislation barring it.
Hence, more gender-equal leave legislation that encourages more equal leave taking
between the genders could help create more equal career trajectories.
1. proactivity only for public and large (100+) private sector employers; complete exclusion of small
(1-9) employers
o No requirement to be proactive in all establishments
2. self managed system, not requiring EE consultation in non-union settings; weak oversight
o In unionized setting, there was a requirement for the ER to consult with the union (so
workers could have a collective voice in pay equity plans)
o In non unionized settings, no requirement to consult with EEs
o You look at four factors in determining the gender neutral value (not simple to do) – where
unions are involved there is a job evaluation committee
o NOTE: firms often buy job evaluation plans produced by large consultancy firms, and the
complaint was that there was built-in pay inequity (they systematically undervalued work
done by women)
3. complexity and manipulability
o Without a credible EE voice, less likely that it would involve raising up of female job classes
o Statistics: unionized women have been the most successful in getting pay adjustments
4. gender neutral job evaluation
o ERs want to minimize pay equity and unions want to maximise it (contentions)
5. lack of male comparators
o 60%/70% issue:
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Having the 60% rate for females classes establishes a larger number of classes as
female
 The 70% requirement for male classes was used because data shows that for each
additional percentage of male incumbency, wages went up (if it was at 60%
threshold there would be more of them, but the value would be lower) – trade off
between # of classes and payoff
o solution: move away from job class to job class comparison to proportional value
comparison
 plot the male job classes (value v. wage) on a graph
 use regression analysis to determine the relationship between the value of male job
classes and their job rates (produces a formula used to calculate pay equity job rates
for female job classes)
 however, this was never applied to the private sector
6. re-assertion of market forces
7. only addresses intra-establishment under-valuation of women’s work; does not address workfamily conflict and vertical segregation
Exceptions to Pay Equity and Conclusions
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Exceptions:
o If the difference between job classes depended in part on a seniority system that don’t
discriminate based on gender
o Merit compensation plan based on performance ratings that don’t discriminate based on
gender
o Temporary skill shortage that pushed up the male rate
o Section 8(2) of the Pay Equity Act: After pay equity has been achieved in an establishment,
this Act does not apply so as to prevent differences in compensation between a female job
class and a male job class if the employer is able to show that the difference is the result of
differences in bargaining strength.
Tucker: there is always a tension when you start regulating against what is actually happening in a
labour market – when you push against supply and demand you generate tension
Overall
o pay equity deals with historic and cultural differences in pay
o however, to the extent that there are other explanations in wage gap ex: (1) differences in
mens and women’s family obligations or (2) persistence of labour market segregation
(horizontally – men and women doing different jobs, vertical – women disproportionately
located at lower level of occupational hierarchies), the pay equity legislation does not
address these issues as they are accepted as legitimate bases for differences in pay
England, Individual Employment Law, 2000
 there is legislation in all Canadian provinces and the federal jurisdiction that seeks to eradicate
discrimination caused by the discriminatory under-evaluation of female work (known as pay equity
legislation)
 today, there are 3 basic models of “equal pay” legislation in use across Canada
 (1) Equal Work Model
o prohibits the employer from paying female employees at a rate of pay less than that received by
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male employees “for substantially the same work performed in the same establishment, the
performance of which requires substantially equal skill, effort and responsibility and which is
performed under similar working conditions”
o legislation provides a list of factors that justify a wage differential:
 seniority
 merit system
 a system that measures wages by quantity or quality of production
 another differential based on a factor other than sex
o drawbacks of the model:
 it depends on a male occupying the same or a substantially similar position as a female,
thereby leaving untouched those positions that are exclusively staffed by women
 it depends on a female plaintiff having the knowledge and fortitude to file a complaint
against her employer for a wage discrimination
o studies show that the model has had virtually no effect in reducing the wage gap
 (2) Equal Value Model
o requires employer to pay identical wages for the performance of job duties that are of the same
or substantially similar worth to the organization, even if duties are dissimilar in nature
o criteria for determining how much value a job contributes to an organization are:
 degree of skill
 effort
 responsibility involved in performing the work
 physical and psychological conditions under which work is carried out
o advantages of the model:
 jobs involving quite different work functions can be compared for pay purposes
 dangers of the model are overstated and moral importance of eradicating gender
discriminatory job evaluation justifies some of the inefficiencies
o disadvantages of the model:
 1. method cannot be used if there are no male occupied jobs in the firm whose value can be
compared with the female occupied jobs – since women dominate certain industries, this is
a real drawback
 2. the job evaluation process will result in females being awarded wage increases above the
market rate, resulting in unjustifiable increases in labour costs for employer
 3. legal and admin costs to employer of complying with equal value laws are likely to be
substantial, resulting in further inefficiencies for the employer
 4. employment opportunities will decrease as a result of the previously mentioned
inefficiencies which will ultimately harm the group that legislation is trying to protect
 5. job evaluation process is so subjective in nature that it can be easily tainted
 6. there is a risk of reduced morale by employees who may feel cheated by the process
 7. the regulatory edifice required to monitor the equal value model imposes an
unwarranted cost on the public purse at a time of restraint in public sector spending
 8. firms are less likely to invest in provinces with equal value laws
 9. such laws are unnecessary, since market forces narrow the wage gap
o Several issues are commonly dealt with under legislation establishing the equal value model:
 1. it must be determined who the employer is for the purpose of making equal pay
comparisons
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 Ontario Pay Equity Tribunal summarized the key factors as follows: (1) who bears
the overall financial responsibility, including budget preparation, ultimate
responsibility for paying wages and benefits, financial administration, and
ownership or shareholder investment structure? (2) who is responsible for
determining employee compensation and administering job evaluation? (3) what is
the nature of the business, service or enterprise, including whether or not there is a
core activity or business; whether or not the work under pay equity review is
integral or severable from the organization; who decides what labour is to be
undertaken and what are the employees’ perceptions as to who is their employer?
 A purposive approach is taken to defining the terms – a definition of employer will
be chosen that seeks to facilitate the achievement of pay equity
 Tribunals will pierce the corporate veil to ensure that employers do not attempt to
restructure their legal identity in order to avoid their statutory obligations
2. if an organization consists of two or more separate establishments, it must be determined
which are relevant for job evaluation purposes

In Ontario, the Pay Equity Act states that an establishment consists of all employees
hired by the employer in a geographical division, defined as a county,
territorial district or regional municipality

In Ontario, the trade unions bargaining unit operates as the establishment for pay
equity purposes
3. the legislation commonly describes how an employer must determine which male jobs to
compare with which female jobs
 employers are allowed to compare female dominated classes of jobs with male
dominated job classes
 a job class is usually defined as a group of positions whose duties, responsibilities,
and qualifications are sufficiently similar to be covered by the same wage schedule
 in non-unionized organizations in Ontario, a job class is deemed to be male
dominated if 70% or more of its incumbents are men and female dominated if 60% or
more of its incumbents are women
4. legislation commonly describes how work is to be accorded “value” for the purpose of
wage comparisons
 in Ontario, PEI, QC and the federal jurisdiction, the employer is free to select
whichever job evaluation system best suits its particular circumstances
 job evaluation process begins with the implementation of a job analysis – this entails
finding out which work duties employees actually perform
 next stage of job evaluation involves determining what will constitute the applicable
compensable factors – equal pay acts usually define these broadly as skill, effort,
responsibility and working conditions but it is permissible for employers to break
them down into more detailed components such as customer relations or
maintaining confidential records
5. The legislation commonly deals with how equality should be implemented in the pay
structure, once male and female jobs have been evaluated

