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					                                            Labour Law
Introduction

1.   What is labour law?
    legal regulation of work: activity of producing goods and services
    legal categories, backdrop of ppty rts
    factors of production

Modes                    Owner                            Labour                    Means of
                                                       (capacity to work)          Production
slavery                 slave                             none                              none
(relationship of master                                   all                               all
production between:

Feudalism                serf                              some                               some
                         lord                              some                               some

Independent              indep producers                           all                               all
Commodity
Production

Capitalism               proletarians (employer)           all                                none
                         capitalists (employee)            none                               all


    Employer, employee: linked by contract of employment

2.   What is essence of the contract of employment?
    labour in return for remuneration
    claims against employer to whom you sell your capacity to work
    employment important in capitalist society

    Employment  access to resources needed to live
    ie. income is rec‟d in terms of wages
    7% of income in form of investments you transfer of various kinds
    employment is access to the $ transfers
    common law contract of employment

Common Law contract of employment
               creator          administrator                 legitimacy
common law     courts           judges                        voluntary, aren‟t forced into
contract of                                                   employment
employment
minimum        legislature      admin boards,                 1. democratic legitimation, should
standards                       tribunals,                        be able to make decisions about
                                commissions                       ppls lives
                                                              2. levelling: level out bargaining
                                                                  power
collective           legislatures,       admin boards,        1. levelling bargaining power (grp
bargaining          courts             Ont labour relat       has more leverage than in
                                       brd, courts,           individuals);
                                       police             2. freedom of association

HISTORICAL CONTEXT:
labour regimes:
        a. common law contract of employment
        b. minimum standards
        c. collective bargaining

3 movements:
1. Feudalism to Master-Servant 1000-1600
2. Master-Servant to Liberal Voluntarism 1600-1877
3. Liberal Voluntarism to Industrial Pluralism

1.   Feudalism to Master Servant 1000-1600 (unregulated became heavily regulated)
    automatic relationships, born into roles
    serfs came to acquire land (tenure)
    lord no longer owned serfs‟ work, serf came to own the capacity to work
    a wage relat began to develop

    also a new class of landless/lordless workers
          people selling their capacity to work
          freedom of direct access to direct means of production

1348: Black Death killed ½ English pop‟m
higher wages
1349: Royal Proclamation issued in response to concerns:
 if don‟t own means of production, could be compelled to work and
 labour wages will be based on pre-Black Death wages, will not let labourers be exploited based on
    shortage of people

1351: Statute of Labourers
 regime of administrative wages
 wage rates determined according to cost of food, so have enough to live on (admin decision that is
   fixed to cost of living rather than market)
 ppl could choose to work for others, not born into working for someone

1562: Statute of Artificers/Apprentices
 to legislate master-servant changes
 presumption that when entered into employment, could not leave before one yr
 restriction on master: cannot unilaterally terminate employment
 Instead, justice of the peace had to terminate employment of servant
 testimonial from employer that completed the employment
 fixed hours of work: 5AM to 7PM
 wage fixing model, mechanism to recover unpaid wages

2. Master-Servant to Liberal Voluntarism (became less regulated; criminal and civil conspiracy)
 demise of regulatory structure as in Master-servant
   emergency of free labour market  free to enter into contracts of employment with whoever they
    choose
   terms and conditions are made BI-laterally through the 2 ppl, leverage that each one has was
    relevant here
   breakdown of regulated employment in previous way
   emergence of early forms of capitalist production
         employer owns means of production and hire employees, emergence of free markets
   wage fixing also went out  ppl enter without regard to enforcement, although workers did petition
    gov‟t to implement wage fixing; wage fixing linked to cost of living
   wage fixing existed but wasn‟t enforced
   presumption of indefinite hiring  no fixed time of employment, little notice needed if want to
    terminate employment, either by employer or employee

1800‟s. wage fixing has already gone
 but criminal breach of employment still applied (such that cannot just terminate employment, have
   to go through a process of Justice of Peace)
 idea of workers combining associations amongst themselves for purpose of increasing wages
 combinations seen as illegal bc seen as attempt to break the statutory scheme (criminal conspiracy)
 criminal conspiracy: purpose is illegal or because use illegal means
 Common Law judges‟ new theory: combinations seen as interfering in free markets, and tf defeating
   free market (what determines prices), seen as an anti-competitive practice and tf illegal

   illegal means: illegal means to use in pursuit of a combination
          so many cases phrased not as joined a union, but rather used illegal means (what was
             considered illegal means)
          ie. watching them set up a picket line to make sure no other employees would go in to do
             their work

   laws developed to control collective actions by workers
   Combinations Acts : combining to regulate wages is illegal and so are the means

(a bit off track here, going back in time again - probably goes back in Feudalism section)
 In Quebec, children of existing slaves free when over 25, so that slavery to end in time, but actually
    ended earlier
 in other provs, no formalization to end slavery
 1833 slavery abolished
(slavery and how it evolved, analogous to Lord-serf relat)

CANADA AND UK
 colonial law: reception, how colonies rec‟d the law of the mother-land
 Qbc has its own history: Civil - QBC and English criminal law on other side
 rest of Canada: we continually rec‟d common law, a single system, as long as remained colony, the
   ultimate decision was English high court - Privy Council
 fixed date of reception later on, such that after the date of reception, our laws did not change when
   the English law changed
 questions about employment law and how much apply to Cndn law

How did Canadian law deal with the British law of combinations?
1837: union movements and questions of employment
1850s: beginning of industrial revolution
1872: 9 hours movement: skilled workers‟ effort to simultaneously strike for a 9-hr day
 employers wants to charge for criminal conspiracy for illegal means and for act of combining
 arrested, magistrate, trial
 Sir Jon A MacD (Lib saw political opportunity to pass Trade Union Act 1872: inspired by Brit Act,
    declared that combin workers for increasing wages were granted immunity from charters; set up
    registration of trade union
 gave workers a freedom of association without being criminalized for doing it
also passed Criminalization Amendment Act: means are still criminal offences, series of specific crimes
associated with labour disputes
 ie. intimidatio, threats, watching the setting : broadly defined, so a lot could constitute either
 designed to control trade union conduct: where trade unions were now legal to combine, the means
    were still illegal - control within freedom)

1876: amended  peaceful picketing for purpose of communication was not illegal
(1892: the 1876 amendment dropped out, judges felt all picketing illegal, based on legislative
intent); gov’ts wouldn’t change again until 1930s

(while criminalization was dropped, some civil rights still applied such that employers could still
sue their employees)

3.   Liberal Voluntarism (1870s): a change to legalizing collections
    civil law: unlawful conspiracy, even after statute of 1872 said it was okay
    trade unions had no separate legal existence from that of its union
    agreements that made up trade union were unenforceable, ie. coulnd‟t sue for non-payment of dues
    could not protect ppties, not legal entities, so bad treasurer could not be sued
    employers also could not sue trade unions as whole bodies

1876: Master and Servant Law still applies, such that workers found guilty of criminal breach of contract
if terminated contract before supposed to

1877: Railway strike, statute then repealled this aspect of criminal breach of contract

provincial offence : still had until 1877
fed offence: repealed earlier on
(but seen as a free labour market, not compelled into employment - if don‟t want that job, don‟t take it)

Liberal Voluntarism to Industrial Revolution:
a double movement:
1. triumph of markets over older regulatory systems, triumph of unregulated over regulated  previously
    unregulated employment such that decide own terms with employers, but leads to exploitation  lead
    to a movement of regulation (#2)
2. market regulation produces forces that construct regulatory mechanisms; once ppl find subjected to
    free labour markets, they then rally for more regulation to get more rights

Liberal voluntarism: employers and employees are equals in law, no longer hierarchical structure (equal
status in law, but in reality different); workers do organize politically, and what to regularize the labour
market

January 18/00

1.   Feudalism to master servant
    broad
    instittutionalised in statute of aftificers

2.   Regime of Liberal Voluntarism: notion that should have market-based legal system of regulation in
     which indivs are left to enter into contracts of emp with others on whatever terms they could
     negotiate; no direct state regulation about terms of the contract; no compulsion to enter into any type
     of contract or any contract at all; breaches of contract were dealt with in civil law (ie. damages);
     repeal of master and servant act formallly decriminalized breach of contract, although still some circs
     when it would be criminal; collective action: ppl free to associate or contract w others for purpose of
     combining; freedom of asssoc for employers as well could choose to associate w some workers
     and not others
3.   Industrial pluarlism:
    in process of establishing market regulation of human interaction, often a countermovement when ppl
     say market is not working and we want other forms of regulation to amerliorate the consequences

                                                           nd
     look at development of indust plur scheme as the 2 movement

Occupational Health and Safety movement an example of counter movement
 ppl and families sue in tort to get damages etc… but even then have to show owes a duty of care
 employees want courts to make standards of care
 crts will not bc say relat betw emper and empee is governed by contract
 when an empee starts, ought to know the dangers associated and if injured from hazards, in law
   deemed to have assumed the risk of being injured by entering into the contract
 legal doctrine of voluntary assumption of risk
 same applied to negligence (ie. if know person is not doing job properly , shoujld report to employer)
   but otherwise you assume the risk of being injured in that way

demands hazards be eliminated or that get money for assumng the risk;
established issue for compensation of injuries at work and established system of health and safety
regulations that was a market system (system that determined level of health and safety)

mid1880s not getting into it
to 1914 Work Comp schemes
 regime of compulsory insurance (against risk of being injured regardless of fault)

    women and children could not stand up for their rights with hazards at work, tf needed more
     protection
    courts wanted them to go back to employers and figure it out; but instead the employees made the
     changes through legislation  ie. found women‟s groups, working class vote and norms of health for
     women (childbearing etc) : Factory Acts: directed at women and younger children: notion of needing
     legal protection
    political action to get state to impose on the market a regime of regulation that is not market based
     but rather a social-political basis

Same pattern with minimum wages:
 first grp was minimum wage: past in end of ww1 and 1920s… to create minimum wage sufficient so
   single woman can support herself

    After 1930s a push to get minimum standards to include men: hours and work and minimum wages (if
     low wages, not sufficient purchasing power to buy cut costs, so produce less and then cut costs and
     then wages go down, and in response have to stop economy from spiral down)
Employment standards act
minimum holidays
entitlement to overtime
notion that entitled to notice if terminated
severance pay

elements in this regime that deal w issues of equality:
ie. equal pay for equal work; discrimination of benefit plans
p36-40

after ww2

1951 fair employment factors act: prohib discrim on race, relat, creed etc
fair remuneration act  end discrim on pay for men or women
19X2: Ont HR code

mainly complaint driven systems (ie. complain to emp stand officer if no issue of pay, appeal mechanisms
too)
(to HR comissions, officer investigation, to resolve the dispute)
problems with implementations of the schemes, backlogs

   pay equity act 1987: assumes equal pay for work of equal value (look at the value of the job in gender
    neutral way); employers have to introduce system - proactive - and if they detect discrepancies in
    pay, have to redress that, but this is no longer today
   employment equity - minimum standards regime, systemic basis of lack of employment: barriers to
    prevent employment for certain grps  again proactive, rather than complaint driven: employers had
    to monitor it and develop plans to achieve proportionate represenation…. Repealled when Consers
    were elected

   income security schemes:
   work comp: employers buy insurance for risk of employee injury at work
   employment insu: complusory state insurance that employers have to provide
   CPP: compulsory
   also a social wage that everyone gets; minimum standards/entitlements

Minimum standards against pure market system : still have discretion in employment, but at least have a
layer of minimium standards

Themes of the Liberal Volunt to Industrial Pluralism :
1. Minimum standards
2. Development of collective bargaining regime

Development of Collective Bargaining Regime
 voluntarism: is there direct state compulsion?
 labour market relationships betw emper and empee: 2 things: is there some background needed to
   make voluntarism work and 2 are there other forms of compulsion
 joining union is voluntary but not to the fullest extent : subject to compulsion not by state but by what
   your options are if you want improvement
 assumes regime of liberal voluntarism is voluntarily accepted
 background of direct legal compulsion
           ie criminal law: watching at the setting: activities to advance purpose of association were
            subject to criminal law
           elements of state compulsion that underly liberal voluntarism system of the way ppl operate

prior to 1900s  criminal sanctions
1900s, crts develop civil remedies (ie. injuction: civil conspiracy to injure being conducted by employees,
                                                                                        rd
injunction ordering employees to stop engaging in picketing action); picketing at a 3 location  picketing
your boss‟s business partners)
<other forms of state coercion that forms liberal voluntarism>

1900 Conciliation Act
 Fed govt
 set up institutional apparatus within fed govt that could conciliate disputes within 2 parties (ie. type of
   mediation, not compulsory conciliation)
1907 Industrial Disputes Investigation Act (collective bargaining laws)
 A Federal Act!!! dispute resolution processes: public utilities: railways, coalmine
 compulsory conciliation (more like an arbitration) and then if still not satisfied then can go on strike
 parties to industrial dispute could not strike until they subjected themselves to public investigation
 compelled to put your dispute before a 3 party
                                              rd



Toronto Electric Commissioners v. Snider (1925)
F: In the 1920s, an important event was the Snider decision. The IDIA was sometimes applied to
municipal streetcar disputes and it was in the context of one of those where the challenge took place in
Snider, p. 57-83.
H: The Privy Council held that labour relations are a part of property and civil rights in the province
(provincial not federal), but federal has jurisdiction over certain areas in the sectors that were under
federal jurisdiction (federal civil servants and other federally regulated areas). This precluded
development of a national labour relations scheme (Snider caused this) and led to a fragmented regime.
The problem was with drawing the line – where is the boundary b/w federal and provincial jurisdiction.

Reaction to Snider case:
 period of new union organizing
 every province enacted such legislation that provincial IDIA applied to provincially regulated industries
   that incorporate the legislature provincially (IDIA restored by provincial legislation)
 Enactment of Industrial Standards Act:
        a kind of collective bargaining
        codes to govern competition between employers
        if workers and employer enter into collective agreement, and if agreement has significance
            for that industry, then that govt could declare that terms of that agreement apply to all
            employees and employers in that industry in that region

   Fed Govt passes PC 1003 (1944) – Statutory collective bargaining modelled after US Act.
        Incorporated Industrial Disputes Investigation Act
        Incorporated Freedom of Trade Union Association
        Where many of employees support the union, they will be certified as bargaining agent for
           group of employees
        Compelled collective bargaining which may support union amongst employees
        No strikes of walk-outs for length of the agreement
        Led to model of Collective Bargaining regime we have today
Industrial pluralism: (voluntary and market value, but we do have regimes imposed of min standards)
 market regulation is the core, something voluntary; dominant mechanism to establish employment
    relations and terms and conditions in employment relations occurs on basis of market regulation
 leave it to the parties to negotiate, decide whether want to enter, law does not establish the terms, the
    terms reflect the market instead  leave wages to the employer and to market value
 on top of this are the regimes of standards: ie. minimum wage standards, the people who depend on
    these regimes are in a very weak market position
 establishment of collective bargaining relationships, we impose limits on the kinds of activities that
    can engage in, so we take some of the voluntarism out of it; but the core is the market system for
    establishing terms and conditions
 market driven mechanism

Dunmore Decision (class notes)
- legislation passed that was struck down – (agricultural workers not included)
-    Decision dealing with the unionization of farm workers
- Why was it suggested that legislature could exclude agricultural workers
How SCC decided in Dunmore (not to exclude agricultural workers):
General principles articulated (has scope of freedom of association been expanded by this decision?)
4 Separate Propositions:
1) Freedom of Association
2) Freedom to establish, belong and maintain an association
3) Individual legal right to engage individually in association
4)
Para 16&17 – Certain kinds of collective action not falling within 3 & 4 above may still be protected by
freedom of association.
- Collective bargaining and striking may not be covered by this expanded notion
- Expansion of scope of protected activities
- Notion of state responsibility for protecting freedom of association
- Positive obligation to protect freedom of association
- Ambiguous whether there is potential for greater expansion of Charter rights into employment
    relationship

What is to be done?
- Get rid of Labour Relations Act? No
- Compulsory collective bargaining – neither require nor forbid inclusion of agricultural workers in a full
   collective bargaining regime
- Provincial govt – if they are risk averse – collective bargaining or some positive protection

Key Points from Dunmore:
- widens the scope of 2(d) to include collective activities
- recognizes that state may have positive obligation to protect associational activity against interference
   by private actors
- Positive assessment of trade union freedoms
- Does not constitutionalize in general the right to bargain collectively under statute or to strike

International Labour Organization
ILO to develop conventions on various aspects of labour and emp law
 Established in aftermath of WWI
 Approximately 175 member states – operates under United Nations
 conventions were not binding on member states unless states chose to ratify the convention
    if ratified, mechanism for enforcing the convention ; complaint rec‟d, investigative committeee
     established, investigation, public report as to whether guilty of violating convention
 so depended on publicity sanction (concerned about being published as bad country – so member
     states ratify conventions and place obligations on those member states)
(by time report is issued, it‟s usually 2 years later and barely mentioned in the papers, so limited moral
persuasion)

ILO: declaration of principles of rts at work, binding on member states (but no way to enforce)
         Right to collective bargaining
         Elimination of discrim of emp (and all forms of forced or compulsory labour)
         End to child labour

Impact of ILO in Canada:
 Little direct influence - A set of standards to which govt has committed itself, but does little in forcing
   govts to comply
 Has not inhibited violations of conventions ratified by Canada
 Complaints and reports of violation receive little publicity
 Finding and recommendations made long after violation occurs
 Indirect influence on courts (Dunmore)

North American Agreement on Labour Co-op: (side of NAFTA)
 Side deal to NAFTA – came into force Jan 1, 1994
 Endorses 11 labour principles
 Provides complaint procedure
 Limited to failure to enforce existing law, not failure to enact law
11 Labour Principles that countries endorse when entering into NAFTA (pg 97):
1. Freedom of Association and protection of the right to strike and organize
2. Right to bargain collectively
3. Right to strike
4. - 11 (more technical): forced labour, prohib child labour etc.

How to enforce? 3-tiered enforcement process under NAALC
 not all tiers can go through each principle

TIER 1: complaint and report issued:
 any person can bring complaint about failure of enforcing laws in respect of principles to a national
   administrative office in another country
 does not create a positive legal obligation to enact laws to institutionalize the principles to which each
   is committed
 complaints based only on ability to administer and enforce the laws it has passed
 NAALC can accept the complaint, public hearings, report and recommendations, may recommend
   ministerial consulations, that ministers of countries have consulationa bout the issue
 for collective barg prcinip, cannot go on to tier 2

TIER 2: Evaluation Committee of Experts
 For technical labour standards/principles, can go to tier 2; minister has to request that matter goes to
   next level: Evaluation Committee of Experts
 not that particular incident of non-enforcement but a pattern of non-enforcement of the principle in
   question
   not everything can be assessed here, however. Ie. Canadian min labour can only deal w/ violations
    dealing w/ trade-related industry and that Canada has a labour law that is equivalent to the law that is
    alleged to be violated in Mexico

TIER 3: Arbitration and Trade Sanctions
 If 2 doesn‟t resolve the dispute, go the 3.
 To go to 3, only if violation of 3 principles: child labour, min wages, occupational health and safety.
 arbitration panel: if find inconsistent pattern of enforceability, then trade sanctions can be imposed (ie.
   fine of X volume of trade between the countries)

Reality:
 most complaints about Mexican laws, but some Canadian and US
 so far no complaints have gone past tier 1


SPECIAL TOPICS

Appropriate Bargaining Unit:
Collective Bargaining:
1) Introduction
2) Legal Framework for Certification
3) Appropriate Bargaining Units
4) Unfair Labour Practices

   core of industrial pluralism: the individual contract of employment, so have to opt into collective
    bargaining system
   even unorganized workers have access to some kind of collective works (ie. works councils on which
    employee reps sit, don‟t need union to have some kind of voice)
   lack of democracy or industrial citizenship
   hope that collective bargaining would become the norm


only way to gain a collective voice is through unionization, with exceptions:
 Occupational Health safety Act
     in almost every prov but Alberta if more than 20 employees, must deal with health and safety
 spread of collective bargaining uneven and changing – overall decline in union density
 By-law – must be a works counsel forum where workers can participate in workplace decision-making
 In US – Union density has dropped to 12% in 99 (25% in 60‟s)
 In Canada, early origins of collective bargaining limited to number of sectors (transportation; utilities;
    etc)
 Union density got to 30% level and has remained there roughly
 Composite has changed – 60-70‟s collective bargaining extended to public sector
 97 – public sector 72.5% union growth; private sector 21.9% decline
 Gender – decreased in sectors predominantly male and increased in public sector which has grown in
    composite of females



1) Legal Framework for Certification: (Ontario Labour Relations Act)
A. establish that you‟re covered by the statute
   have to be an „employee‟. Independent contractors don‟t have rt to form trade unions and get
    certified, but can make associations and bargain informally, but not covered by OLRA.
   employee: includes dependent contractors; exclusions of „employee‟ s1(3): not employees are 2
    classes: member of architectural, legal, in professional capacity… or second class: managerial
    functions or confidential capacity
   grps of employees to whom act doesn’t apply: domestics, ppl in agriculture, silver culture, police,
    firefighters, OPP, education but are covered by others… but domestics and agriculture are NOT
    included in ANY other legislation

B. Between employer and trade union that is the exclusive bargaining agent for the employees
(ppl could still be covered by the negotiations even if not part of the union)

Trade Union: organ of empee , for purpose of regulation betw empee/empor
When union applies to be bargaining agent, proof to labour relat brd that it is a trade union (s113)

s15: Board cannot 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 prohibited by the OHRC or Charter

HOW TO CERTIFY:
 Normally someone in workplace contacts union, would union want to assist them? An organizing
   drive occurs, people who are employed in target group, attempt to sign membership cards and
   become members of union. When union feels strength with that group,, will apply to Ontario Labour
   Relations Board to be certified.
 S7 of Act – Establishment of bargaining rights by certification
 S7(12) : Application for certification shall include a written description of the proposed bargaining unit
   including an estimate of the number of individuals in the unit.
 Trade Union provides list of people who have joined and propose to Board the definition of the
   bargaining unit that seeking to represent (ie. all production employees)
Board then has to determine what would be the voting constituency.
        If 40% of that constituency have signed union cards, then it will hold a vote within 5 days of
        application for certification. If disputes about the appropriate bargaining unit etc, issues
        postponed until after the vote.
        Must establish through vote that has support of majority of employees of who are in the
        bargaining unit, includes all those who are in the bargaining unit.

        (5 days, limits time employer has to mobilize opposition)

Changes in 2000 – s.7 and s.10:
s.7: If union applies for certification and withdraws application, it might have to wait certain period before
it can apply again.
s.10: If vote is conducted and union loses, cannot be another organizing drive for a year

The Legal Framework in Which the Board Makes its Bargaining Unit Determination:
s.9(1): The board is to determine appropriate units - “... unit shall consist of more than one employee and
Board may, before determining the unit, conduct vote of any of employees of employer for purpose of
ascertaining wishes of employees as to the appropriateness of the unit..” - the Board may consult their
interest, but are not bound by it
Craft Workers:
s.9(3) – Allows craft unions to bargain separately
s.9(4) – Separate provision for professional engineers
s.9(5) – Bargaining unit consisting solely of dependant contractors



Board Policy
 Board sees greater need for flexibility in bargaining units
 Board is certifying very small units
 Today, ¾ of bargaining units had less than 100 employees

United Steelworkers of America v. Burns (1994)
In this case, they took a more flexible approach in defining appropriate bargaining units. They looked at,
“does the unit which the union seeks to represent encompass a group of employees with a sufficiently
close community of interests that they can bargain in a meaningful way without causing undue labour
relations problems for employers”. This involves degrees of appropriateness. “A trade union need not
seek to represent the most comprehensive union and as long as the unit it seeks to represent does not
create undue hardship for the management, it will be certified as it desires”.
R: It doesn‟t have to be the most appropriate unit as long as management‟s interest in having long-term
stable labour relations is not unduly affected by the proposed bargaining unit.

Decertification:
 Once a union gets certified its given a certain kind of security
 S.7; 62/63: Certain periods that are closed and cant be decertification applications for a protected
   period of time
 Decertification applications need to get 40% of people in bargaining unit to support decertification and
   then a vote will be held

Unfair Labour Practices
Common law:
 within regime of liberal voluntarism, lots employers could do to prevent unionizing without much legal
   restraint
 shift to industrial / liberal pluralism is significant in that while not completed overthrowing voluntarism,
   it imposes limits on exercise on some of those employer rights to create a more protective space for
   employees to enjoy a freedom of association and right to form a trade union; your freedoms as
   employees are protected by rights, duty on employers not to interfere with your choices as employees
 Employers have property rights and - nuisance – cannot interfere with another‟s enjoyment of their
   private property (cannot impede access to property)

Ontario Labour Relations Act: Section 5: Employee Freedom:
 S.70: employer not participate or interfere w/ selection etc. of a trade union or formation of union,
    BUT (balancing right of industrial pluralism) can freedom to express its views so long as no coercion
    or threats etc.
 S.72: cannot fire b/c part of union, cannot discriminate on terms of employment if member of union
 Cannot impose term in contract that you won‟t join union in the future (restriction on freedom of
    contract)
 S.76: no person, union, organization shall coerce to compel person to become or stop becoming
    member of trade union (general prohibition)
 S.77: persuasion during working hours – Cant persuade employee during working hours not to
    become part of trade union
Enforcement:
 Need meaningful way of enforcing the rights - can enforce by making complaint under s96 to Labour
    Relations Board, hearing
   Mechanism of prosecution, offence to violate lab relat act, need leave from lab relat board to
    prosecute
   Also a criminal offence to violate s72 of Ont LR Act, put into s425 Criminal Code “offence by
    employers”  punishable on summary conviction.

Applications:
 Lab Relats Brd reluctant to say that exercise of ppty rights to exclude union organizer from coming
   onto ppty and speaking to employees rarely if ever constitute an unfair labour practice
   - generally, cannot get onto ppty of employer to gather employees even if ppty is a public place
   - certainly cannot approach them during their working hours
   - where exit is onto public space, then can wait for them there as long as does not constitute a
   nuisance
 problems where employees are in malls and step onto other set of private ppty and then step onto
   street, so difficult to target
 Eatons case: could not exclude unless interfered with business – Could go to Eaton‟s cafeteria and
   meet with employees provided that activities didn‟t disrupt normal activities.
 Very little access to employer property despite s.70 which states that persons acting on behalf of
   employers cant interfere with union organizers – must show business justification re excluding union
   organizers. (Eatons)
 protected space in which freedom of association can occur contrasted with rts of private ppty owners
   to enjoy ppty rights
 union access to privately owned publicly used ppty unless employer showed interfered with good
   business

In-House Employee Organizers:
During Working Hours – General Rule: Adam’s Mine:
a) No solicitation or no distribution rules which prohibit union solicitation on co. property by employees
    during their non-working hours are presumptively an unreasonable impediment of self-organization
    …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 absence of evidence that the rule was adopted for a discriminatory
    purpose or applied unfairly.