when determining exactly how equality is to be implemented, there are two
methods:
 1. job to job method: involves matching each female dominated job class in the
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firm with a male dominated class that has been determined to be of equal value
 2. proportional value method: involves calculating a wage line representing the
pay rates of all male dominated job classes according to their points allotted by
the job evaluation process, and plotting it against the wage line of the applicable
female job classes
 furthermore, the legislation in all provinces states that no employee can suffer a
reduction in pay in order to achieve pay equality for other employees
 6. The role of employees in the pay equity process is commonly dealt with in equal value
statutes
 7. the legislation must address what government services are available to help employers
implement pay equity
 8. legislation must specify whether any particular employers or employees are excluded
from equal pay provisions
 main exclusions are: (1) equal value model binds private sector employers only in
QC, ON and the fed jurisdiction, elsewhere, only public service and designated
public and parapublic organizations are bound to adopt the equal value method (2)
act often excludes small businesses – firms must hire at least 10 employees in order
to be covered by the pay equity acts (3) casual or transient employment
relationships, such as with summer students, may also be excluded
 (3) Pay Equity Model
o hallmark of this model is that employers are bound to proactively achieve defined pay equity
goals within specified time limits and to regularly report their profess to a government
appointed Pay Equity Commission
o provinces with this model: NB, MB, ON, NS, QC, PEI
o rationale for this approach:
 complaints based approach has proven to be relatively unsuccessful in achieving the
desired goals
o each Act contains detailed time limits within which the various steps in the pay equity process
must be completed
o proactive model does not preclude employees from filing complaints that their employer has
breached its statutory obligations
 rather, legislation commonly contains machinery for resolving such complaints
o remains to be seen whether this model will be applied to private sector employers outside the
federal jurisdiction, Ontario and QC
Work Family Policy
 Background:
o Addresses the pay gap that arises because of the way work/family responsibilities are arranged
within families (ex: working mothers or single male wage earner models)
o Not a normative judgement that one model is preferable, but rather policies designed to allow
people to make freer choices about the kinds of arrangements they want to have in their
families (shouldn’t feel compelled to work or stay home)
o Generally, we have not done very much about this
o Some ERs have adopted family friendly policies, but depending on voluntary action means not
everyone will do it
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o No national system of childcare: national day care issue has never been addressed
o Downloading of care giving for sick and elderly, stagnant or declining male wages
o Gendered division of care giving persists
 Response: Unpaid leaves (EI partly covers)
o Pregnancy and Childbirth leaves (ESA, s.46-47)
o Parental Leave (ES s.48-49)
 both men and women up to a maximum of 35-37 weeks (but 93% who claim are women)
 Quebec: introduced paternity leave (not tradable to women), increased the earnings cap,
offered the option of taking a higher substitution rate for fewer weeks – did increase
percentage of men who took some time off to look after children
o Family Medical Leave (ESA s.49.1)
o Organ Donor Leave (ESA, s. 49.2)
o Emergency leave (ESA s.50)
o Emergency leave – Declared Emergencies (ESA s.50.1)
 Rights during leave (ESA s.51-53)
o Continuity in benefit plans: ER still has to make contributions to benefit plans so you don’t
lose benefits
o Accumulation of ‘seniority’: you continue to accumulate seniority (ex: termination notice
increases with years of employment, and this will continue to accrue while on leave)
o Right to reinstatement: right to get the job you left back (provided the job is still in existence,
and if its not you have the right to a comparable job)
 If you are discriminated against with respect to the return to work, there are stronger
remedial powers that exist
 the board has the power to order reinstatement (this exists for ULPs, but outside of
unionized setting it is very rare to have reinstatement orders – not available in wrongful
dismissal).
 NOTE: In reality RO are almost never sought outside of unionized settings because it is
widely perceived that they can’t be effectively implemented. Reinstating against the will of
the ER means the relationship will never work, and EEs are usually limited to getting
damages.
Employment Equity
 Employment equity seeks to have women, members of visible minorities, disabled and aboriginal
people represented in job classes from which they historically have been excluded
o NOT just about closing the wage gap – about labour market segregation
o These groups tend to be segregated into certain occupations (and within those occupations,
tend to be crowded at the lower levels)
 GOAL: to require ERs to take measures to achieve a more equitable representation within their own
work force of the population in which they operate
 POLICY: Workplaces are potentially the most integrated places because people are compelled to
spend time together (very different from voluntary associations or neighbourhoods which tend to be
more segregated).
o Workplace has enormous potential to overcome some of the barriers between people
 How do we address the labour market segregation that exists?
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o Market approach: Voluntary equity programs that some ERs have chosen to adopt. They have
looked at their self interest and realized they could hire a higher quality work force for the same
price if they had more equitable policies and brought people in who were otherwise not getting
access.
o External pressure (non-state): organizations that monitor this, like the Canadian Board
Diversity Council, can get the information out and hurt firms’ reputations.
 Ex: Stanford Law school surveyed major law firms across the US to ask about diversity,
created a website in which that data became available. Coming from an elite group of law
students, arguably this is an effective way of catching firms that are outliers and
embarrassing them.
o Legal Regulation:
 Employment equity laws: designed to push this agenda and make changes
 HR codes which prohibit discrimination: if a firm had a significantly low representation of a
particular group, they could bring a complaint (as evidence that the firm discriminates)
Action Travail v. CNR 1987 SCC
Facts: CN had small number of women employed in the trades
HR Tribunal:
 CNR had discriminated against women in the St. Lawrence region operations who were seeking
employment in non-traditional blue collar jobs - women held only .7% of such jobs
 As part of a comprehensive remedial order, tribunal ordered CN to hire one woman in every four
new hires for blue collar positions, until representation reached 13%
SCC
 Tribunal was within its limits in imposing the order
 Tribunal may order the adoption of a special program designed to prevent the same or similar
discriminatory practice from occurring again in the future
 An employment equity programme is an attempt to ensure that future applicants and workers in the
affected group will not face the same barriers that affected their predecessors
Employment Equity Act (introduced in 1986, strengthened in 1995)
 “employment equity means more than treating persons in the same way but also requires special
measures and the accommodation of differences” (s.2)
 Goal is that designated groups’ representation in workforce should be proportional to their
representation in the relevant labour market
o Assumption that underlies this Act is that part of the reason we don’t have these groups equally
spread through the labour is that there are barriers to their recruitment and advancement
o Only jurisdiction with an employment equity law is the federal government’s law, which only
applies to federally regulated sectors an public service (about 10% of the labour market)
o BUT they adopted the federal contractors program – anyone who wants to do business with the
feds that has over 100 EEs and K is over 200k has to have its own internal employment equity
regime that complies with federal scheme
 Designated groups under the Act are:
 Women, aboriginal peoples, members of visible minorities, and persons with disabilities
 Core employment equity obligations imposed upon employers include:
o 1. conducting a work force analysis to determine under representation of designated groups
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(9(1)(a))
o 2. reviewing employment systems, policies and practices to identify employment barriers
affecting designated groups (9(1)(b))
o 3. preparing a short term plan (less than 3 years) which sets out measures to remove
employment barriers; positive policies and practices to correct under representation, and to
reasonably accommodate designated group members; and numerical goals and timetables for
hiring and promotion (10(1)) and
o 4. preparing long-term plans (more than 3 years) for improving representation of designated
groups (10(1)(c))
o Act stipulates that employer plans must achieve reasonable progress in the realization of the
statutory program (s.11) and that employees must take all reasonable steps to implement a plan
(s.12)
 ON: In 1995 govt enacted the Job Quotas Repeal Act which repealed the EEA in 1993
o Ontario had an employment equity act passed by the NDP in 1993, repealed by the PCs in 1995
o Only Ontario employers who fall under the contract compliance aspect of the federal
Employment Equity Act, therefore, are required to keep workplace data regarding the
representation of equity groups and to make efforts to rid of their establishments of
discriminatory employment practices
 In Ferrel v. Ontario the Ontario CA held that the repeal of the employment equity law did not
violate the Charter
o Court expressed doubt that s.15 imposed a duty on legislatures to enact legislation to combat
systemic discrimination in employment, but held that if it did the Ontario HR code satisfied that
duty
 Tucker:
o Most of this is aimed at reforming the organization’s internal processes
o it is not a system that sends inspectors in to enforce laws (unlike minimum standards where
you could look at the books and see if law is complied with) – institutions have to do this
themselves, like pay equity
o There is a requirement of EE participation, and unlike pay equity, non unionized EEs have to
participate so employer cannot just produce an employment equity plan without participation
 Then it goes to HR commission which has the power to conduct audits and potentially issue
orders to comply (never happens)
How effective has this regime been?
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
Negative: employment equity law has not achieved its objectives, especially for visible
minorities, persons with disabilities and aboriginals
 too few resources available, too few audits conducted, very limited budget for
government
Positive: Corporations subject to federal law have significantly higher proportion of women as
corporate officers (27%) than unregulated corporations (14%).
 In crown corporations women’s representation is substantially larger (twice as much as
the private sector)
 TD bank (federally regulated) established a task force on diversity and as a result they
have gone from 8% to 34% senior managers, and 47% middle managers.
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CH 5: Introduction to the Rights and Duties in the Employment Relation
 EE rights and ER rights are correlative
Employer Duties/Employee Rights
o
o
o
o
Duty to Pay
Duty to Provide Work
Duty of Good Faith?
(Not dealing with vicarious liability and OHS)
Employee Duties/Employer Rights
o Duty to Obey
o Duty to Exercise Skill and Care
o Duty of Good Faith and Fidelity
CH 5: Duties of the Employer
Duty to Pay Remuneration
 This is the essence of the employment relationship: provision of services in exchange for remuneration
 It is either EXPRESS (written or oral agreement to pay wages at a particular rate) or IMPLIED (courts, in
the absence of an expression provision, will figure out what the implied relationship was with respect to
wages)
o NOTE: if courts cannot construct the implied relationship they will likely find no duty to pay
Establishing the Duty
 in most situations, there is a written or oral contract of employment in which there has been an
agreement for amount to be paid
 contractual duty to pay contingent on establishing an employment relationship (Reeve v. Reeve)
 problems regarding amount of wages; enforceability of promise to pay more (Stylk v. Myrick)
o Employees lost because there was no fresh consideration – but why was the promise to work harder
not constitute fresh consideration? Because employer had already purchased their capacity to work
and owns it, so directing them to work harder was already part of initial agreement
o what about a situation where employer promises to pay you a higher wage in exchange for higher
work, but then does not pay you higher wage at the end? Employee can probably say that contract
was renegotiated at newer wage and thus it was a new contract, for which consideration was the
fact that the employee stayed at the job
Reeve v. Reeve 1858 ER
Facts: uncle was managing his nephews farm and received room/board/clothing. Uncle argued that he
was entitled to be paid (claims they had an oral agreement) but nephew disputed. Nephew argued
that just because one family member does something for another does not imply a duty to be paid.
Analysis:
 there is no duty to pay wages in all circumstances in which services are rendered, rather you must
look to see terms of express K or terms that could be implied from circumstances
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Judgment: there was a bargain that required payment of wages
Sprague and Wife v. Nickerson 1858 UCQB, Canadian Case
Facts: Young women living with her father. Father died and did not leave her an inheritance. She sued that
there was an implied arrangement in which she was to be paid wages
Analysis: courts were hostile to implying such a bargain as it struck the court to be normal and natural
bonds of affection that leads woman to dedicate time to her father
 "this young woman could not be living anywhere else more properly than with her aged and infirm parent;
and if she did acts of service, instead of living idly, it is no more than she ought to have done in return for her
clothes and board, to say nothing of the claims of natural affection which usually lead children to render such
service."
 In situations where one member of a family is working for another, Canadian courts historically
have been loath to find an employment relationship and imply a duty to pay
Quantum Meruit
 where a K is unenforceable because there has been a fundamental mistake by parties in respect of
the bargain they believed they had struck, a court on a quantum meruit basis may order
remuneration
 This means that a person who has rendered services would be able to claim that the ER would be
unjustly enriched if he was not to pay for the services rendered – courts calculation would be based
on the implied understandings of the parties in the circumstances
 ex: ER calls EE to house to do repair work but doesn’t pay. EE might be able to make unjust
enrichment (quantum meruit) claim that there was an expectation that performance was not to be
free, ER got benefit of services and that it would be unjust to allow ER to be enriched by getting
services for free
Timing of Payment
 a K of employment may expressly provide when remuneration is to be paid
 where there is no such express agreement, at CL remuneration is payable in arrears at the end of
agreed-upon period
 If a K does not specify when remuneration is to be paid and it is terminated before the expiry of
the agreement (for any reason other than ER breach(, the EE would not be able to sue under the K
for remuneration for the broken period of services rendered (Cutter v. Powel 1795)
 the ESA makes provisions for the timing and manner of payment
o these provisions may help solve the problems at CL, and there is still the potential utility of
quantum meruit
Minimum Wages
 s.23 of ESA provides that where an employer has permitted an employee to do work of the type
where min. wage has been set, the employee must be paid at least that amount
o According to the CL, there is no law as to substance of contracts re: minimum wage rate
o CL allows for K to be negotiated between parties  based on market supply and demand
Starting point is CL: is there anything in the CL that limits the wage bargain?
 Consideration: can be as little as a peppercorn
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o CL courts do not inquire into the quantum as long as there is something that amounts to
consideration (amount is irrelevant) – so low wages would never be considered at CL
 What about if ER promises wage increase?
o Stylk: EEs not entitled to additional wages if there is no fresh consideration
o Argument that new K is established – the terms of the K had been renegotiated and that would
be the new agree upon rate of pay (this will usually happen)
 This takes place in K of indefinite hiring (renegotiation is ongoing)
 More complicated if it’s a limited term K and terms were written out (might resemble Stylk)
o Why is the extra work not consideration?
 ER is allowed to speed up the process without breaking the K of employment.
 The only way to get around this is to say you have started a new K – working harder within
an existing contract is not fresh consideration
History of wage setting
 Master/servant
o in pre-capitalist labour markets, old mechanism provided for wage setting under masterservant statutes by magistrates who took into account the cost of food to determine wage
o those mechanisms fell into disuse as we began to get a commodified labour market and
development of industrial revolution
 Industrial revolution/liberal voluntarism
o during liberal voluntarism, workers petitioned govt to bring back wage fixing but govt refused
o response of workers to emergence of market setting wages was collective action and beginning
of political movements to try to get state regulation to intervene
 Early 20th century
o earliest minimum wage laws were restricted to women as women were thought to be
particularly vulnerable and thus unable to protect themselves
o led to enactment of min wage laws after WW1, boards set wages for women based on their
trade  based on what single person would need to be able to maintain a socially acceptable
standard of living
o min wages for men came about during depression where there was view that depression was
caused by vicious cycle being depressed, leading to depressed demand and thus a slower
economy, unemployment and further depression of wages
 Mid-20th century to now
o Only in the aftermath of WW2 did more modern minimum wage laws develop (as baseline
general minimum wage that applies to everyone, with some exclusions)
o In recent years, there has been a lot of concern about low wages and min wages, and a lot of
discussion about what the appropriate kinds of policy responses are.
Data on Minimum Wage
 Incidence of Minimum Wage (2009): 5.8% (ON 8.1%; AB 1.3%)
o Percentage of Canadians working at the minimum wages
o In 2003, it was only 4%
o Young people have the highest instance of working at minimum wage (20.7%)
o Women are more likely to work at minimum wage than men (7.2% to 4.3%)
 Incidence of Low Wage Work (OECD - less than 2/3 national median hourly wage)(2007): 27.2%
o This is particularly high among young people (70% of 15-24 yr olds) and higher among adult
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women (24.4% of women, 11.4% of men)
o Canada has second highest incidence of low wage work in OECD countries (US is first)
Labour market poverty
o the overwhelming majority of people who work full time at the minimum wage are living in
poverty
o This produces labour market poverty: people who are employed but still classified as poor
o The minimum wage has been going up in Ontario, but if you trace the real dollar value it
peaked in 76 and has fluctuated, never been that high since
Arguments AGAINST the minimum wage
o Economics argument: it increases the cost of labour which decreases its demand, and leads to
unemployment (or price increases)
o Should not be all that concerned because it is transitory (50-75% of min wage earners are
teenagers, who probably still live at home etc) – need policies to target those who are
independent
o increases unemployment, decreases training opportunities for young people and discourages
wage flexibility
Arguments FOR the minimum wage
o Counter to economics argument – small incremental changes don’t have a significant impact on
employment
o Productivity argument: we don’t want to encourage reliance on low wage work – we should be
trying to encourage Canadian ERs to choose a strategy of high-wage/high-productivity (rather
than the lower road which is a low wage, less productive workplace)
Amato Pizza
o $42,000 of back wages were owing to EEs for paying below minimum wage
o orders to pay were issued but they were ignored by company and directors
o provision under ESA for prosecution did take place
o recently, convictions took place
o corporations were each fined $150,000, directors were fine $10,000 and there was an amount for
victim surcharge  there is some bite in the legislation
o can seek wage recovery through ESA branch and an ESA officer will investigate a complaint
and issue an order to pay
Statutory minimum wages
o 1. ESA Part IX. s.23 – employer must pay prescribed minimum wages
 Govt determines level of minimum wages
 “prescribed” means government can change it without going to legislature
o 2. O. Reg. 285/01
 Sets wage rates
 Difference rates for different groups of workers
 Liquor servers have a lower min wage
 Hunting and fishing guys have a different min wage
 Home workers have a different minimum wage
 Note ESA exclusions, s.2: (a) as a duly qualified practitioner of, (i) architecture, (ii) law,
(iii) professional engineering, (iv) public accounting, (v) surveying, or (vi) veterinary
science; (b) as a duly registered practitioner of, (i) chiropody, (ii) chiropractic, (iii)
dentistry, (iv) massage therapy, (v) medicine, (vi) optometry, (vii) pharmacy, (viii)
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physiotherapy, or (ix) psychology; (c) as a duly registered practitioner under
the Drugless Practitioners Act; (d) as a teacher as defined in the Teaching Profession Act;
(e) as a student in training for an occupation mentioned in clause (a), (b), (c) or (d); (f) in
commercial fishing; (g) as a salesperson or broker, as those terms are defined in the Real
Estate and Business Brokers Act, 2002; or (h) as a salesperson, other than a route
salesperson, who is entitled to receive all or any part of his or her remuneration as
commissions in respect of offers to purchase or sales that, (i) relate to goods or services,
and (ii) are normally made away from the employer’s place of business
 Minimum wage exclusions, s.7: (a) a person who is employed as a student in a
recreational program operated by a charitable organization registered under Part I of
the Income Tax Act (Canada) and whose work or duties are directly connected with the
recreational program; (b) a person employed as a student to instruct or supervise
children; (c) a person employed as a student at a camp for children; (d) a person who is
employed as the superintendent, janitor or caretaker of a residential building and resides
in the building
Enforcement of ESA 2000:
 All we have data on is the # of complaints (NOT the # of violations) – some studies have found that
minimum wage violations are quite extensive at the bottom of the labour market
 Non- union employees go to the employment standards branch, unless they want an order of
$10,000+ then they go to the Superior Court (ESA s. 97, 98, 103(4))
 Union employees must enforce their ESA rights through grievance arbitration (s.48 of OLRA).
o ESA 2000 s.99 specifically precludes EEs who are covered by a CA from enforcing their rights
through the ES branch
 Weak enforcement (Auditor General’s Report 2004):
o Overwhelming majority of EEs only claim after they leave employment (90% of claims) – does
not adequately protect rights while employed
o 70% of claims upheld but individual complaint rarely leads to extended investigation
o 2003/04: 151 proactive inspections, over 300,000 workplaces
 inspections uncovered violations in 40-90% of cases, depending on type of business
o employers found to be in violation of ESA rarely prosecuted or fined (so cost to them was just
doing what they already had to do without penalty)
o only 40% of employers against whom order are issued pay voluntarily
o private collections agencies (to which unpaid orders are sent) only collected 12.4% of
outstanding amounts in 2004
o This affirmed what many advocacy groups were saying – the enforcement process was not
effective
 Government Response
o Increased targeted inspections: identified low wage sectors where they believed there were
problems and conduct inspections (without being initiated by a complaint)
 2135 inspections in 2008/09
o Increased prosecutions: in 2000 there were 5, in 2008 there were 480
 Employment Standards Task Force (2010) and the Open for Business Act (2010)
o Focus on clearing the backlog (seeking to reduce the # of complaints coming into the ES Branch)
– 14000 backlog
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o Shifts this to a self-enforcement model
o Documentation: Allows the Director of Employment Standards to require claimants to provide
specific information and let their employer know about their Employment Standards complaint
before the claim is assigned to an officer.
 Imposed responsibility on complainant to produce documents necessary to substantiate
complaint
o Settlement: Authorizes employment standards officers to attempt settlements of complaints.
 Before violation can be filed, the EE has to have first attempted to settle with ER
o CRITICISM: this is bad for low wage workers because they are in unequal power relationships
and requirements being imposed are burdensome to those at the end of the labour market.
Further the settlement mechanism puts pressure on people to accept something less than what
they are legally entitled to (problematic since their legal entitlements are the bare socially
tolerable minimum that we allow in the labour market)
 Results:
o More people are working at minimum wage
o But complaints have gone up and now there is a backlog (14k backlogged)
Sickness
 CURRENT CL POSITION: no implied right to be paid while off sick – you must negotiate for sick
pay and/or sick leave (or you are left to depend on whatever statutory entitlements you have)
o Express entitlement to sick leave: parties are always free to negotiate over the terms of the K
 In good jobs people often have contractual entitlements to days of paid sick leave
 BUT it is hard in lower end of labour market EEs to negotiate for more than the default rule
o Implied entitlement to sick leave? See Dartmouth below
STATUTORY ENTITLEMENTS
o ESA absence without pay (new) – s.50: An EE whose ER regularly employs 50 or more EEs is
entitled to a leave of absence without pay because of any of the following:
 1. A personal illness, injury or medical emergency.
 2. The death, illness, injury or medical emergency of an individual described in subsection
(2).
 3. An urgent matter that concerns an individual described in subsection
o Protection against dismissal in Canada Labour Code – s.239: no ER shall dismiss, suspend, lay off,
demote or discipline an EE because of absence due to illness or injury if
 (a) the EE has completed three consecutive months of continuous employment by ER before absence
 (b) the period of absence does not exceed twelve weeks; and
 (c) the EE, if requested in writing by the ER within fifteen days after his return to work, provides the employer
with a certificate of a qualified medical practitioner
o Workers Compensation (entitlement to pay)
 For EEs who are off from work due to a workplace injury (provides for wage replacement
and also a right to re-employment)
o Unemployment Insurance
 May qualify
HUMAN RIGHTS (duty to accommodate) AND FRUSTRATION
o Frustration: no notice requirement
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 ESA Regs – Employees not entitled to notice of termination or termination pay –
2. (1) The following employees are not entitled to notice of termination or termination pay
under Part XV of the Act: 4. An employee whose contract of employment has become
impossible to perform or has been frustrated by a fortuitous or unforeseeable event or
circumstance.
 BUT 2(3): above does not apply if the impossibility or frustration is the result
of an illness or injury suffered by the employee
 Due to sub (3), illness does not constitute frustration
o HR Code can have an impact on frustration insofar as an illness/disability does not constitute
frustration up to the point of undue hardship
 There is a duty to accommodate (see Meiorin) but it has limits
 See Hydro Quebec – there is a limit to how far ER has to go, so if accommodation of the
illness would cause undue hardship, it could constitute K frustration
o When is sickness a disability (and therefore entitled to HR protection)?
 Disability is defined fairly broadly in the code
 “any degree of physical disability, infirmity, caused by birth defect, illness etc…”
 definition says nothing about the duration
 however, there is some older case law in which HR adjudicators held that a minor illness
(ex: flu) is not a disability
 Impact on automatic termination clauses in CAs – McGill University Health Centre 2007 SCC
o Grievance was filed, and the issue was whether the automatic termination clause violated HR
law
o Court: the provision, prima facie, was discriminatory and could not be justified as a BFOR
 However, where the clause was a generous one, it did allow that an arbitrator might take it
into account in determining whether there had been reasonable accommodation.
o NOTE: McGill may not be good law after Ontario Hydro
o In this area, ground is shifting to reduce scope of obligation imposed on ERs
Dartmouth Ferry Commissioners v. Marks 1903 SCC
Facts: Company passed a resolution that any EE who was absent due to illness would not receive any
pay for the period of absence. Marks, on some occasions accepted reduced remuneration because of
absence due to illness. His condition worsened in November and soon he was dead – his widow sued
for wages from mid-December to mid-July.
Issue: In the absence of an express provision, when, if ever, should court imply an entitlement to sick
leave and/or sick pay?
Jury:
 Permanent illness is viewed as a frustration of the K
o NOTE: when a K terminates due to frustration, there is no requirement for either side to give
notice
 However, here EE had a temporary illness and thus his widow was allowed to recover
 Davies:
o There is no analogy between such permanent disablement and temporary sickness
o The law permits temporary sickness on the ground of common humanity to be offered as an
excuse for not discharging duty temporarily and allows the disabled party to recover wages for
the time he is temporarily away from his work
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 Common humanity becomes the rationale for modifying a normal K rule
o Tucker: this is another instance of the protective impulse (of labour law) to acknowledge that
we are dealing with the lives of real people – that human beings are the bearers of the labour
they are selling and to some extent that humanity has to be taken into account.
 Is Dartmouth still good law?
o No clear cut answer, but probably if someone were to stand up in court and plead it, the
likelihood is that a court wouldn’t follow it
 Tucker on Paid Sick Leave
o How could it be that you have a contract with a reciprocal obligation, where employer is forced
to pay where employee does not provide service?
o SCC finds that there is a duty to pay even where EE does not provide service because based on
old master-service paradigm, superior had obligation to pay servant
o Thus, still see elements of a de-commodified way of thinking of the employment relationship
 Notion of an entire contract
o In Brewers case, it was a 10 year contract to serve. Does that mean if you are sick for 1 day in 10
years, does it mean you have violated your contract and thus get nothing? No! unacceptable
and irrational outcome
o Marks was a monthly employee, failure to provide service for part of a month doesn’t entitle
him to collect wages for the month
Judgment: Killam J. then went on to find that, in the case before him, the normally implied qualification
could not be implied because Marks had, contrary to the jury's finding, agreed that he should not be
paid when absent due to illness.
Main point of the case: Temporary illness does not relieve employer of duty to pay
Maternity and Parental Leave
 Women on maternity leave face similar problems as workers who are will
 They can bargain for any protection they like but most workers are non-unionized and must rely on
the ESA
 RULE: EEs who start with the ER at least 13 weeks before they are expected to give birth are to give
at least 2 weeks written notice of the fact that they wish to take maternity leave
o EE shall be entitled to return to her job without suffering adverse effects if she claims such leave
o This does NOT entitle her to lost remuneration
 ES Branch divides violations of the existing maternity leave provisions into 3 categories:
o 1. wrongfully forced leave – award of damages
o 2. firing due to pregnancy or pregnancy leave – award of reinstatement
o 3. failure to reinstate without justification – award of reinstatement
 Employment insurance:
o Prior to 1971, unemployment due to pregnancy was not indemnified under the UIA on the
grounds that it was the predictable result of presumably voluntary sexual activity.
o As part of a major overhaul of the EI scheme, the federal government amended the
Unemployment Insurance Act to provide for maternity benefits.
o Women need the same work history as needed for sickness benefits -- 700 hours in the last 52
weeks.
o In 2000 the Federal government amended the Employment Insurance Act to increase parental
leave benefits to 35 weeks. The ESA, 2000, enacted subsequent to the EI amendments, also
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provides 35 weeks of parental leave (see ss. 48, 49).
Maximum Hours and Overtime
 decline in standard work week (35-40 hours)
o 1976: 71% of labour force
o 1993: 61% of labour force
 Common law: no regulation
o Parties are free to K about hours of work
 In England, long hours became a source of political unrest and the 9 hour day was achieved
 Karl Marx: The creation of a normal working-day is, therefore, the product of a protracted civil war, more or
less dissembled, between the capitalist class and the working-class... It must be acknowledged that our labourer
comes out of the process of production other than he entered. In the market he stood as owner of the commodity
"labour-power" face to face with other owners of commodities, dealer against dealer. The contract by which he
sold to the capitalist his labour-power proved, so to say, in black and white that he disposed of himself freely.
The bargain concluded, it is discovered that he was no "free agent," that the time for which he is free to sell his
labour-power is the time for which he is forced to sell it, that in fact the vampire will not lose its hold on him
"so long as there is a muscle, a nerve, a drop of blood to be exploited." For "protection" against "the serpent of
their agonies," the labourers must put their heads together, and, as a class, compel the passing of a law, an allpowerful social barrier that shall prevent the very workers from selling, by voluntary contract with capital,
themselves and their families into slavery and death. In place of the pompous catalogue of the "inalienable
rights of man" comes the modest Magna Charta of a legally limited working-day, which shall make clear
"when the time which the worker sells is ended, and when his own begins”.
o This is not two business people meeting in the market – we are dealing with people in two very
different positions, and that must be taken into account
o Tucker: it is interesting that the contradiction that Marx identifies reappears in judgments
 The common humanity notion
 Also shows the protective impulse that we see both in the CL and in other areas
 Initially, hours of work legislation was limited to women as they were felt to be most vulnerable
(Factory Acts), and only later was the legislation extended to men too
 In 1970’s there was a movement to reduce working week to 35 hour week
 By the mid 20th century the norm that emerged was the 8 hour day, 40 hour week
o Average weekly hours (1996 – 2006): about 24% of the labour force is working longer than a 40
hour week (so fewer people working at the standard, and more people working either short or
long hours)
 Statute: ESA prior to 2000 (subject to exemptions in O.Reg 285/01, s.2,4,8)
o 8 hour day, 48 hour week is norm (longer hours in emergency)
o employer needs permit from Ministry of Labour to establish longer working day (up to 12
hours) or longer working week (60 hours – but only 100 hours a year per EE); EE can refuse to
work longer hours
 would need to apply to MOL to get approval for longer working day/week
o overtime wage premium (time and a half) after 44 hours a week (provision for averaging over 2
weeks)
o ½ hour eating period after 5 hours
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 Statute: 2000  Changes made by Conservative government:
o Provision that ERs could extend working day to 13 hours without having to get EE consent
o 40 hour working week could be extended to 60 hours with EE consent
 got rid of the ministry consent rule
o must be 24 hours off every 7 days or 48 hours off every 2 weeks
o provision for overtime averaging over 4 weeks with EE consent – must work more than 176
hours over 4 week period before entitled to overtime pay
o can substitute 2 eating periods equalling 30 minutes with EE consent
 note: in unionized workplaces, union gives consent for EEs
 the changes in 2000 were intended to increase amount of flexibility with respect to scheduling of
hours and entitlement of overtime. However, changes also took away some of the protections of
the prior Act re: removal of permit system
o these changes were objected to by EEs and unions
o said that for non-unionized EEs, the reality that EEs would withhold their consent when
approached by ERs was not realistic
 thus, liberal government amended the ESA
Liberal’s changes to ESA 2000 (effective March 1, 2005/6)  THIS IS THE CURRENT
EFFECTIVE LAW
o Liberals campaigned against this and said they would restore the previous laws (but didn’t
quite go that far.)
o WORKING DAY:
 No change in 13 hour days – ER can establish that normal working day is more than 8
hours without needing to get special permission  it can be up to 13 hours.
 But Section 18 of ESA specifies that EEs are entitled to at least XX consecutive hours of
not working (meaning that the effective maximum is this 13 hours.)
 If ER establishes a shorter working day and wants EE to work overtime based on that
shorter day, there is a provision that says that EEs have the right to refuse
overtime work and ER must secure their agreement in writing in order for
overtime.
 In order for written agreement to be valid, ER needs to provide EEs with information
sheet which outlines rights of workers and overtime
 Section 17(2): about working more than the prescribed hours…
o WORKING WEEK:
 Also retains the ability of individual EEs to agree to work more than 48 hours a week and
average entitlement to overtime over 4 weeks  But there is an additional layer of control,
past just needing to get the EE’s agreement.
 May be extended to 60 hours with written agreement of EE
 17(1): This also requires Director approval
 It now requires employers to:
 Give EEs an information sheet regarding hours of work (s.17(5), 21.1) and
 Obtain an approval from the director for long weekly hours of work (s.17(3)(b)) and
overtime averaging (s.22(2)(b))
o OVERTIME
 Paid after 44 hours. But may agree to overtime averaging over 2 or more weeks.
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
There is no upper limit on the amount of weeks for which you can have overtime
averaging.
 But in order to do averaging, you need:
 Written agreement by employee
 Director approval
o The legislation specifies what the Director must consider in issuing
an approval for long weekly hours (s.17.1(7-8)) or overtime averaging
(s.22.1(6-7))
o Tucker: Liberals added formalized procedures and some oversight by the director of the
employment standards branch (but didn’t totally restore laws)
 Conclusions
o 1) Has the law provided adequate protection so that long hours are only worked when
workers freely consent to those hours?
 Concern is that when vulnerable workers are approached they will sign because most
workers feel that if they don’t, it will jeopardize their position with their employer
 Data shows that a large number of employees work overtime and a large number of
employees who work overtime do it without overtime pay
o 2) Extent of hours of work violations?
 Violations either in relation to excessively long hours, or a failure to pay overtime?
 General indication on survey of employers that 25% of employers were in violation of some
part of the regime
o 3) Class Actions: The New Enforcement Tool?
 NOTE: Employment standards apply both to individual K of employment and the CB
regime, but for unionized workplaces it would be the union grieving (no class actions)
 Just this summer  Ontario Court of Appeal released judgments about these  see
readings
 In these 3 trials, there were a number of issues:
 Misclassification of EE’s: claim that EE’s were misidentified as managerial (and so
should have been entitled to… overtime?)
 McCracken:
 Involves CNR.C Claim is that a bunch of front-line supervisors were misidentified as
managerial. ER’s claim that the front-line supervisors were too diverse; Court
accepted this and refused to certify the class action.
 Fuqua v BNS
 Again, low-level supervisors: Court found there was a common claim, that the class
had a similar issue – supervisors and similar duties and such
 Fresco v CIBC  page 12-13 of the materials
 Off-the-book issue
o Company made it known to EEs that they had to stay late to do their
work, if they weren’t finished it, and they would have to do it off the
clock.
 Court found that there was a single policy that cut across the range of CIBC branches
and so certified the class.
 IN order to get certified
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 Must show there is a common issue that can be tried without inquiring into the
individual circumstances of the parties looking to form the class
 One of the main issues in deciding whether the class action can stand is whether there is an
alternative remedy – ie: suing, remedy through employment standards branch
 Employment lawyer at Heenan Blaikie says that in order for employers to get
prevent certification of class actions they need to short circuit the certification which
results in situations where it is economically unfeasible to litigate individually
 Class action was brought by Fresco (P) against the CIBC claiming there was a systemic
practice of overtime violations – that EEs weren’t formally required to stay but it was a
norm at work to do so
 This was followed by two other similar actions (against bank of Nova Scotia and
CNR)
 Motions judge refused to certify the case as appropriate for a class action – no
common policy so no common issue to be tried (upheld in Sept by divisional court
with a dissent)
 Bank of NS: has been certified, on appeal to Ontario COA
 CNR: was certified in August of 2010
 This could be a new enforcement tool – where there are widespread violations as a result of
workplace cultural norms where EEs are expected to get their work done, this mechanism
could be powerful.
 Gives entrepreneurial lawyers an incentive to find complainants (money to be made).
Collective bargaining and hours of work
o Nothing in CB law limits hours of work
o However, ESA continues to apply in CB regime so unions can only negotiate within parameters
of ESA
o Where there are unionized workers, union gives consent required for overtime averaging and
longer working weeks
o There appears to be two perspectives commonly taken by unions re: long hours of work
 1) Long hours of work may be viewed as undesirable and ethics of labour movement have
tried to shorten those hours (health, quality of life)
 Also bad for membership because if EEs are working overtime, then it means the ER
should be hiring more people.
 2) BUT overtime is often a valuable option for union workers (because of the premium pay)
 Unions try to negotiate for higher levels of premium pay, instead of 1.5 times (which
is the multiplier required under ESA) they push for 2 times
Vacation Pay (didn’t do this in class?)
 ESA 2000 maintains minimum requirement of at least 2 weeks annual vacation after each 12
months of employment (s.33(1))
 Bill 147: “allows” for vacation to be taken in less than one or two week periods where the employee
makes the request in writing and the employer agrees (s.34(2))
o This section is designed to increase “flexibility” for individual employees and employers
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Duty to Provide Work
COMMON LAW
 We remain having freedom-to-K; parties are free to negotiate that ER will provide XYZ hours of
work per week.
 The default rule, i.e. if nothing is said in the employment K about temporarily laying people off
without notice: ER does not need to continue paying EEs during temporary layoff.
o NB: the default rule is important in that it can influence the final result that is arrived it.
o E.g. transaction costs – sure, it’s possible for parties to negotiate to a different position but
things can get in the way of negotiating. Also consider the theory of “adaptive preferences” –
behavioural economists suggests that when people have an initial entitlement to begin with,
they tend to value it more highly than they would if they didn’t start out with that benefit.
 In the CL individual K of employment regime, it is a foundational principle that ERs continue to pay
EE’s (for the appropriate notice period?) even if they are not requiring the EE to continue to work.
How can an employment K be terminated?
o fixed term contract: terminates automatically
o contract of indefinite hiring (legal presumption if nothing else explicit or implied):
 (i) employer can always terminate you but they must provide you w/ reasonable notice, OR
 (ii) employer can give you pay in lieu of notice,
 (iii) can fire you summarily if there is just cause, OR
 (iv) contract frustrated for reasons beyond the control of either of parties
o A shortage of work is not just cause under common law: if ER wants to permanently reduce
its workforce b/c there is a shortage of work, they are free to do that but there is an obligation to
give reasonable notice and pay the EEs for the notice period.
What about a TEMPORARY lay-off? Can employer unilaterally lay worker off
TEMPORARILY without pay? Also applies to temporary reductions in hours worked by
employers.
Collier v. Sunday Reference Publishing 1940 KB
Analysis
 Court states the uncontroversial common law position
o A K of employment does not necessarily or normally oblige master to provide servant with
work
o Although there is no duty to provide work, there is still an obligation to pay the EE until
contract is terminated, or payment is given in lieu of notice of permanent layoff
o “Provided that I pay my cook wages regularly it should not matter to her whether I take any of
my meals out”.  Meaning, don’t have to continue to provide work, just have obligation to
continue PAYING.
Devonald v. Rosser & Sons 1906 KB
Facts: EEs had monthly K of employment with provision that termination of contract required 28 days
of notice on the first day of the month. ER decided that they didn’t have work and so they suspended
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employment in the middle of the month – didn’t give them notice and laid them off before they were
legally entitled to (based on the K). That is the ER hasn’t been able to give them the permanent notice
because that had to be done on the first day of the month, as it was the middle of the month. As such
the ER just told them, in the middle of the month, to go home and not come back. EEs were paid by the
piece. EE argument was that they were deprived of the opportunity to earn wages and there is a duty
to provide work (or pay in lieu) – EE is suing for breach by ER of agreement to find EE work. ER
argued that there was no duty to give notice, no duty to provide work and no duty to pay in lieu of
work.
Issue: in the absence of an express stipulation, can an ER fail to provide work and not pay workers?
(nothing said in the K about laying people off in the middle of the month)
Trial judgment (Jeff J)
 the defendant had expressly or impliedly agreed to find the plaintiff employment
 TEST:
o 1. plaintiff (EE) has to show that the express or implied agreement which he relied upon existed
o 2. if he is successful in showing that, then burden of proving custom to cut down that prima
facie case would rest upon the defendant (ER)
 Court looked at express terms of the contract, but found no express duty to pay in K (and so must
look at what should be implied)
 Implying terms into contract of employment where no express provision is made:
o generally, when courts imply terms into the K they are figuring out what the parties would
have agreed to had they put their minds to the question (ie: what would two reasonable
business people have agreed to?)
 Does employer have duty to pay if they suspend work for lack of business?
o It would be grossly unfair if people could be laid off and not paid where they held themselves
ready to be called by the ER (and that the EE is losing wages during that period)
Court of Appeal
 endorses trial judge
Lord Alverstone:
 Implying terms: notion of “business efficacy”
o The implication which is to be drawn from this contract is one which is raised “from the
presumed intention of the parties with the object of giving to the transaction such efficacy as
both parties must have intended that at all events it should have”, that “what the law desires to
effect by the implication is to give such business efficacy to the transaction as must have been
intended at all events by both parties who are business men”
 Obligation of the employer?
o Tension: need to consider it from each point of view
 the ER desires to carry on work at a profit (though not necessarily every week)
 the EE has to live, and if ER has no obligations, it could at any time (as soon as it was
operating at a loss) close its doors to its EEs (when the EEs, even if they gave notice to quit,
would be bound for at least 28 days during which they would be unable to earn any wages
at all)
o The necessary implication to be drawn from this contract is at least that the master will find a
reasonable amount of work up to the expiration of a notice given in accordance with the
contract
 However, this obligation is not absolute, as it is subject to certain contingencies such as
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breakdown of machinery and want of water and materials
 In this case, the excuse of not being able to provide work due to decreased profitability is
not acceptable for non-performance of an implied obligation to provide work
 Custom?
o A custom cannot be read into the contract unless, “it is so universal that no workman can be
supposed to have entered into” the “service without looking to it as part of the contract”
o In this case, the closing of the work is entirely dependent on the ER, upon the particular
circumstances of the case and the view that the ER takes of the prospects of trade
 There is no element of certainty about the alleged custom at all and defence of custom must
fail
Sir George Barnes
 There is a binding obligation to work, and it seems that there must be a necessary implication, which
is arrived at by the principles that an ER ought to find work to enable the workman to fulfill his end
of the bargain, to do his work
 However, risks which are known to both parties (ie: breakdown of machinery), and which prevent
both parties from doing what is contemplated, should excuse ER from obligation to provide work
 In this case however, there is no such risk which was known to both parties
Farwell
 Customary practice of laying off workers:
o Custom must be reasonable, certain, and notorious
o The alleged custom that the work may be closed without notice in this case, is entirely at the
discretion of the master and this custom cannot be good
 Contract implication:
o Need to look at the implication from the view of the master and servant
 Master makes his living by realizing a profit and workman makes living by wages
 Masters profits are relatively larger, but workman has to live de die in diem and his wages
do not leave much room for future savings
o It would be eminently unreasonable for the master to claim the right to say that since prices for
a good are not sufficiently remunerative, he will decline to find further work for the servant
when the servant is bound himself ready to obey orders
o Implication is that master has to find work for the servant
 Judgment: it is appropriate to imply a duty to pay notwithstanding that work is suspended due to
lack of business
Tucker on Devonald
 bottom line of judgment:
o what is to be implied is that there is a duty to be paid until the relationship is terminated
 ER can’t temporarily suspend the K
 if ER chooses to terminate, they have to pay until end of the termination period
o however, duty may be limited depending on cause of suspension of work
 ie: where work is suspended due to unforeseen circumstances (ex: machine break downs),
that is a shared risk and thus the duty to pay ceases
 but where there is a lack of profitable work, that is totally in the domain of the ER – ER can
plan ahead and can provide amount of notice required under contract. If ER fails to engage
in this kind of planning then that is a risk that ER has to suffer
o the length of time for which the ER has to pay is determined by the contract or statute
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 *even though courts may imply one thing using business efficacy test, if there is a custom to the
contrary, then courts will give effect to the custom*
o Farwell: not every customary practice will be endorsed by the court, court will only give
customs legal effect when they are reasonable, certain [ie: everyone knows exactly what the
custom is] and notorious [ie: well known to everyone in that particular group]
 tension between de-commodified understanding of labour and business efficacy:
o Farwell notes the difference between the classes of master and workman (the social reality is
that the parties are in different situations)
 That Farwell’s M+S stuff is almost a Marxist critique that pulls the mask away and shows
the Marxist perspective on the reality of the employment relationship but then as the Court
continues and talks about the intentions of the parties wrt a meeting of businessmen and
that those intentions should be reflected  the mask is put back on.
o In deciding what is reasonable (in both implication and custom), court takes into account a decommodified understanding of labour (labour is real people who are dependent on their
survival for their wages). On the other hand, there is also overlay of business people meeting
and trying to give efficacy to business contracts.
o You see this tension when you apply the test of giving a K business efficacy – workers is seller
of labour power where employer is purchaser of labour power. There is no recognition that they
are in unequal positions, but that reality is not far beneath the surface.
Stolze v. Addario 1997 Ont CA
Facts: ER purports to lay workers off, temporarily. EE takes position that they have been terminated
and are entitled to termination and severance pay under ESA.
Held: a temporary layoff may constitute a CD thereby entitling EE to treat the K as having been
terminated, entitling them to notice.
Analysis (ON COA)
 Employer did not have Kual right to temporarily lay off or suspend the K of employment, and by
doing so, it breached the K, which allowed the EE to treat it as a constructive dismissal and thus,
EE had right to termination and severance pay (Devonald v. Rosser principle)
o history of the appellant’s relationship with the employer as a “key employee” gives rise to an
obvious implied term of employment, which include employment at an annual salary for an
indefinite period of time – this constitutes the layoff to be a repudiation of a fundamental term
of the contract
Tucker on Stolze
 Does this mean all EEs are protected against temporary termination?
o Express term: Can have express contracting out where K states that employer can temporary
lay off without having to pay (Devonald v. Rosser has express contracting out)
o No express term: then we are in the world of Devonald v. Rosser, and what would be implied in
the circumstances or what might be the customary practice
o Custom: It is impossible to make a sweeping generalization because even in this case, there are
certain things that are specific and might not follow in other Ks
 In last paragraph of judgment, court mentions that there is a history between parties – this
is taken into consideration. From a customary notion, if ER had custom of not paying EEs
then it would be implied. Or perhaps, this is a term only implied into a contract of
employment in higher status (aka “upper echelon” work (ex: as a lawyer, you are not
temporary terminated due to less work at the firm vs. industrial workers may be laid off for
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a week or month due to customary practice)
 We don’t see a lot of litigation because most EEs would prefer temporary suspension without pay
vs. permanent layoff
o For many (e.g. lower status workers) a temporary suspension with right of recall is often
preferable to treating a suspension as a breach of contract for which you claim damages for
constructive dismissal. The latter is more likely to be the preferable option for higher echelon
workers compared to lower status workers because of the higher damage payout + greater reemployability of higher-echelon workers.
Employers right to impose administrative suspension an employee during a K of employment:
Kabiakman v. Industrial Alliance Life Insurance Company 2004 SCC:
 Case does not get much consideration in the rest of Canada because based on Quebec civil code but
principles in the code are not significantly different
 Facts: EE is charged with criminal offence which is related to their work. Thus ER suspends EE
without pay but EE gets acquitted 2 years later. ER reinstates EE. EE argues that ER did have a duty
to provide work and pay.
 Issue: does ER have right to suspend contract of employment?
 This case is about an administrative suspension, not a disciplinary suspension
 SCC: right to suspend can only be exercised under restrictive circumstances:
 1. Employer has to be protecting legitimate business interest
 2. Employer must be acting in good faith
 3. Employer must be acting fairly (duty to consult with affected employee)
 4. Interruption has to be temporary and unless there are exceptional circumstances, the
employee must be paid during period of admin suspension
Collective Agreements and the duty to provide work
 under CAs, it has become accepted that, subject to anything contrary in the agreement, the ER can
deploy his labour as he wishes and, in particular, may reduce the amount of work available
 one of the great advantages which CB has bestowed on workers is the institutionalization of a
seniority system
o unions seek to protect EEs right to a job based on years of service
o seniority clauses may affect the ERs right to reduce his workforce as ER may not be able to get
rid of EEs that he feels are most dispensable as he will need to abide by the seniority clause
 parties can accept any arrangements that are mutually agreeable
 Common understanding of arbitrators is that if collective agreement is silent about temporary lay
offs, then it seems that it is already been accepted that employer has a right to do that without pay
 Thus, unions typically negotiate for some kind of protection. Examples include:
o 1. prohibition of temporary lay off
o 2. loss shall be by seniority – ER should not have opportunity pick and choose who gets to work
rather work shall be allocated based on seniority
o 3. workers get paid or if they get unemployment insurance then they get a top up wage to
cushion them
Re James Howden & Parsons
Facts: ER chooses not to open for a half day on Dec 24th and Dec 31st, thus EEs are deprived of half a day
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of wages
 unions argument: union points to hours of work in CA to say that by not allowing EEs to work on
Dec 24 and 31 from 7:30-11:30, company’s decision to not operate its plant was a violation of 2(1)
 CA s.2(1) states that “eight hours per day will constitute a day’s work; normal starting and finishing
time will be 7:30am and 11:30am and ……” “Forty hours per week shall constitute a week’s work,
Monday to Friday,…..”
 companies argument: 2(1) is not a guarantee of employment, and s.6 allows management exclusive
function to maintain efficiency and generally to manage its enterprise
Arbitrator
 Rejects unions argument by saying that it simply defines a normal working day and does not
guarantee that work will be provided 8 hours a day and 40 hours a week
 If you want a guarantee of work, need to negotiate that – cannot imply it from definition of
normal working day
o Arbitrator held that any guarantee of work must be provided by explicit language
 Reference is made to a number of cases that all support the proposition that a provision such as the
one in this case does not guarantee employment
 Main point: Arbitrator found that:
o 1. there was no duty to provide work (as has been found at common law)
o 2. there was no duty to pay employees on the pre-existing basis (the reverse of the common
law duty)
Re UAW and Northern Electric 1971 LAC  With existence of certain protections when layoffs occur,
focus has shifted to figuring out when layoff occurs
Facts: Strike at production facility and as a result of the cessation of work at the plant, the work falling
to be done by office EEs was considerably reduced. ER decided that they don’t need all of the office
staff and thus sent some of them home. ER does not follow lay off procedure in CA (ie: did not do
layoffs by seniority). Article 10 of the CA outlined the “Lay-off and Recall procedure” (the layoff
procedure applies “in the event of a reduction in the work force which necessitates lay-offs”). ER
argues that this was not a lay off, rather just a temporary interruption of the employment status of EEs
and because of this abnormal situation, the seniority provisions do not apply.
Issue: has there been a layoff that triggers provisions in the CA that governs what shall occur? If yes,
then ER would have to be governed by the CA
Analysis
 There have been many cases in which lay-off has been defined as “a period of being off work”
 In Re Amalgamated Meat Cutters 1963 arbitrator held that:
o “a lay off must be regarded as any period during which employees are required to cease working and
includes being sent home from work as little as 15 mins before the end of a regular working period”
 “In my view, lay off involves a temporary severance of the employment relationship for the purpose
of reducing the employment force in order to meet the manning requirements of the ER”
o Thus, a lockout, disciplinary suspension or an absence brought about by the decision of an
employee or trade union does not constitute a lay off
o While temporary severance of all employees would come within this definition, such a
severance might not involve the seniority provisions of a CA since there would remain no jobs
to be claimed
 Consistent with the above definition, a layoff is a method of reduction of the working force
 In this case, the employers contention is that the situation was “abnormal” and not one to which
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seniority provisions applied
o This contention calls for a special definition of “layoff” which cannot be supported by the
collective agreement of the reported cases
Judgment:
 This case is plainly of the sort to which the seniority provisions were meant to apply
 The company, quite properly, determined that it would reduce the number of EEs engaged in office
work
 The reason or circumstances which led to the determination are immaterial to the issue
 The short name for this kind of temporary interruption of EEs work by reason of a reduction in the
work force required is a layoff
Tucker
 Trade off between management rights to alter staffing arrangements vs. protection negotiated by
unions in the context of these kind of work disruptions
 Arbitrators have taken a broad lay off definition, expanding the negotiated protection to unions
 Limits? What if the layoff is just sending people home early at the end of the day?
 Any suspension constitutes a lay off
Duty to Provide Work: Shortened Hours
Air-Care Ltd. V. United Steelworkers of America 1974 SCC
Facts: CA stated that layoffs would be by seniority. There was a drop in demand, so ER achieved force
reduction by moving all EEs to a reduced working week. Union grieves saying that layoffs must be by
seniority and management has partially laid everyone off instead. Arbitrator accepts unions argument,
because arbitral jurisprudence stated that any shortening of working day = lay off
Issue: whether Air Care, under the terms of the CA, was obliged, during a temporary shortage of work,
to lay off EEs, as the union contends, or whether it was entitled to place all EEs on a short work-week,
as the company maintains
SCC (Dickson):
 union’s case rests in large measure on the submission that there is no difference between a reduction
in the hours of work and a lay off and the moment one reduces the hours of work of an individual
that individual is laid off
 the Oxford dictionary defines lay off as “a period during which a workman is temporarily
discharged”
 In my opinion none of the EEs were laid off on the occasions in respect of which the grievance was
raised
 There was no reduction in the working force and the status of the EEs as EEs was unaffected by the
notice periods – the action did not undermine the seniority protection assured by the agreement
 If a shortage of components or a breakdown, or a fire or flood, caused the company to close the plant
early, no one would contend that it would amount to a lay off and that seniority would have to be
recognized
 The company had the right to reduce the hours of work for a period, rather than impose a lay off
o The arbitrator, who held otherwise, added to the agreement by imposing upon the company a
duty to lay off EEs whenever there was a shortage of work
Judgement: Protections that unions have negotiated with respect to layoffs do not apply in this case,
as a reduction in working hours is not a layoff
Tucker
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 SCC rejected arbitrators view
 Court in this case, ignored the industrial relations context and arbitral jurisprudence
 Court did not go to arbitral case law to decide what constitutes a lay off
o Rather, they go to the dictionary
o Court substitutes dictionary definition for understanding of arbitral jurisprudence
 in this context, it was a unilateral decision made by ER rather than negotiating with union
o from a labour relations context, it was unacceptable to union
 thus, based on the decision of the SCC in this case, there is a narrowing of a layoff
Battlefords and District Cooperatives 1998 SCC
Facts: there was an unequal reduction in the hours of work where some EEs had more hours reduced
vs. others. Union stated that unequal reduction in hours of work constituted a lay off.
SCC
 it has been held in several arbitral decisions that a significant reduction in hours, in circumstances
where a particular employee is singled out, may amount to a constructive dismissal
o this conclusion seems reasonable – it follows that it was not patently unreasonable for the
Board, in this case, to conclude that there had been a lay off
 ERs must have the ability to reorganize their departments and staff
o yet in the absence of a clearly expressed intention to the contrary, the provisions in a CA should
not generally be interpreted in a way that undermines acquired seniority rights of EEs and
fundamentally alters the nature of the employment
Tucker
 we see a shift – SCC and general courts are more respectful of arbitrators and thus ground their
arguments in context of arbitral jurisprudence
 court accepts arbitral view that where an individual EE has been singled out in a reduction of
hours = constructive lay off – thus, definition of layoff has been expanded from previous case
Canada Safeway 1998 SCC
*court reached a different conclusion as compared to Battlefords*
Facts: nature of the hours that EEs received was altered. Rather than having regularly scheduled hours
of work, some EEs were given call-in hours. Union argued that shift from regularly scheduled hours
vs. call in hours constituted a constructive dismissal (union argued that difference in the quality of
work amounted to a constructive lay off)
SCC:
 a “layoff” does not terminate the employer-employee relationship rather it temporarily
discharges the employee
o the hope or expectation of future work remains
o the controlling idea of a layoff is a disruption
o thus, in order to a be a layoff, there must be a cessation of work – if EE continues to work
substantially the same number of hours, his or her grievance is not a layoff
 we would not preclude the possibility that in certain circumstances, a significant reduction of
hours might give rise to a constructive layoff
o constructive dismissal recognizes the fact that a drastic change in conditions of employment are
tantamount to terminating the employment relationship whereas a layoff simply refers to a
temporary cessation of employment for which damages are not available
 rejected unions argument
o thus, drawing a narrow line around notion of constructive lay off
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 constructive layoff had to involve a succession of work or a shortening of the working day. A
change in the quality of hours that disruptive the employment relationship was not a layoff.
o Not all disruptions of relationship constitute a constructive lay off, it has to involve shortening
or succession
o thus, see a tension between what constitutes a lay off and protection provisions in the CA
Duty to Provide Work: ESA



Provides protection for EEs who are permanently laid off (notice, termination and severance pay)
No protection for employees temporarily laid-off without pay (by implication, it recognizes the
right of ERs to temporarily lay-off without pay)
Patrols boundary between permanent and temporary lay-off to protect against abuse (ER could
try to avoid notice/severance by calling it a lay off)
No termination without notice
54. No ER shall terminate the employment of an EE who has been continuously ER for three months or
more unless the ER,
(a) has given to the EE written notice of termination and the notice has expired; or
(b) has complied with section 61.
What constitutes termination
56. (1) An ER terminates the employment of an EE for purposes of section 54 if,
(a) the ER dismisses the EE or otherwise refuses or is unable to continue employing him or her;
(b) the ER constructively dismisses the EE and the EE resigns from his or her employment in response
to that within a reasonable period; or
(c) the ER lays the EE off for a period longer than the period of a temporary lay-off.
Temporary lay-off
(2) For the purpose of clause (1) (c), a temporary layoff is,
(a) a lay-off of not more than 13 weeks in any period of 20 consecutive weeks;
(b) a lay-off of more than 13 weeks in any period of 20 consecutive weeks, if the lay-off is less than 35
weeks in any period of 52 consecutive weeks and,
(i) the EE continues to receive substantial payments from the EE,
(ii) the ER continues to make payments for the benefit of the EE under a legitimate retirement or
pension plan or a legitimate group or EE insurance plan,
(iii) the EE receives supplementary unemployment benefits,
(iv) the EE is employed elsewhere during the lay-off and would be entitled to receive supplementary
unemployment benefits if that were not so,
(v) the ER recalls the EE within the time approved by the Director, or
(vi) in the case of an EE who is not represented by a trade union, the ER recalls the EE within the time
set out in an agreement between the ER and the EE; or
(c) in the case of an EE represented by a trade union, a lay-off longer than a lay-off described in clause
(b) where the ER recalls the EE within the time set out in an agreement between the employer and the
trade union.

EE can be laid off up to 35/52 weeks of certain conditions are met – provides additional protection
to EE
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
Some protection against avoidance of notice obligation through a reduction of work week in
definition of what constitutes a regular work week
o 56(3.1) For the purpose of sub (2), an EE who has a regular work week is laid off for a week
if,
 (a) in that week, the EE earns less than one-half the amount he or she would earn at
his or her regular rate in a regular work week; and
 (b) the week is not an excluded week (sick/suspension)
Duty of Good Faith
Common Law

Historically at CL ERs did not owe a duty of good faith or fair treatment to EEs, but in recent years
there have been some developments in that direction
 The most well established duty to act fairly is when terminating an EE – but does the duty to act
fairly extend to mistreatment during the employment relation?
Piresferreira v. Ayotte
Facts: Piresferreira (former account manager with Bell) had had good reviews until recently. Ayotte,
her supervisor, (who had a history of aggressive behaviour and verbal abuse) yelled and swore at P
because she failed to schedule a client meeting and at one point pushed her left shoulder. Bell gave A a
disciplinary warning and required him to participate in conflict resolution courses. The day after the
issue was formally resolved by Bell’s HR department, P went on sick leave for “stress leave due to
anxiety – dealing with work harassment.” She never returned and subsequently commenced litigation
for wrongful dismissal (CD) and tort damages.
Analysis: TJ
 determined that Bell (vicarious) and A were jointly and severally liable for:
o The tort of negligent infliction of mental suffering;
o The tort of intentional infliction of mental suffering;
o Battery and assault.
 Also held that P had been constructively dismissed.
o Her continued employment at Bell was impossible because the company merely “relocated”
A within the same office, and offered to change her reporting structure.
Analysis: COA
 Issue: Negligent infliction of mental suffering in an employment context?
o Sub issue: is there a general duty to take care to shield an EE during the course of the entire
employment from acts in the workplace that might cause mental suffering?
 Code of Business Conduct: EEs had the right to work in violence free environment
o Bell had this, P argued it was included in the K (EEs had to sign it every year)
o BUT even if it was part of the K, contractual breach cannot form the basis or tort liability –
there must be a duty of care that would exist with or without the K
 Novel so must apply Ann’s:
o close enough relationship (proximity) to render damages reasonably foreseeable (PASS)
 yes, close relationship
o countervailing policy considerations (FAIL)
 but Honda: damages in wrongful dismissal are confined to notice and not available
for mental suffering EE may have suffered UNLESS the parties contemplated at the
time of K that a breach might cause P mental distress. BUT:
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




This doesn’t mean that a particular K does not contemplated mental suffering
Honda was directed at mental suffering in the context of dismissal (not
mistreatment during the employment relationship) – so this would be a much
broader duty than dealt with in Honda or Wallace
 recognizing this tort in the employment relationship would overtake and supplant
the Honda framework and all of the jurisprudence from which it evolved
 in the dismissal context, the law already provides a remedy in respect of the damage
here
Possible scenarios:
o ER allegedly tortious behaviour includes termination: EE can claim compensation for mental
distress set out in Honda
o ER allegedly tortious behaviour does NOT include termination: EE can claim CD
o ERs behaviour is not grounds for CD: no duty
 arguable that it is not foreseeable that EEs would suffer mental distress from a poor
review
 if the EE was sufficiently aggrieved, they could claim CD
 it is undesirable to find a duty here (and thus mental distress damages) b/c it would
be a considerable intrusion into the workplace, and it would constrain efforts to
achieve increased efficiencies, and the duty would be so broad it could apply
indeterminately
Held: the tort of negligent infliction of mental suffering is NOT available in the employment
context
o EEs can sue for intentional infliction of mental suffering or claim CD
TUCKER:
o ER is not under an obligation to use its capital for the benefit of EEs
o ER is under a general duty to treat EEs with a degree of decency (not abusively)
 if they do not, EE can claim CD (can claim notice) – this is ERs duty of good faith and
fair treatment
 Remedy: damages are limited ONLY to notice they would have been entitled to if
ER had terminated the K properly
o What about damages for mental suffering? (over and above notice entitlement)
 Mental suffering damages available in a limited sense, in the context of
terminations
 Wallace: if ER acted badly in the context of terminations that caused mental
suffering, EEs are compensated by getting EXTRA notice (very controversial)
 Honda: Wallace bump was unprincipled, have to go back and ask – what did
K promise (Hadley principle)? It promises that EE will be treated decently at
termination (BUT only since Wallace, which caused this expectation)
 There is an implied K duty on ERs to treat EEs decently at the point of termination
 Honda better entrenched this duty, but limited its scope
 EE must actually establish that they suffered damages as a result of the bad
behaviour by ER at the point of termination (ex: couldn’t get into the labour
market right away)
o What about tort damages for negligent/intentional infliction of mental suffering?
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
o
Issue: is there a tort duty that operates generally in the employment relationship not
to inflict mental suffering on EEs? would be drastic expansion of the Honda duty
 CONTRACTUAL basis: breach of K not a tort
 ER had a code of conduct which provided that EEs would be free from
harassment/violence – P argued this was K obligation not to cause mental
suffering and that they breached their K
 Court: this doesn’t make a difference, if ER breaches K, the remedy is CD or
possibly Honda damages if it was in termination (K breach is not a basis for
tort liability).
 NO separate tort duty for NEGLIGENT infliction of mental suffering
 Applied Anns, there is proximity but it fails on policy
 Not appropriate to impose tort liability here b/c it would be too big a
departure from existing norms to impose a wide sweeping duty of good faith
on ER
 In Wallace, a general duty of GF was rejected because it would effectively
impose an obligation not to terminate EEs except with valid justification – too
major
 Imposing a duty here would be even larger than Wallace because it wouldn’t
be limited to the termination context - court is not comfortable doing it
(floodgates)
o every time an EE was disciplined or pressured to improve
performance, it could theoretically lead to a claim of mental suffering
o too much intrusion into the workplace – NOTE the protective impulse
of the courts running up against the desire to not impede efficiency of
workplace
 BUT other ways for tort to operate: intentional torts are actionable
 Battery: EE was shoved, could sue for separate damages
 Intentional infliction of mental suffering: court entertains the possibility of
this arising, but have to carefully patrol the boundary between negligent and
intentional
o requires a SUBJECTIVE intent on the part of ER (or agent)
o will be unusual – hard to make out this claim
What was held in Piresferreira:
 Constructive dismissal:
 EE was treated badly by supervisor (abuse/shoving), amounted to CD =
notice
 Mental distress:
 ER behaved badly in the course of supervisor = additional Honda damages for
mental distress
 Tort liability:
 No contractual basis for this (even if it said in the K no mental suffering, can’t
sue, only CD is available)
 No negligent infliction of mental suffering tort (would be too broad a duty)
 Battery and intentional infliction of mental suffering are available (intentional
torts only)
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Prinzo v. Baycrest
 the tort of intentional infliction of mental suffering DOES apply in the workplace. Three
elements:
o (1) flagrant or outrageous conduct
o (2) calculated to produce harms
o (3) resulting in a visible and provable illness
Minimum Standards




no general statutory obligation to treat EEs fairly or to act in good faith, but there are statutory
duties that might be seen as related to a duty of GF
OHRC: prohibits harassment on prohibited grounds
o remedies are available under the code that address pain and suffering caused
OHSA: covers workplace violence and harassment
o requires ERs to develop policies to protect EEs from being exposed to violence/harassment
o remedies are within the Act (EE can’t sue)
Workers Comp:
o EE who is disabled as a result of mistreatment is entitled to claim and get workers comp
Collective Bargaining




Management typically maintains rights to manage the workplace through a “management’s rights”
clause. So, are they limited by a general implied duty by to exercise those rights in good faith?
Some CAs expressly stipulate that the ER is under a duty to exercise its managerial authority
reasonably and in good faith (in Manitoba, this duty is imposed by statute)
Where no duty is imposed by statute or expressed in the CA, can arbitrator imply it?
CONTROVERSIAL.
In this context there are two dimensions to the GF obligation:
o K administration
 Issue: does the ER have a duty of GF in exercising its powers under CB agreements?
 Starting point: ERs have ‘managerial prerogative’ – freedom to run enterprise as
they see fit, subject only to constraints imposed on them by the CB
 Arbitrators: began imposing an obligation of GF – ERs had to exercise the
prerogative reasonably, without discrimination, bad faith, or arbitrariness (general
duty)
 Courts:
 arbitrators were going beyond their powers – instead of interpreting the CA
they were modifying it, which they are not allowed to do, and had struck
down awards
 over time, after several decisions, courts have backed off from this view and
have permitted arbitrators to impose this duty of GF at least when it comes
to the exercise of discretionary powers
o Issue of mental suffering
 Before proceeding: remember that unionized employees generally can’t take
complaints to court, they must go through the grievance procedure
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



Cross fertilization: we’ve seen courts take doctrines from CB and use it in CL, here
we see arbitrators take development from the CL and apply it in the CB sphere, in
ways that produce more protection for EEs in CB than EEs in CL
Issue: what does the K promise?
CL: promises termination by notice
 the act of termination itself can’t give rise to liability b/c the individual K
doesn’t promise peace of mind
 You can’t claim mental suffering merely because you were given notice
CB: these Ks DO PROMISE SECURITY
 basic principle is that ERs can’t discipline/discharge without just cause
 this allows unionized workers to claim damages for mental suffering,
because ERs can’t terminate without just cause
 they can now claim damages for suffering that ERs caused them without
proof of physical loss because it is a K that promises peace of mind
 EE is not limited to treating this as a termination
Municipality of Metro Toronto v. CUPE 43
 Facts: six EEs challenged a unilaterally imposed rule requiring ambulance drivers to use certain
emergency warning lights and sirens when responding to emergencies. No discipline had been
imposed, and CA provided that EE could grieve if discipline was imposed without just cause.
Previously drivers could exercise discretion over the use of lights.
 Arbitrator held: no valid reason for implementing the new rule and any discipline imposed for
breach of the rule would be unjust
 Judicial review: quashed the award, board’s interpretation of the CA was unreasonable
 ISSUES:
o is the board correct in assessing the reasonableness of the rule, since no discipline has been
imposed?
o was this rule reasonable?
 ON COA:
o union’s argument: where a rule has disciplinary consequences and where the CA provides
that discipline must be for reasonable cause, the Board is correct in assessing the
reasonableness of the rule
o Re Council of Printing Industries: it is not patently unreasonable for an arbitrator to oblige
management to exercise its discretion reasonably, where to do so unreasonably would
create a conflict with or undermine the rights conferred by the CA
 NOTES:
o Stelco: this judgment doesn’t suggest that that a decision made in good faith could
nevertheless be challenged as unreasonable simply because it had the effect of conflicting
with or undermining some right in the CA – such a principle would cripple managements’
ability to conduct their affairs
o St Joseph’s Hospital: court here stuck down arbitrator’s award b/c it added to the CA by
requiring ER to provide clear and cogent reasons when exercising its management rights to
alter long-standing practices
Collective Agreement Arbitration in Canada (Palmer & Snyder)
 The duty of fairness in CB is limited to three circumstances:
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o

ERs are under a duty not to exercise discretionary powers in a manner that is arbitrary,
discriminatory or in bad faith
o ERs must act reasonably when adopting rules that could lead to disciplinary action
o ERs must exercise their discretion reasonably when to do so unreasonably would
undermine rights conferred by another provision in the CA
However, most arbitrators are reluctant to find a general duty of fair K administration
Employers’ Responsibility for Employee’s Conduct




McKee v. Dumas – issue of who is ER
o Making this determination was important in order to determine vicarious liability for EEs
negligence
Principles of ERs responsibility for the conduct of EEs apply whether the K of employment is
governed by CL or CB
o the CB scheme does not fundamentally alter the nature of the ER/EE relationship at CL
o ERs responsibility for the EEs conduct, otherwise known as VL, means that one person (the
ER) is monetarily responsible for compensating for another's (the EEs) tortious acts or
omissions committed in the 'course of employment'.
Liability is fault-based, the third-party plaintiff must be able to establish the liability of the EE
to pay damages before liability can be attributed to the ER.
o If the EE is liable, the only remaining issue is whether or not the alleged act of misconduct
occurred during the course of her employment.
INDEPENDENT CONTRACTORS:
o In the middle of the nineteenth century it was decided that there would be a general
principle affirming liability for servants and denying it for independent contractors
[Quarman v. Burnett]
Course of Employment




The ERs VL only encompasses conduct occurring in the course of the employee's employment.
VL may be imposed, even when the ER specifically prohibited the very tortious act in question.
o A prohibition relating to time, place or manner of the execution of the work does not
ordinarily exclude from the scope of employment an act committed in violation of the
prohibition.
Liability can be avoided when an employee goes on a frolic of her own.
o Issue: whether the activity was reasonably incidental to the performance of her duties or
involved so substantial a departure from the assigned tasks as to render the EE a stranger
vis-à-vis her ER.
As well, the ER is not usually held VL for wilful or intentional wrongdoing on the part of the EE.
o In such cases, the EE has committed a tort in her own right in the furtherance of her own
goals independent of the ERs goal [Bourgeault]
o ER is liable only when the act falls within the scope of the EEs "real or ostensible authority".
Employers’ Duty to Provide a Safe Workplace

The CL framework for regulating OHS developed through litigation over ERs liability to
compensate injured workers.
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o

Because most workers are now covered under statutory workers' compensation schemes
that severely limit their right to sue, this law is not of much practical importance today.
Moreover, the ERs substantive duty to provide safe work has generally been superseded by OHS
legislation.
CH 5: EMPLOYEE DUTIES
 This is the other side of L+E law: the side we have talked about mostly so far is the protective side,
but there is also a disciplinary side: a side that helps ensure the employer gets what it has bargained
for.
 focus here is on facilitating ERs ability to get the use of the labour they have contracted for
o Issue: to what extent is there recognition that there is a human being obliged to provide the
service, so some of the obligations are to be softened to take into account the human character
of the employment relationship?
 duties and obligations imposed on employees by implication of law fall into two categories:
o 1. duty to obey and the duty to use appropriate skill and care
 these duties apply only during the duration of the employment relationship
o 2. duty of good faith and fidelity
 this duty may have a post-contractual scope, i.e. they continue to some degree after the
employment relationship has ended.
 duties and options may be imposed because the parties explicitly agree to them or may be implied
o where an EE is in breach of an express of implied term, the ER may have cause of action in
damages in respect of the loss occasioned or have a right to dismiss the EE from his service
Duty to Obey
Common Law
Laws v. London Chronicle 1959 ER
Facts: during a meeting with her direct supervisor and the chairman of the company, there was a fight
between direct supervisor and chairman. Direct supervisor asked plaintiff to leave with him while
chairman asked her to “stay where [she is]”. Plaintiff left and was dismissed. Defendant company
denies that the plaintiff had been dismissed and states that even if she had been, the company was
entitled to dismiss her because of her wilful refusal to obey a reasonable and lawful order given to her
by the chairman and director of the company
Issue: appeal by the defendant company in an action by the plaintiff for damages for wrongful
dismissal
Lord Evershed:
 Since a K of service is but an example of K in general, so that the general law of K will be applicable,
it follows that, if summary dismissal is claimed to be justifiable, the question must be “whether the
conduct complained of is such as to show the servant to have disregarded the essential conditions of
the K of service”
 it is generally true that wilful disobedience of an order will justify summary dismissal since it shows
a disregard of an essential condition to the contract of service, namely, the condition that the servant
must obey the proper order of the master
 One act of disobedience:
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o in the present case, it is not right to say that one act of disobedience, to justify dismissal, must
have been of a grave and serious character (as was stated by the trial judge)
o however, I do think that one act of disobedience or misconduct can justify dismissal only if it is
of a nature which goes to show (in effect) that the servant is repudiating the K, or one of its
essential elements
o thus, disobedience must at least have the quality that it is “wilful” (connotes a deliberate
flouting of the essential contractual conditions)
 Application:
o In this case, the situation was embarrassing for the plaintiff and in the circumstances, the fact
that she walked out with her supervisor cannot be conduct that amounted to a wilful
disobedience of an order that was a deliberate disregard of the conditions of service
 Judgment: Appeal dismissed.
Ratio: it is generally true that wilful disobedience will justify summary dismissal, but it must be of a
wilful quality that shows the EE’s effective repudiation of the K.
Tucker on CL Duty to Obey
1. Source of the obligation
 Historically (master/servant regime) it was criminal for EE not to obey his masters order
 In free labour market, it is implied in the essence of the K
o One person has agreed to provide service in exchange for remuneration (doesn’t require
express undertaking or statute)
o Allows ER to get the benefit of what it paid for
o The court never refers to an express contractual term that Laws was under a duty to obey, so
presumably it must be implied.
2. What constitutes disobedience?
 If disobedience requires the intentional disobedience of authority, was Jean Law’s disobedient or
was she simply trying to comply with conflicting commands?
o She was, in fact, trying to be obedient! Merely made a mistake. She had contradictory order, one
from supervisor and one from chairman.
 Walker v. Booth Fisheries.
 EEs thinks that they are doing what ER would want them to do in the
situation, but EE turns out to have made the wrong call and ER fires for
disobedience.
 Court: this is not disobedience, it may be bad judgment but it is not
disobedience. For disobedience you need a defiance of legitimate authority,
not an attempt to comply with authority that has gone wrong.
3. What are the limits of the duty to obey? When can an employee disobey without breaching an
implied term of the contract of employment?
 1. Occupational health and safety – employer cannot lawfully order employee to unreasonably
endanger oneself or others
o In Ontario, s.43 of the Occupational Health and Safety Act gives a worker the right to refuse unsafe
work while s.50 provides that employers shall not retaliate against workers for exercising this
right. Labour Board can order re-instatement should the ER terminate, for both unionized or
non-unionized workplaces.
 2. Unlawful orders
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 3. Unreasonable orders – orders that are inconsistent with other express or implied terms – eg.
lawyer employed at law firm ordered to spend day performing janitorial services.
4. Will any act of disobedience justify immediate dismissal without notice?
 (before moving on – we will return to the fact an ER can pretty much always terminate an EE
provided there is proper notice)
 Laws: even if she was disobedient (in a sense), it wasn’t sufficient to justify summary dismissal
 disobedience must be to the threshold of a breach of K to justify immediate dismissal
o At CL they take into account record of employment (length of service, previous issues)
o BUT they say a single act could justify termination if it ruptures the relationship so thoroughly
that it can’t go on (but not every act will meet this standard, view to look at everything in
broader context of relationship).
 “Someone who just has a minor act on its own is probably not enough to justify dismissal.”
 Also need to look at the record of the employment. In Laws, the decision reflects the
paternalism of the judge and the era, but the point remains. The decision takes the record
into account.
 Page 55: she had served loyally.. had been a good girl.
5. Enforcement.
 At common law, mostly enforced by threat or exercise of power to terminate
o Non-unionized EEs who have been terminated for disobedience can challenge this by suing for
wrongful dismissal at CL or claiming statutory notice pay under ESA
o but note ESA disqualification from termination and severance pay for EEs dismissed for
disobedience
 ESA Reg 288/01 s.2(1)(3): An EE who has been guilty of wilful misconduct, disobedience or
wilful neglect of duty that is not trivial and has not been condoned by the ER is NOT
entitled to notice
Walker v. Booth Fisheries 1922 OWN
Ratio: wilful disobedience justifies dismissal without notice
Collective Bargaining & Duty to Obey: general rule is to comply now and grieve later
Ford Motor Co. 1946
 Some men apparently think that, when a violation of a K seems clear, the EE may refuse to obey and
thus resort to self help rather than the grievance procedure – THIS IS INCORRECT
 Nothing in the K suggests the idea that only doubtful violations need to be processed through the
grievance procedure and that clear violations can be resisted through individual self-help
o both must be handled in the regular prescribed manner
 grievance arbitration procedure is capable of adequately recompensing EEs for abuse of authority by
supervision
Ratio: even if a violation of the K by ER seems clear, EEs must not refuse to obey at the time, but
rather go through the grievance process
Kimberley-Clark 1973
Facts: ER company advised the union that it wished to extend the working day due to a strike at
another company location. Union objected and told its members not to scab. ER instituted the longer
hours and in protest, EEs walked off during an extended shift. ER suspended some of these EEs
arguing that they disobeyed lawful instruction.
Analysis:
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 Whether the company does have the right to require the employees to work overtime
o Previous authorities have clearly held that in the absence of any express provision in the CA
limiting management rights, the ER has the authority to require compulsory overtime
 management rights are broad and if union wants to limit them it must negotiate it
o Based on the principles above, we find that the company did have the right to assign overtime
work to the EE and under the terms of the CA compel them to perform such work
 Where the order is illegal or dangerous: (Re USW and Lake Ontario Steel Co)
o ER cannot order EE to do something that is not permitted under general law or under statutory
employment law
o If an order is unlawful there cannot be disobedience, there cannot be insubordination.
 refusing to follow it is not disobedience (applies to CL and CB)
 Exception to the comply now, grieve later principle
o Here, the overtime was unlawful because the ESA required ER to have a permit from the
Ministry of Labour and it did not
 NOTE that this is an objective test – state of mind of EE is irrelevant
o HUGE difference between CB and CL: remedies available
 when unionized EEs are disciplined, they can challenge it through grievance and get
remedy
 non-unionized EEs operate within a dismissal or CL notice entitlement limitation
4 exceptions to the “work now, grieve later” rule
o 1. Health and safety: The following requirements must be shown:
 EEs must have an honest belief that their heath or well being is endangered
 they must communicate this belief to their supervisor
 their belief is “reasonable” in the circumstances
 that the danger is sufficient to justify the particular action taken
o 2. Unlawful act: EEs are justified in refusing to perform an assignment which would involve
them in committing an unlawful act
o 3. Union officials: if union officials, acting reasonably, determine that it is necessary to refuse to
comply with an order of their supervisor in order to attend to union matters and avoid the
infliction of irreparable harm to the EEs they represent, they may refuse to work on the spot
 La-Z-Boy Canada 2002: Union officials must be able to challenge management practices
and contract administration without fearing discipline or dismissal. They cannot be
expected to articulate concerns or criticisms in calm, considered and diplomatic phrases but
are expected to be human, vigorous, honest and clear. Considerable latitude must be given
to union officials when carrying out their responsibilities concerning the administration of
the collective agreement.
o 4. Privacy Issues
 chipping away at personal rights of EE: orders regarding appearance are invasive of
privacy that some arbitrators have said might be seen as exceptions to work now, grieve
later
 ex: if ER ordered you to shave, could you disobey? some scope to protect the realm of
personal privacy
Tucker
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 It goes without saying that the duty to obey has been imported into the CB regime. How, if at all,
does it differ from the common law regime?
 1. Source of duty?
o Usually there is a management rights clause in a CA
o If not it is implied (Ford Motor) – arbitrators will imply a management’s rights clause, which is
only limited by express provisions in the CA that narrow these rights (or limited by statute)
 2. What if ER’s order violates CA?
o ex: a provision in CA that limits management authority, mgt ignores it and orders EE to do
something in a way that ER does not have the right to do – can the EE disobey without
suffering penalty? NO
o Gospel rule of CB relationships: obey now, grieve later – fundamental to the relationship.
 Even if EE is certain that ER has no right to give the order, the law of the unionized
workplace is obey now and grieve later.
o Rationale from Ford Motors: “When a controversy arises, production cannot wait for
exhaustion of the grievance procedure. While that procedure is being pursued, production must
go on. And someone must have the authority to direct the manner in which it is to go on until
the controversy is settled. That authority is vested in supervision. It must be vested there
because the responsibility for production is also vested there; and responsibility must be
accompanied by authority. It is fairly vested there because the grievance procedure is capable of
adequately recompensing employees for abuse of authority by supervision."
 this is part of what the CB relationship promises EE: that there will be continuity of production for
the life of the CA (production goes on)
 Tucker: However, there are limits to ‘grieve now grieve later’: similar to the limits we saw
before:
 Occupational health and safety: work that defies standards or that would endanger
themselves or others
 Unlawful orders
 Unreasonable orders
 3. Enforcement:
o Note that in unionized setting, ERs generally enjoy a vast range of disciplinary powers short of
termination, including suspensions without pay.
o Union can challenge ER discipline and discharge of EEs by filing a grievance that can ultimately
be resolved by formal adjudication before an arbitrator.
o In every CA it says there will be no discharge or discipline without JUST CAUSE.
CONTRARY to non-unionized process where EEs can always be terminated w/ NOTICE.
Hence, huge difference in employment security in a unionized environment.
o Disobedience can good enough for just cause. But not every act of disobedience is just cause for
dismissal.
o There is no question that ER can discipline in the CB context. But EEs in CB have much better
ways to complain – the grievance procedure.
o Discipline can take many forms: letter of reprimand, suspension.
o Arbitrator can make a number of remedies.
 Substitute discipline – e.g. make it lesser. Shorten suspensions.
 Order reinstatement.
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Statute