Adam’s Mine (1982):
Policy: An in-house organizer on their break is free to engage in union organizing activities with other
employees on their break as long as it doesn‟t interfere or disrupt their business.

Employers Access:
 surveillance; group meetings; individual meetings

   Employers have constant access. They know the names, addresses and phone numbers of their
    employees and they are therefore able to contact them at home or by mail. They therefore have no
    problem with access. They have full access to their employees during working hours.
K-Mart Canada Limited (Peterborough) (1981) p.150
(Management’s actions seen as unfair labour practice – form of surveillance, intimidation and coercion)
F: How did K-mart become aware that an organizing drive was taking place? – local management found
it when it received a call from K-mart‟s head office advising them that there was an organizing campaign
taking place in their store. How did head office know this? There are no facts given as to how they knew.
But, K-mart may have used spies. They had contracts with security organizations to watch and see if
union campaigns were taken place (i.e. some employees may have actually been spies)

K-mart hired an investigation company and gathered info in a variety of ways – they planted agents as
employees in the Bramalea warehouse. They even voted in the election. Criminal conspiracy charges
were brought against K-mart and they were convicted and fined.

What did K-mart do that the board had found put them over the line?
CONCLUSION by the BOARD:
     By isolating and creating the impression that you have special surveillance, they have created
intimidation and treated them in a way that is degrading. Someone is constantly watching you
everywhere you go. It is an abuse of the access that employers normally have to their employees. When
they go beyond and intimidate, this is essentially an unfair labour practice.
What about conducting meetings with your employees or compelling employees to attend a meeting
when it has been called? What was wrong with what K-mart did in terms of meeting with its
employees. – Mrs. Fox, National Employee Relations Director was circulating in the store constantly
engaging employees in discussions about the union. This was a form of surveillance and intimidation
and coercion. K-Mart violated protected space by intimidating employees and interfering with their
choice for unionization.



Wal-Mart Canada Inc. (1997, OLRB)
Re: Unfair Labour Practices – Refusal to Answer Question on Store Closing - Certification

F: The case dealt with a union drive at a Wal-Mart store in Windsor. The employer had an established
practice of holding regular meetings with the employees every day before the store opened. During the
union drive, a senior member of Wal-Mart‟s upper management attended one of the meetings. Speeches
were made regarding the union drive. The manager circulated through the store and spoke to
employees. At one meeting, an employee who opposed the union was allowed to speak. Management
did not distance itself from her comments and no union representative was allowed to make follow-up
comments in response. In addition, the employer provided a question box for workers to submit concerns
anonymously. Answers were provided on sheets that were given to the employees. Management
refused to provide specific answers regarding how the status quo surrounding job security would change
until a collective agreement was negotiated. For example, employees asked whether the store would be
closed if a union was formed. Management did not provide an answer to that question. The certification
vote failed. The union alleged that unfair labour practices had occurred and applied for automatic
certification on the basis that the results of the vote did not reflect the true wishes of the employees.


Q:      Were unfair labour practices committed by the employer such that automatic certification is
        warranted?
Yes. Automatic Certification Ordered.

The Board found that the morning meetings and the speeches made at them were not in violation of the
OLRA, even though the union was discussed. However, other employer actions did breach the Act,
including threats that certain employee benefits could be lost and management‟s refusal to answer the
question about the future of the store under a union presence. Not answering the question about store
closure in the unique “open” culture that existed at Wal-Mart constituted an implied threat and allowed a
reasonable employee to wonder whether he could lose his job.

Note that a difference b/t the two cases is that KMart focussed on access rights abused by employers,
WalMart focused on economic power abuses over the employees.


Employer Economic Power - Anti Union Animus

Terminations

Section 72: No employer, employers' organization or person acting on behalf of an employer or an
employers' organization,
       (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 trade union or was or is exercising any other rights under this Act;

        (b) shall impose any condition in a contract of employment or propose the imposition of any
        condition in a contract of employment that seeks to restrain an employee or a person seeking
        employment from becoming a member of a trade union or exercising any other rights under this
        Act; or

        (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 employee to become or refrain
        from becoming or to continue to be or to cease to be a member or officer or representative of a
        trade union or to cease to exercise any other rights under this Act.

   It is not unlawful for employers to terminate employees; but it unlawful for a certain purpose. This is
    the notion of Anti Union Animus (b/c of persons trade union activity)

s.96 – Reverse Onus Provision  must show there was no anti union animus. How does employer
discharge this onus? By showing a) that they had no knowledge a unionizing activity was taking place.

   If can‟t do this b/c had knowledge - b) they have to show that their action was not taken for those
    purposes, despite their knowledge. Will show that they had other grounds to base their decision.
   The reverse onus clause was put in place to help protect unfair labour practices. Employer has to
    show on balance of probabilities that firing was not motivated by trade union activity. Employer does
    not have to show just cause for firing the person, just has to show that didn‟t terminate for anti-union
    sentiment.
Altering terms & conditions
 Altering terms & conditions of employment refers to threats or promises; for example: If join, cut
    wages or if don‟t join, increase wages. There can also be more subtle threats.
 Clear cut threats are clearly unfair labour practices but more ambiguous terms are more problematic.
 Subtle threats found to be anti-labour practices (ie. K-Mart)

Shutting down or moving
 What happens if employer decides to shut down factory and move somewhere else or if employer
   threatens to shut down factory if you start to unionize?
 The threat that you will SHUT DOWN OR UNIONIZE is an unfair labour practice. There is some
   restraint placed on the exercise of these kinds of rights where done for purpose of discouraging
   employees from unionizing
 Employers cannot close b/c you„ve become unionized but they can close where there is a union

WE SEE HOW BOARD IS LIMITING EMPLOYER RIGHTS SUCH AS: MANAGEMENT RIGHTS, FREE
SPEECH RIGHTS, PROPERTY RIGHTS, ETC. FROM A LIBERAL PLURALISTIC VIEW, THERE IS A
     CLEAR INFRINGEMENT ON ALL THOSE RIGHTS. IT‟S WRONG WHAT‟S BEEN DONE.
  INDUSTRIAL PLURALISTS: THIS IS THE SCHEME THEY WANTED. SAY WE NEED A WAY TO
 COME TO A BALANCE THAT WILL NOT UNDULY INTERFERE BUT WILL PROTECT EMPLOYEES
TOO. WANT EMPLOYERS TO BE ABLE TO ENTER INTO A COLLECTIVE BARGAINING SCHEME IN
                                  A NORMAL WAY.

Labour Board Remedies

Section 96(4): Remedies. Lists boards powers in the event of unfair labour practices.
    (a) cease and assist order: to stop what employers are doing.
    (b) rectify acts complained of
        posting notices: might be able to order that employer post a notice to employees;
        access orders: can make an order respecting access (give union access to employees that it
           doesn‟t normally enjoy); can have access to bulletin board on employer‟s premises; can have
           access to employer‟s premises during working hours
        damages: In terms of damages only COMPENSATORY (not punitive) damages can be
           awarded for rectification purposes
        resumption of production
    (c) reinstatement (of jobs, if fired for entering into union)(or with compensation)
Section 96(5): Reverse onus of proof
Section 98: Interim relief 98. Board can grant interim orders, but restricted to procedural matters.
Section 11: This remedy allows for certification of a union w/out proof of majority support. In the earlier
version, automatic certification was available if three criteria were met (Kmart)…
    1. There must have been a breach.
    2. Breach must have prevented employees from voluntary expressing their wishes; and,
    3. There had to be evidence of sufficient support for union to support collective bargaining
However, TODAY, all Board can do is force another vote for certification, if the three criteria are met.

Walmart:: Board dealt with the adequate support provision of Section 11. 40% had signed union cards
at time of application, but at time of vote, only 21% gave support for the union. Is 21% support enough?
Yes, it is a core. Board does not want to disentitle union from support just b/c employer‟s acts. Automatic
certification did not do much to gain support for union since employees & employers still had problems
w/union. As a result, Walmart Bill was introduced by government which amended Section 11 as
seen above.
 best you can do under s.11 is force another vote for certification
What is the effect of political & labour law on certifications? (1987-98)
   1987-90: Liberal Government
   1990-1995: NDP  # of certification applications increased by 10-15%; success rate increased
       by about 10%. Overall, # of successful bargaining units increased
   1995-1998: PC  # of certification applications decreased; success rates dropped; overall there
       was a drop.
CONCLUSION: Under the new labour laws of PC, the #s have decreased since Liberal period.


THE EMPLOYMENT RELATIONSHIP

1.   WHO IS AN EMPLOYEE

INTRODUCTION

Contract of Employment: If the worker does not have a contract of employment, s/he is outside of labour
employment law and is not governed by Labour & Employment law. Employees have contracts of
service WHEREAS independent contractors have contracts for service.

A Paradigm Case of Employment
                                       Employee            Employer
Service                                Duty                Right
Ownership           1. Means of        -                   +
                       Production
                    2. Final Product   -                   +
Control             1. Planning        -                   + e/yer controls
                    2. Execution       -                   these
                                                           +
Chance of                              -                   + e/yer stands to
Profit/Risk of                                             profit and bears
Loss                                                       risk of loss

The + indicate the core management rights of the employer. Employee does not have not these rights.
Employee instead has a duty to fulfil those services as indicated by -.

Facts on Self Employment

Own Account Self Employed: People who are self employed (sell their services to other people)(e.g.
independent contractor). This definition does not include those running their own businesses who are
also self employed but employ others.

    From 1931-71: self employment declined from 26% of workforce to 10%
    1971-98: increased from 10 to 17%
    Self employment accounted for 58% of net job growth in the 90s (86% of male job growth; 42% of
     female job growth); full time jobs account for 18.5 %of net job growth
    On average, self employed are worse off than employed (lowed income, longer hours)
    On average, self employed women are worse off than self employed men and differences are
     larger than between employed women & employed men
COMMON LAW TESTS

   Why does it matter whether you are an employee or an independent contractor?
    1. Doctrine of vicarious liability  Operates only wrt the employment relationship. There is no
        vicarious liability for tortious actions of independent contractors.
    2. Ability to claim employment related benefits

POLICY: What is the rationale for having vicarious liability?
 Risk creator should bear cost when harm materializes
 Deter future harm  Employers given the incentive to supervise employees‟ actions

CONTROL TEST:
What are implications for a legal test (who is an employee vs independent contractor)?
 OLD ONE-FACTOR TEST  CONTROL: Does this person hold control over the other person‟s
   activities? If yes, then you have a real hand in materializing the harm….
 TODAY, Courts are critical of the one factor control test b/c “employees” are given leeway in their
   activities but even though there is no control, employer should not be left off the hook. Furthermore,
   “independent contractors” sometimes have contracts that are subject to detailed controls. Thus,
   courts have elaborated on a number of factors that are relevant to determine who is an included in
   the employment contract

Ready-Mixed Concrete – Review of Common Law Authorities:

a) Montreal v Montreal Locomotive, 1947
TEST: To determine whether a contract of service applies:
a) control
b) ownership of tools and materials
c) chance of profit
d) risk of loss

b) US v Silk, 1946
TEST: Economic Reality  Whether the men were employees as a matter of economic reality.
 Important factors were said to be, “the degrees of control, opportunities for profit or loss, investment
   in facilities, permanency of relation and skill required in the claimed independent operation”

c) Bank voor Handel en Scheepvaart N.V. v. Slatford, 1953 (Lord Denning)
TEST: Integration test  Is the person part and parcel of the organization? – To what extent is persons
actions integrated into organization

e) Ready Mixed Concrete v. Minister of Pensions & Ntl Insurance, 1968
Facts: They buy (check on this) their own trucks through a finance company that is associated with
Ready Mix concrete. Trucks they borrow carry the name and colours of the company. They wear the
uniform when performing their job and their accounts are done by an accountant who has been approved
by RMC. Any repairs to the trucks are controlled somewhat by RMC. Drivers are paid by the mile. The
are expected to maintain repair and insure the truck out of monies they receive and if they are not
available to perform deliveries, they can hire replacements.
Issue: Whether driver of concrete delivery business was an independent contractor or an employee.
Decision: Held that the contract was a contract of carriage, not a contract of service.
TEST: Whether there is a contract of service depends on:
Used a three part test, although Montreal Locomotive is key test. Held that a contract of service exists if:
(1) the servant agrees that in consideration of a wage or other remuneration he will provide his work and
skill in the performance of some service for his master,
(2) he agrees expressly or impliedly that in the performance of that service he will be subjected to the
others control in a sufficient degree to make that other master,
(3) the other provisions of the contract are consistent with it being a K of service.

N: Really demonstrates the emphasis on control that the common law places in this test: Control includes
the power of deciding the thing to be done, the way in which it shall be done, the means to be employed
in doing it, the time when and the place where it shall be done. However, while control is necessary it is
not always sufficient depending on the other standards.[that is why it was rejected in Montreal]

Prof Tucker’s Comment: the main question seems to be “do they enjoy a degree of economic
independence that provides them with enough freedom?”
CONSIDERED: Montreal Locomotive is most liked by courts. Denning‟s test was not.

f) 67122 Ontario Ltd v Sagaz Industries Canada Inc, CA, 2000
Note: good decision to read b/c provides model analysis of how courts are making these kinds of
decisions - provide historical background
Facts: Company wanted to be a supplier of Canadian tire. Got the contract through bribery. Company
that lost the contract sued claiming tort. There was definitely tortious action
Issue: Whether person who bribed did so as independent contractor or as an employee
Decision: Courts go through what is the policy rationale for vicarious liability. Identify factors we noted
above. Thus, how should rule be formulated? Says there is no one test. NO bright line standards.
Central question is whether person who has been engaged to perform the services is performing
them as a person in business on this own account. Factors include: control, ownership of equipment
used, whether worker hires his/her own helpers, degree of financial risk taken by work, degree of
responsibility for investment and management held by the worker ,and the worker‟s opportunity for profit
in the performance of his or her tasks. Thus, these factors constitute a non-exhaustive list and there is no
set formula as to their application. Weight of each depends on facts of each case.

Ratio: In this case, the court endorsed the “organization test” and emphasized that the legal
characterization of the relation would depend on the facts, not the label that the parties chose to attach to
the relationship.

SOCIAL WAGE PROTECTION

Consider:
1) Is the person providing the service eligible for statutory benefits?
2) Why do we have programs like EI and Worker‟s Comp plans?

What is at stake?
 Entitlement to statutory benefits/liability to pay cost
 One issue is that where workers are classified as „contract workers/independent contractors‟ rather
  than employees, the boss can avoid paying Canada Pension Plan (CPP), EI, and the worker cannot
  claim under ESA or OLRA

Implications for test, if any:
A) Has legislature defined employee or otherwise specified who is covered?
B) Has decision-maker taken context into account in drawing line? (court or administrative tribunal)
Ready Mix Concrete
Issue: Are these workers employees or independent contractors?
Decision: Using the judgment from Silk, hold these are small business men, not servants
Note: There is no linkage to the test they apply to any expression or acknowledgement that they are not
making the distinction in common law re vicarious liability. Rather, they are trying to determine whether a
person is covered by a national insurance plan and whether this is the kind of person who given the
rationale for the program ought to be covered.




Thompson Canada Ltd v Canada (MNR), 2001
Facts: WFP publishes a newspaper which is sold at retail outlets, by machines & by carrier delivery.
Workers collect the papers from distribution outlets. No record is maintained by WFP as to whether
worker collects himself or sends someone else to do so. Workers do not have to PERSONALLY deliver
the papers and when it is not personal, they do not have ask permission or approval from WFP. Workers
can enter into contacts w/other papers to deliver. Workers provide their own transportation. Workers
choose their own hours.
Issue: Whether newspaper carriers of Winnipeg Free Press were employees for whom Thomson News
was responsible making EI & CPP contributions.
Decision: Held that they are not employees for purpose of EI & CPP and therefore no need to make
deductions.
Reasoning: Applied the four part test.
Note: A few years earlier, the Manitoba Labour Relations Board found the same group of carriers to be
employees for purposes of collective bargaining.

11 factors Determining the BUSINESS REALITY of the business situation

In Stork Diaper, the Workers‟ Compensation Appeal Tribunal developed a test that continues to be widely
used. Hybrid test which emerged may well be characterized as a “business reality” test involving a
consideration of various factors including:

  1. Ownership of equipment used in the work or business
  2. The form of compensation paid to the worker or independent operator (the “entrepreneurial”
       factor)
  3. Business Indicia (e.g. business cards, advertising, telephone listings, etc.)
  4. Evidence of co-ordinational control as to where & when the work is performed
  5. The intention of the parties, often evidence by an agency agreement, employment agreement,
       contract for service, contract of service or limited term contract
  6. Business or government records which reflect upon the status of the parties
  7. Economic or business market
  8. Existence of the same or very similar services supplied to an employer by a person or person who
       are classified as workers under the Act
  9. Substitute service
  10. Size of the consideration or payments
  11. Degree of integration
Recent Inquiry: Worker‟s comp board said that this is not working well. Jan /02 examined the issue of
coverage under the Workplace Safety and Insurance Act. Is the issue of independent contractors? They
held that there has been an enormous expansion of IC or those known as self employed. Board is
concerned about this b/c revenue concerns, they are concerned that these people will fall outside of their
safety mandate, people injured fall out of compensation system. Their test they have decided is hard to
apply b/c of its complexity. Thus, they are asking others what they should do about all of this?

Employment Standards Act

To whom does the Act apply?
s2 Current ESA --- act applies to every contract of employment, written or implied (contractual relat)
s3 current ESA cannot contract out of ESA provisions

New statute s3 - applies to an employee and employer  no longer mention of contractual relationship
(courts becoming likely to recognize employment relationships even absent to contract, looking at status)

s1 - ‘employee’: person who (a) works for or supplies services for wages; (b) does homework for
employer; or (c ) receives instruction or training in activity, business, trade, occup/ profession of employer

s1 - ‘employer’ - (a) owner, proprietor, manager, superintendent, overseer, receiver or trustee of activity,
business, work, trade occupation, profession, project… who has control or direction of, or is directly
or indirectly responsible for, the employment of person

s1 - ‘wage’ - monetary comp according to an employment contract (express/implied), including room and
board; not including tips, gifts, bonuses that not related to hours, travelling expenses.

Exclusions
Statutory:
Sections 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 employer is an employee of that person if the skill in which the
individual is being trained is a skill used by the person's employees, unless all of the following conditions
are met:
 The training is similar to that which is given in a vocational school.
 The training is for the benefit of the individual.
 The person providing the training derives little, if any, benefit from the activity of the individual while
     he or she is being trained.
 The individual does not displace employees of the person providing the training.
 The individual is not accorded a right to become an employee of the person providing the training.
 The individual is advised that he or she will receive no remuneration for the time that he or she
     spends in training
 Section 3(2): This Act does not apply with respect to an employee and his or her employer if their
     employment relationship is within the legislative jurisdiction of the Parliament of Canada.
 Section 3(3): This Act does not apply with respect to an employee of an embassy or consulate of a
     foreign nation and his or her employer.
 Section 3(4): Only the following provisions of this Act apply with respect to an employee and his or
     her employer if the employer is the Crown, a Crown agency or an authority, board, commission or
     corporation all of whose members are appointed by the Crown:
 Continuity of Employment; Equal Pay for Equal Work; Benefit Plans; Leaves of Absence; Termination
     and Severance of Employment; Lie Detectors; Reprisal, except for 74 (1) (a) (vii) and clause 74 (1)
     (b);Building Services Providers.
   Section 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:
   Section 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 employee,
    nothing in subsection (5) precludes the application of this Act to that individual and his or her
    employer insofar as that other work or position is concerned.

Regulations:
Ontario Regulations 285/01: Exemption to benefits under ESA are described.
Section 5(1): NO-CONTRACTING OUT: You cannot contract out of the Employment Standards Act but
you can obviously if you can show that you are not an employee

Becker’s Milk, 1973 (franchise case) - Note: Good case to look at re Montreal Locomotive test
Facts: Managerial Employers/Supervisors. Status of store managers is considered. Have little control
over work hours, some discretion over ordering stock & hiring employers. Beckers did keep control of the
decisions, managers could also be fired by Beckers. Beckers set hours of work, accounting practices,
owned uniform of the managers.
Issue One: Whether workers are employees or IC
Decision: Applied the four-part test from Montreal Locomotive. (control; ownership of tools; chance of
profit; risk of loss)
Held that managers were employees.
Reasoning: They were not truly in business for themselves, did not have „freedom enough‟ to be IC; did
not buy/resell goods, limited accountability for lost inventory; only provided labour. There was not enough
scope to be an entrepreneur.
Issue Two: If they are employees, was the work managerial OR supervisory
(14(2) subsection 1 (max hrs section) does not apply to an employee whose only work is supervisory or
managerial in character, or of a character exempted by the regulations)
Decision: Held they were managerial employees however, since the work involved both managerial and
non- managerial functions, they were able to claim as regular employees. The s14(2) exemption did not
apply to employee.
Reasoning: To fit w/in the exclusion, had to be performing managerial duties EXCLUSIVELY. (Note
that in collective bargaining cases, the focus is on the predominant/primary function, not the exclusive
function). The managerial exception in Section 14(2) is narrow (if some duties are not managerial – this
section will not apply)
Considers Falconbridge which indicates that supervision of other employees is a primary indicia of the
managerial employee. At the same time, employees can be considered managerial when where they do
not exercise any direct authority over employees.

Note: Elaborated on the control element from the four-part test when determining application of ESA.
1. Degree of supervision
2. Manner of payment
3. Capacity of individuals to employ others
4. Provisions made for termination of the contract

N: In terms of test in Montreal Locomotive, none of the factors by itself conclusively point to whether a
person is an independent businessman. The question is of a complex nature and becomes a matter of
determining whether the combined weight of the factors present leads one to the conclusion that a person
is an independent businessman rather than a an employee.

Re Sooters Studios, 1991
Facts: Sooters owned the premises of a business to which it was the sole supplier.
Issue: Whether the operators of the business were managers.
Decision: Held that the operators of Sooters outlets were managers and not individual business
operators. Managers' authority to hire others to discharge their responsibilities was not inconsistent with
the managers' status as employees

Problems
 Inconsistent results
 Absence of policy rationale
 Can the legal category of employee provide a proper basis for determining entitlement?
 Should own account self-employed be legislated in? (eg. BC ESA, re newspaper carriers)




The Ontario Labour Relations Act

   The OLRA does not apply unless an “employee” is involved

Dependent Contractors
 Under the OLRA, an “employee” includes a “dependent contractor”
 Some kinds of employees are excluded from the Act [s. 1(3); 3] including those exercising “managerial
   functions” and those who work in a confidential capacity in matters relating to labour relations”


Toronto Drywall Services Ltd. (1976)
FACTS: A contractual scheme was worked out that would ensure that workers did not fall under definition of
employees in LRA. They described themselves as subcontractors. They use material supplied by the contractor but
they use their own tools. They are free to work for other contractors but there is a risk if they do so, this contract
might be terminated. Contractor makes no deductions for income tax, EI or CPP but does deduct for worker‟s
comp.
ISSUE: Whether these workers are employees who can participate in collective bargaining – whether there is an
employment relationship.
DECISION: Applied the 4 part Montreal Locomotive test inclusively. Held that they ARE employees, rather than
IC b/c purpose of act is to promote collective bargaining, & to facilitate a certain kind of production. They are part
of the bargaining unit.
REASONING: Considered who owns the means of production. Whether they are being paid for their labour?
How are they being supervised?
Found that the workers had little control over their work.
APPLICATION:
1. Ownership: They own their own tools but Board says this is not decisive b/c employees also can bring their
     own tools
2. Chance of profit: They are paid by square foot, not hourly wage, so there is chance of profit. The faster they
   complete the job means faster they can make the money
3. Risk of loss: Can they lose money from doing this work? Board says no loss of money, even though don‟t
   make very much
4. Control: Not much supervision/control except to meet certain standards
RATIO: Application of Montreal Locomotive test to determine whether workers are employees or Individual K‟s.

Dependent Contractors – statutory definitions
  The Labour Relations Act was amended soon after this case to extend the application of the LRA to people who
   are not just employees but also dependent contractors – a dependent contractor is someone in a position of
   economic dependence and under an obligation to perform duties for the employer, more closely
   resembling the relationship of an employee than that of an independent contractor – therefore, majority
   of dependent contractors can be included in the broader group of employees.
  Employment becomes a matter of status that we confer on people rather than one of contract
  Dependent contractors are deemed as appropriate bargaining unit – if they want to bargain separately the board
   is required to acknowledge them as an appropriate unit

Toronto Star, 2001, LRB
FACTS: Application for certification by news carriers.
ISSUE: Are the workers dependent contractors. Is the relationship between the Star and its carriers one of
dependence, akin to that of employer & employee
DECISION: Applied the multi-factor test & clustered the factors under three headings. Held that carriers were
employees. (similar to Winnipeg Free Press). Held that what distinguishes a dependent K from an independent K
is the degree of economic dependence each has upon his/her employer.
REASONING: Three factors were considered:
1. Duration of relationship of dependent K was considered relevant: whether the dependence is on-going (suggests
     dependence) or not.
2. Another was the element of entrepreneurial risk taking (profit from capital v selling one‟s own labour). Refers
     to opportunity for profit outside of the relationship. Note that even though the work is part-time, it is
     considered a permanent part-time work & must focus on what happens when they are at work & if that
     dependency manifests itself.
3. Amount of time spent together in the relationship was considered
Note: This case takes the pressure off the board of having to expend the definition of employee.
Note: What is important is not the actual economic circumstances of the individual rendering the service or services,
but whether the structure of the relationship between that individual and the employer is such as to draw the
conclusion that the terms and conditions of the relationship renders the individual economically dependent upon the
employer. Of importance is the kind of dependence of the contractor in relation to the employer.

Unlike the Employment Standards Act that still has weight on the uncertainty of the definition of employee, there
has been a conscious effort to extend the limited definition of employee in the LRA wrt collective bargaining.
Regardless, the question remains: should employment legislation generally go beyond the legal category of
employee and even go any further to include DC without regard to an economic test?

Status of the Artist Act, 1992 (example of employment legislation including ind K‟s without test of economic
dependence)
     This act set out a scheme that applies to professional artists (those who would otherwise be Ind K‟s)
     This federal legislation applies to professional independent contractors who are authors of artistic works,
    performers, and contributors to production of performing arts
     One example is Freelance Editors who have sought coverage under this act. Issue is whether editors are
    authors? Response is sometimes yes, other times no
     Administrative tribunal defines sectors and certifies associations most representative of artists in sector
     The Act contemplates the creation of sectoral producer associations
        Artists and producers bargain for scale agreements (scale agreement is the minimum --people are afraid to
    negotiate for more than the scale)
     Bargaining agent has to show that they are the most representative of that group - this is enough to be
    certified - majority support is not required

Managerial Exclusion
 Recall that Section 1(3) excludes employees who exercise managerial functions from the Act.
 Standard exclusions
     Craft: non-working foremen were excluded (craft workers are those in e.g. construction industry)
     Industrial: foremen (working foremen are deemed employees – do not fall into managerial exclusion) –
        includes those persons working on site
 What was the rationale for drawing the line? Why exclude them?