Tucker
o We’ve already seen that the ESA and EI reinforce the duty to obey by disqualifying
disobedient employees from entitlements that they would otherwise be able claim.
o Note, however, that the OHSA gives most employees a right to refuse unsafe work.
Duty to Exercise Skill and Care
In both CL and CB regimes
 In the absence of an express or implied warranty on the part of the EE, the general presumption is
that ER will determine whether the EE has the required skills (burden on ER)
 Probation: For this reason, many ERs have adopted the practice of hiring workers on probationary
status, preserving a right to dismiss for lack of skill or unsatisfactory work performance for a
defined period of time
 Beyond probation: EEs who wilfully refuse to apply themselves or exercise care can be terminated
 CL: there is a duty, and if wilfully breached results in discharge without notice
 ESA: recognizes this as a ground for summary dismissal without notice [O. Reg. 288/01, s.
2(1) 3] –
 CB: this is just cause for termination within the CB relationship
 The more problematic cases involve breaches of the duty to exercise skill that are NOT wilful
Common Law & ESA
 What can an ER do if it is dissatisfied with EE performance, but there is no violation of the duty
to exercise skill and care?
o Example: EE is trying his best to carry out the job, but he is just unable to – is this a breach of
duty?
 CL: In theory, EEs can be summarily discharged (without notice) for incompetence, but in
practice it is difficult
o Requirements: (1) Must establish bona fide job qualifications (subject to human rights & health
and safety limits); (2) properly assess employee performance; (3) not have condoned that poor
performance by accepting it without complaint; (4) have provided the employee with an
opportunity to improve.
o *Non-unionized ERs can always discharge by giving appropriate notice, provided lack of ability
is not related to a prohibited ground of discrimination (eg. disability), in which case human
rights law and duty to accommodate kick in.
 ESA: no exceptions – EE does not get disentitled
o The right to dismiss without notice is explicitly reserved but may only be used where there is a
finding of wilful misconduct (s.57(10)(c)) of ESA
 Remedies: ability of ER to collect damages (either VL or to itself) from EE for EEs negligence
o Lister: HOL held that EEs were liable to their ERs for negligence. For many years, Canadian
courts accepted Lister as good law, although they often limited it by restricting liability to
skilled workers
Douglas v. Kinger (2008 CA)
 Facts: 13 year old doing maintenance on a cottage, causes fire by using gas lawn mower, which
210
burns down the family’s boathouse. Covered by insurance, and insurance company wants to sue
the young boy.
 Issues:
o was he in business for himself or an EE?
 If IC, then he is liable (don’t have to worry about employment context)
 Held: EE
o if EE, can he be held liable in negligence for the damage he caused ER?
 Analysis:
o Novel duty, so much apply Ann’s test of proximity/policy
o Proximity: yes, reasonably foreseeable that damage would cause harm
o Policy: protective impulse kicks in, there is a power imbalance between the ER and the EE
which would make it hard for EEs to contract out of liability
 It would be wasteful if both parties had to have insurance – ER has insurance anyway
 Ratio: If an EE is negligent (NOT intentionally negligent), he is not liable to ER for damages
Collective Bargaining
 Fundamental difference between CL and CB regime:
o In the CB regime, ERs do not enjoy an unfettered right to always terminate an EE by giving
notice.
o CAs provide that there shall be no discipline or discharge without just cause (wilful neglect of
duties will constitute just cause)
o This difference leads to a different implication of having ‘just cause’ in each context:
 individual K: can ER summarily dismiss EE? (can always just give notice)
 CB: can ER dismiss EE at all?
 In situations where ER is dissatisfied with EEs work performance, in principle, EE can be
terminated, but must pass numerous hurdles (Aro Canada Ltd)
o Assuming job requirements are properly set, ER must fairly assess EEs work performance
(cannot demand perfection – only level of performance of a reasonably able, skilled and
efficient EE), notify EE that such behaviour is not condoned, and provide opportunity to
improve
o Burden is on ER to satisfy arbitrator that had just cause
 However, even if ER satisfies the arbitrator that the EE is not competent to perform the job, it may
not be able to terminate employment by giving statutory notice under ESA because CAs often
contain seniority and bumping rights provisions (Aro Canada)
Aro Canada Ltd 1975
Facts: Emburgh, a packer within the bargaining unit, had applied to become a storekeeper-help and
carried out her work without any complaints. She went on voluntary layoff, preserving her seniority
rights for the purpose of recall. She was so recalled when the male storekeeper quit his job – she was
advised that she would no longer get any help from the boys. When she got an order which required
her climbing up a ladder to bring down a 85lb box, she had to ask for help which she was given. She
was subsequently dismissed because employer argued that she could no longer do the job.
Analysis
 Who gets to establish job qualifications and what the expectations are?
o starting point: management prerogative remains untouched except to the point it is limited in
CA language
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 Management’s ability to determine job qualifications:
o it is generally recognized that management has a presumptive right to determine the
qualifications for a particular job unless the collective agreement provides otherwise
 this includes not only describing qualifications but also staff levels – ER decides how many
people are required to perform particular jobs
o limit: however, in determining these qualifications, management must not act arbitrarily,
discriminatorily or in bad faith
 obligation that there be a legitimate business justification (not arbitrary)
 management should not use the requirements as a guise in defeating EE rights under the
CA
 in this case, there is no evidence to support conclusion that allowing Emburgh to continue
on as in the past would have prejudiced the company’s operating position
o company does have the right to determine and alter jobs that are assigned to a particular
classification
 however, they must act reasonable and not in a manner which would subvert an EEs
seniority rights
o Tucker: the standards can’t violate statutory limits
 must comply with HR code
 must comply with principles in Meiorin: if the standard is harder to meet by a group of
people, ER has to justify it and show that they can’t accommodate without undue hardship
 OHS: can’t establish rules that put workers at risk
 Level of perfection/skill required of the EE by the ER
o unless the agreement provides otherwise, management is not entitled to insist on perfection
on every conceivable task that is assigned to a job classification
 company must accept the relative strengths and weaknesses of each EE as long as they are
able to meet some general standard of ability
 in this case, Emburgh capably performed all but a small minority of the order she is
required to handle
o the test is one of the skill, ability and efficiency of the reasonably proficient workman of the
same classification
 If company could prove that the handling of particularly awkward or heavy orders was a
significant part of the job, or that manning requirements would have made it unfeasible for
other EEs to help Emburgh, we would think it proper for ER to require Emburgh to exercise
her seniority rights on some other job
 Unions typically negotiate for a number of job security provisions, largely based on
seniority. If ER was justified in removing her from the job, under the CA she might have
seniority rights to get another position in the firm (‘bumping rights’). Here they had
terminated her without letting her exercise those rights.
Judgment: company did not have just cause to discharge Emburgh and grievance must succeed
 burden is on ER to show that EE can’t do the job, and here ER failed to prove that EE could not perform the
job up to a reasonable standard – the fact that she may have required occasional assistance in moving an
unusually heavy package does not means he failed to meet the standards of the job
Dissent:
 there are no job descriptions for any or all of the job classifications set out in the CA – the
company has exclusive right to determine and change the job content in any occupational
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classification and to determine job qualifications
 Emburgh was informed that the change in job content and qualifications were caused by a cut
back in personnel due to economic conditions
 Company had the right to determine the qualifications and duties of storekeepers helper and that
determination was not made in an arbitrary or unreasonable manner, nor in bad faith
 Emburgh admits that she was unable to do the heavier parts of the job and thus it is clear that she
was not qualified to perform all of the requirements of the job
NOTE: unionized EEs are not entitled to CL notice, but they are entitled to ESA notice (or whatever the
CA says) – and in a situation like this, she would be entitled to it because only wilful neglect disentitles
you under the ESA.
Ratio: (1) it is generally recognized that management has a presumptive right to determine the
qualifications for a particular job unless the collective agreement provides otherwise (2) in
determining these qualifications, management must not act arbitrarily, discriminatorily or in bad
faith (3) the test for meeting the standard is one of the skill, ability and efficiency of the reasonably
proficient workman of the same classification
Aro Canada and International Association of Machinists 1988
Facts: Emburgh was an employee of the company since ’73 in the assembly department. She was
suffering from severe physical disabilities which prevented her from lifting heavy objects and thus,
when she needed to move heavy things, she sought help of a guy in her department. When the
assembly department superintendent saw this, he made comments such as “it would be nice to have a
man around here” and “you see what I mean about needing a man”. Emburgh got angry and told the
superintendent to “F* off”
Issue: whether a three day suspension of Emburgh was imposed without reasonable cause?
Analysis:
 The use of the foul language towards a supervisor is never permissible and except in the rarest of
circumstances merits some discipline
 ERs are entitled to expect proper conduct and a certain degree of respect towards members of
management and EEs who fail to do so must not be surprised when the ER reacts by way of
discipline
 In this case, the language used was unacceptable and constituted misconduct
 However, there are mitigating factors: Emburgh was angry and reacted emotionally, her
psychological state was somewhat frayed
 Manager testified the 3 day suspension was based on company’s rules and regulations
Judgment: I think it is appropriate to exercise my discretion under s.44(9) of the LRA which empower
me to substitute 3 day suspension with 1 day suspension  superintendents comments provoked the
abusive language
Tucker: this is really a case about insubordination and the duty to obey than it is about the duty to
exercise skill and care
Ratio: the use of foul language towards a supervisor is insubordination and not permissible, but the
penalty may be mitigated by provocation
Duty of Good Faith and Fidelity
 **THIS DUTY DOES NOT COME TO AN END WHEN THE RELATIONSHIP IS SEVERED**
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 There is an implied duty of good faith and fidelity that EE owes to ER
o POLICY: to ensure to a reasonable degree that ERs get the benefit of the employment contract
 Obvious breach: dishonesty (theft, fraud) is the most basic breach of GFAF
 Consequence:
o serious breaches (like things that would land you in jail) provides CL just cause for termination
without notice (also would not be entitled to notice under the ESA)
o Tricky part is when the acts are not independently criminal or tortious – like EEs pursuing their
own best interests where that might come at the expense of the ERs interest
 Tension between EE priority and ER priority:
o EE wants freedom to make best use of their human capacities and to be able to circulate freely
in the labour market,
o BUT there is potential for harm to ERs businesses
o Ex: loss of confidential business information that competitors might be able to take advantage
of, loss of trade secrets that ER guards to make a profit
Common Law
Hivac Ltd. (1946 – British Court of Appeal)
Facts: 5 employees of H Ltd started working for P Ltd on Sundays, H ltd's sole competitor.
Held: An injunction was sought and granted after the Court of Appeal held that the employees were in
breach of their implied duty of fidelity, and
that it was not consistent with their employment K’s that they were doing something in their
spare time that would 'potentially inflict great harm on the company.'
Analysis:
 Soliciting ERs customers while working
o This is clearly not okay – clear violation of the duty of GFAF
o Working in your own interest on master’s time (ER has bought his time).
 Soliciting ERs customers on his own time
o E.g. milkman wants to deliver oranges on the weekend, to the same client list
o Misuse of ER information: customer list is ERs property (question of whether this is legally
accurate)
o He got that property by virtue of the employment relationship
o EE cannot use ERs info for their own benefit, even if it’s on their own time. So this is generally
a breach of GFAF.
 On his own time works for ERs competitor
o Assuming no restriction in K
o This is the problem at issue in this case. It is complex, problematic and not a simple question,
court must balance competing interests!
 It would be unfortunate if court placed undue restriction on the right of the workman to
make use of his leisure for profit.
 On the other hand, it would be deplorable if workman could, consistently with his duty to
his ER, knowingly and deliberately set himself to do something in his spare time that
would inflict great harm on ERs business.
 In Hivac, ultimately the Court looks to that the skills acquired by the EEs are highly
specialized skills and that even if the EEs do not distinctly use insider knowledge
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somewhere, they will inevitably be applying this insider knowledge and it is unfair to the
company
 Question ultimately becomes: can the ER establish that what the EE is doing is going to inflict
some kind of harm on ERs business?
o No bright line test about this – EE can theoretically moonlight for competitor, but it will come
down to facts and whether ER is liable to suffer damages.
o It seems that EEs ability to work would have to be sacrificed in this situation
 TWO MAJOR RISKS TO ER:
o Risk of sharing confidential information:
 The protection of ERs property-like interest seems to trump EEs right to circulate freely in
the labour market.
 Here, the EEs were not in possession of confidential information, but Court was concerned
that it would be almost inevitable that insider info would be carried over to competitor –
see Tucker note below.
 Court seems to leave it open that if there is a reasonable fear that confidential information
could be shared in the future, it would be a sufficient ground.
o Risk of giving human capital, developed by ER, to competitor
 Distinction between a man’s skill (his property) and confidential information (ERs
property)
 Hard to draw this line, but patrol the boundary between kill and information
 Example of tension: IT business
 if a broad definition of confidential business info is adopted, it could restrict
the free movement of EEs in the IT field
 BUT if there is no protection, ERs will not have incentive to innovate because
they will be worried about competitors poaching their EEs
 If the work was highly specialized, could argue that EEs got firm-specific human capital
through their employment, and EEs could take this specific human capital with them to a
competitor. This is a second reason to impose a limit on EEs mobility.
 TUCKER:
 The hierarchy in which the person is employed will have an impact – managers owe a
higher duty, with potential up to the point of being declared a fiduciary.
 The court took the view that it would be almost inevitable that EEs would carry with them
some of the trade secrets with regard to production, even though TJ found no evidence of
this or that they even had access to it (unusual).
 **Once this risk is present, it is sufficient to limit the freedom of EEs to work for a
competitor **
(i) Duty of Good Faith – Content
 Most recent cases hold that all EEs owe their ERs a general duty of good faith & fidelity, even if they
are not fiduciaries (Faccenda Chicken)
 The issue of the scope of this duty and its implications has been the subject of much recent
litigation.
o Right to protect trade secrets: argument that ER doesn’t have to show EE breached K, only that
he divulged confidential info to competitor
o ERs also want to protect trade secrets, which are hard to define:
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 a plan or process, tool, mechanism, or compound known only to its owner and those of his
employees to whom it is necessary to confide it [R.L. Crain Ltd. v. Ashton, (1949)]
The issue of whether or not an employee has breached his/her duty of good faith by "stealing" a
trade secret does not in fact arise very often.
o Courts have held that even mere EEs have a duty on leaving employment are not to use
confidential information (Alnor Services)
The English Court divided confidential information into three types in Faccenda Chicken:
o (1) First there is info of a trivial character or easy accessibility from public sources that it cannot
be regarded by reasonable persons or by the law as confidential at all. The servant is at liberty
to impart it during his service or afterwards to anyone he pleases, even his master’s competitor.
o (2) Second, there is information which the servant must treat as confidential, either because he
is expressly told it is confidential, or because from its character it obviously is so, but necessarily
remains in the servant’s head and becomes part of his own skill and knowledge applied the
course of his master’s business. So long as the employment continues, he cannot otherwise use
or disclose such information without infidelity and therefore breach his contract. But when he is
no longer in the same service, the law allows him to use his full skill and knowledge for his own
benefit in competition with his former master
 If an employer wants to protect information of this kind, he can do so by an express
stipulation restraining the servant from competing with him (within reasonable limits of
time and space) after termination of employment.
o (3) Third, however, there are to my mind, specific trade secrets so confidential that, even though
they may necessarily have been learned by heart and even though the servant may have left the
service, they cannot lawfully be used for anyone’s benefit but the master’s. …
FACTORS TO CONSIDER (Faccenda Chicken)
o A contextual approach is used to determine the nature of the information in question which
considers:
 a) the nature of employment where the habitual handling of confidential material imposes a
higher duty;
 b) the nature of the information: whether it is a trade secret or equivalent;
 c) whether the employer impressed upon the employee the nature of the information
 d) whether relevant information can easily be isolated from other disclosable information
Barton Insurance Brokers: court held that absent an enforceable agreement to refrain from soliciting
former customers, the employee owed no duty to refrain from doing so.
(I [b]) Duty of Good Faith – Post-Employment: courts in general have been narrowing their
view of what is contained with the post-employment duty of EE to ER
RBC Dominion Securities v. Merrill Lynch: Manager while still at ER, organizing “mass departure” of
employees
Facts: Merrill Lynch and its local manager induced several employees of DS to leave their employment
with DS, join ML, and take client information with them. DS sued ML and was partially successful. ML
appealed and was partially successful.
Issue: whether this was a breach of GFAF – courts said yes.
Analysis:
 When someone in management position organizes subordinates to go to another firm, this is a
violation.
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o The duties are variable depending on the level and status
o higher status EEs will have a higher level of duty of GFAF, and at the highest levels courts call
it a fiduciary duty, where they always have to put their own interest behind ERs.
NOTE: in measuring damages, court applied Hadley principles – liability for all damages that flowed
from the breach
There is no duty not to compete unfairly [para65]
o “In my opinion, there is no such thing on the part of a servant, upon leaving his master's employ, as an
obligation not to compete "unfairly". Such a broad open-ended legal duty, whether treated as an implied
term of a contract of service or as some obligation outside the contract but imposed by law, would be
dependent for its scope on the length of any particular judge's foot.” [from COA]
There is no implied duty not to work for a competitor even during the notice period.
o BUT there are restrictions on the use of confidential info. Restrictive covenants may also
apply.
o “Generally, an employee who has terminated employment is not prevented from competing with his or
her employer during the notice period, and the employer is confined to damages for failure to give
reasonable notice... added qualification that a departing employee might be liable for specific wrongs such
as improper use of confidential information during the notice period. This appears to be consistent with
the current law, which restricts post-employment duties to the duty not to misuse confidential
information, as well as duties arising out of a fiduciary duty or restrictive covenant”
 DEFINITION of “confidential information”: Specific information not already in public
domain that would harm the employer if made known to a competitor.
CLIENT LISTS – including EEs contacting former ER’s clients
o Olden Court:
 Can’t copy down list, but no restrictions on “remembering” the list in your head.
o Modern Court
 Here takes a liberal view of the freedom of EEs. After they have moved, they are free to
contact their former clients and advise them of their relocation. This comes from an
understanding that there is a relationship between the client and the EE that is no less valid
than the relationship between employer and client. It is also in best interest of client for
them to be informed of where persons working with them are going.
 BUT they cannot take the documentation that contained the clients info with
them – that material only moves if the client directs it to.
Tucker:
o ER Remedy: if you left your ER without giving notice and went to a competitor, all that ER
could get from you would be whatever damages flowed from a failure to give notice – NO
claim for unfairly competing
o Clients interest: this is a more triangulated way of thinking – what about the clients? this seems
to drive the case. The client has a right to know what their investment advisors has moved, and
the client gets to decide whether they want to keep their business where it is or move to the
new firm.
o So the restriction is primarily about the misuse of ERs confidential business info, but
customer lists are no longer interpreted by the court as being ERs confidential business info
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(ii) Restrictive Covenants: used by ERs to try to get more protection from EE leaving,
through the power of K
 ERs try to minimize the harm of EE movement by making express K provisions beforehand,
where EEs agree to terms such as:
o not to solicit clients
o not compete by working for a competitor within a geographical area for a period of time
 POLICY ISSUES – “freedom of K and public policy”
o On one hand, they contracted to restrict their freedom and presumably got a benefit from doing
so
o on the other hand, this isn’t a realm in which freedom of K operates (inherent inequality
between ERs and EEs)
o Further, it is anti-competitive b/c it artificially suppresses competition between ERs by limiting
the pool of potential talent from which other ERs can draw
 Requirements for a valid RC [Nordenfelt v. Maxim Nordenfelt Guns & Ammunition Co. Ltd.]
o ER must have a proprietary interest that they are protecting by the RC
o RC must be reasonable in time (length), space (geographical area), activity (nature of activities
prohibited) and overall fairness
o RC can only protect activities that are legitimately important to ERs business interests
o RC’s terms must be clear, certain and not vague – no ambiguity
o RC cannot be unreasonable from a public policy perspective (Tucker: a “catch-all” concern)
Staebler Company Ltd. v. Allan
Facts: Staebler is an insurance brokerage. Its sales staff all sign a RC that prohibits departed EEs from
soliciting Staebler clients for 18 months. As well, it prohibits them from providing services or products
that are substantially the same as those provided by Staebler for 24 months following the termination of
the employment relation. When several EEs departed to take up employment at a competing firm,
Staebler obtained an injunction enforcing the covenant. The former EEs appealed.
Analysis:
 Reasonableness is the mechanism by which a court decides whether a covenant is “overly broad” or
is only that which is reasonably required for the employer’s protection.
 But how is a court to determine whether any given restrictive covenant is “reasonable”? Elsley
offers a framework for making such a determination.
o The starting point is “an overall assessment of the clause, the agreement within which it is
found, and all of the surrounding circumstances”.
o Thereafter, three factors must be considered. [Tucker: they left out clarity but it is implied]
 First, did the employer have a proprietary interest entitled to protection?
 Second, are the temporal or spatial features of the covenant too broad?
 And, third, is the covenant unenforceable as being against competition generally, and not
limited to proscribing solicitation of clients of the former employer?
 Under the policy heading, we see courts distinguishing between no-solicitation clauses and noncompete clauses
o non-solicitation: EEs agree that they won’t solicit former clients for a period of time
o non-compete: EEs agree not to compete with former ER by taking employment in a similar
business in a geographic area for a period of time (MUCH GREATER RESTRICTION, can
prevent EEs from working in their field, unlike non-solicitation)
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o court says non-solicitation clauses are more likely to be found reasonable than non-compete
clauses which would require special circumstances to be defended.
 must be able to show that your interests would not be sufficiently protected by a nonsolicitation clause – need justification to extend the restriction.
 And in large part due to this, it is very tough to enforce a non-compete clause.
Held:
 The RC in question was not just a no-solicitation clause but also a non-competition clause.
 While it found that Staebler had a proprietary interest to protect in its book of business, it held that
the covenant was overbroad in its geographic scope (limitless) and time (2 years).
o It also found that the restriction on activities was too broad (“doing business with”).
 On that basis, the restrictive covenant was held to be unenforceable.
 The court also re-affirmed that, in general, well crafted no-solicitation clauses will be sufficient to
protect the employer’s interests. Leave to appeal to the Supreme Court of Canada was denied.
Shafron v. KRG Insurance Brokers, [2009, SCC]
 Facts: Issue was enforceability of a non-competition clause between an insurance agent and his
brokerage that was of three years duration and was to apply to the geographic area described as the
Metropolitain City of Vancouver. KRG sought to enforce the agreement but was confronted with the
argument that the geographic description was neither clear nor certain and was in any event
unreasonable.
 Analysis:
o After reviewing the general principles, the SCC turned to the geographic description, which it
found to be ambiguous.
o The question then arose whether the ambiguous term could be severed in order to save the
covenant.
 The SCC indicated that while it might allow “blue-pencil” severance (where the change can
be achieved simply by drawing a line through the problem clause) in limited cases, it would
not permit “notional” severance (reading down an ambiguous or overly broad provision) in
employment contracts.
 “It invites the employer to impose an unreasonable restrictive covenant on the employee with the
only sanction being that if the covenant is found to be unreasonable, the court will still enforce it to
the extent of what might validly have been agreed to.”
 POLICY: courts are trying to avoid the incentive for ERs to draft overly broad covenants knowing
they will be saved – from the outset ERs need to draft appropriately
(iii) Remedies
 Current EEs who breach the duty of good faith and fidelity can be terminated without notice.
 What other remedies can an employer obtain?
o William R. Barnes: secret profits, loss of profit, loss on sales and increased costs are all
recoverable as damages flowing from the breach of such a duty.
 However, the court held that the master is not entitled to recover the back salary, paid to
the unfaithful servant in addition to such damages.
 Where EEs have already departed, termination is obviously not an option. As we have seen,
injunctions are often sought in addition to damages.
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Polyresins Ltd
Facts: Two EEs, well-aware of the confidential nature of the process and materials used by their ER,
joined a rival ER in the same business and divulged the patently secret information to him. The rival ER
was thus enabled to become more competitive than it had been up to that time, and long before it
might well have become so if it had to rely on its own research. The original ER sought interim
injunctions against its former servants and ER.
Analysis:
 ER has a strong case:
o ER possesses secret processes that were important to it
o EE learned of these secrets during the course of employment
o EE knew the processes were secret
o EE made improper use of the knowledge to the benefit of new ER
o new ER gained benefit of secrets to which it was not entitled to
 Remedies
o Injunction is granted where it is necessary to prevent irreparable harm which cannot be
compensated for in damages
 injunction against new ER who acquired info to which it was not entitled
 injunction against EEs
(iv) Inventions
Comstock Canada v. Electec Ltd (1991)
 court held that there is a presumption that the invention belongs to the EE except
o 1) where there is an express contract to the contrary;
o 2) where the individual was hired for the purpose of inventing.
(v) Whistleblowing
 If EE discovers that ER is doing something illegal and makes it public, isn’t this a breach of GFAF?
 CL and CB: courts have said for EE to go directly to a public authority is a violation of the duty of
GFAF
o Up the ladder first: Both courts and arbitrators have said that if EE brings the concern to the
appropriate person in the organization, and then follows up the ladder, it doesn’t violate the
duty of GFAF, and you can go outside the organization if no one addresses the issue.
o BUT if you get fired, your only remedy is wrongful dismissal, and because of this some
jurisdictions have enacted Whistleblower Legislation
 WB legislation:
o if it is in place, the scope of protection depends on the statue
o Ontario: does NOT have WB legislation for private sector EEs, but does under the Public
Servants Act for provincial EEs.
o EE fired for breach of GFAF if under the regulation the ER can demonstrate that the EE is guilty
of wilful misconduct and obedience.
IABSORIW v. Merk (SCC 2005)
 Facts:
o Sask legislation protects EEs who report wrongdoing to “lawful authority”.
o BUT in this case, the EE went up the ladder, all the way up to the President, BUT THEN was
then terminated by the union for reporting on a business agent who was double dipping.
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 Issue: does WB legislation protect workers when they go inside the firm, or does it only extent to
workers who go to public authorities outside the firm?
 Held: court interpreted “lawful authority” broadly, and held that it included people within her
organization (so she was therefore covered by the legislation – this was consistent with the CL up
the chain approach)
SKIPPED? – Nov 13 2012
Collective Bargaining
 Obligations regarding the duty of good faith for unionized EEs are similar to those of nonunionized EEs
o no obligation on ER to negotiate a specific term in a CB agreement – arbitrators will imply it
 United Brewery: duty was implied
o scope is similar
 working for yourself on your ERs time is a breach of the duty
 Re Gray's Department Stores Ltd: the grievor was a dismissed EE whose basic job had been
to sell men's clothes in his ERs store. He had set up a competing business. This had come to
the attention of the ER via one of its customers. There was no other evidence of overlap in
customers. Nonetheless, the arbitration board found that there was ground for discipline,
but not dismissal.
United Brewery Workers and Pepsi-Cola
Facts: the grievor had been employed by the company as a driver-salesman. His duties required him to
obtain locations for the company's vending machines and to service and supply vending machines. The
grievor was discharged after the company discovered that he and a supervising EE, who was also
discharged, had obtained a beneficial interest in some of these vending machines. The company had no
published rule against an employee acquiring such an interest.
Held: the grievance was dismissed.
Analysis:
 The normal requirement that notice of a company rule is necessary before disciplinary action is
justified does not have its usual applicability in these circumstances.
 The grievor had attempted to conceal his activities by taking the vending machines in the names of
various relatives and it was clear that he knew the company would not accept his activities.
 As it was apparent to the grievor that he was violating the duty of fidelity intrinsic in the
employee-employer relationship, it was unnecessary to have such a basic duty put in writing.
De Havilland Aircraft of Canada Ltd. (1972)
Facts: a union official got a document in a brown sealed envelope. It contained the record of
management deliberations on manning needs and plans. The union official, who was an EE in the plant
concerned, reprinted pertinent parts of the document in the union newspaper. The ER disciplined him
by suspending him for two days. The EE grieved this suspension. The arbitration found that the ER had
just cause to discipline its EE.
Analysis: he was still an EE even though he was a union official and had an overriding duty of
loyalty to ER that took precedence over his obligations as a union official to benefit his members
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Nipissing Hotel
Facts: The employing hotel and the union were bargaining for their first contract. The union was
dissatisfied with progress, feeling that the ER was not bargaining in good faith. Accordingly, it had EEs
picket the hotel in their off-shift hours; there was no strike; there was no violence. The placards merely
said that there was no agreement and some would-be patrons were accosted. The hotel sought
injunctive relief.
Held: union was in breach of its duty to bargain in good faith by breaking off negotiations and
picketing.
Analysis:
 Duty of GFAF acts to limit the tactics that agents can use to put pressure on ERs
 EEs were doing something in their own time which was damaging to ERs business and therefore
were in breach of their duty of GFAF
 a K of employment may be terminated according to the terms of the contract, by mutual agreement,
by performance, by frustration, death of one of the parties, by the sale of the business, by
bankruptcy, by retirement or because one of the parties' conduct amounts to repudiation
CH 6: Faultless Terminations Without Notice
Completion of the Contract
 An EE whose K is not renewed at the conclusion of a fixed term is not dismissed or terminated;
rather her employment simply ceases in accordance with the terms of the K (Chambly City v
Gagnon 1999)
o A K for specified services or time comes to an end at the point specified.
o Similarly, a K that is stipulated to last for a fixed period, automatically terminates at the end the
period
 In these situations, no notice is required: .
o No notice of termination is required and there is no entitlement to termination or severance pay
under the ESA Reg 288/01
o 2. (1) The following employees are not entitled to notice of termination or termination pay
under Part XV of the Act:
 1. an employee who is hired on the basis that his or her employment is to terminate on the
expiry of a definite term or the completion of a specific task.
 O. Reg 288: Period of employment
o 8(1) An employee’s period of employment is the period beginning on the day he or she most
recently commenced employment and ending on,
 (a) if notice of termination is given, the day it is given; and
 (b) if notice of termination is not given, the day the employee’s employment is terminated.
o (2) For the purposes of subsection (1), two successive periods of employment that are not more
than 13 weeks apart shall be added together and treated as one period of employment.
Ceccol v. Ontario Gymnastic Federation 2001 Ont CA
Facts: The federation had employed the administrative director for over fifteen years on a series of oneyear contracts when it advised her that her contract would not be renewed. She sued claiming
entitlement to notice for the termination of a contract of indefinite duration. Employer argued that it
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was natural termination of a fixed term contract
Analysis (MacPherson)
 Fixed term employment K’s are legal. If terms are clear, they will be enforced (Chambly).
 BUT Courts require unequivocal and explicit language to establish a fixed-term K, because:
o Consequences for finding that an employment K is fixed term are serious:
 ESA protections and CL reasonable notice don’t apply when fixed-term expires.
 The courts will look beyond the form of the K and ask – what was the reality of the relationship?
o Employers should not be able to evade the traditional protection of the ESA and the CL by
resorting to the label of `fixed term contract' when the underlying reality of the employment
relationship is continuous service by the employee for many years coupled with verbal
representations and conduct on the part of the employer that clearly signal an indefinite term
relationship
Conclusion: the employment contract was for an indefinite term, subject to renewal and termination in
accordance with other provisions in the contract.
Tucker: this doesn’t mean that everyone with a fixed term K that doesn’t get renewed can claim
they had continuous employment, just that the courts left the door open for the possibility of
arguing there was something more going on.
Frustration
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Frustration: termination of K, when it has become impossible to fulfil performance because of a
supervening event which is
o fortuitous and
o unforeseeable.
This concept operates in the CL and in the ESA.
Classic example: factory burns down, making work impossible (Polyco Window 1994)
ESA References:
o Temporary illness/injury: O. Reg. 288/01 s. 2(3) states specifically that paragraph 4
regarding frustration does not apply where the frustration is due to an illness or injury
suffered by the EE
o Termination/severance pay relieved: O. Reg. 288/01 s. 2(1) 4 relieves the ER of termination
and severance pay obligations when the K of employment has been frustrated
o Notice relieved: O. Reg. 288/01, s.2 exempts prescribed EEs from the usual notice
requirements to terminate a K of employment.
 Prescribed EEs are: EEs whose Ks of employment have become impossible to
perform or have been frustrated by a fortuitous or unforeseeable event or
circumstance
No frustration of contract:
o Temporary illness will not serve to frustrate the employment K,
 However a permanent illness that disables the employee could constitutes
frustration. (Marks)
o What about duty to accommodate?
 Remember that issues of illness/disability are complicated by the HR regime: ER
must accommodate to the point of undue hardship, so what would constitute
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

frustration would require the ER to make the case that they couldn’t accommodate –
narrowing area
Consequence of frustration: when a contract of employment is frustrated it terminates at the time
that the contract becomes impossible of performance  No notice is required
In some cases, loss of the special skills of the employee will be held to invoke the doctrine of
frustration.
Death


Death of either party terminates the contract.
However, death does not extinguish the parties' rights which had vested to that point such as, say,
the right to wages.
Bankruptcy




Dismissals resulting from bankruptcy are terminations for the purposes of the ESA (Rizzo and Rizzo
Shoes 1998)
Bankruptcy does not in and of itself terminate a K 
o Bankruptcy may give rise to frustration and if this is so, the K will be terminated.
o Where an act of bankruptcy occurs, a breach of a contract may ensue, giving rise to an action
for damages.
o In bankruptcy, employees can sue to recover for arrears of wages.
Winding up of a company also does not lead to termination of the contract, its treated as a breach
of contract and gives rise to damages
o There still has to be notice given after bankruptcy for the K to be terminated, so EEs do not
lose their right to reasonable notice (covered by ESA).
o Although whether they can collect is the bigger issue, addressed in Bankruptcy and
Insolvency law.
Rationale:
o ER should not be able to terminate its obligations by terminating its existence.
Dissolution of Firm


Where a firm dissolves because one of the partners dies, and the K was one such as to make the
personal characteristics of the dead partner an essential element of the relationship, then
contract will held to be terminated
o where the personal characteristics of the partner was of no concern, the contract will remain
intact
Sale of a business under the ESA:
o Based on minimum standards legislation, where there is a sale (which usually includes a
lease, a transfer or any other manner of disposition) of a business (which usually includes an
activity, trade, undertaking or any part thereof), the employment shall NOT be deemed to
be terminated and duties and obligations that the vendor owed to his employees shall now
be borne by the purchaser.
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Retirement

Since mandatory retirement is now generally prohibited as age discrimination, the termination of
employment must now come about through agreement, by giving reasonable notice or for cause
CH 6: Termination by Notice
Common Law Notice
General Principles





Where the employment K is one of indefinite duration, it will be possible for either party to
terminate it by giving appropriate notice.
o I.e. at CL, an ER can always bring a contract of indefinite hiring to an end by giving
reasonable notice. It is not necessary to provide a reason.
o But of course – notice is not a defence to a statutory protection such as Ontario Human
Rights Code. Practically, would work out as you get fired (ER doesn't need notice), you file
complaint after.
Entitlement to common law notice can only be claimed by non-unionized employees
o unionized employees are only entitled to the minimum notice required under the ESA
unless the collective agreement makes provisions for enhanced notice.
Parties may fix notice periods in the K:
o the parties may fix the notice period by contract, but there are a number of potential
problems that may be encountered
 What if the notice period was set many years before the employment was
terminated? Can it be argued that the terms of the contract have varied too much
since the original deal?
o These provisions cannot be less than the minimum required by the ESA
 You cannot contract out of the ESA
 If you violate this, courts have held that it is unenforceable and EE can seek to get
notice pursuant to the CL (which is better than ESA)
On negotiations: Cornell Engineering (2001)
o court held that there was no obligation on ER to have other parties’ interest in mind during
negotiations (no implied duty of ER to take care of EE)
On inserting notice clause into K after EE has already signed: Braiden v. La-Z-Boy:
o 10 years after Braiden started work at La-Z-Boy, La-Z-Boy inserted a 60 day notice clause
into a revised employment K that Braiden signed. 10 years later he was dismissed with a 60
day notice period. He sued, claiming he was entitled to common law notice.
o Court: it is possible for employers to enter into a fresh agreement specifying the period of
notice of termination, but that in order to discharge the burden of establishing the validity
of such an agreement the ER must, at a minimum, present evidence that it clearly
communicated the change, that the EE appreciated that he or she was giving up legal rights,
and that consideration flowed
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
In the absence of enforceable K stipulations, it is up to the judiciary to determine the
appropriateness of notice.
Lazarowicz v. Orenda Engines Ltd. (1961, ON COA)
Facts: Lazarowicz was a professional engineer hired at a weekly salary. He performed important
duties for the defendant, but did not exercise supervisory authority. The employer's operations
discontinued when the government decided not to purchase the engines it produced for the Avro, a
Canadian designed and produced military jet. Lazarowicz was given one week notice.
Analysis:
 Having concluded that his hiring was for an indefinite period, the next question is, to what notice
was he entitled on the termination of that employment?
 The answer may be given that he was entitled to a reasonable notice – what is reasonable?
o if the ER and the EE at the time of the hiring had addressed themselves to the question as
to the notice that the employer would give in the event of him terminating the
employment, or the notice that the employee would give on quitting, what would their
respective answers have been?
 Tucker: this approach was quickly rejected as being unhelpful, now we use Bardal 5 factors
Bardal v. Globe and Mail (1960 ON HC): WE ARE FOCUSING ON THE Q – HOW TO CALCULATE
AMOUNT OF REASONABLE NOTICE?
**SCC has endorsed this approach**
Facts: Bardal was hired for an indefinite term and over the years he was promoted. After sixteen
years, he was dismissed without notice.
Analysis:
 The reasonableness of the notice must be decided with reference to each particular case, taking
into account: [known as the “Factor Approach”]
o character of the employment
o length of service of the servant
o age of the servant, and the availability of similar employment
o experience, training and qualifications of the servant
 court will also take into account customary practices (Scapillati – construction worker had pattern of
being laid off, then hired back, numerous times. Not hired back. Sues for wrongful dismissal and
loses. Ct not wrongful dismissal – took the custom into account, but said it wasn’t determinative.)
 Notes
o the test in Bardal is contextual
o in determining appropriate notice, court may also take into consideration the customs of the
trade
o The “rule of thumb” approach that employees are entitled to a month notice for every year
worked has been rejected by the OCA (Minott)
 Rule of thumb flaws:
 Too much weight to one factor
 Risks undermining the contextual flexibility of the Bardal test.
 Tucker
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o
o
Courts now take the view that the purpose of the notice requirement is protective and
designed to give EEs some opportunity to find new employment. The Factor Approach is
here to stay (or maybe some variation on it.)
GENDERED IMPACT OF THE FACTORS (possible essay Q):
 Gender Implications of Wrongful Dismissal Judgments in Canada 1994-02
 Lower positions have lower notice – but what about the glass ceiling?
 Length of service – affected by maternity leave? Leaves, like maternity leave, that are
mandated for in ESA technically should not apply as a reduction in length of service.
However if women take off time on top of the normal maternity leave amount this
will reduce length of service.
Judicial Consideration of Specific Factors
Status

traditionally, based on the assumption that senior EEs will have more difficulty finding alternative
employment, a person holding a higher status job was awarded a longer notice period
 however, Cronk has called this logic into question
Cronk v. Canadian General Insurance 1994 CA
Facts: Cronk was a full time EE from ’59-’93, she was 55 when terminated, her position was junior. At
the time, she resided in an area that was experiencing a recession .
TJ: At trial, Cronk received 20 months notice. It was unheard of to award this much to someone of her
“low” status to get this amount; TJ said her employment prospects were very poor.
COA: downgraded to 12 months!
 COA found TJ decision disturbing because it flew in the face of what had become established (“on
the grounds of stare decisis”(!)) and insisted that status is a relevant factor and should be taken into
account.
 CA held that the trial judges award had the potential of disrupting commercial and industrial
practices where employers must predict the cost of downsizing with reasonable certainty, and
legal practitioners must be able to give advice the EEs and ERs in respect of termination of
employment with reasonable certainty.
Minott v. Shanter 1999 Ont CA
 court commented on the issue of “lower status”
 I do not regard this court's decision in Cronk as establishing an upper limit of 12 months' notice
for all non-managerial or non-supervisory employees
o the imposition of an arbitrary 12-month ceiling for all non-managerial employees detracts
from the flexibility of the Bardal test and restricts the ability of courts to take account of all
factors relevant to each case and of changing social and economic conditions
 Tucker: court said status is relevant but it is only ONE factor – here they awarded 13 months, based
on the other factors that basically said he had poor re-employment prospects. They did
acknowledge that it was on the high range.
Honda Canada Inc. v. Keays, 2008 SCC
Facts: Keays had been employed by Honda for 11 years, first as an assembly line worker and then in a
data entry position. At trial he was found to be entitled to 15 months notice.
TJ: took the view that since Honda claimed it was not a hierarchical organization in the same way that
North American firms are (Honda = flat management structure) it diminished the claims that could be
made regarding status.
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SCC:
 The only question is: how do we look at status within this flat management structure?
 No one Bardal factor should be given disproportionate weight
o TJ erred in giving undue weight to the flat management structure – should look to all the
Bardal factors to help illuminate the character of Keays employment.
 BUT looking at all the factors, SCC upheld the 15 months determined by TJ; said no basis to
interfere with TJ.
o Keays was one of the first EEs hired at Honda's plant who spent his entire adult working life
there
o He did not have any formal education and suffered from an illness which greatly
incapacitated him.
o All these factors substantially reduce his chances of re-employment and justify an
assessment of 15 months' notice.
 CONTRAST Bardal with Di Tomaso [2011 ONCA], a more recent case
o Di Tomaso: same judge (MacPherson) as Cronk; said ‘character of employment’ becoming
less important and cast doubt on the supposed claim that lower-level workers have an easier
time finding alternative employment as opposed to higher-level.
Economic Conditions



Who bears the cost of economic downturns?
o If EEs bear the cost and ERs can freely lay off, there will be an excess of EEs in the market
and it will take even longer to get a job, hurting EE’s re-employment prospects.
o BUT if ERs bear the cost and longer notice periods are imposed, their businesses will suffer.
ER has right to manage its company: notice periods, it could be argued, should be reduced
as to facilitate management’s right to manage their company.
Courts have been ambiguous about this, but it is clear that:
o The economic outlook for both employer and employee must be considered. Also, the
employer must be able to reduce its work force at a reasonable cost. (Bohemier v. Storwal
1982)
Empirical evidence:
o recession of the 80’s: courts were sympathetic to EEs, giving longer notice periods
o recession of the 90’s: courts favoured ERs, gave shorter notice periods
Freedom to contract: Harsh Terms & Unconscionability
 Contracts that stipulate what the reasonable notice period will be, ARE enforceable, provided
they do not breach statutory requirements, are clear and unambiguous, and do not show an
inequality of bargaining power or unconscionability (HOJ Industries v. Machtinger 1992 SCC)
Ballpark Justice (this doctrine has been rejected)
 Perry v. Gulf Minerals: Judge introduced doctrine of “ballpark justice”: method of approaching
litigation over notice periods should be to determine whether the employer's offer was reasonable
 Idea was that if ER made an offer of notice that was within the ballpark and EE refused to accept
it, litigated it and got an award in the ballpark, EE would be penalized with costs. REJECTED:
o because it would put pressure on EEs to accept offers
o because ERs would have incentive to calculate + offer the lowest number in the ballpark
o admittedly in civil procedure we have similar principles to ballpark justice in terms of
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encouraging settlements, we have penalties for lawyers who do not accept a settlement offer
and then they end up getting less – but importantly EE’s should not be expected to be as
sophisticated as lawyers in this area.
Near Cause
 Can EE misconduct which is not seriously enough to constitute just cause, result in a reduced
notice period?
o The doctrine of “just near cause”, which allowed for moderate damages received, has been
rejected by the SCC (although some rumbling that it ought to be reconsidered) (Lasczewski,
citing contextual approach to termination in McKinley).
Aggravated and Punitive Damages for Wrongful Dismissal
 Background:
o For many years, Canadian courts disallowed damages beyond the loss of the pay from the
notice period that should they should have gotten but did not because of the wrongful
dismissal (Addis). Arguments about that victims should get damages compensating for the
mental suffering that they suffered from the dismissal, were rejected.
o However, starting in the ‘80s, there was some consideration by the courts to award punitive
damages in wrongful dismissal cases and to award damages for loss of reputation. (Brown v
Waterloo 1982)
o SCC in Vorvis got involved, majority sharply distinguished between aggravated and punitive
damages, and said both might be available.
 Aggravated damages were to compensate for injury to proper pride and dignity, but their
availability in the employment context was narrowly confined [need ‘IAW – independently
actionable wrong’ and injury must have arisen out of dismissal itself]
 Punitive damages were to punish exceptionally harsh, vindictive and reprehensible
conduct. It was also to be awarded only in case of an actionable wrong, and would be very
rare in a contract case and that the court should be cautious in awarding these.
 EFFECT: only in NARROW circumstances that wrongfully dismissed EEs could
successfully claim aggravated or punitive damages, or damages for mental distress.
Wallace (1997): bad faith can be worthy of compensation, leading to increase in notice period 
rejected in Honda!
 Facts: EE was terminated without notice or explanation, sued for wrongful dismissal, ER asserted
that it had just cause and made things up. This damaged W’s reputation in the industry and he
found it hard to find work.
 Issue: EE said he should be awarded aggravated damages because of how he was treated during the
process.
 TJ: awarded 24 months notice period, and granted aggravated damages under Vorvis (IAW)
 COA: reduced to 15 months, dismissed claim of aggravated damages (no IAW)
 SCC: Where an ER acts in bad faith in the manner of dismissal (such as humiliation,
embarrassment and damages to EE’s self worth) might all be worthy of compensation, depending
on case-by-case. Compensation for bad faith is compensated for by addition to notice period.
 APPLICATION SCC: W’s discharge did not merit damages for bad faith.
 NOTE:
o this was referred to as the “Wallace bump” – anyone litigating would allege bad treatment from
the ER and claim it
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o This did not require an IAW – it was a way to get a larger award without one
Fidler – sub-case, referred to in Keays
Insurance company denies a claim without reasonable gorunds. Insurance company sues for damages:
1.
Normal damages
2.
Mental suffering
Court reviews where mental suffering damages are awarded in K cases.
1.
IAW, ala Vorvis
2.
Where a particular class of K: a “peace of mind K”
Court says: going to pull back from these ideas and go to basic principles:
1.
what were the damages in reasonable contemplation of the parties when they went into the K?
Honda Canada v. Keays 2008 SCC
Facts: Keays started working for Honda in 1986, first on the assembly line and later in data entry. In
1997, his diagnosis of chronic fatigue syndrome ("CFS") was confirmed by a doctor. He stopped
working and received disability benefits which stopped when he was evaluated as being able to return
to work. In 1999, due to Keays frequent absences, Honda asked him to see an independent physician
hired by them. In 2000, after more absences, Keays was asked to meet with a specialist in order to
determine how to accommodate his disability. Keays refused to meet with the specialist unless he was
informed re: purpose, methodology, etc. Honda wrote Keays a letter saying that they expect him to
come to work and meet the specialist and that if he does not meet the specialist, his employment will be
terminated. Keays remained unwilling to meet the specialist and was terminated.
Issue: The main allegation was that Honda discriminated by requiring Keays to bring in a doctor's note
to justify each absence when employees with "mainstream illnesses" did not have to do so.
TJ: gave Normal Damages + Wallace Bump of 9 Months + $500k Punitive (reprehensible behaviour)
+ Costs Award
COA: reduced the Punitive Damages and the Costs Award but really didn’t interfere too much.
SCC: what we sho
 The current law re damages for termination without adequate notice
o Reasonable notice:
 Action for wrongful dismissal based on implied obligation in employment K to give
reasonable notice of intention to terminate the relationship when there is no just cause.
 Thus, if an employer fails to provide reasonable notice of termination, the employee can
bring an action for breach of the implied term (Wallace)
 In Vorvis the court held that the general rule is that either party could terminate the contract
by due notice, and the only damages that could arise would be from the failure to give such
notice
 Unless IAW: Court in Vorvis left open the possibility of allocating aggravated
damages in wrongful dismissal cases where the acts complained of were also
independently actionable
 In cases where parties have contemplated at the time of the contract that a breach in certain
circumstances would cause the plaintiff mental distress, the plaintiff is entitled to recover.
However, the normal distress and hurt feelings resulting from dismissal are not compensable
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o This conclusion is based on the principle in Hadley v. Baxendale: damages are recoverable for a
contractual breach if the damages are "such as may fairly and reasonably be considered either
arising naturally... from such breach of contract itself, or such as may reasonably be supposed to
have been in the contemplation of both parties
o Damages resulting from the manner of dismissal must then be available only if they result from
the circumstances described in Wallace, namely where the employer engages in conduct during
the course of dismissal that is "unfair or is in bad faith by being, for example, untruthful,
misleading or unduly insensitive". And this fits with Hadley in that because of Wallace it is
understood in the contemplation of the parties that there is a duty of fair treatment.
 Conclusion of current law:
o Damages attributable to conduct in the manner of dismissal are always to be awarded under
the Hadley principle immediately above.
o “** if the employee can prove that the manner of dismissal caused mental distress that was in
the contemplation of the parties, those damages will be awarded not through an arbitrary
extension of the notice period, but through an award that reflects the actual damages” **
 Tucker: they don’t go on to talk about exactly the ‘actual damages’ are.
 Punitive Damages
o Whiten: for an award of punitive damages, "[a]n independent actionable wrong is required, but
it can be found in breach of a distinct and separate contractual provision or other duty such as a
fiduciary obligation
 Another important thing to be considered is that conduct meriting punitive damages
awards must be "harsh, vindictive, reprehensible and malicious", as well as "extreme in its
nature and such that by any reasonable standard it is deserving of full condemnation and
punishment" (Vorvis)
 APPLICATION: The facts of this case demonstrate no such conduct. Creating a disability
program such as the one under review in this case cannot be equated with a malicious intent to
discriminate against persons with a particular affliction.
o Punitive damages are restricted to advertent wrongful acts that are so malicious and outrageous
that they are deserving of punishment on their own
 This distinction must guide judges in their analysis
o punitive damages should "receive the most careful consideration and the discretion to award
them should be most cautiously exercised (Vorvis)
o Courts should only resort to punitive damages in exceptional cases (Whiten)
o a breach of the HR code is NOT an IAW for the purpose of damages (Honda)
APPLICATION:
 The employer's conduct in dismissing K was in no way an egregious display of bad faith justifying
an award of damages for conduct in dismissal.
 The employer's March 28 letter to K did not misrepresent the positions of its doctors and it should
not have
been faulted for relying on the advice of its medical experts.
 The employer's request for a meeting between K and the specialist was normal in the circumstances.
The employer's decision to stop accepting doctor's notes was not reprisal for K's decision to retain
legal counsel -- rather, the employer was simply seeking to confirm K's disability.
 Lastly, there is no evidence that K's disability subsequent to termination was caused by the manner
of termination.
231
 There was no basis for the claim for punitive damages and that it overlaps with the award of what
were formerly known as "Wallace damages".
Ratio: There is a duty of good faith in the manner of dismissal and damages for poor conduct are
compensatory – they arise if EE can prove that the manner of dismissal caused mental distress that
was in the contemplation of the parties (not awarded through adding to the notice period, but as a
separate head)
Tucker:
 Court rejected Wallace bump (had led to a huge amount of litigation)
 Court found duty of good faith through a Hadley analysis: what kinds of harms were in the
reasonable contemplation of the parties when they entered the K?
o they piggy back on Wallace by saying that since the case was decided, the parties have had an
expectation about being treated fairly in the manner of dismissal
 “To be perfectly clear, I will conclude this analysis of our jurisprudence by saying that there is no reason to
retain the distinction between "true aggravated damages" resulting from a separate cause of action and moral
damages resulting from conduct in the manner of termination. Damages attributable to conduct in the manner
of dismissal are always to be awarded under the Hadley principle”
o aggravated damages for an IAW are OUT, it is all to be calculated under the Hadley principle,
and because of Wallace there is a general expectation to be treated fairly during dismissal
 Thus, if the employee can prove that the manner of dismissal caused mental distress that was in the
contemplation of the parties, those damages will be awarded not through an arbitrary extension of
the notice period, but through an award that reflects the actual damages (main point)
 What the court does NOT do is provide any method of calculating the damages – all we know is that
EE has to prove that there were actual damage and that it caused actual harm/suffering
 Before Keays – easier to get damages for mental suffering. Post-Keays, more difficult.
 Tucker says in future someone may challenge Bardal Factors’ inconsistency with the return to
Hadley v Baxendale – because Bardal, after all, is about calculation of damages and tries to attach a
formula, as opposed to the rejected Lazarowicz line of reasoning that parallels Hadley, aka turning
their minds to what the damages would have been at the time of formation.
 Using reasonable contemplation of the parties as a metric is inherently conservative of the status
quo; it is very close to saying ‘do what has always been done’, since that will be in most cases what
would be in the reasonable contemplation of the parties.
Duty to Mitigate
 As in all K cases, EE has duty to mitigate.
 Duty to mitigate requires the injured party to take reasonable steps to reduce the accumulation of
damages.
o Where an EE has been wrongfully dismissed, the onus is on the ER to prove that the EE has
failed to mitigate.
o In order to overcome this onus, the ER must show that the EEs conduct was unreasonable, not
in one respect, but in ALL respects.
 Question: Should failure of EE to accept altered terms and conditions of employment qualify as a
breach of the duty to mitigate?
o Duty to mitigate in constructive dismissal:
 Where ER alters terms/conditions of employment, EEs have claimed CD.
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 ERs argue that there was no CD (because they are permitted to change the terms to some
extent), and EE failed to fulfil their duty to mitigate, by not accepting the changes.
Evans v. Teamsters Local Union 2008 SCC
Issue:
Evans is an EE who has been wrongfully dismissed:
Is an EE required to mitigate damages by returning to work, for the Same ER who terminated
the employment K?
Facts:
 Evans was employed for 23 years at the Teamsters Union office and was dismissed after a new
executive was elected in – Evans had supported the incumbent Union President, who was defeated.
The new president inquired with counsel about terminating Evans – counsel said that Evans would
be found to be an indefinite employee and thus the union would need to provide working notice or
pay in lieu of notice. The new president wrote letter to Evans, including what counsel had said,
EXCEPT failed to say anything about notice.
 Jan 3: Evan’s lawyer contacted the union and asked for 24 months notice (12 in continued
employment and 12 months’ salary in lieu of notice).
 Negotiations continue…


May 23: ER lawyer sent a letter to Evans stating that his request to have his wife replace him was
unreasonable, and that Evans should return to work immediately to serve the balance of his 24
months notice. If not, ER will amend statement of defence to note that Evans failed to mitigate his
losses by failing to return to work.
Evan’s lawyer sent a letter back stating that Evan’s had never been offered the 24 month notice –
rather, it was an alternative to litigation that Evan’s lawyer had suggested. Also, Evans would be
willing to return to work if his termination letter was rescinded – employer refused.
TJ: found that the original letter was termination. And the later letter about the balance of 24 months
was an offer of re-employment.
SCC Analysis (Bastarache)
Salary in lieu of notice
 It is not because of the termination we are asking the ER to pay salary to EE; we ask for
monetary damages where we are compensating for less notice period.
1) Notice period purpose: is meant to provide EE with time to seek new
employment and arrange affairs.
 ER pays to extent given notice is not adequate, but requirement is subject to EE making
reasonable effort to mitigate the damages by seeking an alternate source of income.
Duty to mitigate generally
(1) ER bears onus of demonstrating that EE (Red Deer College 1976 SCC):
a. has failed to make reasonable efforts to find work, and
b. that work could have been found
Duty to mitigate by working with previous employer:
 Courts: necessary in some circumstances for dismissed EE to mitigate his/her damages
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by returning to work for the same employer. Assuming there are no barriers to reemployment, requiring EE to mitigate by taking temporary work with dismissing ER is
consistent with idea that damages are meant to compensate for lack of notice, and not to
penalize the ER for the dismissal itself.
Giving 12 months notice v. Giving no notice but offering 12 months new job: Very little
practical difference! In both situations EE is aware employment relationship is finite.
Unless bad faith, ER not required to pay compensation for termination that has adequate
notice.
TEST: Unless conditions making return to work unreasonable, an EE can be expected to
mitigate damages by returning to work with the same ER.
 Would a reasonable person accept the opportunity? On objective standard. (Evans v
Teamsters)
 “Where the salary offered is the same, where the working conditions are not
substantially different or the work demeaning, and where the personal relationships are
not acrimonious " (Mifsud v. MacMillan OCA 1989)
 Cox Factors (BCCA):
1) History and nature of employment
2) Whether EE has commenced litigation
3) Whether offer of re-employment was made while EE was still working for ER or
only after EE left.
 Critical element: that the EE is “not obliged to mitigate by working in an atmosphere of
hostility, embarrassment, or humiliation.” (Farquhar)
Court recognizes that TEST may apply more often to constructive dismissal: because it is
more likely that the circumstances of their dismissal are less personal than when dismissal
relates to the individual themselves.
Duty to mitigate doesn’t negate bad faith damages per Wallace: EE’s ability to mitigate doesn't
alter the SUFFERING that the damages from bad faith are meant to compensate for.
RATIO: if the Cox Factors are met and the rest of the TEST above are met (aka – once a multi-factor
and contextual analysis is met), both constructively dismissed and wrongfully dismissed EEs are
required to mitigate their damages by working for their dismissing ER. This kind of mitigation
requires “a situation of mutual understanding and respect, and a situation where neither the ER nor
the EE is likely to put the other’s interests in jeopardy (Farquhar).
Held: Upheld CA decision – Evans had acted unreasonably in refusing to return to work when ER
refused to meet his conditions.
Abella (Dissenting)
 The majority suggested that there was little practical difference between terminating an
employment by giving notice and dismissing an employee without notice but later offering reemployment – by doing this, the majority fundamentally changes the obligations of an ER upon
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termination and appears to remove a critical protection from an EE at a time when the EE is most
vulnerable
o these situations are VERY different: in the first, the ER did nothing wrong, and in the second, it
breached its terms of the K
o why would we ever expect someone to go back to work for the person who just breached the
terms of their K?
 The distinction between constructive dismissal and wrongful dismissal is important
o If an employee is wrongfully dismissed, the employees duty to mitigate by returning to work
would only be reasonably expected in rare cases
o In addition, the rarity of expecting constructively dismissed employees to mitigate damages in
the same workplace is well recognized
 The OBJECTIVE test for reasonableness of the decision to go back to ER should not be used
o court should be sensitive to the SUBJECTIVE experience that the person just had
 Employment contract is one of personal service – majority’s decision has the danger of making
routine the requirement to accept re-employment with an employer who acted wrongfully
o This principle should be jealously guarded in the case of an employer who has been wrongfully
dismissed
 I support two propositions:
o re-employment will be a rare circumstance for a dismissed employee
o the duty to "act reasonably" in mitigating must be seen not just from the perspective of a
reasonable person, but from the perspective of a "reasonable person in the dismissed
employee's position”  thus, reject the objective test for a modified objective test
Tucker
 Majority has woven in a web of factors to the test whereby it is a high threshold that would need to
be crossed before an EE would be expected to accept offer to go back to the ER.
o If there is some bad blood it should be relatively easy for EE to establish on an objective basis
that requiring them to go back to work would be unreasonable
 Tucker suspects that this will have little practical significance b/c ERs having wrongfully dismissed
EEs rarely make employment offers
Statutory Notice Periods
 At the Outset, Employees must choose either to go for a CL Claim or a Statutory Claim. ESA is
capped at $10,000. There is no cap at CL. However there is a Duty to Mitigate at CL; there is no
Duty to Mitigate under ESA.
 The ESA sets out minimum notice entitlements for all non-excluded employees.
o Remember: unionized employees cannot claim common law notice.
o Therefore, absent a provision in the CA, unionized EEs get the statutory notice.
 The view is that unionized EEs do not have individual K of employment, they have CA.
o employment standards cannot not be waived or contracted out
 minimum termination notice provisions are found in the Employment Standards Act. (s. 57
termination, s. 58 mass termination and s. 65 severance)
Individual termination (s.57)
 from 1-8 weeks, based on length of employment.
235
 Exemptions: O.Reg 288/01, S.2
 Entitlements kick in at 3 months, i.e. notice not required before 3 months. (ESA s54)
57. The notice of termination under section 54 shall be given,
(a) at least one week before the termination, if the employee’s period of employment is less than one
year;
(b) at least two weeks before the termination, if the employee’s period of employment is one year or
more and fewer than three years;
(c) at least three weeks before the termination, if the employee’s period of employment is three years or
more and fewer than four years;
(d) at least four weeks before the termination, if the employee’s period of employment is four years or
more and fewer than five years;
(e) at least five weeks before the termination, if the employee’s period of employment is five years or
more and fewer than six years;
(f) at least six weeks before the termination, if the employee’s period of employment is six years or
more and fewer than seven years;
(g) at least seven weeks before the termination, if the employee’s period of employment is seven years
or more and fewer than eight years; or
(h) at least eight weeks before the termination, if the employee’s period of employment is eight years or
more.
Mass termination (s.58 & O. Reg 288/01 s.3)




Extended notice period for affected workers
Duty to provide information to Ministry of Labour
this is on TOP of basic notice
POLICY: when there are mass layoffs it is even less likely that that EE will get a job – flood of local
labour market in their area – geographic and possibly labour type
 NOTE: there are provisions that allow ER to provide info about the economic circumstances and
other plans that might be made for retraining these workers – there to provide opportunity to
implement labour readjustment period
58. (1) Despite section 57, the employer shall give notice of termination in the prescribed manner and
for the prescribed period if the employer terminates the employment of 50 or more employees at the
employer’s establishment in the same four-week period
3. (1) The following periods are prescribed for the purposes of subsection 58 (1) of the Act:
1. Notice shall be given at least eight weeks before termination if the number of employees whose
employment is terminated is 50 or more but fewer than 200.
2. Notice shall be given at least 12 weeks before termination if the number of employees whose
employment is terminated is 200 or more but fewer than 500.
3. Notice shall be given at least 16 weeks before termination, if the number of employees whose
employment is terminated is 500 or more.
Severance pay (in addition to notice, s.65)
 Five years job tenure and either:
o 1. payroll of $2.5M or
o 2. permanent discontinuance resulting in 50 or more employees being terminated in 6 months
 1 week for each year up to 26 weeks
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 Does not exist at CL. And you cannot get CL notice and Statutory Severance; however TUCKER
thinks that you could make a well-reasoned claim for it, even thought there was a case that goes
against that point.
ESA Claims in Court
 EEs must choose between filing a complaint with the Ministry of Labour OR suing their ER in
court
o the ESA stipulates that if you commence a legal action, you have to make an election about
whether you pursue it through ES or civil action
o An EE CANNOT sue an ER for wrongful dismissal AND have a claim for
termination/severance investigated by the Ministry for the same termination – EE must chose
one procedure or the other
 Under the ESA the maximum allowable claim is 10k – so if you have a higher entitlement your
only option is to pursue a civil action
 Ex: EE employed for 20 years, you are entitled to 8 weeks of termination pay AND 20 weeks
of severance pay = 28 weeks of notice [this would be more than 10k, because even minimum
wage is about $400 per week, and you would have to be making $357/week to fall under the
10k mark]
 How to avoid the 10k limit? Go to court.
 Civil Action
o You do have the right to sue for your ESA entitlements in court (had been doubted but now
established – Boland 2005)
 Mitigation in ESA
o with respect to ESA entitlements, there is NO duty to mitigate – these are statutory minimums
 What you can claim in the ES civil action – ESA and CL?
o Law is settled that you can claim both ESA and CL, but you cannot collect both – court will let
you claim the larger entitlement
o what about claiming CL notice and ES severance?
 there is no severance entitlement under the CL – conceptually they are two separate
entitlements (severance is distinct from notice under the ESA)
 Stevenson v. Globe: You cannot claim both – compare the total ES entitlement (including
severance) with the total CL entitlement and EE gets the larger of the two
 Reasoning in this case was very week, possibly vulnerable
 NOTE the OVERLAP (could have had good reasoning): CL notice takes into
account the time EE needs to get re-established (many factors), so it’s more
broad than the ESA entitlement that covers notice (just seniority based) plus
severance – a court would probably conclude that allowing CL notice + ES
severance would be double recovery
CH 6: Termination by Action of the Employee
Employee Obligation to Give Notice
 An EE who wishes to terminate a contract of indefinite hiring is bound to give reasonable notice.
237
o Litigation over the failure of an EE to give reasonable notice (wrongful resignation) is fairly rare
 Purpose of the employee giving notice: to provide the ER with a reasonable opportunity to find a
replacement (Engineered Sound Systems Ltd. v. Klampfer)
Voluntary Quits and Constructive Dismissal
Voluntary Quit or Dismissal?
 An EE who “voluntarily quits” is not entitled to notice (under ESA or CL)
o Rather the EE is under a duty to give ER reasonable notice. Otherwise liable for damages
 Issue: has the EE actually quit? Or were they dismissed?
o In law (CL and CB) a quit requires both subjective expression of intent and objective behaviour
 NOTE: court is protective of EEs who get angry and stomp out, but then have second
thoughts. I.e. Courts have said a resignation must be clear and unequivocal.
 Proctor v. Sharp’s: P was frustrated in his job and experiencing personal difficulties and
one day got angry and walked out of work. He did not get in touch with ER for several
days, and ER informed him that they accepted his resignation. P sued for wrongful
dismissal.
 Held: he had not resigned b/c there was no objective behaviour to give effect
to the expression of intent.
o TUCKER:
o The main facts are similar to Dowling: the guy didn’t come back to
work. In Dowling, this was enough confirmatory conduct but it was
not enough in Proctor.
o HENCE -- Can’t really distinguish definitively between this and
Dowling Red & White! Maybe there are minor factual differences…
but it seems like Tucker may not think there is a definitive difference.
It may have more to do with the person adjudicating the case.
o ERs should try to get some confirmation from EE – “we expect you
back and work and if we don’t hear from you we will treat it as a
resignation”
o Possible outcomes:
 quit = no entitlement to notice
 terminated = entitlement to notice
 constructive dismissal = entitlement to notice
Dowling Red & White
Facts: Following an argument with the store’s owner and manager (G), L was confronted by G at the
close of business. G accused L of having bad mouthed him with other members of the staff. A heated
discussion took place following which L either quit her employment or was terminated. She did not
appear for work next day, and requested her UIC separation slip
Issue: whether L quit her employment or was terminated.
Analysis:
 There’s a consensus in arbitral authority that the act of quitting one’s employment involves both
the subjective intent to leave one’s employment and an objective manifestation of the subjective
intent
238
o This objective element may consist of notice or conduct inconsistent with remaining in the
employ of the company.
o The mere assertion “I quit” without some evidence of confirmatory conduct may represent a spur of
the moment response to some employment difficulty and not true intentions.
o In order to find that EE has in fact quit, arbitrator must be satisfied that EE meant what he said
(Oil Employee Association and Sun Oil Co Ltd. 1968)
 Re University of Guelph: absent any other conduct, the expression that an employee is quitting is
not sufficient to result in a severance of employment
 L should not be deprived of the benefit which she is otherwise entitled under the ESA if she did not
form and carry out a decision to quit her employment
Judgment: L quit her employment and is not entitled to termination pay in lieu of notice under ESA. In
this case, there WAS confirmatory behaviour in that after saying “I quit”, she did not return to the
company.
Constructive Dismissal or Quitting for Cause
 Basic principle: where one party to a K demonstrates an intention to no longer be bound by it, that
party commits a fundamental breach that results in its termination (Farber)
o ISSUE: what constitutes a fundamental breach?
 EEs options: if an ER unilaterally alters a term of the contract the EE has a choice to either:
o accept the change (in which case there is a new K)
o treat the unilateral change as a CD and claim damages for the failure to give reasonable notice
Farber v. Royal Trust (SCC)
Facts: long term EE at fairly high level (managing 21 offices). ER runs into difficulty and downsizes,
offers him a demotion (branch manager of a non-lucrative branch), and no guarantee about
compensation.
Issue: is this demotion a fundamental breach?
Held: YES
TEST:
 To determine WHAT FACTS COUNT AS CONSTRUCTIVE DISMISSAL must look at each case
on the facts contextually: “each constructive dismissal case must be decided on its own facts, since
the specific features of each employment contract and each situation must be taken into account to
determine whether the essential terms of the contract have been substantially changed.”
 Principle: when one party to a contract demonstrates an intention to no longer be bound by the
contract, that part commits a fundamental breach that results in its termination (the principle
from contract law)
o (made specific to L+E law): “Where a ER unilaterally makes a fundamental or substantial
change to an EEs K, the ER is committing a fundamental breach of the contract that results in its
termination and entitles the EE to claim damages from the ER in lieu of reasonable notice”
 examples of a fundamental breach:
o pay cuts, significant demotion
 Note: here the branch became very lucrative and he probably would have made the same amount of
money he made before. Court says that it is not fair to hold someone to that kind of standard – at
the time of termination it was reasonable for EE to view the change as a breach of K.
239
Issues in Constructive Dismissal
 Basic question is how to balance employer flexibility with employee protection
o Changes to job content/status
o Changes to compensation structure
o Changes to job location
o Changes to notice entitlement
 Employee options: Wronko (below)
o Accept change
o Treat as constructive dismissal
o Reject and stay
 Duty to mitigate by remaining with employer?
 Options for unionized employees faced with unilateral change
Wronko v. Western Investments
 Until recently, it was thought that, at CL, EEs had two choices when faced with unilateral
changes, e.g. unilateral changes to contractual notice periods:
o accept the change in terms of employment (either expressly or implicitly through apparent
acquiescence, in which case employment continues under altered terms)
o reject the change, treat it as a constructive dismissal, leave work and sue for damages
 In 2008 the Ontario Court of Appeal in Wronko added a third option:
o make it clear to ER that EE reject the change and keep working at the OLD position
 ER may respond to rejection by terminating EE with proper notice and offering reemployment on the new terms
 If ER permits EE to continue to fulfill his job requirements, then EE is entitled to insist
on adherence to the terms of the original K
 in other words, if the ER permits the EE to discharge his obligations under the original K,
then unless proper notice of termination is given, the ER is regarded as acquiescing to EEs
position
o "I cannot agree that an employer has any unilateral right to change a contract or that by attempting to
make such a change he can force an employee to either accept it or quit."
Tucker on Constructive Dismissal
 If ER trying to negotiate for a unilateral change  make it not unilateral by providing
consideration.
 In deciding whether a change in term is reasonable, court will ask if it was reasonable to imply the
term
 remember that the DUTY TO OBEY is an open ended obligation
 courts are trying to balance the freedom of ER to modify their operations with EEs who may be
adversely affected by those modifications
 court says that NOT ALL violations of the K are fundamental breaches, but at some point the
changes are so significant that EEs can if they chose treat the actions as CD and seek damages
 NEED A SENSE OF WHERE THE COURT DRAWS THE LINE:
o demotions
240
o significant changes in compensation structure
o abusive treatment (Piresferreira)
Manner of Termination Damages – is there room for Honda damages in CD?