Rationale: District of Burnaby:
1) Conflict of Interest: Can‟t let lowest level managerial personnel be unionized because it would create a
    conflict of interest and compromise their loyalty and therefore they must be excluded. The employer does not
    want management‟s identification in the activities of the employees union.
2) Trade Union Independence: Leaders would be those identified with management and possibly prevent people
    below them to make independent judgements of what would be their best interests.

City of Thunder Bay (1981)
(Board Factoring Test -- Is there an effective authority over the employees?)
THE LABOUR RELATIONS ACT does not contain a definition of the term "managerial function", nor are there
any specified criteria to guide the Board in reaching its opinion. The task of developing such criteria has fallen to
the Board itself, and in recognition of the fact that the exercise of managerial functions can assume different forms
in different work settings, the Board has, over the years, evolved various general approaches to assist it in its
inquiry. In the case of so called "first line" managerial employees, the important question is the extent to which they
make decisions which affect the economic lives of their fellow employees thereby raising a potential conflict of
interest with them. Thus, the right to hire, fire, promote, demote, grant wage increases or discipline employees 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. In the case of more senior managerial personnel
whose decision-making may have a less direct or immediate impact on bargaining unit employees, the Board has
focused on the degree of independent decision-making authority over important aspects of the employer's business.
It is evident that 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 employees which is
characteristic of a first line foreman.

CAS of Ottawa Carleton (2001)
FACTS: Application for certification. Bargaining unit constitutes a group of persons who are employed in various
positions w/CAS but are described as supervisors. Employer challenges claiming that the proposed members of the
unit are not employees under the LRA. The employer does not want management‟s identification in the activities of
the employee‟s union.
ISSUE: Whether there should be a separate Managerial Bargaining Unit: Does it make a difference?
DECISION: Power holders must be separated from employee unions.
REASONING: In the case of so called first-line managerial employees, the question is the extent to which they
make decisions affecting the economic lives of their fellow employees – potential conflict of interests (e.g. right to
hire, fire, promote…).
There is NO TEST which is universally applicable to determination of whether employees exercise managerial
functions.
In this case, the supervisors play a significant role in performance appraisal which has an impact on employees
Note: The status quo has been to treat the supervisors as excluded employees exercising managerial functions.
RATIO: LRA is intended to extend collective bargaining rights to employees & it is incumbent upon any party
seeking to exclude employees from the scheme of the act, to come forward w/affirmative evidence that they exercise
managerial functions. What distinguishes management from ordinary employees is the power that managers
exercise over the economic security of their fellow workers: a power which foremen have used to interference w/the
right of those workers to engage in collective bargaining through a trade union of their choice.

WHO IS THE EMPLOYER

Common Law – Vicarious liability
Context – The Borrowed Servant
General Rule: Is that the general employer is vicariously liable

McKee v Dumas, CA, 1976
FACTS: Eddy has a large business and wants to contract out. Eddy enters into a contract with Daoust to provide
trucks. Dumas (Eddy‟s employee) is borrowing products from Daoust -- driving Daoust trucks. There was a train
accident causing damage. (borrowing Eddie Forest employees to drive own trucks)
ISSUE: Whether Eddy or Daoust is vicariously liable for Dumas‟ negligence. Who is the employer. Whether both
are vicarious liable.
DECISION: TJ found drivers were integrated into the temporary organization b/c it involved driving and Daoust
organized how the driving was controlled . TJ held that E was not vicariously liable for D‟s negligence. CA found
E vicariously liable. Held that E is considered the general employer & Daoust is the temporary employer. Dumas is
categorized as the borrowed servant.
REASONING: Court rejects organization test (b/c Dumas can be found to engaged upon both of their businesses).
Court also rejects control test. Instead, court‟s decision is based on a direct appeal to policy considerations, but still
seems to rely on control factors. Even though it is relevant that equipment was owned by Daoust, E put Dumas
behind the wheel, maintained control of action D may have taken by reason of his conduct and E paid him.
Dumas’s act was unrelated to any control of Daoust.
RATIO: The general employer remains vicariously liable for the negligent acts of the borrowed servant unless they
can demonstrate that the temporary employer was exercising direct control over the manner in which the work was
performed. They don‟t restrict the ability of the employer to have another entity do some work. But, unless that
entity is exercising control over the borrowed servant, you still remain vicariously liable for any negligent acts of the
employee.
 In most cases, courts have found that the general employer is negligent

Parent-Subsidiary Arrangements

   Sometimes size of employer makes it difficult to see who employer is

Peoples Department Store of Marks Spencer
FACTS: Marks & Spencer is the parent co. Subsidiaries include the People‟s Department Store, a division of
Marks & Spencer & D‟Aillards – All of which have employees. The parent company has spun off a large number of
subsidiary companies. As a result of the closing of People‟s, two employees lost their jobs.
ISSUE: Whether employees are employees of parent or subsidiary – whether employees are entitled to severance
pay under ESA on grounds that employer exceeded $ threshold for entitlement. (employers want to claim employer
is Marks and Spencer and not subsidiary)
DECISION: Held that true employer is the parent, not the subsidiary
REASONING: Relied on the aspect test. Most often it is the subsidiary who exercises control.
RATIO: Aspect test relies on who effectively exercises most immediate and direct control over employee – parent
or subsidiary. Aspect test deals with definitions which can be read to mean that there may be more than one
employer in respect of any particular group of employers.
Pointe Claire v. Quebec (1997 – SCC)
FACTS: The city of Pointe Claire hired some employees through a temporary help agency. The employee in
question was hired on 2 assignments. The person in question was paid by the agency which invoiced the city for the
employee‟s services. He was supervised by the city – when he worked, didn‟t work, took breaks, etc. was dictated
by the city. Union claims that the temporary employee is part of its bargaining unit & therefore s/he is entitled to the
protection & terms of that collective agreement.
Decision: Held that the City of PC was the employer for the purposes of the collective bargaining legislation.
Rejected the legal subordination test (which was predominant test being used in Quebec). There is no legal
relationship b/t client & worker. Agency is employer.
Reasoning:
3 factors:
1. performance at work
2. remuneration
3. legal subordination (control) of the employee to the employer
           this is the most important one, without which 1 and 2 are not sufficient
           employer is defined according to who the employee is subordinate - who has direct and actual
               control of the workers
 Crt rejects legal subordination/control test (b/c although legal control with the temp agency, actual control was
with the city/client) and prefers a comprehensive control test/fundamental control test:
 multi factor/comprehensive approach: greatest direct control  This is the test preferred by SCC. – who
     exercise most direct control over temp employee‟s day to day work
 Held that one entity can be the employer for minimum standards and another for collective bargaining and not
     for others.
 Found more control was exhibited by city rather than temp agency.
 The comprehensive test elaborates the various elements of control and asks the court to examine its relationship
     in totality. That is, who has the most control. The application of this comprehensive test determines who was in
     control of what – what was the agency in control of and what was the city in control of.
 Without drawing up an exhaustive list of factors pertaining to the employer-employee relationship, I shall
     mention the following examples: the selection process, hiring, training, discipline, evaluation, supervision,
     assignment of duties, remuneration and integration into the business.
DISSENT: Splitting employer obligations b/t entities is irrational.
N: Concern that if agency is employer, virtually impossible for agency employees to organize effectively (so crt
didn‟t want to deny them access to collective bargaining)
N: Strikes blow to temporary employment agency since client seen to have control and bear responsibility.

Related Employers
 Related businesses operate through distinct legal entities

Related Employers - Employment Standards Act
 Employers can organize their enterprises as they see fit. However, if the reason for the organization is to avoid
    the ESA, the arrangement has no legal effect.
 The existence of common investors and officers, however, does not automatically lead to a related employer
    finding. In addition, even if business arrangements are perceived as being integrated, it does not follow that
    successful complainants under the ESA will get what they want.

        Section 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.
        Section 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.
      Section 4(3): Subsection (2) applies even if the activities or businesses are not carried on at the same time.
      Section 4(4): Subsection (2) does not apply with respect to a corporation and an individual who is a
     shareholder of the corporation unless the individual is a member of a partnership and the shares are held for the
     purposes of the partnership.
      Section 4(5): Persons who are treated as one employer under this section are jointly and severally liable for
     any contravention of this Act and the regulations under it and for any wages owing to an employee of any of
     them.

Biltrite (550551 Ontario Ltd v Framingham), Ont. Gen Division, 1991
FACTS: Silvers are majority owners of Biltrite & of the shares of 550551. Biltrite is the contractual employer of
the employees. The Land (where Biltrite operated) is owned by 550551 Ontario Limited. Biltrite goes bankrupt and
employees are left with wages owed to them. Employees try to seek from ESA to get at least the minimum they are
entitled to. Biltrite has no assets so employees want to get the money they are owed from those entities that do have
money (i.e. 550551 Ontario Limited) and the shareholders of the corporate entities (Silvers). There is a stretch of
time that gives the Silvers time to strip land (550551 Ontario Limited) and by time order is issued, they are able to
strip 5 million dollars from Ontario Limited.
ISSUE: What legal criteria is applied to determine whether separate entities can be related employers. Whether
they are related employers.
HELD: Blite rite and the Numbered company are related employers for the purpose of the act. all the companies
were either directly owned, or owned through holding companies under control of Silver.
Test: Are they related employers?
1.   is there close functional interdependence betw the companies? (more of a stretch to show functional
     independence of real estate company; crt finds its activities were closely connected to the business)
2.   common ownership and control (same owners, yes)
3.   intent or effect of arrangment to defeat purposes of act  crt says doesn‟t have to be intent, just effect of
     arrangements defeats employees from obtaining min standards they are entitled to (purpose)

  Court grouped them into ONE company for employees to recover payments  but nothing recovered b/c no
   assets for either companies (assets were stripped)
 Courts unwilling to pierce corporate veil to hold Silver personally responsible: Silver not a related employer,
   therefore could not be held personally responsible, not intention of legislature to make individuals personally
   responsible for corps (despite that ESA says can treat indiv as one employer…) word individual relates to a
   “sole proprietor” it wasn‟t intended to go beyond that.
New Esa: s4 - Related employers do not include an individual who is a director or shareholder of a corp

Lian J. Crew Group Inc. Ontario, 2001
(Criteria for associated and related based on s.12 not met)
FACTS: A class action is brought on behalf of homeworkers claiming unpaid wages including unpaid overtime &
vacation pay. Claim also for punitive damages. P works directly for EW. J Crew contracted w/YT to manufacture
J Crew shorts. YT subcontracted w/EK to manufacture the shorts & EK subcontracted w/EW to do part of the job.
Retailers all claim that there is no common ownership/management w/the clothing manufacturers w/which they
contracted or w/any other subcontracting party down the chain.
Purpose of ESA – to protect interests of employees by compelling employers to comply with min fair and
reasonable stds of employment.
s.1 – defines employer as someone with control/direction of employment
s.12 – expands meaning of word employer to include persons who are “associated or related” to prinicpal employer
when the intent or effect of such an arrangement is to defeat either directly or indirectly the true intent or purpose of
the ESA
ISSUE: Is there a related employer based on criteria from Biltrite.
HELD: There is no evidence that any of the defendants are associated or related to Eliz World within the meaning
of s.12 of the ESA (see test below)
Reasoning: Note Section 1 definition on employer & the extension in Section 12.
None of the criteria for (c) associated or related was met. (d) was also not met.
In the absence of intervention by legislation or regulation, businesses have the freedom of action to determine the
type and extent of the particular business activity carried on, as seen to be in their own self-interest. To succeed,
must show
RATIO: Refines the test for Related Employers
  a) two or more entities
  b) claimant employed by one
  c) entities must be associated or related
         Criteria for determining associated or related
                   i.        common management or directing mind
                   ii.       common financial control
                   iii.      common ownership
                   iv.       common trade name or logo
                   v.        sharing or transfer of assets or sharing premises
  d) intent or effect of arrangement must be to defeat ESA directly or indirectly

N: The fact that there is a known chain of supply and pyramid of businesses within the overall garment industry,
such that it can be said there is a vertically integrated industry, is in itself of no adverse legal consequence to the
retailer.

Related Employers - Collective Bargaining Legislation

   The "related employer" provisions have been used to prevent an employer from avoiding the obligations of a
    collective agreement by entering into a contract with an employment agency to supply workers

Section 1(4) LRA: Where, in the opinion of the Board, associated or related activities or businesses are carried on,
whether or not simultaneously, by or through more than corporation, individual, firm, syndicate or association or
any combination thereof, under common control or direction, the Board may, upon the application of any person,
trade union or council of trade unions concerned, treat the corporations, individuals, firms, syndicates or associations
or any combination thereof as constituting one employer for the purposes of this Act and grant such relief, by way of
declaration or otherwise, as it may deem appropriate.




Related Employers – Common Law

Downtown Eatery v Ontario, CA, 2001
FACTS: Business carried out through consortium of companies (similar to Biltrite).
ISSUE: Whether Employee can collect judgement in wrongful dismissal action against ALL companies – not just
the one with which he had a contractual relationship
HELD: Court approves common employer doctrine and by doing so, rejects the contract nexus as essential to
establishing the employment relationship.
Reasoning: Held that a contract is only one factor to consider in the employer-employee relationship. If it were
determinative, it would be too easy for employers to evade their obligations to dismissed employees by imposing
employment contracts with shell companies with no assets.
RATIO: Court rejects contractual basis of employment as being essential when determining from whom employee
can claim. K is only one determining factor.

Successor Employees

   The problem of identifying the employer also arises when an employee seeks to rely on statutory protections in
    situations where the employer sells or contracts out part of its business. Thus, to ensure that employers do not
    escape the incidents of statutory or collective bargaining regulation simply by selling their businesses, both the
    Employment Standards Act and the Labour Relations Act permit the adjudicator to impose obligations upon the
    purchaser on the ground that the purchaser should take over the obligations of the selling employer.

Employment Standards Legislation (ESA)

    Section 9: CONTINUITY OF EMPLOYMENT preserved if employee hired by successor.
    (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.
    (2): EXCEPTION --(1) does not apply if the day on which the purchaser hires the employee is more than 13
    weeks after the earlier of his or her last day of employment with the seller and the day of the sale.
    (3): "sells" includes leases, transfers or disposes of in any other manner, and "sale" has a corresponding
    meaning.
    (4): For the purposes of subsection (1), employment with the seller includes any employment attributed to the
    seller under this section or a provision of a predecessor Act dealing with sales of businesses.
        If you are employed by a purchaser, there is deemed to be continuity of employment - some entitlements
            under ESA are linked to your employment (e.g severance pay. Etc) - the longer you have been employed
            at X, the more you are entitled to
    Section 10: Section 10 and its predecessor was enacted to protect workers who may lose their jobs when the
    contractor that employs them is replaced by another (See O. Reg. 287/01) - contracting & building services
        (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
        (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.
        (3): Subsection (2) does not apply if the day on which the new provider hires the employee is more
            than 13 weeks after the earlier of his or her last day of employment with the replaced provider and the
            day on which the new provider began servicing the premises.
        (4): For the purposes of subsection (2), employment with the replaced provider includes any
            employment attributed to the replaced provider under this section or under a provision of a
            predecessor Act dealing with building services providers.
Successor Employee - Collective Bargaining
   Function is to preserve collective bargaining rights when there is the sale of a business
   Interpretation of “sale of a business” is highly contentious point  when does a sale of business occur?
      There are some transactions where there is NOT a sale of business and therefore collective bargaining
      legislation does not apply (e.g. contracting of building services). There is a distinction b/t selling the business
      & contracting out of the business.
   Courts are weary of LRB decisions that extend successor employment provisions -- to control this, said that
      standard of review wrt decisions re successor rights was one of correctness (b/c determination of whether
      someone was a successor went jurisdiction of the board) rather than one of reasonableness
Two conceptualizations of Successor Rights:
a) Functional approach: bargaining rights follow the work function eg. if new entity took over, it was still
    successor
b) Instrumental approach: focus on whether there was transfer or sale of a business (rather than the actual work);
    an alienation of the undertaking must occur

Successor rightsts (such as respecting CBA) flow if sale of a business. When is there a sale of a business? Is
contracting out a sale of a business? Contracting out, according to the instrumental test does not constitute a sale of a
business bc there is no alienation of the undertaking. But if sale of a business was defined in a functional approach,
then contracting out would be considered as a sale of a business and tf successor rights would flow.
 Bibault case: SCC  struck down FUNCTIONAL test  so now follow INSTRUM TEST such that
    contracting out is NOT considered a sale of a business and tf successor rights do NOT flow!

 So court is giving less protection to employees who are being contracted out because they are not sale of
    business and therefore do not have benefit of bargaining agreement

Ivanhoe Inc v. UFCW - SCC indicated its willingness to give labour boards more scope to interpret the successor
rights provisions of their respective statutes. Court effectively allowed the Quebec Labour Court to use a functional
approach. Most boards favour the instrumental approach.

UFCW and Parnell Foods Ltd. (1992, OLRB) – (instrumentalist approach)
(Why Boards favour an approach which benefits employers and disadvantages unions)
 Argument is: A union is not certified in respect of particular employees and there are no proprietary rights in
   jobs for either the union or the workers – thus, there must be a sale of a business for successor rights to apply.
   Employer controls existence of job.
 there has been controversy regarding franchising of Canada Post retail services
 CUPW has generally been unsuccessful in arguing that collective bargaining rights should follow the work –
   the general rule is that union rights follow the business


FAIRNESS IN EMPLOYMENT


HUMAN RIGHTS LEGISLATION

   The Ontario Human Rights Code does not protect workers as workers, it protects workers from being
    discriminated against on some aspects/characteristics that they possess. It doesn‟t protect workers as such
   The Employment Standards Act does protect workers as workers; but we don‟t normally consider this act as
    human rights legislation
Issue of Enforcement – Disposition of Human Rights Complaints, Employment (OHRC 2000-1)
s.34 – has power to refuse complaints for various reasons (15% of complaints refused at first stage)
s.33 – Can accept complaint – resolve and settle (56% resolved and settled)
s.36(2) – After investigation , refer to board or inquiry (4%) or dismiss after investigation (11%).
- 14% withdrawn from complainant – no evidence provided.
 Can be lengthy process – delay in processing complaints.

Blencoe 2000 (SCC)
 Blencoe, cabinet minister - Claiming abuse of process; must show delay caused harm to the individual
 In this case, court found that a case had not been made

There is a distinction drawn b/w 2 kinds of discrimination :
1) Direct discrimination (for example, a rule that says they don‟t hire blacks/ women. This would be direct
    discrimination. This has become less and less common).
2) Constructive/adverse impact discrimination (a rule that is facially neutral but has a disparate impact on a
    group protected by the act)
 Employers have a duty to accommodate individuals up to the point where it becomes an “undue hardship” –
    employers have a “duty of reasonable accommodation”
 Three-step test for all types of discrimination: The Meiorin test:

Duty to Accomodate

BC (PSERC) v. BCGSEU (the “Meiorin Test”) (1999, SCC)
(abolishes the distinction between direct and adverse effect discrimination and develops unified approach 3step test)
FACTS: gov‟t had minimum physical fitness standards for its forest fighters; femal fighter, Meiron, who had
performed past work satisfactorily failed to meet the aerobic standard after 4 attempts and was dismissed. Her union
brought a grievance on her behalf.
ISSUE: Whether aerobic standard was discrimination since most women have lower aerobic capacity than men?
Whether fitness test is a bona fide occupational requirement? (BFOR)
HELD: Appeal Allowed. The employer had the burden of showing that adopting a less stringent physical testing
standard would cause undue hardship. It did not do that on the facts of this case. The conventional approach of
categorizing discrimination as indirect or direct should be replaced by a unified approach.
RATIO: A three step test should be adopted for determining whether an employer has established on a
balance of probabilites that a prima facie discriminatory standard is a bona fide occupational requirement. The
BFOR must be:

         (1) Rationally connected to the performance of the job;

         (2) Adopted in honest and good faith as necessary to fulfilling the job; and

         (3) Reasonably necessary to the accomplishment of that work-related purpose. It must be demonstrated that
         it is impossible to accommodate individual employees sharing the characteristics of the clamant without
         imposing undue hardship.

Step 1: Must identify the general purpose of the impugned standard and determine whether it is rationally
connected to the performance of the job. Must demonstrate a rational connection between standard and objective.

Step 2: Subjective element–mut be an honest and good faith belief that it was necessary.
Step 3: Is the standard reasonably necessary to achieve the legitimate purpose for which you‟ve adopted?
Reasonably necessary requires accommodation to the point of Undue Hardship– “undue infers that some hardship is
acceptable, it is only undue hardship that satisfies this test. Among the relevant factors are the financial costs.

In the context of BC Forest Fire’s Case, the BC government failed at step 3. They failed to show that the standard
was reasonably necessary. 1) the medical evidence (needing the aerobic capacity) was unconvincing/inadequate
and 2) they didn‟t show that it would cause undue hardship and a less significant impact on women;

Adotpion of a uniform standard
 This is now the standard for both direct discrimination or constructive/adverse impact discrimination  the
   standard is now that it was reasonably necessary to achieve the legitimate purpose

There are some exclusions:
 Under s.24, there are provisions regarding special employment – they allow for discrimination to occur. For
    example, if you are employing people for personal/medical care grounds, religious groups, etc.
 Affirmative action provision – s.14 – allows employers to enact programs to relieve economic hardship. These
    plans can‟t be challenged if proven valid.

DRUG AND ALCOHOL TESTING

Canadian Human Rights Act (1985)
 Applies to all federal entities including businesses which fall under fed. Powers
 Section 25: definition of disability includes any previous or existing dependence on alcohol or drugs
 Sections 7, 8 and 10 allows fed. employee to file complaint of discrimination on basis of disability; so one who
   has been disciplined for testing positive in a drug test can complain

Entrop v. Imperial oil Ltd. 2000 Ont. C.A.
Re: Drug and Alcohol Testing – Discrimination on the basis of handicap–Unified approach accepted for Ontario -
No rational connection-drug testing is discriminatory - alcohol testing is a BFOR

FACTS: Imperial Oil established a comprehensive alcohol and drug testing policy. Entrop had alcohol
problem in 80's and worked in safety sensitive area. Policy had disclosure requirements. Entrop
was reassigned. The policy targets safety-sensitive employees. policy provides that there must
be no presence of drugs in the body or a blood alcohol level beyond .04, random urine tests
administered and breathalyser tests, any positive test results in immediate dismissal, mandatory
disclosure of past problem resulting in reassignment of which a 2 year rehabilitation programme
and 5 years of abstinence before reinstatement.

also all applicants would be tested after: near miss or accident, and pre-employment testing for
all employees. progressive discipline used for these employees.

ISSUE: Does Imperial‟s Oil testing programme discriminate on the ground of hanicap or whether they are bona fide
occupational requirements? (BFOR)

HELD: Drug testing is discriminatory; alcohol testing is BFOR

RATIO:
Substance abusers are handicapped and entitled to protection under the act. Although not all
 users are abusers Imperial Oil perceives them as such and so this falls under the act.
1) Drug and Alcohol testing is rationally connected to the performance of the job.
2) They were adopted in good faith. (safety reasons)
3) Reasonable and Necessary? Yes, but questionable whether undue hardship - drug testing may not be least
   intrusive… alcohol testing is not intrusive
    3rd step of the “meiorin” test is problematic. It will fail the third prong if it is too broad, arbitrary or strict.
        Drug testing cannot reasonably measure impairment with any type of accuracy. The sanction of immediate
        termination is too severe and not sufficiently sensitive to the individual. There is no accommodation to the
        point of undue hardship. However, alcohol testing is reasonable as it is accurate. However, there is still a
        need to accommodate.

 To maintain random alcohol testing as a BFOR accommodation should include sanctions less
severe than dismissal.

 Drug testing after near accidents or for cause is permissible if it forms part of a larger
assessment of drug use. Disclosure of current/past substance abuse and Reassignment fail the third step b/c no limit
on past disclosure. The cut off point should be around 5 years. Automatic reassignment is not
appropriate. Two years and rehabilitation and 5 years of abstinence is not reasonable to accommodate for past
problems.

Random alcohol testing (not drug testing) for employees in saftey-sensitive positions is a BFOR provided that the
sanction for an employee testing positive is tailored to the employee‟s circumstances. The provisions for mandatory
disclosure, reinstatement and reassignement cannot be justified as BFORs

Racial Discrimination:

- about 35% of all employment discrimination claims are for race and colour, ethnic origin, ancestry and place of
origin.
- appears that these cases are dismissed more and have lower settlement rates than comparing them to general
discrimination.

Sexual Harassment:

- History traces back to the earliest days of factories (late 19 th century)
- It was only really in the 1970s did the problem get named and identified and a more general legal response.

Definitional Issues:
What is encompassed by the term?  There are 2 kinds of sexual harassment:
              1) quid pro quo
              2) poisoned environment : encompasses a much broader range of bhvrs.
as a matter of law, both kinds have been captured by legislation

Quid pro quo – s.7(3) of Human Rights Code:
A person who is a superior in the hierarchy of the work place, engages in sexual solicitation or makes an
advancement at work contingent on a threat of reprise of punishment if the woman doesn‟t comply with the
employer‟s demands.
s.7(2) : more general prohibition in the workplace b/c of sex.
General definition of harassment in s.10 – vexatious comment or conduct that is known to be unwanted…
s.10: deals not only with harassment by a superior to a subordinate, but also harassment by co-workers



The group of women most targeted for sexual harassment are young women.
Results of surveys: (YorkU) 1992 – 2000 working women, over a lifetime, 77% of the women had some
experience of sexual harassment at work. When broken down into the categories, in poisoned environment they
divided it into sub-categories, gender harassment (i.e. insulting jokes about women or display of materials), non-
verbal, unwanted sexual attention (leaning, getting too close, staring, attempted use of forces, etc.), verbal unwanted
sexual attention (remarks about you individually, request for dates, etc.), sexual coercion (quid pro quo) – only 3%
reported this last category (threat of job at stake)

Legal Remedies
In Ontario, there are specific provisions in the Human Rights Code that cover sexual harassment. In the absence of
provisions in other jurisdictions, the courts, after some resistance, have come to the view that sexual harassment is a
form of sex discrimination

Robichaud v. R.
FACTS: This case involved sexual harassment by a supervisor.
ISSUE: They wanted to make the employer a party to hold them liable.
DECISION: There was a question of statutory interpretation before the court and they adopted the notion that
Human Rights codes should be read purposively. In that kind of a spirit, they read it as allowing the employer to be
held vicariously liable. The actions taken by the employer to prevent the problem would be taken into account. It is
an important case in expanding the scope of the complaint and trying to get more systemic change. Employers
know if they do nothing and there is a complaint, their behaviour will be considered in determining a remedy.
remedies --- employer is always vicariously liable ; even if employer exercised due diligence to prevent sexual
harassment but issue of employer’s conduct will be taken into account in looking at the remedy ; following
this case, companies have responded by establishing in house policies and complaint procedures

N: Point is not to punish employer but to ensure appropriate measures are taken to deal with issue so it does not
occur in future.