Honda: when EEs are mistreated in the manner of dismissal, ER could be liable for damages for
mental suffering
Piresferreira: no liability for negligent infliction of mental suffering – EE who suffered
mistreatment during employment was not entitled to damages
CD Issue: manner of dismissal damages arise in the ACT OF DISMISSAL, but in a CD scenario
there is no actual dismissal
Tucker: it is unlikely that a court would allow EE to claim under both heads of damages because it
would be conflating the two tests (CD and manner of termination damages)
o the majority of CD cases do NOT involve abusive behaviour, only changing terms of K,
which would not give rise to manner of termination damages anyway
Mitigation in Constructive Dismissal: IF EE fails to accept the new terms, has there been a
failure to mitigate?
 Does EE have to accept the new terms while looking for another job?
o Evans: courts apply an objective test (reasonable person), taking into account whether taking
back the employment would involve compromising integrity, humiliation, discomfort, etc –
if not, EE must return to work and failing to do so will be a failure to mitigate
 Evans may make it harder for EEs offered unilateral changes to treat it as CD and stop
working and claim damages (assuming that the change was just a business change, not
some sort of mistreatment, it would be hard to argue that going back to work would
involve humiliation, etc)
 Wronko: third option of continuing to work but informing ER that you reject the terms?
o if EE advises ER that he is rejecting the change overall but accepting the change for the
purposes of mitigation, in principle he could still sue for damages in the case of reduced pay
(but pretty unlikely scenario). If the change is not reduced pay, there will be no grounds to
bring an action. Therefore the act of mitigation will also effectively be the act of accepting the
changed terms.
o TUCKER – problem with Wonko: in most cases (except a K change in the notice period, which
would have no immediate effect) it is NOT POSSIBLE to continue working as before. If you get
demoted, you can’t just pretend to still be at the higher level position (you either work in the
demoted position or you don’t). If you are offered reduce compensation and you keep
working, you get the reduced amount. You either relocate or you don’t. Hence the third option
in Wonko is not readily available. If you are unable to continue working as before, the ER just
accepts your services on the new terms and it is up to you to sue for CD, where your only
remedy will be the difference between what you earned before and what you earn under the
new terms.
 Objective standard: does not take into account subjective reasonableness
o Loehle v. Purolator Canada (2008 ) the court held L had been constructively dismissed when he
was offered a demotion. Nevertheless, the court also held that L had failed to mitigate his
damages by not accepting the demotion.
241
o “His subjective assessment of the situation is not unreasonable. An objective consideration
results in a different conclusion. In my view, a reasonable person would have accepted the position
offered, notwithstanding the demotion, until alternate employment elsewhere was obtained. Searching for
a comparable position with another company while working should be less difficult than during a period
of unemployment”
o This narrows the circumstances in which an EE could treat a unilateral change as CD
CH 6: Termination for Cause
Termination for Cause at COMMON LAW
Basic Principles
3 ways to get terminated
What’s needed, issues, etc.
No cause
Just cause
At CL, ERs always have the option of terminating EEs by giving notice
 ER can terminate an EE without notice where they have cause – cause
arises from breaching the duties in the K of employment
o This links back to the duties of EE.
o Major issue: how significant does the breach by EE have to be
in order to justify summary dismissal?
If Wrongful Dismissal
found
Courts can only award damages for notice EEs should have received
o Courts do not have the ability to re-instate!!
HUGE difference between CL and CB regimes (arbitrators do have the
power to reinstate
Procedural Matters
Onus and Post-termination reasons


Where EE is terminated without notice and sues for wrongful dismissal  defence for ER to say
that it had just cause for termination.
o ONUS on ER to show on a BOP that had just cause to terminate without notice
ER is entitled to introduce evidence of matters unknown or not thought of at time of dismissal:
o If after termination ER discovers things that EE did wrong  ER can rely on them in court.
o Ex: resume discrepancies
Condonation (Empey v. Coastal Towing Co Ltd., 1997)



the ER loses the right to treat the conduct of an EEs as repudiation of the K (entitling him to
terminate without notice) if he accepts the employee’s breach
Requires that the ER know of the EEs breach
The ERs also entitled to reasonable time to react to a breach
242
Obligation of good faith and fair dealing in manner of dismissal

In the Honda framework, is there an obligation of procedural fairness in the administrative law
sense?
o does EE get reasons and opportunity to address ERs concerns?
o Tucker: generally, no. Courts have not held ERs to a duty of procedural fairness in private
relationships, although EE could make the argument that by not giving them an opportunity
to be heard it caused mental suffering and damages could be claimed (unlikely)
Wallace v. United Grain 1997 SCC  Superseded by Honda! We just discuss it for history.
 Obligation of good faith and fair dealing in termination
 Implications? Right to procedural fairness?
 Courts can only award damages (no power to reinstate)
Analysis
 When the employment relationship ruptures, it is the time where EE is most vulnerable and in
need of protection
o In recognition of this need, the law encourages conduct that minimizes the damage and
dislocation that result from dismissal
 Employers ought to be held to have an obligation of good faith and fair dealing in the manner of
dismissal, the breach of which will be compensated for by adding to the length of the notice
period
o In the course of dismissal, employers ought to be candid, reasonable, honest and forthright
with their employees and should refrain from engaging in conduct that is an unfair or is in
bad faith
NOTE: this is now superseded by Honda
Substantive Matters
Probationary Employees: these rights continue to generate controversy



Issue: can EEs hired on probation sue for wrongful dismissal?
o Generally the answer is no, but this is no longer absolute
 Principle: Without legislation or other authority to the contrary, a probationary EE is
entitled to reasonable notice of dismissal where there is no just cause. (Benson v Co-op
Atlantic, Nfld CA, 1987)
Probationary EEs entitled to ‘just cause’ protection against summary dismissal, but at lower
standard
o courts have said that ER has to establish that it gave EE a fair opportunity to demonstrate
his abilities, and must establish that the failed to meet the reasonable standard of
performance
Problem: what notice? Very little notice would be awarded.
o there is no entitlement to notice for persons employed for three months or less (ESA, s. 54)
o At CL there is no bright line duration test, but a wrongful dismissal action for a probationer
is unlikely to attract much in the way of damages.
Disciplinary Suspensions Without Pay
If there is misconduct on the part of EE, does ER only have the option of terminating, or can ER
243
impose a disciplinary unpaid suspension?
o Yes IF Express contractual provision in a K of employment that reserve the right to
suspend in certain circumstances
o Also, Could make argument that there is an implied term in the K (customary practice in
the trade)
In the ABSENCE of being able to show an express/implied term that gives right to imposes
disciplinary suspension without pay:
lower courts:
SCC in obiter:
take position that there is no CL right to suspend
seems to presume the opposite, that there is an
implied right to impose disciplinary suspensions.
244
Haldane v. Shelbar 1999 Ont CA [lower court]
 IMPLYING A TERM in an EMPLOYMENT
K:
o The existence of an implied right to
impose a disciplinary suspension
without pay depends on whether
evidence can establish the existence of
a custom or usage, or the presumed
intentions of the parties
o The special relationship created by
employment contracts and the power
imbalance between the parties renders
these contracts particularly
susceptible to the implication of terms
as a matter of law
 Having regard to (a) the inclusion of
progressive discipline in virtually all CAs (2)
that adding this implied term would provide
flexibility to the EE-ER relationship (3) the
incorporation into employment Ks the
provision requiring reasonable notice absent
just cause, a case could be made for implying
a term providing reasonable discipline into
employment contracts.
 BUT Such a step would, however, raise
complex questions concerning both the
procedural and substantive scope of that
implied term. In any event, the issue should
await a case where it is fully argued and its
resolution is necessary for the decision.
Carscallen v. FRI Corp 2004 Ont CA [lower
court]
Express v. implied:
 Express: If an express term of the
employment contract permits suspension for
misconduct, courts have held that such will
not amount to a constructive dismissal
 Implied: Where there’s no express right to
suspend and the ER suggests that the term
ought to be implied, courts will refrain from
implying a term into a contract unless it is
necessary to give business efficacy to the
contract
Rationale:
Two SCC Decision that did NOT involve
suspensions but where they assumed the RIGHT
exists:
McKinley v. BC Tel [2001, SCC]
 Issue was when ER can dismiss EE for
dishonesty – in the course of the judgment the
court assumed there were other sanctions
available to ER
 Iacobucci indicated that disciplinary
measures short of dismissal may be
appropriate in a non-unionized setting: “This
is not to say that there cannot be lesser sanctions
for less serious types of misconduct. For example,
an employer may be justified in docking an
employee's pay for any loss incurred by a minor
misuse of company property. This is one of several
disciplinary measures an employer may take in
these circumstances.”
Cabiakman v. Industrial Alliance Life Insurance,
2004 [SCC]
 Facts: ER wanted to suspend the EE. It was
under determination if the EE had committed
an offense  the offense had nothing to do
with the employment.
 Held: the ER had an obligation to pay the
employee during the suspension
 Court distinguished sharply between
disciplinary suspensions and administrative
suspensions (OBITER)
o the court assumed ERs enjoyed an
implied power to impose disciplinary
suspensions (without pay)
o court relied in arbitral jurisprudence
and held that ER had an implied right
to impose an administrative
suspension for legitimate business
reasons - but ER has obligation to pay
during the suspension
245



In the unionized setting, ERs and unions
expressly bargain for suspension rights at the
formation of the CA, and most CAs that
contain the right to suspend also provide EE
with right to grieve it
If grieved and ER can’t provide justification,
an arbitrator has wide powers to lessen or
remove the discipline, or reinstate EE.
There is NO SUCH REGIME in the
individual K of employment situation, so it is
not appropriate to allow these sanctions in
individual K of employment.
POLICY
 Why are lower courts concerned about
implying a right?
o Procedural issues: what does EE do if
he thinks it is unfair? their only
remedy would be CD (claiming the
discipline was a breach of K)
o There are no obvious remedies, no
way to challenge it – so courts don’t
want to open the door
Examples of Cause for Dismissal


Threshold: How serious does the violation have to be before a court will find grounds for summary
dismissal?
Courts no longer take the view that every violation of EEs duty constitutes just cause!
Dishonesty
McKinley v. BC Tel 2001 SCC: evidence of SOME dishonesty, but did it justify summary dismissal?
Facts: M worked for BC Tel for 17 years. In 1993, he experienced high blood pressure and subsequently
took a leave of absence on his doctor’s advice, indicating he wished to return to work at a less stressful
job. BC Tel subsequently terminated his employment. M rejected the severance offer and sued for
wrongful dismissal. BC Tel alleged M had been dishonest about his medical condition; there was
evidence of some dishonesty in this regard, but the question was whether a summary dismissal was
justified.


TEST:
General principles (CONTEXTUALIZATION and PROPORTIONALITY) that ought to be applied
o although they are applying it to dishonesty, they apply to any misconduct
Whether an ER is justified in dismissing an EE on the grounds of dishonesty is a question that
requires an assessment of the context of the alleged misconduct.
246
o
The test is whether the employee’s dishonesty gave rise to a breakdown in the
employment relationship
o Just cause for dismissal exists where the dishonesty violates an essential condition of the
employment contract, breaches the faith inherent to the work relationship, or is
fundamentally inconsistent with the employee’s obligation to his employer
 TWO PART ANALYSIS:
o (1) whether the evidence established EEs deceitful conduct on a balance of probabilities;
and
o (2) if so, whether the nature and degree of the dishonesty warranted dismissal (factual
inquiry)
 Underlying the approach is the principle of proportionality
o An effective balance must be struck between the severity of EEs misconduct and sanction
imposed
o This balance is informed by considering the sense of identity and self worth individuals
frequently derive from their employment
o NOTE: Iacobucci assumes that ERs have a wide range of disciplinary options available to
them
 Rationale: An analytical framework that examines each case on its own facts mitigates the
possibility that an EE will be unduly punished by the strict application of a rule that equates all
forms of dishonest behaviour
 Protective Policy: court reverts to language used in previous cases
o “Given this recognition of the integral nature of work to the lives and identities of
individuals in our society, care must be taken in fashioning rules and principles of law....
The importance of this is underscored by the power imbalance that this Court has
recognized as ingrained in most facets of the employment relationship. In Wallace, both the
majority and dissenting opinions recognized that such relationships are typically
characterized by unequal bargaining power, which places employees in a vulnerable
position vis-àà-vis their employers. It was further acknowledged that such vulnerability
remains in place, and becomes especially acute, at the time of dismissal.”
Corso v. Nebs Business Products (2009 ON SC)
ISSUE: question of when an EEs breach of K is sufficient to justify dismissal without notice?
TEST: used a FACTOR ANALYSIS
o (1) the nature and extent of the employee’s misconduct;
o (2) the context and surrounding circumstances, including;
 (a) the circumstances of the employee, including:
 (i) seniority;
 (ii) role and responsibility within the business;
 (iii) employment history and performance;
 (iv) age and other appropriate personal circumstances;
 (v) other relevant circumstances;
 (b) the circumstances of the employer, including:
 (i) the nature of the employer’s business activity;
 (ii) relevant employer policies and practices;
 (iii) the employee’s position within the organization;
247


(iv) the degree of trust reposed in the employee;
(v) other relevant circumstances;
Sexual Harassment

early cases were reluctant to uphold summary dismissals of EEs on the basis that they were found to
be sexual harassers, but there has been a shift over time
Bannister v. GM (1999)
 Facts: A foreman was summarily discharged for sexual harassment and sued for wrongful
dismissal. He succeeded at trial. Court of Appeal reversed and reprimanded the trial judge.
 Analysis:
o the fact that the environment is rough and abuse/sexual innuendo flowed freely cannot be
tolerated in today’s cultural acceptance of gender equality
o No female should be called upon to defend her dignity or to resist or turn away from
unwanted approaches or comments which are gender or sexually oriented. It is an abuse of
power for a supervisor to condone or participate in such conduct
 Main Point: claiming that the environment was full of abuse/sexual innuendo does not excuse
EEs who are sexual harassers
Simpson v. Consumers’ Association of Canada (2001, COA)
Facts: a supervisor was terminated for sexually harassing female EEs. He sued for wrongful dismissal
claiming in part that his relationships occurred outside of work and were consensual. The trial judge
found for the supervisor but was reversed on appeal.
Analysis:
 after-hours interaction between a supervisor and other EEs can constitute the workplace for the
purpose of the application of the law regarding employment-related sexual harassment.
 This was a question of fact in each case.
 supervisory roles should not be ignored (power imbalance)
o judge should appreciate the perceived consequences of objecting to a supervisor’s behaviour
o a supervisor EE could be held accountable for any prevailing sexual culture and he cannot
benefit from the absence of a sexual harassment policy when it was his responsibility to
develop one
 The issue is how the court constructs the notion of consent
o court was reluctant to find that relationships were purely consensual b/c of power
imbalance
o Tucker: if the relationship is unequal, proceed with caution
Off Duty Conduct


why should ER ever be able to terminate an EE for conduct that occurs off duty?
o issue is whether the off-duty conduct can be shown to have a material effect on the (1)
employment relationship and (2) on the ability of EE to perform his function without
compromising legitimate interests that ER might have in the particular context
Example: EE is arrested outside of work
o it is only an allegation, no conviction
o Cabiakman: SCC held that administrative suspension with pay is permitted but didn’t allow
it without pay
o If suspended without pay, EEs options:
248


take the suspension and hope things work out
take the suspension and claim CD and sue for damages
Pliniussen v. University of Western Ontario:
plaintiff lectured part-time in the University's
School of Business Administration. He
subsequently pleaded guilty to charges of fraud
concerning multiple false insurance claims on a
single lost watch. The University dismissed
Pliniussen and successfully defended itself
against his action for breach of contract. The
County Court found that the potential damage
to the University's reputation, and that of the
Business School in particular, justified the
dismissal
was fired because he was convicted of 2
criminal charges unrelated to work which
would cause him to miss 30 days of work.
Heynen then brought an action for wrongful
dismissal.




The court found that the misconduct was
unrelated to the employment and therefore
did not constitute a basis for summary
termination.
Moreover, the 30 day absence did not rise to
the level of just cause for dismissal,
notwithstanding that it was caused by the
employee’s misconduct.
The employer was required to show that
they could not accommodate his absence.
“In light of the appellant’s length of service, his
unblemished record and the demonstrated ability
of the respondent to cover his absence there was
nothing approaching just cause for
termination.”
Heynen v. Frito Lay Canada: a driver-salesman
who had been with the company for 23 years
Collective Bargaining
George W. Adams, Grievance Arbitration of Discharge Cases: historically, narrow approach to EE
misconduct and favouring of ER’s interest; now eroding. Tucker: courts embracing that ER-EE
relationship is hierarchical.
 The inadequate protection accorded to EE interests by master and servant law provides an
important backdrop against which to assess the reasoning of arbitrators
o The law of master and servant, as it developed, took a narrow contractual approach to EE
misconduct. A K governed the employment relationship and improper conduct was
considered to be a breach of that K. The treatment of EE misconduct became quite
mechanistic from this perspective.
o A second aspect of master and servant law giving rise to general dissatisfaction was its
almost single-minded pursuit of the ERs interest.
o In contract, an innocent party is entitled to his remedy regardless of the personal
characteristics of the breaching party or of the reasons that caused or contributed to the
breach.
 Contractual remedies are not individualized and "strict liability" is the general rule.
 Significant distinctions were not made between different types of misconduct
 Seniority didn’t matter
249



 The equality in remedy had a most unequal impact on EEs
As Chief Justice Laskin has observed (Arthurs):
o The Courts were not specialized agencies for dealing with employment relations; and under a
common law regime of individual bargaining governed by ordinary contract principles, the
employer's unilateral determinations of causes for discharge (where the underlying facts were
established) tended to be viewed in general terms and, when sustained, became guiding principles.
However, this approach is undergoing considerable erosion.
o Given this more individualized approach it may be that the older grounds for dismissal will
lose their "iron clad" significance.
o The first question to be asked, thus, is in what major respects the arbitral jurisprudence
differs from judicially evolved laws. (The arbitration cases are selected for their
representational quality, not for their currency).
TUCKER: in the last 20 years, courts have embraced the idea that the relationship between EE
and ER is hierarchical, and that EEs are at a disadvantage.
o They have constructed a more protective regime and do not proceed in a narrow
mechanistic way in addressing issues of EE misconduct.
o They have expressly taken the view that you have to look at it from the perspective of the
EE
o They have on a number of occasions given effect to EE concerns by focusing on
proportionality, balancing, etc and reserving terminations for situations where the
relationship has been ruptured by actions of the EE
General Principles



unionized employees can only be dismissed for just cause
o The employer does not have a general right to dismiss for no reason by giving notice
o notion of just cause for dismissal is broader, since it includes non-disciplinary grounds for
termination, such as an economic downturn  in such cases, notice will be required
o however, disciplinary discharges under the collective bargaining scheme are analogous to
just cause dismissals at common law, which do not require notice
Because of principle of “no discharge or discipline without just cause”, just cause has a broader
meaning in collective bargaining and grievance arbitration than it has in common law. It
includes:
o Disciplinary terminations (no notice required)
o Non-disciplinary terminations – eg frustration, workforce reductions, etc
 Ex: if ERs business is shrinking it can terminate EEs – that is just cause
 this doesn’t affect EEs entitlement to ESA (or any notice provisions in the CA)
Focus here is on disciplinary terminations (summary termination for cause)
Procedural Matters
Onus and Post-termination reasons


ONUS: onus on employer to show just cause on a balance of probabilities
FAIRNESS: issue of fairness is addressed in the CB regime through the grievance procedure:
250
o



typically requires the ER to disclose the ground for its action and gives the union an
opportunity to challenge the decision through several stages of dispute resolution prior to a
formal adjudication before an arbitrator
o General principle is that employer cannot alter reasons or rely on matters unknown at time
of action, but numerous and expanding exceptions
 Contrast: remember that in CL, ER could use causes discovered after dismissal to
justify the dismissal
DUTY: In general, management under a duty to exercise its rights fairly and reasonably
o negotiated grievance procedures apply
ER POWERS: Variety of disciplinary actions, including suspensions, are permitted
REMEDIES: Arbitrators have the power to order reinstatement or to moderate the discipline
Condonation

an ER who has condoned misconduct will generally be prevented from relying upon it to establish
just cause for discipline or discharge
Probationary Employees
Overall:
 Very similar to CL probationary EEs
Rationale:
 While probationary EEs should have some rights, for the probationary period to mean anything
it must be treated as an opportunity for the ER to assess the EEs full potential and capacity to do
the job
The Law:
 Parties often negotiate over what the rights of probationary EEs are
 Probationary employees cannot be denied access to grievance machinery, but lower standard
of just cause typically applies
o There is a question as to whether they can be per se denied the grievance procedure, but
it is clear that they can address the substantive elements of the problem
 Most arbitrators have adopted the view that ERs are under a duty to fairly access whether
probationary EEs have met the job requirements
o as long as ER can show that it didn’t act arbitrarily/unreasonably and that there was some
grounds for deciding the EE wasn’t suitable, they will have just cause
 Unionized probationary EEs can get reinstated if the arbitrator finds there was not just cause
for termination
Disciplinary Suspensions


General point: not every breach of EEs obligations under the CA will be just cause for dismissal
under the CB relationship
unionized employers do enjoy the right to impose unpaid disciplinary suspensions
o suspensions can be grieved and the arbitrator can shorten the length of the suspension if it is
found to be too severe
o if the suspension was found to be unjustified, the arbitrator can order the employer to pay
the suspended employee in full and to erase the suspension from the employee’s record
251

Misconduct: Numerous grounds for discipline or discharge, but arbitrators examine context and
proportionality (from McKinley)
o Insubordination
 Disobedience is clearly a ground for discharge or discipline, but as we saw there are
limits on the duty to obey
o Dishonesty
o Off-duty conduct
Insubordination
1) Aro Canada: EE told her supervisor to “fuck off” – this was insubordination but not enough to
justify dismissal (and even the suspension was too harsh)
Re Gardner-Denver 1974 LAC
Facts: B thought he had obeyed the orders of M, a foreman. M thought otherwise and angrily told him
to load trucks. B abusively replied he had done what he was supposed to have done.
Issue: (1) did B refused to carry out orders? (2) was he insolent and abusive?
Analysis:
 Insubordination does not consist of failure to obey any order, it consists of failure to obey a
reasonable order (Re Spruce Falls Power & Paper Co)
o On the facts, I am satisfied B carried out the entire task assigned to him
o He therefore did not refuse to carry out the reasonable part of his orders (the order was an
unreasonable one)
 However, B’s failure to advance reasons for his seeming disobedience cannot be lightly
condoned
o The onus is on him to dispel the foreman's misapprehension that he was refusing to obey
orders
o Instead he reacted with insolence, addressing the foreman with abusive profanity
o Insolence is a serious offence in the industrial setting, and is regarded as a form of
insubordination
 Well there's no doubt that B was abusive to his foreman to a high degree, the company stated at
the hearing that B was not discharged for abusiveness but for gross insubordination
o B carried out his tasks and did not adversely affect production with his outburst
o The court adopts a classic IR perspective: the workplace is a site in which there needs ot be
order, the hierarchical relationship btw supervisor and EE needs to be respected, and
insolent behaviour cannot be condoned
 Court looks at the following (similar to McKinley):
o EE was responding in kind
o looked at work history – length and other issues of insubordination
Held:
 The company has not established just cause for dismissal
 However, B was at fault for not explaining the actual situation to his foreman – B leg M to conclude that
he was refusing to do his job
Judgement: B is to be reinstated in his job, but received a five day suspension with wage deductions
Tucker: this is where arbitrators get into a realm that courts cannot access. They have a much bigger
range of appropriate sanctions and can incorporate the principle of proportionality, not faced with a
stark choice.
252
Dishonesty
Fraser Valley Library 2000 LAC
Facts: G had applied for a promotion but was unsuccessful. She subsequently broke into her manager's
e-mail on 10 occasions and read a number of messages. When she was caught, she apologized and
claimed to be deeply embarrassed by her actions. Nevertheless, the ER terminated her. The ERs e-mail
system was not secure and EEs were warned not to use it for confidential communications.
Analysis:
Applicable test in cases of discharge involves three questions:
 WAS THERE DISHONESTY? YES/NO
o has the employee given just and reasonable cause for some form of discipline by the
employer?
 IF YES, DOES THE DISHONESTY WARRANT THE PENALTY? (this is the critical question)
o Look at the context
o an ER has a legitimate interest in expecting honesty from its EEs and in deterring others in
its work force by taking dismissal action when dishonesty is detected
o however, the EE in cases of dishonesty can often point to years of discipline-free service
as support that the misconduct will not be repeated
o BC Rail and CUTE, 1998 – an act of dishonesty raises serious questions in cases where trust is
a component of the relationship. The question of whether the employment relationship is
capable of being restored does not turn on a unilateral appraisal by one party. It is an
objective test and, in cases of theft and dishonesty, involves a consideration of the
motivation and intent of the EE and the likelihood that the conduct will be repeated
 IF NO, WHAT ALTERNATE MEASURES SHOULD BE SUBSTITUTED?
Judgment: Discharge is upheld
 disappointment does not come close to excusing a breach of privacy
 arbitrator said there had been irreparable harm to the relationship
Sexual Harassment


Old world didn’t impose discipline for sexual harassment, but now there is much more sensitivity
around these issues
Tension between human rights and industrial relations perspectives on this issue
Re C.U.P.E. and Office and Professional Employees' International Union, Local 491 (1982)
 Evidence:
o no evidence of sexual harassment (physical acts or propositions) nor was there a constant
stream of gender-based insults and comments in this period, creating a sexist and
discriminatory environment.
o difficult working conditions, which the grievor believed were linked to her failure to comply
with sexual demands and to discuss sexual matters, and designed to drive her from the
office.
 Holding:
o The evidence, we believe, shows a difficult working relationship, causing her anxiety, but
arising from working styles and personality problems. This is not sexual harassment.
 Possible reasons for the difficult environment:
o sexist structure of our society, where men are usually the bosses and women are the
subordinates
253
Community Living South Muskoka v. Ontario Public Service Employees Union (Walla
Grievance)[2000]
Facts: male co-worker sexually harassing his female co-workers – involved inappropriate physical
contact. This had been going on for years but none of the women had made a complaint. Once a
complaint was made, other people started coming forward. ER responded by firing the harasser.
Analysis:
 here there was clearly sexual harassment – the issue was what the appropriate discipline should be
 HR perspective: you can’t put someone back in the workplace b/c he would work closely with
women who would feel vulnerable
 IR perspective: no previous complaints (so no opportunity to reform), long work record
 Issue is that in other circumstances EE might not be terminated, but here you can’t really put him
back in the workplace
Held: arbitrator reduces it to a 6 month suspension and then requires the ER to pay the EE from the end
of the suspension to the date of arbitration, when the discharge will take effect (odd)
Off-duty Conduct



EEs can be disciplined/discharged for off-duty conduct,
o but ER has to establish that the punishment is justified in relation to the impact the off duty
conduct had on the ERs legitimate business interests
EX: violent conduct would make others afraid to work with him
what happens when a person has been charged but not convicted?
o if ER can establish that the very fact of the charge has an impact on the employment
relationship, then they can impose an administrative, not disciplinary, suspension (paid)
o if EE is convicted, the question is whether it adversely affects an ER interest
Re Firestone Tire and Rubber
 “Without more, an assault of any nature of an EE or supervisor by another EE is a serious matter and may
without more justify a dismissal for cause”
 Here, EEs who got into a push and shove with members of management while lunching at a motel
(a long verbal dispute over work conditions being a forerunner of the rather mild altercation) were
all held to have been properly subjected to discipline, although the board found that discharge was
too severe a penalty.
B.C. Telephone Co. and Federation of Telephone Workers of B.C. (BCSC)
 Facts: EE had been dismissed after his conviction of several offences, including dealing in small
quantities of drugs and drunken driving.
 Held: B.C. Supreme Court upheld an arbitration award which ordered reinstatement of a discharged
EE.
 The arbitration board recapitulated the criteria used to decide whether discharge for conduct
outside the workplace is justified. These are (not necessary to find all of them):
1. The conduct of the grievor harms the company's reputation or conduct.
2. The grievor's behaviour renders him unable to perform his duties satisfactorily.
3. The grievor's behaviour leads to a refusal, reluctance or inability of the other employees to
work with him.
4.The grievor has been guilty of a serious breach of the Criminal Code and thus rendering his
conduct injurious to the general reputation of the company and its employees.
254
5.The grievor's conduct places difficulty in the way of the company properly carrying out its
function of efficiently directing its working forces.
Re Phillips Cables
 Issue: can a unionized employer suspend an EE who:
o has been charged with a criminal offense,
o but is still awaiting trial?
 Ratio: dependent on if the charge leads to a significant adverse effect on ER interests. So, yes, it
can be permissible to suspend an EE that is still awaiting trial but has been charged with a crim
offence. The question is of threshold re adverse impact on ER interests.
 Judgment: the offence wasn’t found to meet the threshold of adversely affecting an ER interest
o the fact that EE was going to be unable to work because he was in jail was NOT sufficient to
justify termination (30 day suspension wasn’t enough of a disruption)
 REASONING:
Arbitrators are being asked to pick between 2 conflicting interests
Company to manage its activities in an
The innocent employees’ interest:
efficient and orderly way
- Overall, the EE can be qualitatively
- Maintaining his livelihood until his status
distinguished from other EEs
has been fairly determined
- EE’s existence can cause real hardship to
- He who ends up being not convicted can say
ER and other EEs, ex: w/ customers
that he was not a risk to his employees or
company; that he was mistakenly branded
- Thus, because he is innocent, he argues
company should bear risk of his innocence
- First: board accepts principle that in some circumstances a company can suspend an EE
charged with a criminal offence, before trial has concluded. This is because presumption of
innocence is a criminal principle that cannot be unqualifiedly transported to labour relations.
Consider that a work-related criminal charge could substantially impair.
- But second: board understands the tough spot that the EE is in; it can be meaningless to be
found innocent if one has been placed through the ordeal of being unemployed in the
meantime.
- Third: d/n understand third part – last para on 6-76
- FOURTH: THE EE CANNOT BE TREATED AS IF HE HAS BEEN CONVICTED OF THE
OFFENCE. THE SUSPENSION CANNOT REST ON THAT. Rather, the factor that
determines who the situation should be dealt with is the weight of the risk of guilt. Where
the company shows this risk of guilt presents a substantial and immediate hardship to the
company or its workers, and the hardship cannot practicably be met by anything other
than the suspension of the EE, then suspension can be justified.
o This last part, deals with situations where workers/customers justifiably refuse to deal
with the EE or he cannot be transferred or watched more closely pending an official
determination of his status.
Tucker: this approach holds discharge as the capital punishment of sanctions, reserved only for the
most serious case
255
CL and CB Terminations Compared





Are the standards necessary to support a disciplinary termination the same in CL and CB?
The approach in both is the same:
o (1) has there been a breach?
o (2) how serious is it, taking into account the context and ER/EE perspectives?
o Adjudicators in both systems believe in contextual and proportional approach
Substantive grounds for termination similar (same duty structure)
Remedial powers different
o Courts: damages only, not entitled to be reinstated
o Arbitrators: reinstatement, moderation of discipline (proportionality can be more effectively
implemented)
Unilateral changes:
o CB: union can grieve the unilateral change and if the arbitrator finds that the ER did not
have the authority under the collective agreement to make that change, the arbitrator can
order that the change is not effective and give EEs who were adversely affected by the
unilateral change a remedy
o CL: treat it as constructive dismissal
CH 7: Collective Action
COLLECTIVE BARGAINING

THEME:
Tension between:
Voluntarism
Coercion
“Letting the parties in CB do what they want” “The state telling them what to do”
The idea that CB is not a significant
The use of state power to impose terms and
departure from CL and the parties should conditions or to limit the use of weapons to promote
be left to establish the terms and
outcomes desired by the state.
conditions of the CAs and achieve the
outcome they desire.
 Essentially we start from free CB  and give the state the power to apply Coercion Power if
necessary. More specifically:
 Free CB is a cornerstone of our industrial relations system.
o But it is open to a labour board to resort to using Coercion when the failure of CB has
imposed very high costs on the larger community

The fact that we can speak of a duty of good faith means that the state compels the parties
to participate in the process in a manner consistent with an expected way of acting – i.e.,
good faith.
1. Negotiation of CA: Duty to Bargain in Good Faith

Health Services v. BC (SCC 2007)
o “the Duty to bargain in good faith...lies at the heart of collective bargaining”
256
o
o
o


SCC talked about the content of the duty to bargain collectively and included it in FOA
Said the duty to bargain in good faith was at the core of the duty to bargain collectively
they made it absolutely clear that the right to CB is a procedural right, NOT a substantive
right
Content of the duty: bargain in good faith and make reasonable effort to reach a deal, but no
duty to agree to any particular terms
o emphasis is on voluntarism – no duty to reach an agreement or compromise, rather duty is
to participate in good faith in a bargaining process.
o Thus the focus in this area is on process, not outcomes.
o s.17 of the LRA: the parties shall meet within 15 days from the giving of the notice or within
such further period as the parties agree upon and they shall bargain in good faith and
make every reasonable effort to make a collective agreement
Problem arises:
o How to distinguish between hard bargaining in pursuit of rational self interest, which is
permitted, and bad faith bargaining – going through the motions but without a willingness
to enter into an agreement (surface bargaining)? (this is what happens in De Vilbiss)
General Principles
United Electrical Workers of American v. De Vilbiss OLRB (1976)
Contextual facts that gave rise to suspicion of bad faith conduct
 union had recently faced a strenuous certification process
o this is the first CA negotiation
 conduct in the negotiating sessions
o cutting negotiations short
o walking out of conciliation and failing to attend another session (ER claimed it didn’t like
union’s tone)
o comments that union didn’t fairly obtain certification
 unilateral alteration of terms/conditions of employment without first proposing changes to union
o direct bargaining with EEs (not permitted in CB context!)
o NOTE: at certain times there is a freeze on unilateral changes to the K, but this was not in
violation of the freeze (applies when CA is in place)
 discriminatory treatment of members of the negotiating committee
o they were excluded from bonus payments
 failure to provide job class and wage rate information
o union couldn’t formulate demands b/c they didn’t have the necessary info
o ER cut the negotiation short on the basis that union didn’t have the demands.
Held  Given all this behaviour, it is easy for the board to determine that the Employer was
negotiating in bad faith (just going through the motions, no real willingness to engage with the union,
no reasonable efforts)
PURPOSE OF – the Duty to Bargain in Good Faith:
 IT GIVES EFFECT TO RECOGNITION: if ER only had to recognize a union but didn’t have to
bargain with it, the substantive content to recognition would be drained out.
o It reinforces ERs obligation to recognize a TU that is lawfully selected by EEs as a BA.
 PROMOTES INDUSTRIAL PEACE: by requiring parties to negotiate in good faith you maximize the
possibility that they will come to an agreement without strikes/lockouts.
257
o Rational discussion is likely to minimize the number of problems between the parties.
 PROMOTES WORKPLACE DEMOCRACY: does not have much relevance in case law (not
mentioned in this case) but is a hopeful notion.
CONTENT OF – the Duty to Bargain in Good Faith:
 Section 17 of LRA: imposes duty to bargain in good faith IN THAT there is an obligation on the
parties to enter a serious discussion with the intent to enter into a CA.
o Once TU certified as exclusive BA of BU, ER must accept its status.
o Parties are obligated to have the common objective of arriving at a CA!
o But of course OK to have different objectives about CONTENTS of CA; but both must have
objective of negotiating in good faith towards a CA.
o Court says this legislation is based on voluntarism; that the parties are the best positioned to
determine their CA – their law to govern their workplace.
o In sum: therefore while they must share the common objective to enter into a CA, the legislation
envisages that they have differences with respect to what the content of the CA should be and
that those differences may give rise to the parties seeking recourse through economic sanctions.
 Difficult to articulate and the legal standard is so broad that a contextual, case by case analysis must
be undertaken.
Remedy and WHY THIS remedy
 Applied: “we direct the respondent to begin to bargain in GF and make all reasonable efforts to
make a collective agreement with the union.” Also: must meet w/i reasonable time.
 Union wanted board to impose CA on ER  but board REFUSES because Board recognizes “that
labour relations in the private sector have for the most part been based upon voluntarism/freedom
of contract.”
o Board doubts it has authority to imposes a CA.  But says unnecessary to “resolve” this issue
because thinks the parties will be able to arrive at a CA if ER starts good faith and makes
reasonable efforts towards CA.
o The finding that there is bad faith is sufficient to discipline ER so it will participate in the
process, with the threat that if ER continues to fail to abide it can be filed with the court, a
violation of which would put ER in contempt
 The duty to bargain imposes a procedural obligation, and imposing a CA with substantive
terms/conditions would take it a step too far and get into the substance of the agreement
 Court’s remedy is a threat to get them to engage in PROCEDURE, but no substantive aspects.
Duty to Disclose
ISSUE: how much info does ER have to provide?
Rationales: It is important for the Employer to disclose information because:
Lack of disclosure
In order for the union to bargain effectively on behalf of its members,
undermines the process
it needs to have information,
itself:
so it can formulate demands and establish its priorities
This requirement is
justified on both fairness
and efficiency grounds:
Once a CA is signed, there are NO strikes/lockouts allowed.
So if union is unable to address an issue (because they didn’t know
about it) during negotiations,
there is no way for them to bring it up later.
258
Westinghouse
Facts: union and ER negotiated a CA and three months later ER announced it was relocating parts of its
plant to another part of the province
Issue: (1) did the ER breach its duty of good faith bargaining by failing to disclose the impending
move? (2) was managements decision tainted by anti-union animus?
Analysis:
 Board held that ER must:
o (1) disclose decisions already made
o (2) answer honestly when asked about plans under consideration, but no duty to disclose on
its own initiative those plans
Held: no breach of duty of good faith, but anti-union animus was present
 board was satisfied that the decision had not been made during the period of CB and union had not
asked the ER whether any such plans were under consideration
Consolidated Bathurst
Facts: union and ER reached agreement, and shortly after ER announced it was shutting down the
plant. Union had not requested disclosure of any impending plans.
Issue: how to establish that a decision had been made and therefore had to be disclosed by the ER on its
own initiative?
Analysis:
 Board reiterates Westinghouse – no proactive duty on ER to reveal matters under consideration
 BUT when a decision is taken shortly after CA is signed, it will be assumed that the decision had
been made earlier (and therefore ER was obliged to disclose it) [rebuttable presumption]
o not a per se rule, but does have the effect of shifting the burden
o ER must show board on a BOP that it was only under consideration, decision had not been
made
o no precise definition of “shortly after” given
Held: ER failed to rebut presumption so a breach of good faith was found
AMAPCEO v Ontario (Government Services) 2012 CanLII
Facts: Ontario govt and OPSEU (another union) entered a CA that provided 2% increase in final year.
BUT had secret agreement for additional 1% increase in final year.
Held: the secret agreement was a false construct, entered into to try to deceive AMAPCEO and lower
the bargaining expectations. Constituted a a misrepresentation by the employer that violated its duty to
bargain in good faith.
Canadian Pacific Forest Products
Facts: after CA was signed ER announced it was shutting down a turbine that would affect BU
members
Analysis:
 Decision that affect the unit (even less significant than plant closures, etc) that have been made at
the time when bargaining is taking place have to be disclosed, and if you announce a change
shortly after the inference arises that there had been a decision and it ought to have been
disclosed
 this duty imposes coercion – ERs are compelled by law to disclose – but it remains procedural
o obligation is to make the process work, not engage in the substance of the agreement
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Legislative Responses: Mandatory Terms
1. Issue that gives rise to substantial (as opposed to procedural) coercion: ER may refuse to
accept something that is fairly standard in the IR landscape and the consequence is that
either no CA will be reached, or there will be a long/bitter conflict because the parties can’t
agree on something that seems so fundamental
 Because hard bargaining is permitted, weak unions may have difficulty extracting
terms and conditions that have come to be considered foundational to the
CB/standard features of CAs
 legislature has started imposing some mandated terms
2. Thus, legislature has stipulated that certain terms are mandatory: OLRA s.45-52
 Most of these are regarding the legal framework of CB – some substantive aspects
though
 There must be a recognition clause:
(1) s.45(1): Every CA shall be deemed to provide that the TU that is a party
thereto is recognized as the exclusive BA of the EEs in the BU defined
therein.
 No strikes/lockouts during life of CA:
(1) s.46: Every CA shall be deemed to provide that there will be no strikes or
lock-outs so long as the agreement continues to operate.
 Must include provision for dealing with disputes through grievance procedure
(1) s.48(1): Every CA shall provide for the final and binding settlement by
arbitration, without stoppage of work, of all differences between the parties
arising from the interpretation, application, administration or alleged
violation of the agreement, including any question as to whether a matter is
arbitrable
 Mandatory dues deduction for all BU members (Rand formula)
(1) s. 47(1): where a TU that is the BA for EEs in a BU so requests, there shall
be included in the CA between the TU and the ER of the EEs a provision
requiring the ER to deduct from the wages of each EE in the unit affected
by the CA, whether or not the EE is a member of the union, the amount of
the regular union dues and to remit the amount to the trade union,
forthwith.
(2) NOTE: union security levels
1. highest: ER can only hire members of the union
2. lower: everyone who is hired has to join the union (union shop clause)
3. lowest: not everyone has to join, but everyone pays union dues (Rand)
3. NOTE: there used to be a mandatory just cause provision but it was repealed by the
Conservatives
 theoretically, an ER could refuse a just cause provision, even though they are
foundational
A Minimum Standards Approach
1. Tension between free economic bargaining and minimum standards arises frequently in CB
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2. duty to bargain in good faith does not prevent an employer from insisting that it will only
sign a K that meets its needs, which may include a refusal to agree to terms that have
become fairly standard in most CAs, provided that those terms are not mandated by statute
Royal Oak Mines (SCC, 1996)
Facts: The mine is located in Yellowknife, and the 240 hourly employees are represented by a union. In
February 1992, the parties negotiated for a new CA and a conciliation officer was appointed to assist. A
tentative agreement was reached in April, but was rejected by union vote. The EEs voted to strike and
were subsequently locked out. The company hired replacement workers and decided to terminate the
striking EEs. The union eventually filed a complaint that the company failed to bargain in good faith
and the LRA Board found the complaint to be valid. As a remedy, the locked-out striking EEs were
called back to work, except for those who had been dismissed. Eventually, 44 EEs who had been
dismissed were reinstated or awarded severance pay.
Held:
 The board found the company breached the duty to bargain in good faith in three ways:
o The ER refused to bargain with the union, the exclusive BA of the EEs, pending the outcome
of the competing EE association
o The company’s demand for a probationary clause for all returning EEs amounted to bad
faith—the EEs engaged in a lawful strike and should not be penalized.
 These would undermine the basic principles of the LRA.
o The company failed to bargain in good faith, when it refused to agree to a provision for any
type of arbitration or consideration of questions arising from its discharge of the 49
employees
 TEST: court broke the duty of good faith down into two elements (based on s.50 of the LRA):
o (1) there is a duty to bargain in good faith – subjective standard
o (2) there is a duty to make reasonable efforts to enter into a CA – objective standard
 *The reasonable effort can be ascertained by looking at comparable standards and
practices within a particular industry*
 This prevents a party from hiding behind an assertion that it is sincere in trying to
reach an agreement when its proposals are far from the accepted norms of the
industry
 How the test is applied: the Board by reference to the industry will determine whether other ERs
have refused such a clause, and if it is common knowledge that the absence of such a clause would
be unacceptable to any union (here, grievance arbitration) then the ER cannot be said to be
bargaining in good faith
 “A refusal to include such basic and standard terms in an agreement as a requirement of a just cause for
dismissal clause, or a refusal to negotiate about pensions, or as in this case, a refusal to consider a grievance
arbitration clause, leads to the inference that despite any "sincerely and deeply held" beliefs the party claims
to have, by taking a rigid stance on such a widely accepted condition, it becomes apparent that the party (here
the employer) has no real intention of reaching an agreement.”
Tucker
3. the standard terms that are widely accepted within the CB area have become the
minimum content that everyone has to accept, because the failure to accept them is either
per se unreasonable, or at the very least gives rise to a strong presumption that ERs position
is objectively unreasonable and therefore they are not making reasonable efforts to reach a
CA
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 this is potentially a significant breach in the procedure/substance divide
4. the other significant part of this case is the REMEDY
 in De Vilbiss, the remedy was to go back to the bargaining table with a threat of court
order
 here the SCC said they were imposing certain terms into the CA – there were too
many risks to going back to the table, there was a long/bitter conflict, so they
imposed terms and conditions
5. TUCKERS FAVOURITE QUOTE: shows tension between voluntarism and coercion
 “Clearly it can never be forgotten that free collective bargaining is a corner stone of the
Canada Labour Code and of labour relations. As a general rule it should be permitted to
function. Nonetheless, situations will arise when that principle can no longer be permitted to
dominate a situation. Where the dispute has been bitter and lengthy; the parties intransigent
and their positions intractable; when it has been found that one of the parties has not been
bargaining in good faith and that this failure has frustrated the formation of a collective
bargaining agreement; and where a community is suffering as a result of the strike then a
Board will be justified in exercising its experience and special skill in order to fashion a
remedy. This will be true even if the consequence of the remedy is to put an end to free
collective bargaining.
Individuals in the System: intersection between the individual K of employment and CB
regime
Duty of fair representation
 law imposes a duty on trade unions to fairly represent all the members of the BU, not just union
members
o union has a significant role: negotiate the terms/conditions, have access to grievance machinery
o individuals do not have a direct agreement with the ER
o If EE feels that they have not been fairly represented, they can bring a complaint to the Board
 application:
o negotiation complaints
 unions must make decisions about competing priorities (different EEs have different
interests) and as long as the choices unions make are in good faith, then they will not be in
breach
o grievances
 in law, because union is a party to the agreement, the union has carriage of grievances
 when unions don’t take grievances all the way, individual has lost the chance to get
adjudication
 unions have to make decisions about priorities/costs, and as long as union has not acted
with subjective ill will toward the EE, or on a discriminatorily/arbitrarily they won’t be in
breach
 reason: because of the regime’s embrace of majoritarianism and exclusivity in regard to
representation. It is a way of protecting the individual in a collective system
Reading:
 LR statutes impose a duty of fair representation on unions.
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


Section 74, LRA: a trade union or a council of trade unions representing a BU shall not act
in a way that is arbitrary, discriminatory, or in bad faith, whether or not the employees are
members of the union.
o A breach of this section permits the remedial processes of Section 96 to be put into
operation. (Orders to stop, rectify, compensate, reinstate, or hire).
o Generally Labour Relations Boards wouldn’t question the agreement struck by a bona
fide union; but this is not always the case. They may interfere where they see
individuals as having been treated unfairly by the collective (Group of Seagrams, 1978).
Section 74 tries to protect against being NOT FAIRLY REPRESENTED.
o Complaint under Section74 “must be evaluated in light of industrial realities and
practices.”
o OLRB will consider:
 Trade unions not professional advocates and have limited time to consider
decisions.
 Trade unions must consider long-term impact of bringing a grievance.
Generally, union has the sole right to bring grievances about interpretation of CA.
o So, if union being biased against an EE, the EE could be disadvantaged if the
bargaining agent chose not to process her claim.
Ford Motor Company of Canada, Ltd. (1973 OLRB)
Facts:
Issue:
Ratio:
Analysis:
Conclusion:
Walter Princesdomu (1975 OLRB)
Facts:
Issue:
Ratio:
Analysis:
Conclusion:
Individual Contract of Employment
 Can an employee enforce terms of a CA by bringing an action in K?
o Several cases indicate yes: that a civil action on the individual K of employment can be
brought, where interpretation of CA is NOT required. Underlying these decisions is the idea
that the terms of the CA are incorporated into the individual Ks the EEs have with the ER who
bargained with the union.
 EE can sue in civil court for vacation pay owed under a CA: (Grottoli v Lock 1963)
 Civil action can be bought in Ontario so long as it did not require interpretation of CA.
Hamilton Street Railway (1966 SCC)
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 Civil action rejected because CA required interpretation. (Close v Globe and Mail 1967)
o But an SCC decision (McGavin Toastmaster Ltd. v Ainscough) threw doubt on the above
principle.
 Issue: within the CB regime, what is left of the individual K of employment?
 Background:
o workers established CB relationships with ERs and by the 20th century began to have CAs
o court found these unenforceable because (1) they were civil conspiracies to restrain trade (2) no
intent to create legal relations and not clear who the parties were
 therefore CAs were not enforceable through civil action
o now: clearly CAs are legally enforceable, but not in the courts
 two theories
o exclusionary: individual K has no place in the CB regime (Laskin)
 Peterborough Lock
 McGavin Toastmaster
o inclusionary: the general law, including statutory, CL and the Charter, can be brought into the
CB regime in certain circumstances
 We have seen that arbitrators will incorporate the ESA and HR into CB: where there is a
violation they have the authority to consider it in grievance
 The next question is: what about CL or civil law rights?
 Isidore Garon
Peterborough Lock (1953, Laskin)
 “The change from individual to Collective Bargaining is a change in kind and not merely a difference in
degree. The introduction of a Collective Bargaining regime involves acceptance by the parties of assumptions
which are entirely alien to an era of individual bargaining. Hence, any attempt to measure rights and duties
in employer-employee relations by reference to pre-collective bargaining standards is an attempt to re-enter a
world that has ceased to exist.”
 the worlds are separate, and NOTHING from the individual K regime should be allowed into the
CB regime
McGavin Toastmaster v. Ainscough 1975 SCC **confusing
Facts: ER shut down plant in Vancouver and thus plant in Calgary was asked to supply buns to the
Vancouver area. The union went on strike – this was a breach of the CA – thus, ER responded by
closing the plant. Closure entitled EEs to severance pay under a term of the CA – EEs claimed this
entitlement. ER argued that they were not entitled to the pay because they no longer EEs of the
company, they wrongfully and in breach of their agreement left the plant, and that they were not
discharged but left themselves.
Issues: (1) did the EEs repudiate their individuals contracts by reason of unlawful strike, entitling the
company to terminate them and did the company terminate them (2) did the refusal to work terminate
the employment relationship (3) did the unlawful strike violate a fundamental term of the agreement so
as to disentitle to severance pay?
SCC Analysis (Laskin):
 Cases where court accepted exclusionary principles:
o Paquet (1959): There is no room left for private negotiation between ER and EE. Certainly to the
extent of the matters covered by the CA, freedom of K between master and individual servant is
abrogated. The CA tells the ER on what terms he must in the future conduct his master and
servant relations.
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o Zambri (1962): When a CA has expired, it is difficult to see how there can be anything left to
govern the ER-EE relationship. Conversely, when there is a CA in effect, it is difficult to see how
there can be anything left outside except possibly the act of hiring.
 In the CA there is a provision for no strikes/lockouts during the life of the CA, so if normal K
principles apply, the EEs would be in breach and a fundamental breach relieves the other party of
its obligations
o *I do not think that it is possible to speak of individual contracts of employment and to treat the
collective agreement as a mere appendage of individual relationships*
o you cannot bring CL notions like fundamental breach into the CB regime – each parties has its
remedies within the CB regime for breaches of the CA
 The CL of individual employment Ks is NOT RELEVANT to ER-EE relations governed by a CA
which deals with matters that have been negotiated between union and company as the principal
parties thereto
o The CA, in this case, makes this point very clear as all aspects of the employment relationship
(hiring, wages, promotions, layoffs etc) are all governed by clauses in the agreement
o Questions such as repudiation and fundamental breach (i.e. issues of normal K principles) must
be addressed in the CA if they are to have any application at all.
 It was open to the company in this case to take disciplinary action against the plaintiffs for
participating in an unlawful strike, and it is arguable that discharge would have been held to be
for sufficient cause in the light of all the circumstances, if this issue had gone to arbitration
o The company’s failure to act against the EEs save by closure of the plant brought it within the
severance pay obligations.
Judgment: Appeal dismissed
Takeaway: the CL of individual employment K, is NOT TO BE BROUGHT INTO the CB regime –
there is no individual K of employment upon which an EE could sue in court, and EEs cannot sue on
a CA in a court of law. (here, Laskin was upset that it was even in court at all)
Dissent (De Grandpre):
 De Grandpre supports the inclusionary theory (described below in Isidore)
 There are principles of general law, and to the extent that they are not displaced by the CA then
they continue to operate
o the obligation of EEs to serve ER is not a term of the CA – it is general law.
 it is legitimate and acceptable for a court to take into account the notion of fundamental
breach
o there are previous cases where unionized EEs had successfully sued in court for wages, and
those cases had never been overruled (arguably EEs can sue in court for unpaid wages, even
though they are in the CB regime)
 When EEs refuse illegally, to offer their services, they are in breach of the most fundamental
obligation of their K and therefore, the ER is no longer bound by any of the terms of those Ks,
including in the present case the benefits stipulated in the CA.
Tucker on Toastmaster
 Laskin seems to prohibit suing in court
 BUT s.3(3) of the Rights of Labour Act: A collective bargaining agreement shall not be the subject
of any action in any court unless it may be the subject of such action irrespective of this Act or of
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the LRA
So the exclusive forum for enforcing CB rights is grievance arbitration, not courts of law – these
regimes must stay separate
Weber v. Ontario Hydro 1995 SCC
Facts: Weber (union member) took sick leave. ER thought he was abusing his benefits, and hired a
private investigator to check. Investigator, disguised as someone else, gained entry into W’s home.
Based on his info, ER suspended W for abusing his sick leave benefits. The issue was ultimately settled,
however, W commenced a court action against ER based on tort and breach of his rights under s.7 and
9 of the Charter.
Issue: if EE has a dispute with ER which involves a tort or breach of Charter rights, can he go to courts
for remedy, or is he still limited to pursuing those complaints within the grievance system?
SCC:
Tort claim cannot stand
 mandatory arbitration clauses in labour statutes deprive the courts of concurrent jurisdiction
o the analysis of whether a matter falls within the exclusive arbitration clause must proceed
on the basis of the facts surrounding the dispute between the parties, not on the basis of the
legal issues
o meaning, as long as the dispute in its essential character arises from the interpretation,
application, administration, or violation of CA, then you have to use the grievance
procedure
 *The exclusive jurisdiction model is the one that should be adopted  arbitrators have exclusive
jurisdiction to over all matters arising expressly or inferentially out of the CA (including tort and
charter claims)*
o Thus, if the difference between the parties arises from the CA, the claimant must proceed by
arbitration and the courts have no power to entertain an action in respect of that dispute
 This is the correct model because: (1) it gives full credit to s.45(1) of the LRA, (2) accords with this
courts approach in Anne Nackawic, (3) satisfies the concern that the dispute resolution process
should not be duplicated and undermined by concurrent actions, and (4) conforms to a pattern of
growing judicial deference for the arbitration and grievance process
Charter claim:
 The power and duty of arbitrators to apply the law extends to the Charter
 In this case the arbitrator is empowered to consider the Charter questions and grant the appropriate
remedies
 He has jurisdiction over the parties and the dispute, and is further empowered by the Labour
Relations Act to award the Charter remedies claimed
Judgment: Tort claim should not be allowed, and neither should Charter claim.
Tucker: This provides a new challenge for exclusionary theorists – if you are telling EEs that they have
to go to grievance if they suffer a tort, doesn’t CL have to come into the process?