PAY AND EMPLOYMENT EQUITY:

   Pay equity and other equal pay laws address gendered wage gap
   Employment equity addresses market segregation as it affects women, visible minorities, first nations and
    persons with disabilities

Pay Equity
 Gendered wage gap is slowly narrowing:
 1880s – 50%; 1967 – 58%; 1997 – 72.5%
 Gap decreases with age and education
 Single women make more than married women
 Unionized women have smaller wage gap than non-unionized women.

Explanations of Gendered Wage Gap
 for full-time workers, women tend to make 72% of what men make
 women tend to be segregated into specific industries and jobs that are characterized by low pay, low status, and
    minimal prospects for advancement
 the gap between the genders is only narrowing because men‟s wages have been stagnant
 various explanations have been offered to explain the differences
 the wage gap has been characterized as a social problem


There is no single explanation to the gendered wage gap. It must be looked at holistically and the various elements
and how they interact
1) Neoclassical model – since the supply side of the market is the problem, the solution is to create programs to
    help women increase their human capital
     Supply side explanation (neoclassical model of wages) – it is an auction. Take individuals offering their
        services and the person who has the appropriate skills gets hired – completely gender neutral. What
        explains the difference then is the human capital. Men’s services are more valuable!
     Why are men‟s wages more valuable? – they invest more in their human capital than women. They get
        more training, have more commitment to their jobs, have more ambition, etc. The solution would revolve
        around increasing women‟s capital.

2) Modified neo-classical – acknowledges that there may be some discrimination between men and women with
   equal human capital. Managerial problem and not one that runs fundamentally or deeply.

3)   Labour Market Segmentation - Labour markets are actually highly segmented. There is a primary and a
     secondary and there is a huge divide b/w the markets and people cannot freely cross b/w them. They are pushed
     into one of the labour markets. Women are disproportionately found in the second labour market.
     - This shows the industry you are in has an effect on the level of wages you are paid.

4) Feminist Explanation – Explores systematic reasons for women‟s relegation to secondary labour markets and
   for the under-valuation of women‟s human capital. Care-giving responsibility they are required to assume in
   most families which have negative impact on wage-earning capacity.

5) Institutional Analysis – institutions have their own means of valuing work and this will determine the wage
    structure

Legislative Responses to the Gap:

Equal Pay for Equal Work Approach:
 dates back to end of ww2
 eg s32(1) ESA - employer cannot differentiate between male and female employees by paying females less
   than males for substantially same kind of work in same establishment or for work requiring same kind of skills,
   except under:
   (a)       a seniority system
   (b)       a merit system
   (c)       a system measuring earnings by quantity or quality of production
   (d)       differential based on any factor other than sex
 Courts have held that “substantially same kind of work” doesn‟t have to be exact same job description
 This doesn‟t deal with the phenomenon where people are in different jobs that are valued very differently.;
   problems also that women don‟t work the same job as men; As a result of the limits of the approach, there was
   a push to adopt a different standard:

Equal Pay for Work of Equal Value:
This principle is not a new one. It was adopted by the Constitution of the ILO in 1919, a convention of equal pay
for work of equal value was issued in 1951 and was ratified by Canada in 1972. It was a result of this decision to
ratify that the Canadian Human Rights Act was amended in the federal government to implement the principle of
equal pay for work of equal value.

2 models of equal pay for work of equal value schemes:


A) Complaint Based System: eg. is in Canadian Human Rights Act p. 393
Canada Human Rights Act
 s.11(1) CHRA - discriminatory for employer to establish differences in wages betw men and women employed
   in the same establishment who are performing work of equal value
 s11 (2)CHRA - value of work means the skill, effort and responsibility required in performance of work and
   conditions under which work is performed
 problem is that if your workforce is mainly women anyway, no men to compare the job to

System requires employer to engage in following process:
1. conduct gender neutral evaluation of work performed by employees see if female work is undervalued
    compared to male work
2. if evaluation shows that men are paid more for equal or lesser value work than women, law requires to raise the
    wages of women so that they are equal to that of men’s wages of equal value
 system under the HRA only applies to federal public sector and federally regulated employers (eg. Bell Canada)

Bell Canada Case (1998) - another example of delay 13 years, fed-regulated company, so CHRA applied
Facts:      Pay equity complaint involving telephone operators – large no. of female operators.
Result:     When Bell realized they were going to lose the litigation, they fired many women operators and Ked
           out the work
         Cdn Human Rights Commission (2001) – called on Fed govt to issue proactive legislation.

B) Proactive Scheme (Provincial)
 the Ontario scheme is based on a proactive approach – employers are required to review their hiring practices
     and make changes even if complaints are not made
 the Ontario Pay Equity Act applies to both private and public sector employers, although private sector
     employers with fewer than 10 employees are excluded
 employers are required to define job classes within the firm and compare pay rates of male and female job
     classes
Steps in Doing Pay Equity:
1) Create pay equity w/i an “establishment” - “all of employees of an employer in a geographic division” (might be
problematic bc a work might be fragmented in different locations)
2) Establish job classes - “job classes” - “positions in establishment that have similar duties and responsibilities and
require similar qualifications…similar salary”
3) Establish gender composition of the job classes
compare female w/ male job classes
           female job classes are those where 60% or more of the members are female
           male job classes are those where 70% or more of the members are male
 if an employee does not fall into one of these classes, they are out of the pay equity system entirely
4)Calculate pay rate for each of the job classes
 the “job rate” means the highest rate of compensation for a job class
5) Calculate job value using gender-neutral job evaluation system- To value work, look at skill, effort and
responsibility normally required in performance of work and conditions under which is normally performed (s. 5)
6) Pay equity is achieved when the job rate for the female job class is at least equal to the job rate for a male class
in the same establishment where the work performed is of equal or comparable value
 if there is a difference between job classes, the female job class is entitled to the same rate of pay as the male
     job class
 pay equity cannot be achieved by reducing the wages of male job classes
 differences between male and female job classes are said to be permissible – e.g. if based on a formal non-
     discriminatory seniority system or a skills shortage
 all public sector and large private sector employers must create a pay equity plan
 a separate pay equity plan is required for each bargaining unit
   Where no union present, no requirement to have worker participation in preparation of pay equity plan
   Where there is a union present, plan must be negotiated between union and Employer
   pay equity plans are supposed to be self-managed
   job evaluation systems are the most contentious issue
   the system is supposed to be gender-neutral
   proportional value compares male and female job classes in the same establishment by using a graph to plot job
    classes and wage lines
   the proxy method is used when there are no male job comparators within the organization
   it allows outside comparators to be used if they are within the same geographic location
   employers must be prepared to justify pay differences and prove that they are not the result of gender bias
   employers will not be required to make pay equity adjustments that exceed 1% of the annual payroll for the
    previous year
   private sector employers with between 10 and 100 employees are not required to prepare a detailed pay equity
    plan but are still expected to make all necessary wage adjustments

Criticisms of Pay Equity
 one weakness is the vagueness of the Ontario program – much of the important issues are left up to
     interpretations of the Pay Equity Tribunal
 funding for the review of Pay Equity was slashed by the Ontario government
 the system is very complex
 the question of who the employer is often arises (Barrie Public Library Board; Haldimand-Norfolk)
 the availability of job evaluation systems is a problem – most are generated by management consultants
 another issue is who actually pays for achieving pay equity (e.g. workers, employers, customers, etc.)
 nothing prevents an employer from “red-circling” a job (lowering the rate for future incumbents yet maintaining
     it for incumbents)
 the self-managed process only works within an organized setting – lacks oversight in non-union settings.

Reforms of Pay Equity
 In 1993, NDP statute introduced 2 new methods of pay equity
1) Proportional value method applies to public and large private sector employers w/100/+ employees  construct
a male wage line (graph) and a female wage line so that you don‟t have to find the job class with the same value,
you just bring female jobs up to male job trend line
2) Proxy evaluation  Could only be used in public sector. Allowed you to look outside establishment and look at
male job comparators in other establishments.

Evaluating the Pay Equity Scheme
 Public servants have fared the best; recd 15% pay raise for 30,000 jobs
 Private sectors have benefited less; less than 1% increase in salary to achieve pay equity
TODAY: modern firms have come into existence – where are we?  There is still a general obligation on
employers to have equal pay for work of equal value, but there is no scheme requiring new companies to develop a
plan. Therefore, it appears that we have moved towards the federal complaint based system rather than the proactive
method used provincially.

Work-Family Policy

   ESA address protecting workers during leaves of absence (pregnancy etc)

Leave relating to Family Issues: PART 14 Leaves of Absence
   Pregnancy - Part 14 of ESA 2000: s46, 47 - pregnancy leave if employed for 13 weeks prior to the leave, leave
    may begin max 17 weeks before pregnancy, linked to employment insurance standards (certain guarantee
    about reinstatement when return) (employer does not pay but rather employment insurance standards)

   Parental Leave : s.48,49 - all parents entitled to within 1st yr of child coming into the home (birth or adoption),
    not just to traditional families but broad defn of spouse; includes same sex partner; allows parent to take
    additional 35-37 weeks away from work (no reqt for employer to pay for this, but rather parental benefits
    under employment insurance acts etc) (in current act 18 weeks, new ESA is 35 weeks - Feds pay for the
    extended benefit)

   Emergency Leave in new ESA : s.50 - employees with workplaces of 50 employees or more allowed to claim
    this; provides that employees allowed to take up to 10 days per year of unpaid leave to deal w personal
    injuries, death etc… (flexibility to take some time off when emergencies, although it is unpaid); nothing like
    this in previous provisions.

   Rights During Leave – s.51-53 – Continuity of benefit plans; accumulation of seniority; right to reinstatement

Employment Equity

   Employment equity is another way of trying to redress discrimination or unfair treatment in the labour market.
    It tries to overcome labour market segregation and overcome segregation within firms of jobs.
 Employment equity exists federally. We had it for 2 years in Ontario (NDP government). What it essentially
    does is identifies 4 designated groups who seem to be particularly badly off: women, visible minorities,
    people with disabilities, and aboriginal people
(Fed emp equity in the federal sector; but don’t have employment equity in Ontario provincial sector)

   Employment equity applies to federally regulated employers and Federal Contractor Compliance Program – any
    institution that does business with the government is required to have an employment equity plan to qualify to
    have that relationship with the government.
   Only employers who fall under the contract compliance aspect of the Federal Employment Equity Act are
    required to keep workplace data regarding the representation of equity groups, and to make efforts to ride their
    establishments of discriminatory employment practices.

What it requires of employers is:
    employer must conduct a survey of its workforce to identify the representation of the 4 targeted groups in
         its workforce
    must compare the representation of those groups with some relevant outside comparator (within the
         relevant labour force)
    then, employers must conduct a survey of their employment systems and try to identify any barriers that
         may be preventing these members of the groups from gaining employment within that workplace
    then you prepare an employment equity plan identifying the barriers and steps you will take to remove
         them, steps that will be taken to correct the inequities and identify numerical goals and timetables for
         achieving them. Where there are unions, they must participate in the preparation of the plan
    overall, in Ontario, it had zero impact – wasn‟t in place long enough (was repealed)


FAIRNESS IN COLLECTIVE BARGAINING SYSTEM

   union represents an entire bargaining unit if gets majority of votes - tf rights of the few who didn‟t vote are
    disregarded; however, rights to protect the bargaining unit in the collective agreement
1.   Union policies affect who can participate in the labour market (eg union security clauses) s51(1)LRA
2.   When certified, union becomes exclusive bargaining unit, represents all workers in unit, regardless of whether
     they are members of the union S45 OLRA
3.   individuals prohibited from bargaining directly with employer
4.   sometimes have requirements for who must actually join the union:
     i. closed shop: must be member of union in order to get hired
     ii. union shop: don‟t have to be member of union to get hired, but once are hired, must join union and
          maintain membership in the union
     iii. Rand formula s45 OLRA: employer is required to deduct union dues from all members of the bargaining
          unit  don‟t have to become member of union to keep your job, but have to pay union dues (don‟t want
          non-union members to get benefit from being in the bargaining unit without paying)
5.   no discrimination in the trade union s6 OHRC
6.   no discrimination in the collective agreement, CBA must comply with OHRC and Charter - s54 OLRA
7.   no certification if discrimination by union - s15 OLRA

Barbisen Case
A union was seeking to insert a provision into a collective agreement to restrict people of Italian origin from
becoming employees. The employer said this was an impermissible type of provision and if you insist on it it will
be bad faith bargaining.

Ontario Hydro (1978 – OLRB)
FACTS: An employee of Ontario Hydro was forced to retire at age 70 pursuant to a management policy on the
subject. The employee did not want to retire. He was still in excellent health and was able to perform his
employment duties. The matter went to arbitration. It was argued that the employer had no authority under the
collective agreement to force personnel to retire. One clause in the agreement stated that there could be no
discharge or discipline without just cause. The griever argued that the employer had to show just cause for the
discharge. He sought damages and reinstatement.
ISSUE: Is there a restriction on management rights to compel employees to retire at age 70?
HELD: No. Application Dismissed. It was found not to be unfair or unreasonable or discriminatory
RATIO:
Is there anything in the agreement to limit manager‟s rights?
1. Is there an Express Limitation - specific language in agreement that limits manager‟s rights ? Such as not
     having mandatory retirement policy etc…
      although specific prohibition against termination w/o just cause, too narrow to deal w mandatory
          retirement, therefore no limit on manager‟s right to mandatory retirement policies by specific language

2.   Is there an Implied limitation on manager‟s rights (to implement mandatory retirement) ?
      by implication, manager rights restricted by general duty to act fairly: cannot act arbitrary, discriminatory
          or unreasonable exercise of power
    Reasonableness: relates to prevailing standards of retirement (age 65 and this policy is 70, tf reas)
    Discrimination: policy apply equally to all 70 yr olds? Are all 70 forced to retire? Yes, tf no discrimination.
    Arbitrariness: was there adequate notice of the policy –yes

3.   Statutory Restriction on exercise of management rights? Such as HR or ESA against man ret?
      Ont HR code : no violation at age 70 (age protected until 65)
      Charter argument - does not specify which age group it protects, so helpful for 70yrolds - Cases at SCC
         said it was discrimination but upper ages (65-70), mandatory retirement are demonstrably justified.

NOTE: McKinney case SCC has upheld rt of employers to have mandatory employment at age 65! 
discrimination that is demonstrably justified ; also said that university is not subject to Charter bc govt control is
only financial and not over operations of the university
Steinberg’s Limited (1971, OLRB)
Re: Duelling Unions - Challenge for Certification - Constitution - Creed is Religious Belief - Unions that
discriminate shall not be certified
FACTS: Union‟s constitution restricted membership so that members of a communist, fascist or similar political
organization could not join. Another competing union used this term of the constitution to challenge that union‟s
application for certification on the basis that the union discriminated on the basis of creed.
ISSUE: How should “creed” be defined?
DECISION: The court said creed should be given a narrow meaning relating to religious beliefs and not political
beliefs. Therefore, the union can be certified – no discrimination on a prohibited ground.

What protections are there for trade union democracy – Are unions free to expel members because they have
different political beliefs?

2 kinds of protections developed: (internal trade union democracy)

1) Orenda Grievance Arbitration
 dealt with this scenario
The union expelled a person but the employer failed to terminate them. The union brought a grievance.      What
must a union provide before the employer must act on discharge? – must provide employer with the particulars –
why the employee has lost their membership, under what provisions of the trade union constitution/rules that action
has been taken, indicating why the expulsion had occurred. This guarantees some regularity. This doesn‟t deal with
whether the employee has a case against union for expelling them (

2) Legislative Protection – s.51(2) – No trade union that is party to a CBA containing a provision in clause (1)(a)
shall require the employer to discharge an employee because, (a-g – pg 439)

Where People are included against their will

s.52 – Conscientious Objection, OLRA
- limits conscientious objection to joining trade and having to pay dues based on religious conviction or belief
- LRB have been restrictive of interpretation and application of section
- Can only raise objection if employed at time unionization occurs.
- That money is donated to a charitable organization – they really just don‟t want you to free ride and still get the
representation.

- Another area which challenged this is under the Charter – freedom of association rights. It is argued that if you
have this right, this should be read to also allow the freedom not to associate.
- This was the argument that arose in Lavigne case.

Lavigne v. OPSEU (1991, SCC)
(Re: Compulsory Union Dues - Use of Funds to Support Certain Causes - Charter Challenge)
FACTS: Lavigne was specifically opposed to the fact that some of the union dues were being used not just for
collective bargaining but also for broader political objectives.
ISSUE: Did Lavigne have a right not to associate?
HELD: Freedom not to associate: Yes: 3; No:
RATIO: While freedom of association includes the freedom not to be compelled to associate, the mere payment of
dues to an association does not bring a person into association with others.
 To the extent that there was a violation, the use of dues for other purposes was demonstrably justified under s.
     1. – proportions that were going to political parties complex and difficult to figure out. Union dues
     constitutionally acceptable for all purposes - the judges in this case just got their in different ways.
R. v. Advance Cutting and Coring, 2001 SCC (CHECK ON QUICK LAW!!!)
FACTS: Qualified construction workers has to approve which of the 5 unions they support. You are deemed to be
member of union you indicate your support. Must join one of these unions and pay dues. Form of compulsory
union membership created by statute.
Lebel (Gonthier & Arbour) – “An individual may be forced to associate so long as he or she is not stripped of the
right to dissociate from the ideology of the group, and not deprived of his or her liberty interests guaranteed by the
Charter.”
Competing Goals: Refusal of some to join group weakens goals of majority. Does requirement compelling people
to be member of union violate negative freedom of association? NO
- Will not deprive of liberty interests. You are not forced to adopt views or opinions of union. Unions belong to
participating democratic society – people have to be members and does not associate you necessarily with views of
the union.
Bastarach (McLachlin, Major and Binnie) – “In my view, the interpretation of ideological conformity must be
broader and take place in context. In this case, this context would take into account the true nature of unions as
participatory bodies holding political and economic roles in society which, in turn translates into the existence of
ideological positions. To mandate that an individual adhere to such a union is ideological conformity.
Iacobucci – Does the compelled association serve the common good or further the collective social welfare? NO
Does the compelled association impair a liberty interest? YES

VOTE: 5 – 3 against compulsory membership in unions.
Is scheme saved under s.1? Yes 4; No 4. Final Result: Scheme upheld 5-4.
EMPLOYER OBLIGATIONS

DUTY TO PAY

   Essence of common law contract of employment is provision of services for remuneration
   payment required where contract of employment exists (oral, written)
   where terms are not explicit, terms of the contract will be implied
   courts have not automatically found a duty to pay

Duty to Pay Remuneration

Reeve and Reeve
FACTS: An uncle was managing his nephew‟s farm. He got room and board and a clothing allowance.
ISSUE: Was the uncle also entitled to wages? – the nephew disputed this.
DECISION: You cannot say you are entitled to remuneration simply on the basis that services were rendered as
they aren’t always employment relationships. There must be a bargain. Here there was a mutual understanding that
remuneration would be paid.

Spraig and White v. Nickerson (older Ontario case)
Daughter takes care of father on farm w expectation of inheritance; when dies, leaves ppty to son; crt says she is
NOT entitled to wages for taking care of father; crt disgusted by this, undermines whole notion of family; typical
role that daughter should perform; reliance on customs and cultures

Stylk v. Myrick
FACTS: A voyage was taken where the sailors agreed to a fixed sum to be paid upon completion. When they
completed the first leg of the journey, some of the sailors deserted leaving the ship short staffed. To induce the
remaining sailors to stay on and do the extra work, the master promised they would be paid the wages of the
deserting sailors divided amongst the remaining sailors. When they arrived back in England, the captain refused to
pay and the sailors sue.
HOLDING: The court holds there was no obligation to pay the additional wages as there was no fresh
consideration. The sailors were already under an obligation to perform the work. In effect, the promise by the
captain to pay them more money was a gratuitous promise.

Quantum Meruit – on principles of unjust enrichment – be unjust to allow person who received benefit of those
services not to pay – court may step in absent K and require party to pay.

Minimum Wages
 Common law – No common law that would regulate the amount of wages that can be established in a K of
   employment. Must look to statutory mechanisms

Context Regarding Problem of Low Wages:
Growth of wage polarization in Canada: 1967: high wage: 36.9%; med wage: 26.8%; low wage; 36.4%
                                       1986: high wage: 39.4%; med wage: 21.5%; low wage 39.1%

Rising labour market poverty:
- 3.6% of labour force paid minimum wage (64% of whom are women; 60% adults)
- 13% paid less than $8.00 an hour (60% women)
- 25% paid less than $9.25 an hour (or less than 2/3 the median wage)

- Growth in low wage employment = growth in labour market economy
- Poverty extremely high with single female family
- Concern over existence of this kind of low wage employment

Policy Instruments in Dealing with Low Wages:
Employment Standards Act (Part IX)
- Most min. wage dealt with in regulation
- Not everyone is entitled to min. wages - exclusions
- Specific exclusions (s.7 – ESA reg 285)
- Not a single min. wage
- No link between cost of living adjustments or link to industrial wage – just left to govt of the day

Issue of Enforcement of a Minimum Wage:
- Generally low enforcement
- Complaints under employment standards:
- Only made by people who have lost their job
- People working unlikely to come forward
- No proactive enforcement by government of min wage laws.

Dangers About Raising Minimum Wages:
- May cause unemployment – will get rid of some of the work force if min wage is raised.
- Economists/researchers – actually believe that marginal increases have very small knock off effects
- May actually have positive effects on economy – cause employers to become more efficient
- Min wages never intended to deal with whole problem of low wage work

How do governments determine what the minimum wage should be? Set by regulation:

– This is done by politics. This reflects what the government of the day decides they want to do. As a result, in our
day and age, governments have not been likely to increase minimum wages. Over time, the actual value has been
decreasing.

           ONTARIO  minimum wage is $6.85 an hour. If an individual works 40 hours a week, they make $274 a
           week and for a year it is only about $14,000. This leaves you, based on the low income cut offs for
           December 1999, about $17,000, so you would be below the low income cut off if only making minimum
           wage.
            The low income cut off for single women is $29,000 – you are therefore really far below it – living in
           poverty

- Minimum wages aren‟t pegged to ensure that people making them are above the poverty line. How many people
work for the minimum wage – in the mid 1980s it was estimated at about 10% of the Ontario population. Since
there has been income polarization since then, it is more likely than not that this figure has probably increased.

- Many people aren‟t covered by minimum wage laws – several groups are exempted  for example, s.3 of Ontario
regulation 325 exempts professionals listed including students training to become professionals, etc.
- Also, there are probably some portion of the population being paid illegally low wages and that don‟t get the
benefit of the minimum that they are entitled to.
Why would this be? Why would someone employed for less than minimum wage not make a claim?

Duty to Pay Remuneration in Specific Circumstances

Illness:

When an employee becomes ill, is the employee entitled to be paid?  Where you have an individual contract for
employment, the parties can agree to just about anything. Where there are “standard” jobs, often there are set
procedures to deal with sickness – you get a certain amount of sick days a month or year. With better jobs there are
also negotiated terms for disability benefits. In “bad” jobs and non-standard employment – shorter term
relationships with employers, these kinds of benefits are not expressly provided for in the contract of employment.

At common law, if the contract is silent, what is a court likely to imply as being the common understanding b/w the
parties. We get a sense of the older common law in:

Dartmouth Ferry Commissioners v. Marks
FACTS: A ship captain was hired on a monthly basis with a provision that either party could terminate the contract
by giving a month‟s notice. The employee became ill in December and died in July having never come back to
work. His wife sued and said she was entitled to wages owing in period of sickness up until date of death.
ISSUE: Is the widow entitled to wages for the period of sickness of her husband?
DECISION: The jury found that the illness was a temporary illness and therefore the widow was able to recover.
The jury wanted to say it was a temporary illness because it made a difference b/c they wanted to come to a finding
that would allow the widow to recover.
Temporary vs. Permanent Illness:
Permanent  allowed employer to put the contract to an end on the basis that it would become impossible for the
employee to perform his duties thereby relieving duty of employer to pay wages (terminates the employment
contract)
Temporary  judgement of Davies. One may say that even if it is a temporary interest the obligation to pay is
suspended until the employee recovers. Davies rejects this on the principle that it is simply a matter of common
humanity to recover wages during tesmporary illness.
N: Implied right to be paid while off sick. Generous approach by common law for those temporary off work and
Sick.
N: Is Dartmouth good law?
- K‟s of entirety don‟t usually arise. Circumstances where one might raise Dartmouth must be similar one where
     very similar facts. Difficult today to convince common law courts using Dartmouth that there is a
     common law right to sick leave and sick pay.
- People likely dependent on statutory entitlements. OR collective bargaining agreements have sick leave or pay
     worked into them.

   Permanent / temporary illness does not frustrate contract, since employed to work to best of ability!
   Note: Can terminate contract of employment by frustration or by reasonable notice or without notice for cause -
    but ILLNESS IS NOT CAUSE!!!

Statutory Provisions:
   no entitlement to sick leave (paid or unpaid) under current ESA (as above)
   matter is decided at COMMON LAW and individual bargaining
   employer may terminate if absent due to illness (but will have to pay b/c illness is not cause)
   ESA - 2000 - emergency leave provisions in larger work places (nothing before this)
   Canada Labour Code - Unpaid sick leave provisions – Employer can‟t lay off employee if:
    a. employee at least 3 consec months of employment
    b. absence not more than 12 weeks
    c. doctor‟s note provided within 15 days of return
   TEACHERS: have statutory entitlement to sick pay.
   If cause of disability is work related, entitled to sick leave and provisions that protect your job.
   If not work related, most employees can claim sickness pay under Employment Insurance scheme
    i. worked for at least past 52 wks
    ii. pays to max of 15 wks
    iii. but no guarantee of re-employment  but one can look to Human Rights Code for discrimination on illness
         – but, defn of disability does not include usually transitory illness such as flu. (Ouimette v Lily Cups)

REGULATION OF WORK HOURS

-   Decline in the standard work week (35-40hrs)
-   Trends: In 1976, 70% of workforce working between 35-40 hours a week; in 1993, only 60% doing so.
-   Employers wanting greater flexibility to adjust hours of work depending on demands of work
-   Employees want flexibility relating to balance of work obligations and home obligations
What the labour market looks like in terms of distribution of hours:

- The largest chunk of people have moved into short hours. In 1997, nearly 25% of the workforce was working less
than 35 hours a week. What this means is that there has been an enormous growth in part time work. There are now
a small number of people working longer hours and a large number of people working shorter hours  polarization
of the labour force. For some people this is voluntary, but for other people they just can‟t find full time work and
are forced to work part time.