Isidore Garon Ltee 2006 SCC
Facts: Company ceased business and gave EEs notice that complied with minimum standards
legislation. CA had no provisions re: closure. Union grieved claiming that notice did not comply with
requirements of the Civil Code (similar to our CL). ER objects (now it is the ER who doesn’t want to the
CL being brought into the CB relationship, because it would extend EEs rights beyond what they
otherwise would be entitled to.
Issue: Can the arbitrator take into account the civil code/CL in this context? (it would be completely
266
against exclusionary theory)
SCC: There have been two lines of cases:
 (1) the general law and individual negotiation have no place in matters relating to conditions of
employment in the collective labour relations context (exclusionary theory)
o CL as it applies to individual employment contracts is no longer relevant to ER-EE relations
governed by a CA (McGavin)
o a collective framework supersedes the traditional contractual process (Noel)
o In seeking to equalize the balance of power between ERs and EEs, freedom of K is dispensed
with, and exclusive representation by the union and predominance of the CA replace
individual negotiation between an ER and an EE
o In McGavin and CPR v. Zambri, this court subordinated individual rights to the collective
scheme.
o EEs will be better protected by a harmonious scheme than by an amalgam of mutually
incompatible rules
o Implication of exclusionary model for unionized EEs: If there is no individual K of
employment, then there can be no possibility for suing for its breach.
 (2) the minimum employment standards set out in various employment-related statutes, the
substantive rights and freedoms provided for in human rights legislation and the principles of
the Canadian Charter of Rights and Freedoms have been incorporated into collective agreements
(inclusionary theory)
o This view is embraced by De Grandpre in his dissent in McGavin
o This line of cases started with McLeod and culminated in Parry Sound
o McLeod: Court held that the ESA applied to the CB regime and, more importantly, that
arbitrators had the power to apply the ESA
o Parry Sound:
 Management rights must be exercised not only in accordance with the express
provisions of the collective agreement, but also in accordance with the employee's
statutory rights
 The substantive rights and obligations of employment-related statutes are implicit in
each CA over which an arbitrator has jurisdiction
o This line of cases gives arbitrators the power to apply provisions that are implicitly included
in a collective agreement
o the HR Code applies to the CB regime and arbitrators have the power to apply it
 Reconciling the two lines of cases:
o Parry Sound did not reverse Paquet, McGavin, Hémond or Noël
o *the underlying principle is COMPATIBILITY - anything from the general law that can be said
to be compatible with the CB regime can be brought into it
 *The principle in Parry Sound is that, if a rule is incompatible with the CB scheme, it
cannot be incorporated and must be disregarded, as was the case in McGavin, Hémond
and Noël*
 If the rule is found to be compatible and if it is a supplementary or mandatory norm, as in
McLeod, Weber and Parry Sound, the arbitrator will have jurisdiction to apply it
 Not everything is contained in a collective agreement, thus it does not operate in a vacuum
– the general law is relevant for the purposes of interpreting the conditions in the collective
agreement
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o *Just because a CA is in place it does not mean that freedom of K is abrogated
 Rather, in the individual K is simply suspended during the period of the CA
 Thus, when a unions certification is revoked, the individual K becomes effective again
 However, during the term of the CA, individual K of employment rights cannot be relied
upon
o arbitrator has jurisdiction over all disputes that can be connected with the CA through their
factual context and will decide those disputes by referring to the express or implicit rules of the
agreement
 We must identify a connection between the arbitrator's jurisdiction and a condition of
employment that is expressly set out in or implicitly incorporated into the collective
agreement
 However, a rule cannot be incorporated into the collective agreement where the rule does
not lend itself to such incorporation – this is the case here
 Application: how to determine compatibility?
o Majority: CL is not compatible with CB regime when it comes to notice for two reasons
 in CL the calculation of notice is individualized – couldn’t apply to a group.
 the reasons for its application are different – in CB context, ER must have just cause (which
includes disciplinary and non-disciplinary reasons) but in CL they only have to give notice
– so source of notice is different.
o Minority: it is compatible
 Judgment: Individual incompatible with the collective agreement
 Tucker:
o there will be cases where general law MUST be brought into CB (ESA, etc) but in the absence of
‘must’, the question is whether it is compatible – if CL norms can be brought in, arbitrators
have jurisdiction to apply them
o So now, unionized EEs in grievance procedure can make CL claims, provided that the CL is
viewed as being compatible with the CB regime (it remains to be seen what exactly come in –
individualized notice is out, we don’t know about fundamental breach)
o we know for sure that tort claims can come in.
 further, a CA is a peace of mind K, so when ERs negligently inflict mental suffering at
termination on unionized EEs, grievance arbitrators have held that those EEs are entitled to
collect damages
 irony is that unionized EEs are in some ways better situated to take advantage of the
developments in CL than EEs who are NOT in the regime b/c
 aggravated damages were awarded for racial harassment in Charlton
The So-Called Right to Strike: Rules Under Which Strikes and Lockouts Take Place
 there are three layers of regulation of collective action: statutory controls, common law controls, and
Charter rights
Statutory Controls on Strikes and Lockouts
Strikes:
 s. 1 of the OLRA defines “strike”
o includes a cessation of work, a refusal to work or to continue to work by employees in
combination or in concert or in accordance with a common understanding, or a slow-down or
other concerted activity on the part of employees designed to restrict or limit output;
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o It was held that any disruption of work during the CA, whatever its intent, was an illegal strike
in Ontario  thus, even if EEs don’t go to work for 1 day in order to persuade their ER to
change certain policies, even if they are not trying to get economic gain, it would be a strike
o NOTE: the purpose for which the EEs are stopping/slowing down doesn’t really matter
 even if EEs were stopping work for political reasons (dispute is w/gov it would be a strike)
 TIMELINESS of strikes
o no strikes during life of CA
 s.46: Every CA shall be deemed to provide that there will be no strikes or lock-outs so long
as the agreement continues to operate
 s.79(1): Where a CA is in operation, no EE bound by the agreement shall strike and no
employer bound by the agreement shall lock out such an employee.
o must first go through process of bargaining and conciliation (procedural limits)
 s.79(2) Where no CA is in operation, no EE shall strike and no ER shall lock out an EE until
the Minister has appointed a conciliation officer or a mediator under this Act, and
 (a) seven days have elapsed after the day the Minister has released or is
deemed pursuant to subsection 122 (2) to have released to the parties the
report of a conciliation board or mediator; or
 (b) 14 days have elapsed after the day the Minister has released or is deemed
pursuant to subsection 122 (2) to have released to the parties a notice that he
or she does not consider it advisable to appoint a conciliation board. 1995,
o Strike vote must be taken
 s.79(3) If a CA is or has been in operation, no EE shall strike unless a strike vote is taken 30
days or less before the CA expires or at any time after the agreement expires and more than
50 per cent of those voting vote in favour of a strike
o notes on history:
 under old CL, workers could strike whenever they wanted, subject only to giving notice
 one of the goals of CB was to change this – promote industrial peace
 Prohibitions on authorizing, threatening, counselling, procuring, or doing anything that someone
reasonably knows will cause unlawful strikes or lockouts [s.81-83]
o UNLAWFUL STRIKE: 81. No TU or council of TUs shall call or authorize or threaten to call or
authorize an unlawful strike and no officer, official or agent of a TU or council of TUs shall
counsel, procure, support or encourage an unlawful strike or threaten an unlawful strike.
o UNLAWFUL LOCKOUT: 82. No ER or ERs organization shall call or authorize or threaten to
call or authorize an unlawful lock-out and no officer, official or agent of an ER or ERs
organization shall counsel, procure, support or encourage an unlawful lock-out or threaten an
unlawful lock-out.
o CAUSING UNLAWFUL STRIKES/LOCOUTS: 83. (1) No person shall do any act if the person
knows or ought to know that, as a probable and reasonable consequence of the act, another
person or persons will engage in an unlawful strike or an unlawful lock-out.
Lockouts
 s. 1 of the OLRA defines “lock-out”
o includes the closing of a place of employment, a suspension of work or a refusal by an ER to
continue to employ a number of EE, with a view to compel or induce the EEs, or to aid another
ER to compel or induce that ERs EEs, to refrain from exercising any rights or privileges under
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this Act or to agree to provisions or changes in provisions respecting terms or conditions of
employment or the rights, privileges or duties of the employer, an employers’ organization, the
trade union, or the employees
o NOTE: unlike in the definition of “strike”, here the aim of the shutdown is absolutely crucial – it
is only a lockout if the purpose is to compel EEs to do something
 Why the difference in definitions of strike and lockout?
o POLICY: have to allow ERs to shut down operations for economic reasons without it being a
lockout – the LRA can’t restrict the way capital is used, ERs must be free to decide how to run
operations
o TUCKER: we have rules restricting the way combinations of EEs can operate, but we forget that
most corporations are combinations of capital – but it disappears behind the corporate entity
Remedies for Illegal Strikes
 (1) ERs can use grievance regime as a remedy
o In the case of an illegal strike, ER can bring a grievance because it is a violation of the CA, and
the arbitrator can decide if there has been a violation and impose a penalty on the union
o Hamilton Terminal: it was not enough for a union to try to persuade EEs from illegally striking –
they were at fault because they let them hold a meeting to discuss it (notion that unions have to
behave responsibly is deeply ingrained in the industrial pluralist regime)
 union will be held responsible if they instigated the strike or didn’t make reasonable
efforts to prevent it (very high degree of responsibility)
o Penalties are compensatory: generally arbitrators try to put the aggrieved party in the position
they would have been in had the breach not occurred (so damages often include lost profits,
continuing expenses and depreciation)
 (2) ERs can use statutory remedies through the LR board
o Declaration of unlawful strike/lockout [s.100]
 make an application under s.100 that there is an illegal strike
o Declaration can have status of court order, where defiance = contempt [s.102]
 if the illegality can be established, file the declaration with the court so it has the same effect
as a court order (if defied it is contempt, which is a criminal offence)
o Damages [s.103]
 damages are available
o Provincial offence [s.104], consent of OLRB required [s.109]
 it is an offence under the LRA to violate the prohibition on midterm strikes, and there can
be prosecutions launched, but need permission from the board
 fines for individuals up to 2k and corporations up to 25k
Remedies for Illegal Lockouts
 Generally the remedies available in the case of an illegal strike also apply to an illegal lock out
 BUT remember lockouts are defined much more narrowly, so ERs can shut down for other reasons
without running into labour law restrictions
 Additional statutory restrictions on ERs:
o Strike-breaking misconduct prohibited 78. (1) No person, ER, ERs organization or person
acting on behalf of an ER or ERs organization shall engage in strike-related misconduct or retain
the services of a professional strike breaker and no person shall act as a professional strike
breaker.
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o (2) For the purposes of subsection (1),
 “professional strike breaker” means a person who is not involved in a dispute whose
primary object, in the Board’s opinion, is to interfere with, obstruct, prevent, restrain or
disrupt the exercise of any right under this Act in anticipation of, or during, a lawful strike
or lock-out;
 “strike-related misconduct” means a course of conduct of incitement, intimidation,
coercion, undue influence, provocation, infiltration, surveillance or any other like course of
conduct intended to interfere with, obstruct, prevent, restrain or disrupt the exercise of any
right under this Act in anticipation of, or during, a lawful strike or lock-out.
 ERs are allowed to hire replacement workers:
o Only Quebec on BC have restrictions on this
o Ontario had one in place under the NDP for two years, but it was removed with the
Conservatives
o this arguably shifts the balance in favour of ERs
Common Law


The common law position is essentially the same as the statutory position: it never explicitly
says strike action is legal, but spells out what is permitted.
Royal Commission on Trade Unions report:
o “The right to strike… derives from statutes passed to protect combinations who act to
improve their wages and conditions and from the implication to be drawn from such
legislation that the combined withholding of labour is a lawful means to that end…”
o “The right to strike is, basically, a right to withdraw labour in combination without
being subject to the legal consequences of acting in combination, which, in the past,
would have been followed.”
OVERALL:
The LRA focuses on WHEN strikes/lockouts are legal, but they do not specify the METHODS that
are permitted to try to make the strikes effective
o this means that the normal rules of criminal and tort law apply to regulate the activity
Common CL Torts
Crimes
 Trespass
 Assault/battery
o EEs on strike cannot go onto ERs premises without
 Cause disturbance
its permission
 Watching and besetting
 Nuisance
o This is someone standing in
o EEs can’t stand outside ERs premises and prevent
front of someone else’s
other people from having access to those premises
premises and watching:
 Intimidation
o This crime originally enacted
o EEs can’t threaten people
for the purpose of restricting
 Battery
union activity
o EEs can’t hit people
o In a set of amendments to the
SCC this section was omitted
(Tucker thinks it was a mistake,
but judges interpreted it to
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mean that picketing was okay!)
o NOW: peaceful picketing is
NOT watching and besetting
 Exotic Torts (economic torts)
o NOTE: these torts were developed in UK law to
place restrictions on what unions could do.
Canadian courts have been sloppy in applying them,
mostly focused on the conclusion to facilitate
granting remedies against industrial action.
o Directly inducing breach of K:
 Ex: union putting pressure on
supplier/distributor of ER to break its contract
with ER
 In these cases, ER is plaintiff, EE is defendant
 Requirements:
 intent to injure P
 knowledge of the existence of a K
between P and 3rd party
 use of lawful means to persuade
the breach by 3rd party
 breach of K results
 economic injury to P results as a
reasonable consequence of the
breach
 Knowledge: exists if D reasonably should know
that a Kual relationship exists, even if he may
not know ifs terms, or if the D acts recklessly,
without caring if a K exists.
 Persuasion: enough if D conveys info to a 3rd
party who the D wants to act in a certain way,
and then the 3rd party acts in that way.
o Indirectly procuring breach of K by unlawful means
 Same as “Directly inducing breach of K” except
via unlawful means.
 The unlawful means can be any technically
illegal conduct, such as tort, crime, breach of K.
(Rookes v Barnard)
 Highway Traffic Act
o pickets could violate rules of
the road, etc
o Conspiracy to injure (note- refers to ECONOMIC
injury):
 conspiracy to injure based on unlawful
purposes
 requirements:
o combination of 2+ ppl
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o
intent to cause injury and
injury results
o predominant motive that
court does not recognize as
legitimate
 example: the purpose of going on
strike is to cause injury to ER, but
this is seen as a legitimate
purpose, so it is not a conspiracy
to injure for unlawful purpose
 conspiracy to injure by unlawful means
 requirements:
o combination
o intent to cause injury and
injury results
o use of unlawful means
 e.g. breach of K’s of employment
 once you start using unlawful
means, it is no defence that your
purpose was legitimate
Hersees of Woodstock Ltd. v. Goldstein (1963)(Ont. C.A.)
Facts: union represented clothing workers of Deacon. ER refuses to sign a CA and union deals with
this by going around to the small distributors that sell the clothes and asking them to boycott Deacon.
One store owner refuses to agree to the request, even though he has no outstanding Ks with Deecon,
and the union members peacefully picked outside his store. Store owner seeks injunction (which at
that time were granted readily) and succeeds. Injunction is appealed.
Superior Court:
 there is no K in force between the parties, so there can be no tort of inducing breach of K
 no conspiracy to injure based on unlawful purposes, b/c the dominant motive was to get ER to sign
CA
 certainly no conspiracy to injure by unlawful means because it was just peaceful picketing
 no nuisance – anyone could walk in and out of the store (NOTE SCC has said that peaceful picketing
is not a nuisance)
COA
 AYLESWORTH
o NOTE: this judge used to be a management-side lawyer, not a friend of unions
o He reverses TJ’s finding of fact that there was no K (so breach of K is available)
 odd to reverse finding of fact, and also odd because the plaintiff was not the ER in this case
o Makes statements about how bad picketing is, makes reference it being illegal, etc
o He creates a new tort: tort of secondary picketing
 Bottom line is that he doesn’t think that people should be permitted to picket at sites other
than ERs, so he deals with this by creating a new tort
 MACKAY
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o finds that there was a civil conspiracy
 there purpose WAS illegal because there was no connection between what they were doing
and the object of putting pressure on Deacon (wilful blindness on the part of the court,
obviously they were trying to put pressure on their ER)
o he really didn’t like that a third party was being harmed as a result of the conflict so he was
not prepared to recognize that the benefit to the workers outweighs the harm to the third
party
o he totally ignore the Rights of Labour Act which says that workers acting in combo can’t be liable
for actions that were not tortious if engaged in individually
NOTE: this case was law until Pepsi, below
Labour Injunctions
1) interlocutory injunction = before determination of merits
 Assuming there is a prima facie case, the courts rely on a balance of convenience test: if
the potential harm of the activity continues outweighs the potential harm of the
injunction, they get it
 P (ER) has to give undertaking that they will compensate D (union) if it turns out that
there was no tort to support the injunction
2) Background:
 procedure for getting these labour interlocutory injunctions used to be very relaxed – ER
could claim emergency, no time to give EE notice, no one in court to oppose it, could
base their claim on ‘knowledge and belief’
i. believe = someone else told you something
3) Unions were very upset about both the substance and the availability of these injunctions, and
as a result the Courts of Justice Act dealt with them
Courts of Justice Act
 s.102 offers a relatively wide definition of "labour dispute" and then goes on to outline the
preconditions on which an interim injunction as such can be granted
o *1. court must be satisfied that reasonable efforts to obtain police assistance and to prevent
damage to property, injury to persons or obstructions have been unsuccessful.
 see Industrial Hardwood
o 2. Applicants must make themselves available to be cross-examined at the hearing of the
motion and at least 2 days notice must be given to all persons who would be affected by an
injunction
 timely notice must be given in specified form, unless it’s an emergency
o 3. An ex parte injunction can only be granted where it is shown that notice could not have been
given and where the delay necessary to give notice would result in "irreparable damage or
injury, a breach of the peace or an interruption in an essential public service"
o 4. Proof of all material facts, for the purposes of establishing the requirements for the granting
of an ex parte injunction must be established by viva voce evidence
 affidavit evidence restricted to facts within persona knowledge, NOT belief
Domtar v. Lampi Ont HC
Facts: union was on lawful strike against Boise (B), who had a K with Domtar. Domtar was supplier of
B. Normally, B’s EEs went onto Domtar premises and made the wood ready for shipment. During the
strike when B’s EEs weren’t coming into the premises to do this work, Domtar hired ICs to do it.
Domtar was compensated by B for paying the ICs they hired (so Domtar hired but B was effectively
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paying for it). B is now getting the supply. Union argues that bargaining unit work is taking place on
Domtar’s premises, so they picket it peacefully. Domtar’s EEs are also unionized and refuse to cross
the picket line, so Domtar’s operations are shut down. Domtar applies for an injunction.
Issue: does s.102 of the CJA apply?
Analysis:
 Whether 102 applies depends on whether the motion is for an injunction is in connection with a
"labour dispute" – it will be applicable if:
o the ER is being picketed (this is the normal application of 102; courts have also applied the next
2)
o the party being picketed has a relationship to the ER as to make it it’s alter ego
 they have come to the active assistance of the ER and have involved themselves in the
dispute
o where the premises picketed can be regarded as the place of business of the struck company
 Application:
o It was just a contractual alteration:
 however, in this case, the act of Domtar in engaging an independent contractor does not
make Domtar the alter ego of Boise within the meaning of the cases
 rather, what has occurred is that there has been an alteration in the contractual
arrangements between Boise and Domtar
 Tucker: this is wilful blindness, Domtar made an arrangement to assist B
o the activity is too small to say that Domtar is now B’s place of business
 the extent of the involvement of Domtar on behalf of B from the point of view of cost, time
involved and the value of the pulp wood is insignificant when viewed against either the
operations of Boise
 even if Domtar could be regard as the agent of Boise in hiring the independent contractor,
the relationship, if any, between Boise and such independent contractor is too remote in my
opinion to constitute the Domtar yard as a place of business of Boise for the few days in the
year in which the slashing operation takes place
 Held: there is no dispute at this time between Domtar and its employees which would constitute
a labour dispute within the meaning of the Act
o the application is not one to restrain a person from an act in connection with a labour dispute,
and that s. 102 does not apply to this motion
o therefore, normal CL rules apply, and the test for the injunction is the balance of convenience
o the harm caused to Domtar by the picketing is clearly demonstrated by the evidence and the
balance of convenience indicates that the court should intervene and grant an injunction
Judgment: Injunction granted.
Industrial Hardwood v. Industrial Wood and Allied Workers OnCA 1996
Issue: What is the standard for establishing that reasonable efforts have been made to obtain police
assistance?
Analysis:
 Policy of s.102(3):
o Strikes and the picket lines that go with them are evolving human dramas where risks of
property damage, personal injury or obstruction of lawful entry are best controlled by flexible
and even-handed policing. Only where this fails should the court resort to injunction
o Court indicates that it will draw a very sharp distinction between situations where picketing is
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causing actual property damage/injury to situations where all it is doing is obstructing access to
ERs premises
 When are the preconditions of s.102(3) met?
o Question posed by s. 102(3) is whether in all the circumstances reasonable efforts to obtain
police assistance have failed to result in an acceptable degree of control of the situation
o The first failure of the police to respond instantaneously to a request for help does not
necessitate the conclusion that police assistance has failed and that therefore the court can be
resorted to
o a robust society can accommodate some inconvenience as a corollary of the right to picket in a
labour dispute before the court will conclude that police assistance has failed, and that it has
jurisdiction to intervene with injunctive relief
o s.102(3) places an onus on the applicant to satisfy the court that the applicant has made
reasonable efforts to obtain police assistance and that those efforts have not resulted in an
acceptable degree of control in light of the factors set out in the section: the risks of property
damage, personal injury or obstruction of lawful access to the premises
 Application:
o where there is property damage or personal injury, the court will be quick to act
o BUT if its obstruction leading to inconvenience, etc but no physical damage or injury, the
court will be more tolerant of that activity – the right to strike/picket is part of our IR
landscape and some inconvenience is permissible
 This is a softening of the attitude towards picketing, although there is no third party involved
Charter Rights
 In the first 20 years of Charter litigation, labour & employment law was given leeway to operate
without attracting Charter scrutiny
 lay and academic commentators have urged the courts to interpret FOA and the FOE guaranteed by
the Charter so as to protect the "right" to strike and the "right" to picket
 Until recently, SCC’s handling of cases involving the right to strike or the right to picket has
disappointed the unions
The “Right” to Picket
Dolphin Delivery (SCC)
Facts: Appellant union was involved in trade dispute with Purolator but was picketing at Dophin
Delivery plant, a courier company affiliated with Purolator
Issue: Was the secondary picketing protected by Charter?
Analysis: 3 steps
 DOES THE CHARTER APPLY?
o No, the charter does not apply to the courts or the common law (here, it was a CL prohibition
on secondary picketing)
o However, the CL ought to be guided by Charter values – opened the door for future
consideration of the interaction between the Charter and the CL
 IF SO, IS THE RIGHT TO PICKET OR STRIKE PROTECTED?
o Barely – picketing does involve expression, but it doesn’t involve rational communication
 IF SO, IS THE RESTRICTION DEMONSTRABLY JUSTIFIED?
o limitations on secondary picketing are easily justified by the court under s.1
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o note hostility to picketing (it is a degraded form of communication that doesn’t involve
rational discourse but rather the signal effect – attracting an automatic reflex response)
Decision: Charter did not apply to the injunction granted by a trial judge - To regard a court order as an
element of governmental intervention necessary to invoke the Charter would widen the scope of
Charter application to virtually all private litigation. A more direct and a more precisely-defined
connection between the element of government action and the claim advanced must be present before
the Charter applies.
Some thought the dicta in Dolphin meant that peaceful picketing may fall under FoE. However, in
two subsequent cases, the SCC has NOT used the door opened byh Dolphin (that CL should be
informed by Charter values) to strike down the restrictions on picketing:
Nfld Assoc of Public Employees v. AG 1986 SCC
Facts: a union of governmental employees was engaged in a lawful strike. The union picketed a court
house. One of the union’s members crossed the picket line and decided to go to work. One of the
union’s by-laws was that it could discipline any member who crossed the picket line during the strike.
Union set trial date. Union member, joined by Attorney General, applied for injunction to restrain
union from holding a trial.
SCC: Union member succeeded. Regardless of the motivation of the picketers, an attempt to stop
judicial officers from carrying out their duties is an interference with the administration of justice – this
is an issue of public concern. Such an interference with the administration of justice threatens the
supremacy of law and, therefore, constitutes a contempt of court.
BC Govt Employees Union v. AG BC 1988 SCC
Facts: A union of public servants which included court workers was engaged in a legal strike. Court
houses were picketed. Trial judge, coming to work early, saw the picketers, and went to his room and
issued an injunction, without anyone having asked for such an order.
Courts: whether intended or not, the picket line interfered with the administration of justice and that
this constituted a criminal contempt of court, one which could not be tolerated, even if this meant the
curtailing of the freedom of speech of workers
SCC had to resolve two issues:
 1. Did the charter apply to an injunction issued by is own motion of a court?
o The court is acting on its own motion and not at the instance of any private party. The
motivation for the court's action is entirely "public" in nature, rather than "private". Thus, it
must comply with the fundamental standards established by the Charter.
 2. If yes, was the injunction a violation of the lawfully striking workers' freedom of association,
and if so, was it saved by s. 1?
o Picketing is a crucial form of collective action in the arena of labour relations – it represents a
highly important and now constitutionally recognized form of expression in all contemporary
labour disputes.
o On the other hand, and this is crucial, both courts below have found that the picketing would
inevitably have had the effect of impeding and restricting access to the courts. Picketing of a
commercial enterprise in the context of an ordinary labour dispute is one thing. The picketing of
a court-house is entirely another.
o Assuring unimpeded access to the courts is plainly an objective "of sufficient importance to
warrant over-riding the constitutionally protected right of freedom" and relates to a concern
which is "pressing and substantial in a free and democratic society"
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RWDSU v. Pepsi Cola (2002)
Facts: EEs of Pepsi went on strike in Saskatchewan, where there is no secondary picketing legislation.
As part of their strike they picketed the retail stores that sold Pepsi products and the homes of Pepsi’s
management. Pepsi successfully applied for an interlocutory injunction to prevent EEs from picketing
at the secondary locations. The EEs appealed the injunction. The Court of Appeal allowed the appeal
and held that picketing by striking EEs at the premises of third parties was not illegal per se at common
law; hence, picketing of this kind could take place as long as it was peaceful. Employer appealed to
SCC.
SCC:
 TEST: the test for the application of the Charter to CL in the context of private litigation is as
stated in Hill
o Hill v. Church of Scientology: Charter values, framed in general terms, should be weighed against
the principles which underlie the common law. The Charter values will then provide the
guidelines for any modification to the common law which the court feels is necessary.
o BUT far reaching changes to the CL should be left to the legislature
o So Charter values trump CL, and the CL needs to be modified to better conform with FOA (BIG
DEAL!)
 BURDEN: the party alleging inconsistency between the CL and the Charter values bears the
burden
o must show that the CL fails to comply with the Charter values and that, when the values are
balanced, the CL should be modified
 RATIONALE: value of picketing
o contrary to earlier decisions that denied the need to assess the competing values of picketing v.
third party rights, the court here puts it front and center because it assesses picketing more
positively
o strike activity is legitimate in industrial pluralism: Labour disputes may touch important
sectors of the economy, affecting towns, regions, and sometimes the entire country. The cost to
the parties and the public may be significant. Nevertheless, our society has come to see it as
justified by the higher goal of achieving resolution of employer-employee disputes and the maintenance of
economic and social peace. The legally limited use of economic pressure and the infliction of
economic harm in a labour dispute has come to be accepted as a legitimate price to pay to
encourage the parties to resolve their differences in a way that both can live with
o As expressive action it engages one of the highest constitutional values: Picketing, however
defined, always involves expressive action. As such, it engages one of the highest constitutional
values: freedom of expression, enshrined in section 2(b) of the Charter. This Court's
jurisprudence establishes that both primary and secondary picketing are forms of expression,
even when associated with tortious acts
o Picketing is important to address the imbalance of power in the employment relation:
Moreover, the imbalance between the employer's economic power and the relative vulnerability
of the individual worker informs virtually all aspects of the employment relationship. Free
expression in the labour context thus plays a significant role in redressing or alleviating this
imbalance.
o Picketing reinforces the important role played by unions in the social debate: As part of the free
flow of ideas which is an integral part of any democracy, the free flow of expression by unions
and their members in a labour dispute brings the debate on labour conditions into the public realm.
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 CAVEAT: must weigh competing value of protecting innocent third parties against undue harm
o How do we judge when the detriment suffered by a third party to a labour dispute is "undue",
warranting the intervention of the common law? At this stage, it suffices to note that the
protection of innocent third parties from the economic fallout of labour disputes, while a
compelling consideration, is not absolute. Some economic harm to third parties is anticipated
by our labour relations system as a necessary cost of resolving industrial conflict.
 The tort of secondary picketing is unjustified infringement of freedom of expression
o picketing is charter protected and curtailment must be justified
 While freedom of expression is not absolute, and while care must be taken in the labour
context to guard against extending the more severe effects of picket lines beyond the
employer, if we are to be true to the values expressed in the Charter our statement of the
common law must start with the proposition that free expression is protected unless its
curtailment is justified
o protection against economic harm is not a preeminent value
 Protection from economic harm is an important value capable of justifying limitations on
freedom of expression. Yet to accord this value absolute or pre-eminent importance over all
other values, including free expression, is to err. The law has never recognized a sweeping
right to protection from economic harm.
o primary/secondary distinction puts undue emphasis on location and is hard to operationalize
 A wrongful action approach to picketing is clearer and more rational than the absolute or
modified prohibition approach represented by Hersees. The Hersees or modified Hersees
approach uses location as the primary criterion for determining when picketing is legal. Yet
the reason for prohibiting picketing is not its location, but its character and impact -- the
wrong it represents and damage it does. Location is merely a legal marker, and not a very
satisfactory one at that; as we have seen, the Hersees jurisprudence is dominated by
formalistic debates centering on location.
o right of trade is not fundamental
 It is argued that although secondary picketing may yield a benefit for a limited class of
people, the neutral retailers' right to trade is "far more fundamental and of far greater
importance . . . for the benefit of the community at large"
 The first difficulty with this argument is that it gives no weight to free expression. As
discussed above, this runs counter to Charter methodology and values.
 A second difficulty is that the argument overstates the interests of third parties by positing
a "fundamental" right to trade in the struck good. Again as discussed above, the basis for
this purported fundamental right is unclear.
o The view of picketing as a signal effect must be reassessed
 court rejects this, picketing is rationale, legitimate communication
Ratio: all picketing is legal regardless of the location where it takes place, unless it can be shown to
be wrongful or unjustified – picketing that involves a tort (a civil wrong) or a crime (a criminal
wrong)
- distinction between primary and secondary picketing is effectively abandoned on a wrongful
action approach to picketing
- NOTE: uncertain areas after Pepsi
o in principle it might be possible for legislature to decide to prohibit secondary picketing (BC
labour code does)
279
o also possible that other torts could be challenged as inconsistent with Charter values? will
the courts have any when it comes to the torts of inducing breach of K and conspiracy?
The Constitutional “Right” to Strike
 Common Law: Workers enjoy partial privilege to strike, subject to legal duty not to engage in
tortious or criminal behaviour
 Post WWII Statutory collective bargaining schemes:
o For most workers, dual movement:
 Partial rights (eg. preservation of employment status, limited right to reinstatement
 Further limitations on privilege (eg. timeliness requirements)
 For others, prohibitions (eg. government employees)
Recent Developments
 1960s: Extension of collective bargaining rights to public employees (with or without the right to
strike)
 1970s & 80s: Limitations: wage controls; expansion of essential service designations; ad hoc back to
work legislation
 Charter challenges to these limitations: Labour Trilogy (1987)
o Freedom of association does not extend to protect activities taken by association in pursuit of its
objectives
o Collective bargaining rights are modern rights, not fundamental rights and freedoms
o Involves examination of legislative policy for which court not well suited
 Will BC Health Services make a difference?
- On April 9, 1987, the Supreme Court of Canada issued three decisions:
o 1. Reference re Public Service Employees Relations Act (AB): SCC upheld legislation
prohibiting all Alberta public sector employees from legally striking at anytime
o 2. R.W.D.S.U. Local 544 v. Govt of Sask: SCC upheld ad hoc legislation requiring
Saskatchewan dairy-workers on lawful strike to return to work
o 3. Public Service Alliance of Canada v. The Queen: SCC upheld wage control legislation
which had the effect of extending collective agreements beyond their negotiated terms and
thereby precluding public servants from participating in lawful strikes
Reference Re Public Sector Employees Relations Act (Alta.) 1987 SCC
- the constitutional guarantee of freedom of association in s. 2(d) of the Canadian Charter of
Rights and Freedoms does not include, in the case of a trade union, a guarantee of the right to
bargain collectively and the right to strike because these are modern legislative rights and not
fundamental rights worthy of Charter protection
 Reasons:
o Need to consider the implications of extending [page391] a constitutional guarantee, under the
concept of freedom of association, to the right to engage in particular activity on the ground
that the activity is essential to give an association meaningful existence
 I reject the proposition that without such additional constitutional protection the guarantee
of freedom of association would be a meaningless and empty one
280
o The protections available for unions (freedom to belong to an association, freedom to maintain
an association etc) is expressly outlined in labour relations legislation
o It is surprising that in an area in which this Court has affirmed a principle of judicial restraint in
the review of administrative action we should be considering the substitution of our judgment
for that of the Legislature by constitutionalizing in general and abstract terms rights which the
Legislature has found it necessary to define and qualify in various ways according to the
particular field of labour relations involved
Concluding Observations
Task Force on Labour Relations: CB and Equity in the Distribution of Income
 CB has not achieved much in terms of income distribution.
 Organized labour’s impact in:
 providing workers with countervailing power against mgmt
 helping workers realize a greater share of enterprise and national income
o Remains highly debatable.
 Weak evidence that CB creates revenue shift towards EEs.
 There has been no change in the %national income going to labour over past 30-40 years.
Economists disagree on why.
 CB has not removed income disparities among workers themselves.
 CB may have even increased the wide range of basic rates within jobs/geographies/industries
and differentials are even wider when you consider non-unionized.
 One cannot assume a correlation between the results of CB and some concept of equity.
 Study was done re last 45 years: shows wage share is declining while corporate profits are
increasing.
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