Overtime pay  By & large, people are not getting more money for overtime hours; 8% work for paid overtime
and 10% worked for unpaid overtime; it was estimated that about 500,000 people (Canadians) were working
overtime without getting any form of premium or overtime pay.

Trends:
 private sector more likely to get paid overtime than in the public sector
 paid overtime within the private sector mainly in blue collar jobs
 but majority of workers say working overtime voluntarily

AT COMMON LAW, no limit on hours of work, freedom of contract prevailed:
 Whatever people agree to is their business. In the absence of a negotiated limit, there is no requirement.
 The absence of common law regulation has provoked struggles as to whether or not there should be any relief.
 B/c of the no common law regulations, saw workers organizing union support or lobbying for statutory
   regulation

Statutory Limitations – Employment Standards Act:
 Under the old Employment Standards Act in Part 4 defines maximum hours of work – a working day should not
     exceed 8 hours in a day and 48 hours in a week.
 s.17 : subject to a variety of exceptions, the working day should not exceed 8 hours per day and 48 hours per
     week. Can be extended to 60 hours with consent.
Exceptions:
 s18 – empee to get at least 11 hours free each day, 11 hours of rest (so 13 hours could establish a workday)
 basically, 13 hours a day, but within a 48 hour workweek
 (no 3rd party permission)

    beyond 48 hours: s17(2)  may permit to work in excess if employee agrees to work those hours and the
     employee will not work more than 60 hours or other than what is prescribed  so can go up to 60 hours a
     week as long as the employee agrees.
    s19 other exceptions: accidents in workplace, emergencies, could go past 8 hrs
    s20(1) permits for excessive hours  employers in addition to s17 (8hrs) or s18 (more than 8 hrs day), had to
     get permit from director of employment standards branch, allowing for up to 100 hours a year
    s20(3)Permit issued did not req employees to work more than 48 hrs week, employees had right to refuse to
     work those hours (permit does not obligate employee)
    s22 Eating periods  ½ hour eating period every five hours, or upon permission of director

Overtime Pay:

    22. (1) An employer shall pay an employee overtime pay of at least one and one-half times his or her regular
    rate for each hour of work in excess of 44 hours in each week or, if another threshold is prescribed, that
    prescribed threshold.

Averaging agreements
     (2) Subject to the regulations, if the employee and the employer agree to do so, the employee's hours of work
    may be averaged over a period of not more than four weeks for the purpose of determining the employee's
    entitlement, if any, to overtime pay.

Collective Bargaining: What have union workers done to deal with concerns about hours of work:

s.7 of ESA: if union agreed to hours beyond 48, would apply each employee in the union regardless of whether the
employee is a member of the bargaining unit
 Provisions
 encouraging workers to resist longer hours
 Have dealt with all issues above; agreements usually provide working days shorter than the ESA maximum
 There have also been agreements on premium pay; usually higher than the rate set by the ESA.
 Because overtime becomes attractive, agreements mark how hours will be distributed among workers, as well
     as the right to refuse overtime.
 Historically, unions worked to change the standard working week; many unions wanted 40 hours/week ;
 to negotiate a reduced working week and for overtime pay to kick in sooner
 also concenred about rights to option to refuse overtime work;
 however, b/c additional hours were considered desireable (premimum rates), many collective agreements had
     seniority provisions as to how to divide the overtime work

THE DUTY TO PROVIDE WORK

The basic question is: Whether the employer can suspend the contract of employment temporarily by laying off
workers and not paying them?

Common Law:
At common law, there is no obligation for employers to provide work during the duration of the contract. There are
certain circumstances where there may be a duty to provide work. In general though, there is no duty to provide
work but there is concern about the question as to whether there is a duty to continue to pay even though no
work is being provided?

Collier 1940: Rule: in general, there is no duty to provide work but there is a duty to continue to pay even
though no work is being provided.

Worker can be terminated:
1) Frustration of K
2) Periodic hiring (K of a year and K ends)
3) Employee breach of K (just cause)
4) Notice (reasonable notice from an indefinite hiring – 2 weeks notice and can‟t avoid a paid notice)

Temporary Suspension of Employment Contract:

Q: What if the employer doesn‟t want to permanently terminate an employee but wants rather to suspend the
contract temporarily?


Devonald v. Rosser & Sons (pg 467)
FACTS: The employee was paid on the basis of piece work [must give opportunity to work]. There was a written
contract of employment with some unusual features  can only be terminated by either party by giving 28 days of
notice, on the first of the month (month to month contract of employment that is automatically renewed for a further
month unless the appropriate notice is given). This type of contract is designed to protect the employee and the
employer from having skilled workers suddenly get up and go.

The employer decided on July 20 that b/c business was slow to suspend the contract of employment and lay off the
employee. On the first of the month (August 1), they gave them the 28 days notice.
ISSUE: There are 2 time periods to look at: July 20-31 and August 1-28  Does the employer have the right to
unilaterally suspend the contract of employment and not provide work or pay?

ANALYSIS:
              1) Look to terms of employment K that speaks to this issue
              2) IN the absence of such, look to Implied terms of K

Implied Terms of K of Employment:
Court looks at Moorcock Case: Business efficacy test that they have relied upon for implied terms of K. In looking
at the K you view it from the presumed intentions of the parties. Claims that there is no distinction b/w piece and
wages per time. The employer bears the risk of layoffs under this kind of contract and cannot escape the obligation
to pay unless the risk of a shutdown is something that the worker and the employer both have control over and share.
A custom may create an exception to the general rule, but only if the custom is notorious, certain, and reasonable.

TJ HELD: Employer is not under obligation to provide work everyday. Has to be mutuality between parties.
Employer cannot unilaterally suspend K of employment and not pay. July 20 – Aug 1 = must pay.

3 Limitations on restricting unilateral suspending contract w/o pay:
1) Paid by Piece: Makes no difference
2) Break down of machinery caused shortage of work – employer should plan for ups and downs in business cycle.
    Employer shouldn‟t have to suffer, yet unforseeable events might be cause where no duty to pay. Break down
    of machinery is to be mutually shared by employee.
     If matter unforeseeable (machinery brkdwn), risk is shared, tf no duty to pay if can‟t give work
     If matter foreseeable (not in control of pary), risks not shared and is duty to pay if no work
3) Custom (Notion of customary practice) - Common law applies generally, but if custom is to suspend without
    pay, then crts respect that. Person that is claiming customary practice must prove:
         a) Custom is notorious in trade
         b) Custom was certain
         c) Custom was reasonable (look at bigger picture)
    It would be unreasonable to suspend employees without wages at a moment’s notice. Employers cannot
    unilaterally lay off employees without having to pay them.

☼ In light of this decision, what is the common law in Canada. Can employers in Canada lay workers off
    temporarily and not pay them wages?
 Most people would assume that workers are laid off regularly and not paid wages by their employers. But, there
seems to be an intra-class distinction.

Stolze v. Addario (1997 – Ont CoA)
FACTS: A senior employee received a letter that purported to be a temporary lay-off notice. The employee,
Stolze, claimed he had been terminated and that he was entitled to termination and severance pay (breach of K so
should be treated as constructive dismissal). In his employment standards case, the ruling was that he had been
temporarily laid off and not entitled to claim termination and severance pay. This was appealed.
ISSUE: Whether the employer had a right to put the worker on temporary lay-off or suspension of contract.
DECISION: This type of case depends upon whether something is a temporary or permanent termination (or lay
off). Here they took the view that it was permanent. He was constructively dismissed.
RATIO: In the absence of established practice that an employer has the right under the contract to temporarily lay-
off employees, the attempt by the employer to do so constitutes a fundamental repudiation of the employment
contract itself. Unless there is an implied right established through practice, there is no right to temporarily lay-off.
Temporary lay off constitutes a constructive termination; so at common law, an employee can
treat such temp. lay off as termination and claim associated benefits
Summary:

   Although there is no common law duty to provide work, employers do not have the right to unilaterally,
    temporarily suspend work
   So why don‟t more people claim constructive termination? The benefits of termination pay and finding another
    job do not outweigh the benefit of having their job to come back to in the future – so they accept temporary
    termination
   So it is not that there is no right, rather in a social context, people choose not to exercise such a right
   Is there a duty to pay if no work is provided?
    - At common law, the courts have taken the view that in the absence of a customary practice to the contrary,
         there is a duty to pay until termination unless the result of the disruption is a shared risk. (Devonald)

Collective Agreements and the Duty to Provide Work:
- In absence of finding an express agreement, arbitration need to find implied terms


Re James Howden and Parsons
FACTS: The employer unilaterally decided that it wouldn‟t open for a half day on December 24 and 31. They told
people not to come in during those days and the employees wouldn‟t get paid for those days. The union said this
was a breach of the collective bargaining agreement.
ISSUE: Is there an implied duty to provide work or pay employees where no work is provided?
RULE: NO. There is no implied duty on an employer to provide employees with work for the duration of a
contract.
 Union doesn‟t even make the claim that restriction that under common law they have a duty to pay (Devonald)
 Instead union argues duty to pay or provide work instead on basis that normal work: 8 hours in workday and 40
    hours per work (defn of hours clause)
COURT: defn of a working week does not guarantee that the workweek will be provided this way! --
rejected interpretation of the 8hr40hr clause
 So if want protection against temp layoffs, will have to have specific clauses about that, not just rely on the
    definition of hours clause.

   If unions want protection against layoffs, will have to bargain for more and not on the basis of working hours
   In some cases, unions have gone back to negotiate no layoffs in collective agreements
   But as one can imagine, employer would disagrees due such restriction
   More likely is a Procedure layoff clause: layoffs will be done on the basis of seniority
   Another likely provision is for layoff benefits
   Due to these procedural safeguards when a layoff occurs, one issue has arisen on a number of occasions and has
    caused problems is the issue as to why exactly constitutes a layoff that triggers these safeguards
   One option is to define the term; but most likely, the term has been left undefined and arbitrators have been
    called in to define the term

1971 (UK) Northern Electric
What is a ‘layoff’ that would trigger layoff protections within a collective bargaining unit?
FACTS: Here, they negotiated 2 kinds of protection:
         1) procedural – must lay people off in accord with a particular procedure.
         2) Lay off allowance – certain monetary payments must be paid to workers who are laid off.
Northern Electric had 2 bargaining units, office employees and a bargaining unit of the production employees. They
decided that there wasn‟t enough work for everyone – they did this without following the lay off procedures and
without paying the lay off allowance.
ISSUE: What is a lay off for the purpose of the collective agreement, in the absence of such a definition and when
do these protections kick in? Arbitrator‟s definition, page 569 (1 st full paragraph)  „a temporary severance
relationship…for the purposes of reducing the working force in order to meet the demands of the employer‟
   Question: Length of the Severance? How does this factor in? eg, What would have been the case if the
    employer had decided to just shorten the work day?

RULE: Any reduction of a regular working period potentially constitutes a lay off for which the provisions
regarding a lay off would have to kick in. Arbitrator says as long as suspension for purpose of meeting staffing
reqts, it is a layoff - regardless of cause due to economic downturn or that your other staff is on strike.

2nd Question: p.568 Arthurs: a layoff must be regarded any period which the employee has to cease working; eg.
even a 15 minute cessation of work before the end of the working day constitutes a layoff ; so any interruption in the
normal working period constitutes a lay off.

What About:
1) General equal reduction or work force (Air Care)
2) Reducing work day unequally across work force (Battlefords)

1) General Reduction of Working Hours in the Bargaining Unit

Air-Care Ltd. v. United Steelworker of America
FACTS: Employer unilaterally decides it will provide all workers with reduced working day. In CBA, says lay off
shall be by seniority.
ISSUE: A question for arbitrators to decide. Do you preserve management‟s rights that employers are unilaterally
entitled to reduce the hours of work?
Can employer reduce hours across the board or is it a layoff?
HELD: Arbitrator says it is a layoff! (consistent w/previous case)
SCC reverses this - looked at terms of the collective agreement and found not layoff.
RATIO: SCC says that the reduction in the hours of work doesn‟t constitute a lay-off and therefore that provision
doesn‟t kick in. It is for management to decide how they will meet the shortage. They can either choose to let
some people go and follow Article 10 or shorten hours across the board and this wouldn’t constitute a lay off.
The SCC is preserving the management rights to schedule
N: If union wants protection in shortening everyone‟s work week, after Air Care, onus is on union to negotiate
rights in CBA.

Battlefords v RWDSU
FACTS: Some peoples hours reduced more than other. Did not follow seniority clause. Significant reduction of
hours, where people singled out. Arbitrator decides the reduction was equivalent to a constructive lay-off.
SCC accepts the arbitrators decision. Rights of seniority should not be undermined. Fundamental principle that
courts should be quick to defend.

Canada Safeway
(constructive lay-off if reduction in actual hours/quantum of hours - not if disruption in distribution of those hours)
FACTS: Employee recd reduced regular scheduled working hours, but able to pick up call-in hours resulting in
same number of working hours. Employees bumped out of those regular hours in unequal ways. Huge quality of
life issue. Instead of knowing when you are going to work, you could be called in to work any shift.
HELD: Arbitrator finds for the employee: even though no loss in hours, change or disruption in normal working
hours and interrupts seniority rights and entitled to a remedy
SCC: Repeats willingness to accept that in some cases principle of constructive layoff is valid; crt says cannot
argue constructive layoff b/c no reduction in total no. of working hours; say as well that disruption can amount to
layoff but has to involve cessation of work and that other kinds of disruption such as this one is not enough to
constitute a layoff even though it is a disruption.
N: Narrows the scope of what a constructive lay-off amounts to.
N: Other schedule alterations? Unlikely to be construed as constructive lay-off.

Summary
 It is clear a reduction of hours across the board is not a layoff [Air-Care]
   Unequal reduction may constitute a layoff as long as the reduction of hours meets the SCC standard of
    significant reduction and that it meets the notion of reduction in quantity of hours and not the quality of hours
    (Canada Safeway) – Inconsistent w/ Battlefords therefore don‟t know exactly what the law is regarding unequal
    shortening of the work day.
   May view this as the SCC narrowing the scope of the arbitrator‟s decisions.


Statutory Minima Governing Termination of Employment:

Regulation 327 tells us what a temporary lay off is, now s.56 of the new ESA:
 ESA does not change the common law
 ESA distinguishes between a temp layoff and permanent layoff (termination)  the distinction prevents
   employers from not paying benefits by disguising termination as a layoff
    S.56(2) - less than 13 weeks in any period of 20 consecutive weeks is a temporary layoff
    if it is more than 13 weeks in a period of 20 consecutive weeks then it is a termination and not a layoff
    But there are exceptions: for example, if it was 13 weeks or more but certain benefits are paid to the
        employee
    The employer cannot layoff, recall, layoff, recall etc. to avoid termination pay. If it is 35 wks in a 52 wk
        period, it is a termination
    S.56(3) Provision on reduction of hours – what a week of layoff consists of : if person earns/receives less
        than half of the amount the person would earn at his regular rate in a normal non-overtime work week 
        where you have earned less than half of what you would have normally earned in a work week. i.e. if
        reduced 40 hr wk to 15 hrs then it would count as a laid off wk towards amount that may deem it as a
        termination

   In the new Act (bill 147), s.56 deals with layoffs; 56(2) defines a temporary layoff either not more than 13
    weeks in a 20 week period OR in certain circumstances, if less then 35 weeks in a 52 week period [continuing
    to receive some set of benefits from the employer]

   Where there is a trade union which allows longer periods of tempoary layoff not a layoff (Unions can agree to
    any definition of temporary lay-off).



EMPLOYEE OBLIGATIONS (DUTIES OF THE EMPLOYEE)

   Duty to Obey
   Duty to Exercise Skill and Care
   Duty of Good Faith and Fidelity

DUTY TO OBEY (at common law):

Laws v. London Chronicle
FACTS: There is a meeting and there is bad blood – one manager gets into a dispute w/ the general manager. The
supervisor stands up and orders his subordinates to come w/ him and leave and the boss, the general manager tells
them to stay. The employees follow their supervisor. The employee comes back the next day and gets fired.
RULE: If the employee does not obey, there is the ability to terminate the contract immediately – no requirement of
notice as this constitutes a breach of the contract by the employee. This duty is derived from the old days of master/
servant relationship where it was a status relation and not a contract – hierarchical relation b/w 2 parties – servant
under duty to obey master.
 However, in this case, the plaintiff was unlawfully dismissed b/c the one act of disobedience which had
     committed was not sufficiently grave to justify her dismissal. The trial judge therefore ordered one month‟s pay
     for the plaintiff and this was upheld by the court of appeal.
   In order to justify dismissal the employee must be repudiating the K by disregarding/breaching an essential
    condition of the K. However, the disobedience in this case was one time and not severe enough to justify
    the summary dismissal [dismissal w/o notice].

Are you disobeying when you receive conflicting orders and disobey the person higher up in hierarchy?
If there was no conflict and just the general manager telling you not to move and she left it would be disobedience
and would constitute dismissal. However, here, what constitutes a disobedience – it has to be WILFUL
DEFIANCE. So in conflicting orders – you cannot say it is disobedience if you fail to obey 2 orders at the same
time and therefore it was not disobedience in the present case.

What limits exist on the obligation of the employee to obey orders of the employer and what limitations does
law place on the employer?
       The employer cannot order the employee to do something that is unlawful and if they do the employee
        does not have to obey
       Health and safety limitation recognized in common law and now embedded in statute
       Common law – the employee could refuse to be placed in a position of being unsafe or killed
       Now, statutory right, OHSA : the employee can refuse to put themselves or others at risk

Collective Agreement Bargaining:

Ford Motor Case (American case)
FACTS: The employer gives an order inconsistent with the collective agreement.
ISSUE: Is there a duty to obey? Why is it the employer‟s interpretation of the collective agreement that is
followed?
RULE: Work must go on! The shop floor is not a debating society (page 531) – This case firmly establishes the
rule that: you must work now and grieve later.

The employee has two options for a (seemingly) unreasonable order:
a) Obey now, grieve later. Preferred b/c there is no downside for the employee, I just do something I didn‟t think
    I had to do.
b) You get an employee who doesn‟t want to be bossed around – refuses. The employee bears the burden of any
    punishment until grievance arbitration. At the grievance arbitration, the employer must establish that the
    disobedience was wilful (grounds for the discipline was reasonable). Then, must establish that the discipline
    itself was reasonable.

Difference Between Common Law and Collective Bargaining:
An employer under a collective agreement has much more flexibility than under CL. Under CL you can be fired or
they can put up with you if they think you are worth it. Under collective bargaining, I don‟t have to choose b/w
condoning and firing; I can punish them until they reform their behaviour. This is called progressive discipline – it
gets progressively worse.
 There is time that the disobedience is so wilful that immediate dismissal is ok.
Also: The arbitrator can order reinstatement. At common law, there is no reinstatement available.


Kimberly Clark of Canada (1973) L.A.C.
FACTS: The employer had several plants and one of them was on strike. In order to make up for lost production, it
wanted to increase its production at another one of its plants that wasn‟t on strike. The people understood that the
overtime they were asked to do was undermining the bargaining unit on strike and therefore they refused the order
which resulted in the suspending of some of the employees.
ISSUE: Can employers order employees to work overtime?
RULE: In the absence of anything to the contrary (in collective agreement), the employer can work you as
they see fit. Employer has right to lengthen or shorten work day. You must bargain otherwise (this is
different from the CL). However, it was an unlawful order.
APPLICATION: Was this order to work overtime a lawful order in accord with the Employment Standards Act?
Here, it wasn‟t. It was an unlawful order. The employer extended the hours in excess of the ESA. If an order is
unlawful, it is an exception to the rule and employees therefore do not have to obey now and grieve later.

When can employees refuse to obey and not suffer discipline (union employee)

1) Unlawful Order:

Kimberly Clark Case

     In contradiction to a statutory duty imposed on the worker. The employer is not allowed to order a worker
      to work overtime without permission. The employee therefore didn’t have to do the work and then grieve.

2) Occupational Health and Safety insurance:

         If the employee has a reasonable belief that he would put himself or others in a dangerous situation, he has
         the right to refuse work.

3) Union Officials:

         Employers giving orders to trade union officials to carry out their duties that would pose harm to the
         employees or where it would seriously interfere with their duty to carry on their duties as officials

4) Personal Appearance:

         If the employer’s orders seem to unduly interfere with a personal right with respect to personal appearance
         or personal privacy, arbitrators have often said that workers can refuse those orders.

5) Personal Privacy:

     i.e. discharge of employee for refusing to subject themselves to a search that has been held to be
      unjustified.

6) Reasonable Personal Excuses:

     i.e. religious beliefs
Difference Relating to Enforcing the Obedience:
1. Individual K of Employment --- fire employee for disobedience and only redress is action for wrongful
    dismissal or ESA claim that not entitled to be charged without notice
2. Collective Bargaining Agreements --- cannot go to crt, employer has broader range of remedies: discipline short
    of discharge - suspension without pay, letters on their file, firing them  progressive discipline; if want to
    challenge the discharge, go before grievance arbitrator has more options than judge has in similar situation, such
    as moderating the discipline or if discharged order that reinstated w or w/o pay, depending on breach of the
    duties

For Indiv K Employees:
What kinds of conduct grant immediate dismissal?
 wilful disobedience of a reasonable and lawful order of the employee within scope of the employment,
    unless one of the exceptions

For Collective Bargaining Employees:
 work now and grieve later, unless one of the exceptions
 Duty enforced though discipline and discharge. Union can either grieve order or grieve discipline for
    disobedience of that order.
DUTY TO EXERCISE SKILL AND CARE

At Common Law:
 previously (Harmer v Cornelius 1885): employee failure to exercise adequate skill and care meant dismiss
    without notice; on basis that by accepting employment meant had skill needed
 now: reasonable refusal or lack of adequate skill by employee who is trying best does not amount to breach
 can only dismiss w/o notice for breach of duty of skill and care where wilful incompetence/gross
    incompetence such that it seems one is doing it on purpose

Statute:
 ESA reflects this attitude: s57(10)(c ) employer relieved of providing termination notice when there is this
     kind of wilful misconduct. Unless wilful misconduct, employees entitled to ESA notice.

Collective Bargaining:
 COLL B: can terminate w/o notice if there is just cause. Incompetence may be just cause.
 job security an advantage to union b/c arbitrator can order reinstatement if person was terminated without just
    cause (whereas ESA can terminate w/notice even where was no just cause)
 Employer must establish just cause for termination w/o notice and the reasonableness of the discipline
    (how reasonable is it for the employer to have that requirement?)


Re Aro Canada (1975)
FACTS: Mrs. Emburgh worked in a warehouse. This was unusual in 1975 to have a woman working in a domain
of male labour. Every once in a while, the job requires you to get an 85 pound box and carry it down a ladder. Mrs.
has to that and asks for help each time. The employer says he isn‟t prepared to have someone assist you with that
part of the work and since you can‟t do it without assistance and therefore you are fired. The union grieved this and
therefore it went to arbitration.
ISSUE: 1) Can they fire her for her „lack of‟ competence? 2) Can they remove her from this particular job?
HELD 1): Can‟t fire her for lack of Competence - Was not a ground for discharge
REASONING: In collective bargaining situations, there is seniority which gives you a variety of rights within the
workforce. One right is the right to bump into other jobs. If you are no longer able to perform your job, if you have
seniority, you can try to bump into another job in the bargaining unit performed by someone with less seniority.
Could they remove her from this job and force her to exercise her bumping rights to perform another job by a
less senior employer?
 It is clear that there is a duty to exercise skill and care and an employee can be removed for failing to adequately
     perform that job.
 How do they determine if the employer had the right to remove the individual from that job? - it is not too
     different from common law courts today.
      Must look at the job qualifications – the employer, to defend their action, must establish first what the job
          qualifications are.
          There must be some notion that they are reasonable and not unduly high.
          Management also has the right to alter job qualifications unilaterally during the life of a collective agremnt.
                   employer must be reasonable in forming job qualifications
                   i.e. unreasonable to expect her to carry the boxes
      Evaluating the performance of the employee individual in question. Who conducts the evaluation?
      It is part of management rights unless expressed otherwise. management is not entitled to expect
          perfection – it is a reasonable ability or the ability of a reasonably able, skilful and efficient employee
          of the same classification)
 The problem here is that they didn‟t establish that her standard of performance fell below the standard that was
     required for getting the job done. (they didn‟t establish that her asking someone else to assist was an
     interruption the operation of business)
HELD 2): The employee is reinstated in her old job in the warehouse
NOTE: There is a duty to exercise skill and care generally (in both common law and collective bargaining)  a
wilful refusal to exercise skill and care is a breach of duty owed and will result in discharge or discipline.
If the act is incompetence or refusal to perform at the level of the employer, it is more difficult to remove
employees from their jobs. But, under both schemes, the employer can modify workloads, can require employees to
work harder – unless there is an express limitation on that right or there is some kind of external minimum standard
in regards to a duty to accommodate or if it is located in Health and Safety Law.

2nd Aro case: 1988 p616
p616 - She swears at worker and is dismissed (w/o pay) for 3 days
 BRD: swearing never permissible; reduced her 3 day termination w/o pay to one day since language was
     common around the warehouse and regarding her prior good work history
1. Did she commit misconduct?
2. Is the discipline reasonable?
 look at offence and then at their record; circs, the kind of person, mitigating factors in past record
 past record: 1 out of 3 prior incidents in 6 yrs for swearing, she apologized
Employer prerogative to decide qualifications and if ppl can meet them; must use standard of reasonableness
for having certain reqts - but these might go to human rts complaint


DUTY OF GOOD FAITH OR FIDELITY

Common Law:
 doesn‟t have to be expressly provided for in contracts for employment  it is implied in common law that the
   employee will serve their employer honestly and faithfully
 and not against employer’s economic interests
 there is no reciprocal duty on the employer to do the same
 operates after hours and beyond the contract term

Dishonesty: Dishonesty is almost always a ground for dismissal so if an employee cheats/robs their employer (etc.)
this is clearly a situation where termination is justified.




Hivac Limited v. Park Royal Scientific Instruments Ltd. : common law leading case
(CRT says that employees are breaching implied duty of good faith and fidelity if work for rival competitor in their
spare time)
FACTS: The employer produces a specialized product (midget valves for hearing aids) and has a virtual monopoly.
A rival firm sets up and one of the engineers goes to work for the competitor and gives them information about the
Plaintiffs processes and gets a number of the skilled employees to moonlight for the competitor. The plaintiff learns
about this and seeks an injunction from the competitor from hiring their employees.
     Basis of the claim: It is a breach of the duty of good faith and fidelity by inducing them to come and
          moonlight for the defendant.
ISSUE: With respect to production employees, there are no restrictive covenants when they are hired. They were
working on their own time, etc. Were they disclosing confidential information to a competitor or using the
information obtained to benefit them? They have special skills and make these valves for Hivac.
COURT: The court struggles with this issue. Although there is potentially the danger that confidential information
may get transmitted, they don‟t think that it would be a breach of good faith and fidelity to be working at the
competitor‟s company. However, it depends on the type of information and also here, the employees snuck around
and did it secretly.
          If it is not treated as a breach by disseminating confidential information, what is it that restricts employees
          from working for competitors after hours?  The court doesn‟t want to say that your skill is the
         equipment of the employer and that they own it and therefore essentially own you. They therefore say
         that your skill is portable, it is your equipment and you can move with it. You are not allowed to
         engage in activities that are harmful to your employer’s business and business interest and this
         includes working for your competitor.

NOTE: Is the employer under an equivalent duty of good faith and fidelity not to use its capital not to engage in
activities that would be detrimental to the employees  NO. There is nothing that says that an employer cannot
engage in activities that are harmful to their employees‟ interests.


Summary:
The duty of good faith and fidelity extends beyond hours of work. It is clear that when being paid you cannot work
for yourself or someone else. You can‟t use confidential information gathered during the course of employment for
another purpose. Employees cannot use trade secrets in a way that interferes with employers‟ interests. After the K
expires, there is a fiduciary duty and you cannot use confidential information against the employers‟ interests. All
these implied duties can be changed by express terms in the employment K.

Restrictive Covenants:

Restraints of trade are invalid unless they are reasonable from the point of view of both contracting parties and the
public. They must have the characteristics of:
1) Protecting a legitimate proprietary interest of the employer
2) Being reasonable in terms of a) temporal length b) spatial area covered c) nature of activities prohibited d)
    overall fairness
3) The terms of restraint being clear, certain and not vague
4) Being reasonable in terms of public interest.

N: To be upheld, the restraining clause must be concerned with a protectable interest. Whether or not the
information sought to be protected is of the protectable kind also depends on the circumstances.




Trade Union Activity (at Collective Bargaining – duty implied here as well):

Nippissing Hotel Ltd. v. H.R.E.B.I.U. (1963 - Ont. H.C.)
FACTS: A hotel and the union (recently certified) were negotiating a 1 st collective agreement. They were at an
impasse. Instead of being on a lawful strike, the union organized the employees to picket the employers after work.
The S.C.C. allows peaceful picketing. The employees are still getting paid then, but still putting big financial
pressure on the employer. The employer could have said that this was a breach of s. 17 of the OLRA (duty to
bargain in good faith) and then filed an ULP complaint at which time (1963) the only remedy would have been to
prosecute the breacher in civil court. This is time consuming.
ISSUE: The employer argued here that the employees were in breach of the duty of good faith and fidelity by
picketing and ruining their good name (not during a strike).
DECISION: Here, the judge finds a breach of the duty of good faith and an injunction for breach of K. Johnstone is
liable for inducing the breach. They can bargain, but during the bargaining, they cannot engage in activities that
the court considers to be potentially injurious to the employer’s interests.
Working on the Employer‟s Time:

Re United Brewers Workers, Local 304 and Pepsi Cola (1967)
RULE: Good faith is so intrinsic that it doesn‟t even need to be spelled out in the collective agreement. It is just
part of it.
REASONING: The duty of good faith is there to protect the employers‟ commercial interests. In this case, the
employee is working for themselves on the employer‟s time – directly against the employer‟s commercial interest
and profit. This is not allowed.

Labour Relations Information:

DeHavilland Aircraft of Canada (1972)
FACTS: The employee comes across a sealed envelope with labour relations info inside. The employee published
the information of management deliberations in union newspaper and receives a 2 day punishment. The union
grieves.
ISSUE: There is no written rule to say that documents could not be removed from company premises and used for
fair comment on possible violations of the collective agreement.
RATIO: “I am satisfied that such a restriction…is intrinsic in the duty of fidelity b/w an employee and an
employer….particularly in an industry such as this”. This does not need to be expressly stated or posted.
Reasoning: Cites Pepsi Cola
Note: There is an underlying understanding that some information an employee has no right to know about. An
employee is not allowed to use the information that is against the interests of the employer notwithstanding the
fact that this is important information for the people that they represent




TERMINATION OF CONTRACT OF EMPLOYMENT

   Faultless Termination
   Termination by Notice
   Termination by Action of the Employee
   Termination for Cause

   Will always start with CL
   ESA, collective bargaining will add to the CL

FAULTLESS TERMINATIONS WITHOUT NOTICE:

1) Completion of the Contract: An employee who 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.

Fixed Term Contracts:
Ceccol v. Ontario Gymnastic Federation (2001:
FACTS: Admin. director had been employed by the federation for over 15 years on a series of one-year contracts
when she was advised that her contract was not being renewed.
ISSUE: Was she entitled to notice for termination of a contract of indefinite duration?
HELD: Not a fixed term K.
RATIO: Employers should not be able to evade the traditional protection of the ESA and the common law by
resorting the label of “fixed term contract” when the underlying reality of the employment relationship is something
quite different, namely 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.


2) Frustration

Frustration  the occurrence of an unforeseen event which renders the contract incapable or impossible of
performance - s.57(10)(d) of ESA - thus exempted from notice under both common law and the ESA

Temporary illness : generally not regarded as sufficient enough to amount to frustration – whereas a more serious
illness which would prevent the employee from performing the contract may amount to frustration at a certain point.

3) Death

As the contract of employment is a personal one, the death of either party terminates the contract. Death does not
extinguish the parties‟ rights which had vested to that point such as, say, the right to wages.

4). Bankruptcy

Common law has often treated this as a frustrating event – you can dismiss employees without notice.
Employees are not secured creditors, banks are.

What about the ESA? – This issue was resolved in court in 1995 in:

Ontario Ministry of Labour and Ritso & Ritso Shoes: Bankruptcy does not deny employees their rights under the
ESA to notice pay and possibly severance.? Or does it????




TERMINATION WITH NOTICE:

At Common Law:
 An employment contract can be terminated by either parties provided that reasonable notice is given
 How much notice is required?

Reasonable Notice:

1. Lazurus 1961 Ont CA:  reasonableness based on intent of parties, based on what would have agreed upon if
the parties had discussed this situation prior to the breach; what would have been decided.

2. Bardal v Globe&Mail OntCA 1960: (leading case) affirmed SCC Wallace case 1997
factor test in calculating appropriate notice (more contextual) : Reasonableness of notice must be decided
with reference to each: character of the employment; length of service of the servant, age of the servant and
availability of similar employment; having regard to experience, training and qualifications of employee.
Judicial Consideration of Specific Factors:

Status: Is there an upper limit for low status employees after Cronk?

Assumption: senior level employees have more difficulty finding alternative employment, so those who have higher
job status got longer notice periods than a junior or semi-skilled employee.


Cronk v. Canadian General Insurance Company 1994 – CA
FACTS: A full-time clerk for almost 35 years, called the logic that senior employees get a longer notice period into
question. She was a very junior employee. She was 55 and living in a region where there was an economic
recession.
ISSUE: Is status an independent factor, or should it be subsumed under reasonable alternative employment?
RATIO: 12 months notice was given by the CA (reduced from 20 months given at trial/company offered 9). Status
is an independent factor.
REASONING: The 20 month award “has the potential for disrupting the practices of the commercial and industrial
world, wherein employers have to predict with reasonable certainty the cost of downsizing or increasing their
operations, particularly in difficult economic times. As well, we need certainty” (Lacourciere JA)
         Trial: status is unfair to „Edna‟; unqualified people have a harder time finding employment (MacPherson).
         He said status is a sub-factor going to reasonable notice.
NOTE: Low status employee capped in terms of entitlement to notice at 12 months.

The issue of “lower status” employees was commented upon by the Ontario CoA in Minnot:


Minott Case
FACTS: A maintenance employee was let go after 11 years with no grounds for cause when he was 43.
TRIAL: He was given 13 months pay in lieu of notice based on two legal basis:
                   1) It was decided at trial before the Cronk case had been appealed and were relying on the
                        limitation of the significance of the status division expressed there - distinction between lower
                        level and higher level shouldn‟t matter
                   2) relied on the rule of thumb of 1 month per year
COURT OF APPEAL: It is necessary to recognize the frailties of reasoning of the trial judge - Cronk was
overturned and they don‟t like the rule of thumb idea.
• Dealing with the CA decision in Cronk – it was clear in the judgment that they were not happy with the Cronk
     decision. The judge in Cronk discussed the idea of predictability and certainty. Here, the court said that this
     was an admirable goal - however, these are best achieved by careful weighing and blending of the Bardal
     factors - not going to let the idea of consistency override the flexibility that the common law approach provides
     the courts with
• Furthermore, they address the idea of the ceiling on notice periods for each class of employees. We should not
     regard the limit set by the CA in Cronk as a universal standard for all lower class status employees - limited to
     the particular facts of that case at a maximum.
HOLDING: In the end, they seem to take a similar approach to MacPherson at trial in Cronk. They focus a lot on
the prospects of re-employability - given all the circumstances, this 13 months, while it might be high, is within the
range of reasonable notice. Appeal courts should only interfere when it outside the reasonable range or faulty in law
application.

Economic Conditions – Economic Downturns:

   There must be a balance b/w employee having trouble getting new employment in a depressed economy as
    affecting amount of damages, and the employer‟s right to reduce its work force at a reasonable cost in the same
    economy. When there is high unemployment it is harder to find other jobs.
    1980s Recession: Those laid off for economic reasons got longer notice periods than those laid off for non-
    economic reasons.
    1990s Recession: Flip – reasoning for shortening notice periods was economic downsizing
   Jurisprudence: Weight to give to economic climate? Minot – relied on difficult economic climate as a reason to
    justify lengthy notice period.

Ballpark Justice:

   At one point there was an idea called Ballpark Justice  if the employer made an offer not accepted by the
    employee but subsequently found by the court to be reasonable (even if not the most reasonable amount of
    notice) the court would not increase the offer made by the employer and would penalize the employee for not
    accepting that offer in costs (based on unnecessary litigation, etc.). The offer didn‟t have to be the best amount,
    or most reasonable, it just had to be reasonable

   Effect of this approach: gave an incentive to employers to make a low-ball offer (at lowest end of what is
    deemed to within the realm of reason) and put the employee in the position of either taking the lower amount or
    trying to convince the court that it was unreasonable. But, in most jurisdictions, the courts have shied away
    from taking this approach – saying unreasonable.

Near Cause:

   Another argument by employers to reduce notice. Even if there wasn‟t just cause, should take into account the
    injustice of the employee in calculating notice period.
   This idea has been rejected by the courts.

Employer Conduct in the Dismissal Process – Aggravated and Punitive Damages:

   Traditionally, courts held that employees could not claim additional compensation b/c the employer had
    behaved badly in dismissing the employee  i.e. embarrassing, no opportunity to address concerns, etc. Recent
    case law seems to be changing this.
   Aggravated and punitive damages as additional basis for giving more compensation for wrongful dismissal.
   Courts resistant in expanding heads of damages.

Vorvis v. Insurance Corporation of BC. (SCC)
Separate actionable legal wrong

In very limited circumstances, wrongfully dismissed employees could claim:

         Aggravated damages  for intangible injuries like mental distress or humiliation, but only available
         where the acts of the employer were independently actionable (tortuous in their own right) and
         Punitive damages  available for vindictive and reprehensible conduct but this must also be
         independently actionable

NOTE: this is a mixed decision - says these are available, but the conditions under which available are severely
restricted - hard to claim

More recent decision of SCC that has created an additional avenue:

Wallace v. United Grain Growers (1997)
FACTS: This case involved a top sales person for many years who was terminated without notice and without
explanation as to why he was being terminated. He sued for wrongful dismissal. The employer said there was cause
for the dismissal but subsequently withdrew this defence. The employee suffered distress and was in psychiatric
care
DECISION:
Trial:
     Wallace was entitled to 24 months notice (this is the most given) and in these circumstances, he was
        entitled to aggravated damages
Court of Appeal:
     Reduced the notice to 15 months and no cause for aggravated damages
SCC:
        Need separate actionable legal wrong to receive punitive damages [Vorvis is still good law]
     However, bad faith conduct on the part of the employer in dismissing the employee doesn‟t have to be dealt
        w/thru aggravated or punitive damages, but rather is a factor in calculating the notice period. An employer
        who acts in bad faith must give a longer notice period than if they had conducted the dismissal in a
        more honest and humane way. It doesn‟t matter whether or not the conduct causes tangible or intangible
        damage. They have set-up a duty of good faith upon the employer and this will be taken into account by
        the court in calculating the period of notice.
        ☼ The end result is that they have constructed a duty of good faith in the dismissal of employees and
        if this is breached, the court can consider these incidents in determining the proper period of notice.
        This seems to somewhat undermine the basis for notice periods  they no longer appear to be relying on
        the rationale of notice periods being the period to allow for alternative employment – the new rationale
        seems to be the focus on protection of vulnerable workers at most vulnerable times (dismissal)

The Duty to Mitigate:
 As in all K cases, employee has duty to mitigate
 Onus on employer to show that employee has breached that duty – must show that employee‟s conduct was
    unreasonable in all respects.
 Should failure of employee to accept altered terms and conditions of employment qualify as a breach of the duty
    to mitigate?

Statutory Notice Periods:

   3 kinds of notice: Individual termination; Mass termination; Severance Pay.

1) Individual Termination:
    S.57 ESA – Entitled to notice period of 1 to 8 weeks, based on length of employment
    O.Reg.288/01 s.2 – Exemptions – who arent available to notice pay

2) Mass Termination:
    S.58 – If terminating 50 or more employees in 4 weeks – notice increases with the number of people
      terminated.
    Duty to provide information to Ministry of Labour
    Regulations narrow now – requires employer to give notice of number of employees, name of trade union
      representing, economic circumstances surrounding termination.

   Severance Pay (s. 63-66) - Employer can never require you to work through this ; in addition to mass
    termination notice; s63 defn; s64 entitlements - entitled to severance pay if :
        (1) work 5 yrs for employer, and
        (2) either let 50 ppl go on permanent basis or if employer has $2.5M payroll
         then get one wk pay for every yr you have worked up to 26 weeks


   s64 ESA - claimant must elect to pursue claim under ESA or common law (Can‟t elect to go to court AND
    minimum standards of the ESA)  have within 2 weeks of filing the ESA complaint to change to court option
   In other words, an employee not entitled to commence civil action for wrongful dismissal if he files an ESA
    complaint alleging entitlement to termination or severance pay relating to the same termination of the
    employment (can no longer use ESA as way of surviving until the crt date)
   $10K cap for awards under ESA s65(1.3) ESA
   if under coll barg, must go to grievance arbitration, no choice of civilsuit - ESA 64.5
   private collection agencies are now used to pursue wages owing
   6-month limitation period to bring a claim ESA s82.3
   Get one or other in terms of notice – then might get severance pay on top of this

Termination by Action of the Employee:
(Has employee quit or were they terminated)

Employees Obligation to Give Notice:
 Employees who wish to terminate their Ks of employment also must do so by providing reasonable notice.
   Where reasonable notice has not been provided, the employer may sue for damages it suffers as a result of this
   failure.

Voluntary Quit and Constructive Dismissal:
 Employee who has voluntarily quit is not entitled to notice
 In law, quitting requires both subjective intent and objective behaviour

Dowling Red & White
FACTS: There is a dispute at work and in the heat of the moment, the employee walks out. What happens if they
show up the next day and the employer says, “what are you doing here, you quit?”
ISSUE: Does this constitute resignation?
COURT: The general approach is that:

    There must be 2 elements to protect employees from forfeiting rights during a heat of the moment argument:
        1) subjective expression of intent
        2) objective behaviour confirming that that was the real intent of the employee

 In this case, the employee did not come back to work - rather tried to claim for lack of notice under ESA. This
failure to return to work met the objective part of test - considered it to be a resignation

Constructive Dismissal or Quitting for Cause:
Basic Principle: Where one party to a K demonstrates an intention to no longer be barred by it, that party commits
a fundamental breach that results in its termination (Faber v. Royal Trust)
I: What constitutes a fundamental breach?


Farber v. Royal Trust (1997) – SCC
FACTS: A real estate agent working for Royal Trust who was restructuring was offered a new position as a
manager of a single office in one of their branches. There are some provisions made to provide some protection of
the reduction of salary but would diminish over time. The employee therefore claimed constructive dismissal –
regional manager to branch manager.
SCC: They said that this was right in this case. The terms and conditions were great enough to treat this as a
constructive dismissal. (change in conditions was significantly great to constitute constructive dismissal)

Note: The onus is on party alleging constructive dismissal to establish it on a balance of probabilities. – objective
test. The onus is on the employer to show a duty to mitigate. Test: objective. As long as the new job isn‟t
acrimonious and/or demeaning.


TERMINATION FOR CAUSE

Common Law

Procedural and Remedial Matters:
   Onus is on employer to show that he had just cause to terminate without notice (on a balance of probabilities)
   s.57(10)(c)ESA wilful misconduct or disobedience or wilful neglect of duty
   Entitled to introduce evidence of matters unknown or not thought of at time of dismissal
   Obligation of good faith and fair dealing in termination (Wallace)
   Does Wallace provide that employee is entitled to some kind of hearing prior to termination?
   Courts have not specified this right to be heard – but argument could be made in a specified case.
   Courts can give pay in lieu of notice
   Can sometimes gain aggravated and punitive damages (basis of Vorvis)

Performance Review:
Marlot and Ashbrands Can (BC SC) – Have to conduct a fair, bona fide performance review if going to rely on for
part of basis for cause.

How have courts dealt with these issues – in common law and Employment Standards cases:

1. Common Law – Substantive Issues:

Probationary Employees :
 There must be an express provision that probation applies. New employees can have assessment of job
performance and be let go during or at end of that period.
 Courts today: Probationary employees are protected in some ways.
 Standard employer has to meet is lower with respect to reason for termination
 Some recognition of just cause protection – but standard is quite low.
 Very short-term employees are rarely given lengthy notice period. They are entitled to one day notice unless the
    employer can establish that the employee has failed to meet the minimum standards of employment (reasonable
    set of expectations) – that they have failed their probation.
 If what you want is Employment Standards  there is no entitlement to severance pay if you have been
    employed for less than 3 month.; no statutory entitlement, unlikely to pursue

Misconduct:
 How serious does the misconduct have to be to terminate without notice?




McKinley v. BC Tel. (2002 SCC)
Principles of contextualization and proportionality
FACTS: McKinley was employed as an accountant by BC Tel for seventeen years. In 1993, at 48 he experienced
high blood pressure and took a leave of absence on Dr‟s advice. Indicated he wished to return to work but at a less
stressful job. BC Tel indicated willingness to accommodate him but then fired him. McKinley rejected severance
offer and sued for wrongful dismissal. BC Tel claimed they had just cause for summary dismissal, alleging
McKinley was dishonest about his medical condition and treatments available
ISSUE: Whether this justified summary dismissal?
HELD: Contextual and Proportional Approach must be used in assessing misconduct.
RATIO: The test is whether the employee‟s dishonesty gave rise to a breakdown in the employment relationship.
Test can be expressed in different ways. Ie - That just cause for dismissal exists where the dishonesty violates an
essential condition of the employment K, breaches the faith inherent to the work relationship, or is fundamentally or
directly inconsistent with the employee‟s obligations to his/her employer.
The Principle of Proportionality – An effective balance must be struck between the severity of an employee‟s
misconduct and the sanction imposed. Look at what happened in broader picture – context of entire employment
relationship (length of service; history; past performance)

Sexual Harassment:
Bannister v. GM Canada Ltd. - Issue of summary dismissal for sexual harassment – summary dismissal justified
here
But,
Xerox Canada Ltd v. Ontario – where an adjudicator held that the sexual harassment in question did not constitute
wilful misconduct for the purposes of depriving the employee of his statutory entitlement to notice

Off-Duty Conduct:

   Can be grounds for dismissal
   Even criminal conduct does not necessarily constitute grounds for dismissal

Plinussen v. UWO – P had contracted to lecture part-time and pleaded guilty to charges of fraud on insurance claims
for stolen watch. Court found that potential damage to University‟s reputation justified the dismissal.

Heyman v. Frito Lay
FACTS: Heyman worked for a long time for Frito Lay. He was sentenced to 4 months in jail and was unable to
show up for work and was dismissed by his employer on grounds of the employer‟s position that they had just cause
based on misconduct.
(This is an Employment Standards case)
DECISION:
Court of Appeal:
It was not just cause for termination. They could hire a substitute driver for the period of imprisonment without any
inconvenience. Therefore, there was no misconduct on the part of the employee justifying summary dismissal. The
court also took into account the long year of employment and his employment record was spotless. The dismissal
was not warranted!

2. Collective Bargaining

    Under colletive barginging, an employer can only terminate an employee with just cause. Otherwise, an
     employee can be reinstated.
 An advantage of collective bargaining regime, more job security. Unionized employees do not have access to
     common law remedies. Instead, must deal with grievance arbitration.
 The union is in a sense the grievor since it files on behalf of the employee.
 In respect of termination cases, burden on employer to show on a balance of probabilites that there was just
     cause for the termination.
Just Cause in Grievance Arbitration

Does grievance arbitration provide a superior system that has been claimed by advocates of collective bargaining?

When people compare collective bargaining and individual contract of employment, they look to the grievance
arbitration that provides employees with a stronger set of entitlement than that available at common law.

George W. Adams, “Grievance Arbitration of Discharge Cases” page 610
                Adams compares collective bargaining and the individual contract of employment (master and
       servant relationship) where he characterized the regime of master and servant as a single minded pursuit of
       the employer‟s interests and it has utterly failed to take into account the interests of employees in its
       determinations. However, even from what we have seen in older law, we have seen that common law
       courts have taken into account interests of employees i.e. with respect to sickness (continuing duty to pay,
       duty to provide work, etc.). However, there has been some cross fertilization – common law has picked up
       some of the themes of grievance arbitrators
Comparative Analysis:
In collective bargaining, the union has carriage of the grievance – whether or not the grievance may go forward.
The union must establish that the griever was employed and either terminated or disciplined and then the onus shifts
to the employer to establish just cause (parallel to the common law where the employer must show just cause).
Where as in the common law employers are allowed to raise matters that came to their attention after the discharge
occurred, in grievance arbitration, only factors which they were aware of prior to the discipline may be raised.

Procedural and Remedial Issues:
 Onus on employer to show just cause
 Used to be no ability of employer to rely on matters unknown at time of action – now exceptions to that
    principle.
 In general, management under a duty to exercise its rights fairly and reasonably – negotiated grievance
    procedures apply.
 Negotiated process for handling disciplinary measures which gives employees right to be heard.
 Employers have right to impose disciplinary measures short of termination – including suspensions
 Arbitrators have right to issue reinstatement or moderate the discipline

Probationary Employees:
 This only exists as expressly provided for in the contract. Once you have a classification as a probationary
    employee, the parties may expressly define what the incidents of probation are. It may say for example, that the
    employee is not protected during the probationary period from discharge or discipline for just cause. This is
    permissible now whereas previously it wasn‟t.
 You cannot however deprive probationary employees access/right to the grievance proceeding. This is b/c there
    is a section of the ON Labour Relations Act, section 48(1) and (2) that says all collective agreements must have
    a provision that provides for the resolution of disputes through grievance arbitration. You cannot have a
    provision in the agreement therefore saying that a matter may not go to arbitration. You cannot strip them from
    access.

Misconduct - Examples of Cause: pg 592

Insubordination:
 Duty on Employees not to be insubordinate

Gardiner v. Denver
FACTS: This case involves a situation where an employee is ordered by the supervisor to load a compressor where
it was clear to the employee that the compressor should not be loaded onto the truck and becomes verbally abusive
to the employer. He was therefore discharged.
RATIO: Work now grieve later is limited by the fact that the order must be reasonable. Therefore one cannot
discipline for this, but he could be disciplined for insolence, but the arbitrator moderates to a 5 day suspension. 
In order to discipline, it must be reasonable.
NOTE: Between this and the common law, we can see in a rough way the notion that not every kind or act of
misconduct will justify discharge - similar to the fact that not every act will justify summary dismissal in Common
Law. The arbitrator and common law courts will look to factors to determine whether there was cause, the difference
really lies in the Remedial Powers:
          Arbitrators  can adjust the harshness of the punishment-thus allows for greater flexibility so that the
          punishment fits the act (allowance for near cause idea); important feature of arbitration, unlike CL judges,
          have a larger range of remedies. Can impose alternative remedies.
          Judges  on the other hand, if they don‟t find just cause, only have the power to award damages. That is,
          can only find right to notice and award with equivalent damages.

Fraser Valley Library and CUPE
FACTS: Employee broke into her bosses e-mail. Was caught and was dismissed. Is employment relationship
capable of being restored?
HELD: Discharge upheld.
RATIO: Arbitrators should pose 3 distinct questions in the typical discharge grievance:
1) Has the employee given just and reasonable cause for some form of discipline by the employer;
2) If so, was the employer‟s decision to dismiss the employee an excessive response in all of the circumstances of
   the case;
3) If the arbitrator does consider the discharge excessive, what alternative measures should be substituted as just
   and equitable?

N: How does the arbitrator‟s approach compare to the one articulated by the SCC in McKinley

Sexual Harassment:

Re City of Nanticoke
FACTS: This case involves harassment at an ice arena which was fairly crude and gross. The harasser was
ultimately terminated and the union grieves.
ARBITRATOR: The arbitrator reinstates the employee/harasser on the grounds that there was more than one
employee involved in the harassment (apparently common bhvr. and this employee was singled out) and only one
was disciplined and therefore unfair treatment of similar employees. The employer seemed to have condoned the
behaviour (didn‟t do anything to deter it) and there was a lack of discipline.
 There was also a lack of progressive discipline whereby unless the behaviour in the first instance is extremely
   harmful, in most cases, there are a series of steps which should be taken prior to termination.

         NOTE: This creates a somewhat weird situation  the failure of management to adequately protect the
         victim in the past allows the employee to be reinstated after discharge which in turn further fails to protect
         the employee due to management‟s misactions
          What about the victim? What can she do? Not much according to Tucker since she is part of a collective
         bargaining system. Access to private litigation outside the scope of the union is limited.

Off-Duty Conduct:
 Some off-duty conduct is sufficiently related to one‟s performance as employee.

B.C. Telephone Co
FACTS: Employee convicted of dealing in small quantities of drugs and drunken driving
HELD: The arbitration board recapitulated the criteria used in earlier cases to decide whether discharge for
conduct outside the workplace is justified. These are:
1) The conduct of the grievor harms the co‟s reputation or conduct.
2) The greivor‟s behaviour renders him unable to perform his duties satisfactorily.
3) The greivor‟s behaviour leads to refusal, reluctance or inability of the other employees to work with him.
4) The greivor has been guilty of a serious breach of the Criminal Code and thus rendering his conduct injurious to
    the general reputation of the co. and its employees.
5) The greivor‟s conduct places difficulty in the way of the co properly carrying out its function of efficiently
    directing its working forces.
 The Board noted that it is not necessary to prove all these factors in order to sustain discharge.
 In this case, though the Board found some evidence of 2 and 5, It also made reference to a yet earlier arbitration
    award concerning another employee of the same co, in which were involved a larger quantity of drugs for
    trafficking, theft of co. property, and a longer sentence. The Board stated that it would be individuous to uphold
    this discharge when the more serious criminal conduct of the earlier greivor, had resulted in reinstatement.

What are the accomplishments of grievance arbitration?

Access to justice – There is no doubt that grievance arbitration is a more accessible system than litigation. The first
stages of the process are relatively costless. It involves a series of meetings.
     Allows unionized employees to be more assertive about their rights and enforce statutory rights
     Readier access to wrongful dismissal action; higher job security
       Much more confident that they will be able to pursue remedy to restore them in the position they were in
        previously. (90% of work refusals undertaken by unionized workers)
       When you get to the actual grievance arbitration, the union has the money to pay the litigation costs rather
        than you having to pay out of your own pocket.
       In terms of the access issue, how did unionized employees deal with grievance before there was mandatory
        arbitration? It depended on the circumstances, but if someone was fired and it was deemed to be unjust,
        they would put down their tools or work to rule  methods that are prohibited today. Therefore, it must be
        kept in mind that there have been both gains and losses. They have lost the right to take direct action.

Remedies – (advantage of the Collective Bargaining Regime):
    Arbitrators have the power to reinstate and this is very valuable to workers who often find themselves with
       limited reemployment opportunities and where continuity for seniority and benefits rights are highly
       valuable.  this is an advantage for unionized workers as the courts will never order reinstatement.
    s.48(17) ONLabour Relations Act - substitute alternative remedies including reinstatement.
    Note: in terms of discharge cases, it is not uncommon for employees to be reinstated. However, in most
       cases for reinstatement, where it occurred, most people did not receive their back pay for the time b/w the
       discharge and the reinstatement. In a number of cases, partial compensation is awarded – back pay less an
       amount deemed to be an appropriate remedy, either days pay or more.
    Moreover, the notion of punishment has been created in the context of unions which has no equivalent in
       individual employment. The analogy is to the criminal justice system – what is the role of punishment –
       specific deterrence, general deterrence, a moral role, and prevention (remove the offender from the
       community so that they can‟t do more harm)
    We are here to teach employees to behave properly, rehabilitate those that have deviated from workplace
       standards and this protects employers from needless waste of human resources if we had needlessly
       terminated without rehabilitating. Only if there misconduct is so great should they be terminated from the
       workplace
    A remarkable expansion of disciplinary power. It has its analogies to the refinement of criminal
       punishment. There is an analogy to workplace discipline – we can control people‟s behaviour in a much
       better way than we‟ve been able to in the past.

SUMMARY: Comparison of Effectiveness of Arbitrators and Judges:

   The substance of the structure of rights and duties b/w employers and employees is not fundamentally
    different in the collective bargaining regime than it was under individual employment.
   Breaches of their duties in either regime will justify summary dismissal without notice. Not just any
    misconduct, but rather both arbitrators and judges have said that the misconduct must reach a certain standard.
   There is however still a huge difference in job security since in common law, employers always have the option
    to terminate with notice whereas in collective bargaining, can only terminate with cause.
   Furthermore, differences also exist with respect to remedies. Courts don‟t have the flexibility – can only
    determine if there was just cause for termination and then if not, award damages.

Why does the new world look the same for the more progressive advocates  it looks too much like the old
world than people hoped it would be?

   There hasn‟t been the level of equalization of bargaining power that people had hoped. The balance of power
    is not equal and therefore, we were unable to get all of the concessions required to radically change things.
   It was thought that management would view the more participatory regimes as better - however, there are too
    many instances where employers don‟t voluntary adopt the participatory ideas.
   Furthermore, the grievance procedure was in a sense too thin of a process to carry these aspirations for
    workplace reform - maybe because not all arbitrators are as committed to the idea of revolutionalizing the area.
   Even those committed to the project of industrial citizenship could not carry it off under the system set up. The
    best way to see this was the Doctrine of Fairness - the most innovative attempt by certain arbitrators to call into
    existence this new kind of power, the background upon which arbitrators interpret agreement, etc. and don‟t
    assume that management rights exist
Laskin: “The change from individual K of employment to CBA is a change in kind and not merely a difference in
degree. The introduction of a collective bargaining regime involves acceptance of parties of assumptions which are
entirely alien to an era of individual bargaining. Hence, any attempt to measure rights and duties in
employee/employer relations be reference to pre-collective bargaining standard is an attempt to re-enter a world that
has ceased to exist.”

   World of collective bargaining has not produced a substantially different world. No change in kind – perhaps a
    difference in degree.
   If no difference, why? Why did old world of employer/employee relations get reproduced in new CB regime?

Canadian Industrial Relations (Woods Task Force Report – 1968)
A principle objective of the CB system is to provide workers with a means of participating, either directly or through
their chosen representatives, the determination of their terms and conditions of employment. The collective
bargaining process becomes a means of legitimacy and making more acceptable to superior-subordinate nexus
inherent in the employee-employer relationship. Accordingly, the actual impact of collective bargaining on the
well-being of workers may not be as important as the potential impact.

CB – Reflection of private power:
 Hope that unions would have counter-vailing powers – But, not sufficient to challenge in fundamental way the
   nature of employee/er relations. Did not have power to do so!

Benefits of Industrial Citizenship According to Pragmatic Industrial Pluralists:
1) Arbitrators review and moderate disciplinary action
2) Participatory Rights
3) Arbitral fetters on management rights …Duty of Fairness

Moderation of Discipline
 Scale of less penalties is not insignificant (instead of dischage) – Results of grievance arbitration suggest how
   high the penalties are in practice:
 Barnade Study: 54% of discharge cases result in reinstatement
- In half those cases, reinstatement is without back pay
- On average, reinstatement order made 7.9 months after discharge
- Average suspension 5.6 months
 Regime that leaves employees facing significant financial harm
 Subjected workers to regime of corrected discipline – modelled on regime of criminal justice system
 Subjected to regime of corrective discipline to achieve conformity to workplace norm.
 Allows for broader range of controls for worker than under common law – BUT how much better are these
   remedies used by arbitrators than those applied by common law courts?

Adams (pg 609):
 Claims that conditions under CB much better than at common law
 Argument is that the nature of the relationship requires a cultural interpretation which sees the collective
   agreement not as a contract but rather as a constitution acting as the fount of a continuing, viable industrial
   relationship in a productive enterprise.
 From that point of view, arbitrators must have an arsenal of tools; these are crafted from contract, tort and
   criminal law precepts.
 punishment - in determining whether a lesser penalty should be substituted for breach, arbitrators consider the
   role of punishment :
        Adams article talks about role of punishment in workplace
        Analogy to the criminal justice system in 4 ways:
                     a. Special Deterrence – influences future conduct and deters offenders directly
                     b. General Deterrence – deter potential offenders (they see what happened to others)
                    c.   Dramatization of the community‟s commitment to values breached by offender –
                         reinforces moral habits by ensuring those who abide by rules will not be disadvantaged.
                    d. Conformity to workplace norms – remove offender from job and replace w/ someone who
                         will conform
Adams recommends corrective discipline – rehabilitate employee who deviated from standards, not by
dismissal as employer wants, but as substituting penalties
 punishment must serve one of these four or else it is improper.
 punishment should not be excessive, should vary depending on conduct.
 summary dismissal deprives an employee from the opportunity to learn from mistakes,
 the most important goal of punishment is correction.
 injuring another employee should still= dismissal.
 where unlikely to offend again should lean toward reinstatement
 This approach is more sensitive than the law of master and servant as it is based on premise that employees can
    be made to correct their ways through incremental doses of punishment.

Professor Tucker‟s comment on Adams–
 Note the mind set here. We are talking about the work place, but it is analogous to criminal law. We see discipline
 and deterrence. We are actually increasing the ability of employers to make workers conform to their desired norms
 and industry disciplines. Therefore, does this help or hurt the labour movement? Does it go both ways-- .ie. Help
 both sides?

 Own version of doctrine of fairness:
  Must show cause to dismiss in union setting. Gradually arbitrators came to the view that they should balance
    the nature of the misconduct, the needs of the employee and employer and the viability of the collective
    relationship.
 arbitrators interpret CBA relying on new version of democracy in workplace via fairness
 background assumption shouldn‟t be management rights but rather management rights must operate fairly
 along w/ fairness emerged a reasonable and non-discriminatory way for managers to exercise their power
 eg. Aro Canada – we saw that employer could not exercise his will on a whim when requiring an appropriate
   level of skill and care on an employee. These notions that function apparently within the exclusive domain of
   managerial decision-making ought not to be carried out in an arbitrary, discriminatory or unreasonable manner
   have gained some currency among arbitrators.

Metro Ambulance Case
FACTS: The employer unilaterally changed the protocols as to when drivers had to drive with their sirens. The
union challenged that unilateral management decision on the basis that it was arbitrary. There was no evidence of
any problems with the way the previous system operated and there were serious concerns about the safety of the
drivers and there was no attempt to consult with the union and hear their concerns.
DECISION by ARBITRATOR: The employer failed to show any legitimate business justification for this change
in policy. It appeared to be an arbitrary decision made by management with no real rationale – therefore, this
decision by employer reversed.

 The Doctrine of Fairness says that management has the powers, but must not exercise them unfairly, in bad
faith, or in an arbitrary or discriminatory manner.
 Management decisions are subject to review by the arbitrators and must be connected to some sort of
management concern.

N: What if the Employer could prove a rational business move? – limitation of the doctrine of fairness.
Once you establish a legitimate business justification, there is no further balancing of the Employee vs.
Employer rights. – the arbitrator will not try to impose a fairer response.  Unless you can show that it
violates the Health and Safety Act.

N: The potential of the duty of fairness doctrine has not gone unchallenged. – Palmer and Palmer in Collective
Agreement Arbitration in Canada have said, “In light of these recent cases, it would seem that the introduction
of the duty to act fairly in the exercise of management’s rights may amount to only a brief imposition of this
doctrine which is already coming to an end, and will be replaced by a return to the prior traditional view of
management‟s rights.

Larger Point: Unlikely that greater workplace democracy is going to be brought out through adjudication.
Changes generally occur through struggles from below – workers enabling grass roots mobilizing approach rather
than using the justice system.


COLLECTIVE ACTION

Liberal voluntarism
 : a number of changes  criminal prohibition on combination was repealed so that it was no longer a crime to
combine for the purpose of increasing their wages. At the same time though there was closer criminal control on the
means of achieving combination. Otherwise though, it left employers and workers to come to whatever
arrangements they could come to within a regime of freedom of contract – didn‟t have to deal with anyone that they
didn‟t want to deal with.

Industrial voluntarism
: modifications to the prior regime (liberal voluntarism) as the parameters of industrial conflict increased and needed
to action to deal with collective arrangements – Industrial Disputes Investigations Act  compulsory conciliation.
Workers couldn‟t strike and employers couldn‟t lock out until

Furthermore, there were also developments in the common law aimed at industrial conflict – development of
economic torts. This placed further restrictions on the ability of unions to use certain kinds of tactics and gave
employers access the judicial remedy of injunction. Employers could apply to the court through a summary process
for an injunction prohibiting behaviour and if workers disobeyed they were liable for a variety of different sanctions.

The above regime lasted until WWII and after which we got the regime which we currently have. It is now a
RIGHT to join a union and employers may not interfere with the rights of employees to join a union of their
choosing. Once a union has been certified, the employer must recognize that union and there is a also the duty to
bargain in good faith. Within this regime though we still have the imprints of the old regime. In most provinces, the
common law regulating picketing and other kinds of strike related activities are what govern those activities. A few
provinces deal with these issues by statute but for the most part it is through the common law.




DUTY TO BARGAIN IN GOOD FAITH:
 The requirement to bargain in good faith gives meaning to the compulsory recognition of unions [OLRA s. 17]
 Policy: rational discussion will lessen industrial conflict
 Every reasonable effort must be made to reach an agreement, but there is no obligation to actually reach an
   agreement
 The parties are only obligated to engage in a process of negotiation in good faith
 Collective bargaining is still based on the underlying notion of voluntarism
 Purpose of duty: Gives effect to recognition of union as exclusive bargaining agent – promotes dispute
   settlement
 General content of duty: Goal is to provide process of negotiation, but not to require settlement on any
   particular terms.

How LRB have filed out the content of duty to bargain in good faith:
• There is no duty to reach an agreement - just a duty to bargain in good faith
• simply requires the parties to engage in the process - to see if the parties have participated in a process of
   negotiations in good faith with willingness to enter into CA if the terms are acceptable
•   classic statement of this De Vilbiss Case
•   we compel negotiation and compel bargaining in good faith, but no compelled decision making - this would
    interfere with normal business market
•   given this premise, what happens when one of the parties takes a hardline approach to negotiations - I will not
    enter agreement unless you accept these conditions:
•   how do LRBs distinguish between bad faith bargaining and good, hard bargaining in one‟s best interests?
•   look to the case law:



United Electrical, Radio and Machine Workers of America v. De Vilbiss (Canada) (1976)
FACTS: Facts that give rise to suspicion of bad faith bargaining.
1) Union recently certified in face of strenuous employer opposition
2) Conduct of negotiating session:
    - Cutting short negotiations to move for concilliation
    - Walking out of concilliation and failing to attend another session
3) Unilateral alteration of terms and conditions of employment
4) Treatment of members of negotiating committee
5) Failure to provide job class and wage rate information (employer refuses to provide basic info to union which
    precludes union to formulate a proposal and negotiate over terms and conditions.

Premise: We compel negotiation and compel bargaining in good faith, but no compelled decision making - this
would interfere with normal business market

ISSUE: Did the Employer breach the statutory obligation to negotiate in good faith?

Given that the above is the central premise, what are Labour Relations Boards supposed to do when one side takes a
hard line – I will not enter into an agreement, unless you meet these conditions – Is this bad faith bargaining, or is
this necessary to pursue their best interests and therefore acceptable? It becomes a difficult issue. How does the
Board differentiate b/w permissible behaviour from bad faith bargaining?

HELD: All of the unions dirty tactics led the Board to decide that the employer had no intention to enter into a
collective agreement and was not bargaining in good faith.

From the evidence, the OLRB concluded that the company had not entered the negotiations in good faith and had no
intention of concluding a collective agreement.

RATIO- (1) s.14- The duty described in s.14 has at least two principle functions. The duty reinforces the obligtion
of an employer to recognize the bargaining agent and the duty is intended to foster rational, informed discussion
thereby minimizing the potential for industrial conflict.

(2) the section imposes an obligation on both unions and employers to enter into serious discussions with the shared
intent to enter a collective agreement. Once a trade union is certified the employer must accept that status. It cannot
enter into negotiations with a view to ridding itself of the trade union. Common objective the parties must have
is to enter into an agreement. However, this is not to say that they are obliged to agree to the content of that
agreement. It is still based on the notion

Remedy: Union wanted Board to compel employer to enter into agreement; Board cannot do this bc inconsistent w
voluntarism; can just order them to go back and bargain; some coercion to make voluntarism work

N: Boards concerned w/ a PROCESS, exchange of rational discussion, focus is NOT ON SUBSTANCE OF
POSITION THAT parties have taken; if focus on substance, more of a direct regulation on outcomes
N: But how far can draw the line between process and substance (that certain provisions are not acceptable for
parties to take)
The Duty to Discliose:
 Do employers have to disclose to the union during the period of collective bargaining, any plans they have
    about workplace modification, etc. Labour Relations Board have had to struggle with this issue.

Consolidated Bathurst Case
FACTS: CBA entered, but shortly thereafter the employer decided to shut down. The employer did not discuss the
plans that they were considering at the time the CBA reached. The union had not made any inquiries as to plans but
makes allegation of bad faith bargaining.
BOARD/RATIO: There is no duty to disclose plans that are not final decisions but the board makes an inference
on the ground that the employer shut down shortly after CBA reached that the employer de facto made the decision
to shutdown at the time of CBA reached. Rebutable presumption that decisions announced in period after
signing of CBA were made earlier and ought to have been disclosed.

Canadian Pacific Forest Products Ltd.
(Extended Consolidated Bathurst to not only shutting down but also technology that will have impact on employees)
FACTS: There was a technology change and they needed to decide whether to keep the old turbine in operation.
This extends the issue of disclosure into the area of technological change and is not limited to plant closure decisions
– Union claim – if we knew that would happen, we would have negotiated this with you.
Remedy: It is NOT appropriate for the board to direct the employer to put the old technology back in to operation
(the board will not tell the employer how to run its operations, will not tell the employer not to shut down or to not
put in new technology)
The Board orders them to go back and negotiate over the impact of the decision to put in new technology. If
they failed in these negotiations, the union has NO right to strike because there is a collective agreement in place and
cannot strike during the period of the Collective Agreement.

Westinghouse Canada Limited
FACTS: Collective bargaining takes place, an agreement is settled and then 3 months later it says it is revoking
parts of its operations in certain cities. A complaint is filed that the employer failed to expose plans and therefore
deprived the union of the opportunity to negotiate with the employer the effect of these plans upon the employees
and the workplace. Had they known about it, it would have been on the top of the negotiation list and they would
have done something to protect their members.
BOARD: The Board finds a duty to disclose decisions that have already been determined at the time the
negotiation took place. It would had to have told them about these plans, even if they hadn’t asked. If they
did ask, they also would have been under a duty to disclose. The employer would have had a duty to answer
the question honestly but not on its own initiative, it would not need to disclose plans that they are thinking
about, but have not yet implemented.
      The union failed to ask about the plans the employer hadn‟t at the time of the determination implemented
          the plan and therefore there was no bad faith bargaining. However, the union still won on different
          grounds.
      Breakthrough case in defining the issue of disclosure

Legislative Responses:
 s.45-52 contains sections on the content of the collective agreement.
 There are some exclusive to first contract scenarios and others are more broad
 s.45-52 – Foundational elements (eg. recognition, no strike/lockout, grievance arbitration)
 s.47 – Mandatory Rand
 Mandatory Just Cause

Mandatory Rand – Everybody has to pay union dues
 Amendment to LRA – unions would not have to negotiate for that provision
 Union shop provision (making membership to union mandatory that had to be bargained for)
First Contract Arbitration

s.43 LRA – now allows for unions to apply to the board for an order to have the first contract resolved by arbitration
rather than by the typical way of negotiation. In order to get that, they do NOT have to show that there has been bad
faith bargaining on the part of the employer, rather, it has its own criteria – it must appear to board that the process
of CB has been unsuccessful because of:
a) The refusal of the employer to recognize the bargaining authority of the union
b) Uncompromising position adopted by the respondent without reasonable justification
c) Failure of the respondent to make reasonable expeditious efforts to conclude a CA; OR
d) Any other reason the board considers relevant

 Clearly, where arbitration by a contract is not voluntarily entered into by both parties, having a 3rd party intervene
and make a decision is clearly against voluntarism. Trying to get them to come to an acceptable first contract and let
them be on their own after that.
NOTE: This section is not used very much (1999-2000 – 21 applications made for first K arbitration)
 Percentage of newly certified bargaining units obtaining collective agreements: 1992-2000:
    2000 – Little over 25% were successfully negotiating CBA after certification.
    1992 – Over 80% were getting CBA after certification.

Royal Oak Mines v. Canada (Labour Relations Board)
FACTS: There was an extremely bitter strike at the Royal Oak mines in Northwest Territories. They used
replacement workers (hadn‟t been done in a number of years). Anytime there is the use of replacement workers,
then violent confrontation is likely to occur. Here, there was a bombing – someone set a bomb off through the mine
and 9 of the replacement workers were killed. One mine worker was convicted for murder. There were efforts made
by the federal and territorial governments to bring this strike to an end, but the employer was bent on breaking on
the union – had no intention to come to an agreement.  The union filed a complaint based on failure to bargain in
good faith which exists even during a strike.
 They based this on a number of grounds:
           You are trying to reach an agreement on back to work protocol (after a strike has occurred) which
              includes provisions for arbitration in regard for any disciplinary action that may have been taken by the
              employer during the strike. Clearly, here the employer had terminated striking workers for picket line
              violence. One of the terms the union wanted was an arbitration provision so that the workers who
              were terminated could be looked at to see if there was just cause for the discharge.
           The employer insisted that all striking workers would be given probationary status when they returned
           Also, during the strike, replacement workers are also workers and enjoy rights under the Labour
              Relations Act and there was an attempt to have the replacement workers de-certify the bargaining agent
              and have their own union certified as the bargaining unit. But, they were disqualified from being
              certified since there was evidence of participation by the employer
DECISION: They found breach of the duty to bargain in good faith and made the employer put on the table an
offer that had been previously rejected by the striking workers and that they agree to an agreement for workers that
had been dismissed during picketing. The employer sought judicial review  made its way to the SCC
SCC: – There are 2 Elements in the Duty to Bargain in Good Faith
              1) Subjective – both parties need subjective intent to participate in the negotiation process in good
              faith
              2) Objective – duty to make reasonable efforts to reach a collective agreement – look at standards in
              the industry (assessed objectively)
               Suggests that the refusal to agree to a term that is a standard in the industry is almost per se bad
                   faith bargaining – unreasonable if did not negotiate a term that others in the industry have accepted

OTHER ISSUE (remedy): The other ground for challenging the Labour Relations Board decision was that the
remedy that they ordered was beyond their powers –that they weren‟t authorized to require the board to put terms
and conditions back on the table.
     It is Interesting that one of the grounds argued – was that one of the principles of voluntarism has been violated
– forcing them to do something. The court should either hold that the board had no legal authority to make this
order or if it was within their jurisdiction, it was unreasonable.
The COURT SAYS: Although it is true that free collective bargaining is a right, in extreme situations, they (the
board) can impose such a remedy – don’t need to be as bound in giving remedies violating voluntarism in
extreme circumstances.

Para 98 (remedy) “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 the 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 WITHIN THE COLLECTIVE BARGAINING SYSTEM:

a. Duty of Fair Representation
 Union is exclusive bargaining agent for all members of bargaining unit. Becomes party that has exclusive rights
    to administer rights on behalf of all
 Controls access to grievance process – union must process grievance for them
 Balancing rights of individuals against collectivities: Volunteristic approach or interventionist regime where
    individual rights are more strongly protected.  See how these tensions have been resolved in present CBA:

Provisions that provide individuals with protection against certain types of behaviour:
 LRA – Reinforce HR protection and some which go beyond that.
 S.15 – Prohibits certification of unions that discriminates on prohibited grounds.
 S.54 – Prohibits collective agreement from discrimination contrary to the Charter or HRC
 S.51(2) – Provides employees with some protection from loss of union membership (limits consequences from
    expulsion from membership.
 S.74 – Imposes duty of fair representation – “not to act in a manner that is arbitrary, discriminatory, or in bad
    faith, in the representation of any of the employees in the unit, whether or not members of the trade union.” (this
    has been held to apply in the context of the union‟s role as negotiator and in control of the grievance procedure)
          UNLESS it is a case in which there is subjective bad faith – (ie - the union is out to get a group of bad
         employees or has behaved in such a way that has been deemed to be failing to listen to the concerns of a
         particular group of employees), it is unlikely to intervene. There is not a lot of success arising in the
         context of the negotiation of the collective agreement. By and large, trade union‟s internal processes of
         determining priorities in the negotiating process have been left alone, without any meddling. Boards, have
         tended to give unions a fair bit of leeway and haven‟t held them to such a high standard of conduct.



Grievance Procedure/Arbitration – s.74 LRA:

Why Boards are Hesitant to Intervene: Ford Motor Co.
Factors Boards should be considering as it attempts to flush out this duty of fair representation:
 Levels of trade union officials‟ expertise and experience varies (lay people making decisions should be given
    some leeway).
 Unions need to be able to reconsider implication for grievance for bargaining unit as a whole
 Don‟t want to make unions risk averse to setting grievances
 Don‟t want to undermine union authority to settle disputes conclusively
 Must be some finality and unions should be able to make these decisions without fear of individuals getting
    these decisions overturned. The trade union should still be given a fair degree of leeway since there are many
    reasons why the may not take grievances all the way to arbitration.
Walter Princesdomu
This case tries to put a gloss on the different elements of the duty to represent. It draws some line about things that
may have caused unions to fail at their duty to bargain fairly. (Whether union is guilty):

1. Subjective ill will motivation to particular individual or group w/in union IS a ground for breach of fair
representation (prohibited to negotiate terms that discriminate b/w union and non-union members.)

2. In regard to discrimination, if the union‟s decision making is based on prohibited grounds, it is a violation of the
Human Rights Code and the duty of fair representation under s.74.

3. Arbitrary Action  We don‟t only have to find subjective ill will, there may be other conduct by the union that
may be characterized as arbitrary. The mere fact that a union though may have made an error in judgement or may
have been negligent in the way they processed the claim, doesn‟t mean that it is a breach of the duty of fair
representation. But, at a certain point, the Labour Relations Board is justified in drawing an inference that the way
the union handled the matter was so unsatisfactory and uncaring of individual concerns that it constitutes arbitrary
conduct. They don‟t hold them to a high standard conduct, but if they give so little attention to the matter, at some
point the Board will be justified to draw an inference that they failed in their duty.

(No right to have grievance taken to arbitration, even if meritorious & No liability for “mere errors of judgement,
mistakes, negligence and unbecoming laxness).

The Individual Contract of Employment in the Collective Bargaining System

   Whether an employee can enforce a term of a collective agreement by bringing an action in contract.

2 Theories: Post Statutory Bargaining Sphere: After statutory collective bargaining schemes after WWII – what
was left of the individual contract of employment? Could workers enforce their collective agreements?

1) Incorporation: Employees can sue on theory that the terms of CBA are incorporated into subsisting individual
K‟s of employment – provided courts not required to interpret CBA. (As long as terms not in dispute – ie. just hours
of work in dispute)

Nelson, Grottoli, Hamilton Railways case
Here, they took the view that there was still subsisting an individual contract of employment whose terms could be
derived from the collective agreement and individuals could sue in court for breach of contract provided that the
action didn‟t require the court to engage in the interpretation of the collective agreement. This principally would
deal with where workers were suing for unpaid wages.



2) New World: When parties enter into the new world of CBA, the old world of individual contract of
employment has ceased to exist; union does not literally act as agent for members but is independent contracting
party.

McGavigan Toastmaster Ltd. v. Ainscough
(Illegal Strike - Termination - Severance Pay Claimed - Collective Agreement Still Applies)
FACTS: The employer announced it was planning on closing down (part of its operations) and the unionized
workers went on strike trying to influence their employer‟s decision and to find some way of negotiating with their
employer about the plant shutdown. The employer said it wouldn‟t pay the striking employees and continued to shut
down the plant right away – they refused to pay the severance due under the collective agreement since there has
been a repudiation and they have breached their contract of employment and therefore have ceased to be employees.
(it is illegal to strike during the life of a collective agreement.)
ISSUE: Are there individual contracts of employment that could have been breached and alternatively, if we‟re
talking about breaches of collective agreements, do we talk about repudiation and fundamental breach – do we
incorporate the old doctrines into the new world?
DECISION: There are no individual contracts of employment to speak of here and this can’t be a ground for
saying these employees had quit and therefore weren’t entitled to claim contract benefits. AND he goes on to
say that these are different worlds and there should be no reason to assume that doctrines that had been developed in
the context of the individual contract of employment and in common law should be incorporated into this regime. In
the context of the industrial relations world, it is a new world, a different order and there are other ways of dealing
with these issues.
Reasoning: It is not possible, given the statutory framework, to speak of individual contracts of employment and to
treat the collective agreement as a mere appendage of individual relationships
NB: Consequently, questions such as repudiation and fundamental breach are not applicable. A collective agrmnt
cannot be terminated by repudiation by one party merely because the other party has broken one of its terms.

Tort Claims Arising Out of Employment:

Weber v. Ontario Hydro (1995, SCC)
(No Common Law Claim for Collective Agreement Violation - Use Grievance Arbitration)
FACTS: Weber claimed sick leave benefits. The employer hired a private investigator. Evidence was gathered
which indicated that the illness was fabricated. Weber was suspended. The union filed a grievance on the basis that
the hiring of a private investigator contravened the collective agreement. Weber began his own court action against
Ontario Hydro alleging tort and breach of Charter rights.
ISSUE: Is this dispute within the jurisdiction of the courts?
DECISION – SCC: They SCC applied the exclusive jurisdiction approach  there is no overlap b/w the
jurisdiction of the grievance arbitrator and the court therefore, we need a test to determine who has exclusive
jurisdiction – the arbitrator or the court.
          Test to determine if the matter is with the arbitrator: – Does the dispute arise expressly or inferentially
          out of the collective agreement?
          In order to determine the essential character of the dispute, the court says you look at 2 things:
                         1) The nature of the dispute (focus on the facts surrounding it, not the legal form it takes)
                              and
                         2) The ambit of the collective agreement.  if facts come within the ambit of the
                              collective agreement, then it is within the exclusive jurisdiction of the arbitrator and you
                              cannot pursue a civil action
Here , the court said that the essential character of the dispute arises in relation to the above interpretation,
violation…. of the collective agreement. Don‟t look at the legal form, look at the facts of the case, about the
employer‟s investigation. And therefore the complaint must be brought to arbitration.

NB: On its face then, Weber seems to be a continuation of the line of SCC cases (above) which is keeping
employment in the collective bargaining arena pursued by grievance arbitration. There is less room to take these
complaints to the courts.

Regina Police Assoc. v. Regina (SCC, 2000) – a matter of police discipline is subject to the Weber test as well.
Look at the essential character of the dispute and see if it falls within the ambit of CBA or statutory scheme. Central
character of dispute is a matter of discipline which came under the Police Act, therefore had to seek remedies from
Police Act, not CBA.

Human Rights: Do Grievance Arbitrators have jurisdiction over human rights?
 Changed by statute in ‟92 – Arbitrators could consider and apply Human Rights Code in their arbitrations.
   Therefore, there is possibility of choice between going to HRC tribunal or grievance arbitration which can
   consider HR Code if under a CBA.
 However, with ESA issues – you MUST go to grievance arbitration if arguing an ESA issue and under CBA.
 What is the policy rationale for distinction between HRC and ESA?
    Expertise of boards of HR Commission dealing with sensitive matters that grievance arb couldn‟t?
        Grievance arbitrators might approach issue from industrial perspective rather than HR perspective.

Summary: Statutory provisions (ie. ESA) and Weber decision funnels complaints to grievance arbitrators.

Individual Contracts and Strikes and Lockouts
3 Scenarios:

1) After CBA expires, but before a union is in a strike position, what governs the relationship?
 After a collective agreement expires the union may strike. What is the relationship b/w the employer and the
    unionized work force when the collective agreement expires?  The individual contracts of employment or
    collective agreement continue to operate notwithstanding the fact that it has expired .
 s.86 LRA – statutory freeze on any terms of CBA
 s.86(3) during this period there is also arbitration over any differences that arise over the meaning of the
    statutory freeze.

2) Union is in a strike position but no strike - neither party has resorted to their economic weapon so that
employees are still working. What is the legal relationship?
 Statutory freeze position of s.86 will only last until the parties get to a legal strike and lockout position. Does
    this mean the employer can now start negotiating individually with employees? – this will depend on the facts of
    the case, but even when the parties have reached this point, certain things remain true: if the union is the
    bargaining agent, the employer can‟t go behind the back of the union and negotiate separately and there is still
    the duty to bargain in good faith.
 If the employer unilaterally alters the terms of the agreement – this would be a breach of the duty to bargain in
    good faith. - DeVilbiss – not per se illegal to alter terms at this time but it may be raised as pattern of breach of
    duty to bargain in good faith

3) During Legal Strike or Lockout?
 s.1(2) LRA: during strike or lockout, those workers are still employees. They are still by law employees for the
    purposes of the Labour Relations Act. What is the significance of that – if the strike is settled, they may have a
    return to work protocol. What if the strike fails or an individual employee chooses to cross the picket line and
    return to work.
 s.80 LRA: – striking workers are entitled to be reinstated within 6 months. Outside of the 6 months, don‟t
    have statutory right to be reinstated. Any employee who wants to come back is entitled to do so within 6
    months subject to the employer‟s staffing and issues of that sort. Cannot treat employees differently b/c they‟ve
    been on strike
 s.80 preserves a right for employees to get their jobs back and gives them a priority over replacement workers.
    Once you get beyond 6 months, the issue is cloudy and there are no per se rights – Difficult question as to at
    what point do they cease to be employees.

STATUTORY CONTROLS ON STRIKES AND LOCKOUTS

Definition of Strike and Lockout under LRA (s.1):

“Strike”  legislation broadly defines a strike to encompass any kind of collective action by workers which
involves stoppage of work or restriction of output and is a strike regardless of the purpose of using this collective
action – individuals who walk out as individuals are not on strike. There must be the element of concerted action.
 Not concerned with the purpose of the strike. As long as you have acted in concert to limit / restrict output, it
     doesn‟t matter why (or what your purpose is).

“lock out”  closing or suspension of work with a view to compel or induce employees to agree to terms of
employment - therefore, if these have other purposes, ie. to influence the government or improve bottom line, this is
not a lockout and therefore not subject to the restrictions of the OLRA
When is it legal to strike or lock out employees?
 Section 46 LRA: (mandatory requirement) every CBA has a term that states there is to be no strike or lockout
   during the life of the CA; i.e. illegal (even for political purposes)
 Before striking, first must go through a process of bargaining and conciliation – s.79(3)
 Conciliation must have failed – and there are certain waiting periods after conciliation (normally 7 days after
   conciliators report)
 Anything outside that time frame is an untimely or illegal strike
 Must be a strike vote - at least 50% of those voting must be in favour of strike

Restrictions:
 It is unlawful to call an unlawful strike. It is also a violation of section 81 of the Labour Relations Act to
    threaten to strike before in legal position to do so and section 82 makes it unlawful to threaten to lockout
 section 83(1): causing unlawful strike/lockouts says that (with respect to lockouts) persons may not engage in
    acts that they know will result or will likely result in an unlawful lockout or strike (if the trade unions engage in
    actions that would result in a strike, then they can be held liable under this section)
 The Ontario Labour Relations Act is Very Serious about the peace obligations  the Collective Agreement is
    to provide industrial peace during its duration.

Remedies for Untimely Industrial Action
 If an employer wants to pursue a remedy against an unlawful strike, they have many remedies:

1) Grievance Arbitration:
 If there is a collective agreement in force, then an unlawful strike or lockout is a breach of the terms of the
    collective agreement so the parties can seek arbitration in order to get a remedy. Arbitrators have the power to
    award damages against trade union officials and the trade union itself unless they took every effort to prevent
    the strike from happening. Trade union officials have been held to a very high standard .
 Employee members can also be held liable since they are in violation of the collective agreement by striking:
    disciplinary discharge

2) Labour Relations Act:
 To go before the Labour Relations Board. S.100 of the Labour Relations Act allows employers to get a
    declaration from the board that a strike is unlawful and order a cease and desist order. There is also a similar
    remedy for unlawful lockouts.
 Once you have the order from the Board, under s.102 you can file it in court so the court‟s order has the same
    effect as a judicial decision and can be enforced as a court order and can be found guilty of contempt of court
    and are subject to fines and potentially imprisonment.

COMMON LAW CONTROLS

   The LRA is largely a questions of timeliness – that is, the statue tells you when you cannot strike. Presumably
    there are times when you can strike. Beyond statutory controls, in most jurisdictions, strike activity comes
    under the common law.
   There is this whole other layer of regulations governing collective action by workers. Therefore, both timely
    and untimely strikes will be subject to both the common law and statute.
   Even where a strike activity is permissible under the statute, it may well offend the common law.

Common Law Controls – Inducing Breach of Contract
Tort of Inducing breach of contract: 1) Direct Inducement; 2) Indirect Inducement

1) Direct Inducement of Breach of K: (must involve)
a) Intent to injure P
b) Knowledge of the existence of K b/w P and 3rd party
c) Use of lawful means to induce breach by a 3rd party
d) Breach of K results
e)    Economic injury to P results


Employer --------(k of supply)----------Supplier
                                         -
                                       - (induce supplier to breach their K)
                                     -
                            Union

     Employer suffers damage based on inducement by union to breach K
     Unions can‟t use these types of tactics against employer

2)   Indirect Inducement: (must involve)
a)    Intent to injure
b)    Knowledge of existence of a K between P and 3rd party
c)    Threat or actual use of UNLAWFUL MEANS to induce a 4th party (supplier‟s emplyees) to breach its K with P
d)    Breach between 3rd party and P ensues
e)    Economic injury to P results

Employer----------------------------Supplier (3rd Party)
                                      -
                                      - (K of employment)
                                      -
                               Supplier’s Employees (4th Party)
                                      -
                                      - (Induce employees to breach)
                                      -
                                    Union

N: Unlawful Means: Just asking a 4th party to breach its K with a 3rd party is unlawful means.

Employer --------------------------Supplier A
                                     -
                                   Supplier B
                                     -
                                   Union

N: If union asks supplier B to stop doing business with supplier A, then there is no unlawful means
BUT, if there was a K between supplier A and B and union asked B to breach with A, that would allow supplier A to
have a cause of action against the union for inducement of breach of K and employer would Also have cause of
action against union for indirect inducement of breach of K.

Common Law Controls – Conspiracy to Injure – Unlawful Purpose & Unlawful Means

Hersees of Woodstock v. Goldstein
(Secondary Picketing - Injunction - Civil Conspiracy to Injure by Unlawful Means)
FACTS: Amalgamated clothing workers represented Deacon brothers and they were having a dispute. The
collective agreement had expired and the union was in a lawful strike position, but instead of striking, they adopted a
boycott and began a campaign telling people not to buy clothing manufactured by Deacon Brothers.
For this campaign, they stationed a person wearing a sign in front of a retail outlet where the clothing was sold
saying that the workers that worked for Deacon were non-union labour protected workers and if you want to protect
your standard of living, don‟t buy clothing from there.
 The retailer, Hersees, seeks an injunction claiming a bunch of torts have been committed – inducing breach of
contract, civil conspiracy to injure (not criminal), and common law nuisance. Hersees lost at trial.
I: Should the injunction be granted?

H: Yes. Appeal Allowed. Judgment for Hersees.

R: Civil Conspiracy to Injure
 the conspiracy involves 2 types:
1) a combination that involves lawful means to achieve unlawful purposes or
2) a combination that involves unlawful means whether or not the purpose is lawful (this one applies)

Unlawful purpose  was the dominant motive to cause harm or the dominant motive to benefit one’s self?
Court‟s have held that where the dominant motive of combination are for the benefit of the combination and not
simply for the purpose of injuring another person, then no tort is committed. People can combine for the purpose of
improving their situation, even at the result of harm to others, as long as no unlawful means were used.

        for this tort, the issues has always been “was the dominate motive to cause harm or the dominate motive to
         benefit oneself”
        courts have held that where the motives of the combination are for the benefit of the combination and not
         simply for the purpose of injuring the other party, then they are ok provided no unlawful means used

In Hersees, what was the purpose?  for collective bargaining purposes (to get a better deal with Deacon). There is
a benefit intended for the members and that is why the union is doing it.
How does the court of appeal deal with this? – there would be better ways in their view of putting pressure on
Deacon brothers and therefore if there are better ways and you haven’t chosen the best way, you may be liable
for the tort of conspiracy to injure even if you’ve done it for the benefit of its members.
- Judgement has nothing to do with inducing breach of K – instead picketing was criminal conduct!

Aylesworthy J.A.
Concludes: a K existed, knew of K and attempted to induce appellant to breach it by picketing his premises,
picketing is a besetting and is unlawful as per criminal code it therefore ought to be restrained. Secondary
picketing itself is illegal. In reality all other torts break down in this analysis, what we are left with is secondary
picketing itself being a cause of action.

 R: Secondary Picketing is per se Tortious!!
(The case illustrates the thinking of the court that anything that takes a dispute beyond the employer and its
employees must be prevented)
• civil conspiracy to injure - purpose was unlawful, to harm someone in their business and not to further the union
• induced breach of contract - either directly or indirectly
• per se illegal - Hersees Case - the right of people to trade trumps whatever privilege workers might have to
    picket once it moves away from the primary site

N: Clear up Direct vs Indirect inducement of K in Hersees. – Believe they are saying – there was conspiracy to
injure based on unlawful means BUT saying this is an indirect inducement to breach K doesn‟t make sense – looks
more like a direct inducement)

Tucker‟s Summary of Hersees
Basically, Aylesworth first went through the inducing breach of contract
analysis and concluded that the union was liable on that basis. Then,
he continued to state that although he could not find a specific
precedent, secondary picketing was per se tortious. He justified this
on the basis that the right to trade was more fundamental (and therefore
deserving of protection) than the right (if there be one) to picket
secondary targets. The holding that secondary picketing was per se
tortious was independent of other theories of liability, including
inducing breach of contract and civil conspiracy to injure.
International Brotherhood Of Teamsters v. Therien
FACTS: City construction company has collective agreement with Teamsters regarding their own employers and
also a contract with someone else, Therien (independent contractor of the city) to supply drivers and trucks (getting
their labour in 2 ways). Teamsters take the view that their collective agreement says that all drivers must be part of
the union and that they must join the Teamsters. Therien, who supplies the drivers says he can‟t join since he is the
employer. Business agent for Teamsters is not happy with that - goes to the city and says that if continue to do
business with Therien they will picket. Company severs relationship with Therien and he sues.



COURT:
    Was this inducement of breach of contract?  It would have been but the City did not breach any contract
    - there was no ongoing relationship to which a contract existed for. Therien does not have an ongoing K, but
    rather has a series of Ks. This is not a breach of K, just not going to continue Kting with you.

      Was this conspiracy to injure?  where is the conspiracy? – The business agent went to the City and
      threatened  said if you don‟t stop doing business we‟ll threaten but based on the evidence, there is no
      evidence/proof of conspiracy - only one individual acting on own

      What about breach of statute? - this would have been an unlawful strike b/c union and City had a binding
      Collective Agreement, however, from torts, courts generally take the view that there is no independent tort
      for breach of statute - unless the courts find that the legislature intended it that way and there is something
      else showing intent to breach.

How did Therien win?: They developed the Therien tort. They intended to injury Therien by threatening to use
unlawful means and this committed a tort

Therien Tort  tort of intention to injure by unlawful means also known as interference with a contractual
relationship without proof of combination. (no conspiracy to injure)
 Because they had intended to injure Therien by threatening to use unlawful means, a tort had been committed?
N: As each new situation presents itself, the courts have been prepared to exercise all their creativity to find a
remedy for the situation.

Gagnon v. Foundation Maritime Ltd
FACTS: The union sought voluntary recognition from its employer. The employer refused. The union‟s response
was to erect a picket line and shut-down the business of the employer.
ISSUE: Was the picketing lawful?
HELD: Picketing Unlawful. The court was unable to classify the conduct as otherwise being tortious, so it was
held that the strike was unlawful. A recognition strike amounts to a civil conspiracy to injure by unlawful means.
Court looked at both conspiracy to injure issues:
    1) conspiracy to achieve an unlawful purpose - ie. to injure someone in their trade
      The union striking not for shear pleasure of injuring Gagnon, but were striking for the purpose of gaining
      voluntary recognition - there is nothing unlawful about trying to gain voluntary recognition – it is permitted by
      the LRA.
    2) conspiracy to achieve lawful purpose by unlawful means - were there unlawful means here?
      Problem: do labour relations statutes prohibit recognition strikes?  they don‟t prohibit directly - no provision
      saying that this is unlawful expressly. On other hand, CB statutes provide a mechanism for getting recognition
      through certification - does this mean that this is the exclusive way to get recognition if the employer will not
      give it voluntarily?
SCC: We have s.79(2) - cannot strike or lockout until go through the conciliation process. Then by
implication, there cannot be a recognition strike - cannot get to conciliation until certified and gone through
bargaining
RATIO: Certification strikes will be unlawful constituting civil conspiracies to pursue a lawful purpose by
unlawful means. It is an untimely strike - not permitted at this point in time.
If the employer will not recognize you voluntarily, the only way to get recognized is through the certification
process - no right to strike for recognition.

Labour Injunctions
Principle: It is necessary to have the ability to stop the tortious action immediately - injunction says “union shall
cease to continue in these activities” is very powerful.

Ontario Courts of Justice Act - s.102: Sets out substantive and procedural requirements for obtaining an injunction
in the context of labour disputes. s.102(1) what constitutes labour dispute (definition)
The most important restriction is s.102(3) - In order to get an injunction, the applicant must show that they have
made reasonable attempts to get police assistance and supervisor to ensure no damage to property, harm to people or
breach of the peace  It is necessary to show that they were unsuccessful in obtaining police assistance in dealing
with these situations.
s.102(4) – Affadavit evidence re injunction restricted to facts within personal knowledge s.102(4)
s.102(6-8) – Timely notice of motion must be given in specified form, unless emergency

When Does a party have to comply with provisions of s.102? (definition issue) Domtar

Domtar Inc. v. Lampi, Leronwowich, etc.
FACTS: There was an unlawful strike between the union and BoiseCascade. The union can picket their place of
business as long as there was no violence, obstruction, etc. and BC cannot get an injunction to stop it. BC had a
business relationship with Domtar which is s separate company. From Domtar, they get inputs for production
process. In the normal course of events, BC employees go onto Domtar‟s grounds to assist in the preparation of
materials. During the strike, Domtar hired and independent contractor to do work that was formerly done by BC
workers who were currently on strike. The union put up a picket line in front of Domtar - says they involved
themselves in the dispute, actively assisting BC by hiring people to do struck work. Domtar goes for an injunction
because Domtar‟s employees refuse to cross the picket lines and they have to shut down.
ISSUE: Is this secondary action or has Domtar chosen to embroil itself as an ally for BC and therefore fair game
for the union? - What constitutes a dispute for the purpose of s.102?
(Domtar claims they are not in a labour dispute, therefore s.102 does not apply.
COURT: s.102 does not apply to secondary action. But at what point is action considered secondary?
The court applies the Allied Employer Doctrine  if you are a third party, we will protect you against secondary
picketing, but at a certain point if you become involved, you will lose this status and lose the protection. There are
two ways you can lose this protection:
     1) The third party has become the alter ego of the employer
     2) Where the third party‟s premises have in effect become a place of business of the struck employer
H: Domtar is not alter ego and their premises is not in effect place of business of struck employer. Domtar
gets a common law injunction.
N: Here, the court draws the line allowing Domtar to assist BC while enabling them to maintain the protection as a
third party. If work is being done on Domtar‟s premises that was formerly done by BC workers, isn‟t this then
becoming ground for BC work? At what point do we draw the line where enough of the activity of the struck
employer is going on on third party premises to draw them in?

RATIO: If you have a case with secondary action, then s.102 does not apply and you are free to get an
injunction in normal ways because you are not a party to the labour dispute.

Legal Restrictions on Employer Tactics

In Ontario, s.78 LRA – deals with strike breaking misconduct. Employers shall not engage in strike related
misconduct or retain the services of a professional strike breaker and prohibits people from acting as professional
strike breakers.
Replacement Workers:
In most provinces, employers are free to hire temporary replacement workers who may become permanent
replacement workers after employee‟s right to reinstatement lapses. Employees have the right to come back to their
jobs within 6 months. After that 6 month period lapses, the question of whether striking workers can come back and
replace replacement workers becomes a convoluted issue.

The Charter of Rights and Freedoms and Its Impact on Strike Related Activity

   Some indication of Charter beginning to show possibility that it will upset the status quo.

Picketing: 3 Issues that arise:
1) Whether the Charter applies
2) Is the right to picket/strike protected?
3) If so, is the restriction demonstrably justified?

Dolphin Delivery : issues of secondary picketing
FACTS: Purolator has locked out its unionized employees. Purolator has contractual relationships with Dolphin
Delivery. After the lockout, Dolphin Delivery makes deliveries for a company called Super Courier. It is claimed
that Super Courier is really Purolator and Purolator is doing strike work. They made an appeal for a declaration that
Super Courier is an ally of Purolator. Secondary picketing of Super Courier – injunction issued. The union
challenged this as it wanted to use the Charter. (Picketing = freedom of expression)
HELD: Charter does not apply to common law based on private action – even where there is a court order such as
an injunction. However – obiter – judiciary ought to apply and develop common law principles in a manner that is
consistent with Charter values.
RATIO: The courts don’t like picketing, and even if there was state action, this would almost always be
justified in prohibiting this type of picketing.
N: Hostility expressed by court toward picketing.

BCGEU (Primary Site Picketing)
FACTS: Judge initiated injunction himself. State initiated injunction – Charter applied.
HELD: s.1 analysis: Intense hostility to picketing: Don‟t view picketing as benign attempt to do something they
have lawful right to do.
“picketing much more than simple exercise of workers freedom of expression; ipso facto impedes access; like a
signal effect – causing Pavlonian response for people not to cross picket lines. Picketing is coercive (even if no ind
tort committed) – Like Hersees!

UFCW v. K-Mart (Leafleting on secondary site)
(Leafleting distinguished from picketing)
FACTS: Unionized employees at K-mart were on strike and locked out of certain stores. The union decides to
conduct a leafleting campaign in front of other stores recommending they take their business elsewhere. In BC, there
is a statutory scheme regulating strike activity. Under that, there is an absolute probation on any action. They are
able to get an order preventing the leafleting. Statute = state action – union challenges this under Charter – FoE.
SCC: Picket lines are formidable barrier. Coercive effect rather than persuasive force: May be applied to
employer, but may not be permissible against neutral 3rd party.
BUT – leafleting is a SHARPLY DISTINGUISHED from picketing and is permitted at secondary sites,
provided not otherwise tortious. Leafleting form of expression which promotes rational discourse. It
persuasdes through rational discourse in contrast to picketing

RWDSU v. PEPSI (MOST RECENT CASE – law is changing!)
(2 private parties – challenging common law based on Charter! And is Successful!!!)
FACTS: RWDUS was involved in a lawful strike against Pepsi and also put up picket lines at a hotel where Pepsi
was housing employees brought in to assist during strike as well as many retail outlets. Pepsi got and injunction
against secondary picketing.
HELD: Charter breach found regarding injunction for secondary picketing -note – 2 private parties yet Charter
used.
No tort of secondary picketing.
SCC: Says apply approach in Hill: If common law fails to comply with Charter values, and that, when Charter
values and common law principle weighed, common law should be changed. Weigh two against each other. Onus
on party who wants to show breach – that common law fails to comply with Charter. Balancing done in some
unarticulated way.
Court takes original suggestion from Dolphin Delivery – to subject common law to Charter scrutiny. (for 2 private
parties)
RATIO:
- Strike activity legitimate in industrial pluralism
- Freedom of expression is one of the highest constitutional values
- Wallace: Imbalance between employee and employer
- Reinforces the important role played by unions in social debate
 After balancing – the tort of secondary picketing is an unjustified infringement of freedom of expression.
 Distinction between primary and secondary picketing – categorical distinction is not rational way about
     deciding how limits should be drawn.
 Protection from economic harm is important value, but not pre-eminent
 Right to trade is not fundamental or protected  Charter rights should take precedence over common law rights
 “signalling effect” of picketing is not per se coercive
 If picketing induces breach of K; trespass; civil conspiracy – all these torts still there and provides more than
     adequate controls for protecting innocent 3rd parties.
 Tort of secondary picketing is too broad – must now show some other tortious activity that takes place forming
     basis for their activity.

Uncertain Areas after Pepsi
 Can legislatures ban secondary picketing
 Invitation to govts to legislate – broad prohibition of secondary picketing will not necessarily be struck down –
   will look at with application of Charter.

What about the rest of Common Law?
 Can other torts be challenged as inconsistent with Charter values (between private parties) ie – inducement of
   breach of K infringing freedom of expression?
 Wrongful action based approach will catch most harmful picketing – law of tort may have to develop to protect
   3rd parties interests in the absence of a tort of secondary picketing.
 Field is wide open: Legislature can jump in re secondary picketing and common law courts are free to possibly
   challenge other torts for Charter infringement or create new torts. Flexibility to handles claims now?

Right to Strike Cases under the Charter

          At common law, workers were privileged to strike at anytime subject only to the susceptibility to common
law torts. Under the modern statutory collective bargaining system, there are provisions for time to strike 
limitations. The issue of right to strike has in the last 30-40 years become more contentious b/c in the 1960‟s
collective bargain rights were extended to the public sector. While the collective bargaining rights have been
expanded, so have the restrictions which can be placed on them.
           ie. wage and price controls - many directed directly at the public sector - unions couldn‟t bargain over
              wages because it was set by statute - thus could also not strike over them
           development of essential service designation - certain services workers could not participate in lawful
              strikes - this has been expanded over the years
           when public sector workers do strike, they are often subject to the effects of back to work legislation -
              has become more regular

Charter Challenges to these limitations: Labour trilogy: („87):
 Freedom of assn does not extend to protect activities taken by assn in pursuit of its objectives
 Unless these activities were fundamental rights
 Right to strike – modern right, legislatively created (CB right) – not appropriate for court to get involved and
    second guess policy judgements – end to litigation about constitutionally protected right to strike.
DUNMORE – will it make a difference Charter and right to strike?
 Court skated around how far it was prepared to go to protect freedom of association
 Some protecting against employer interference re joining trade unions
 But not overturning limitations articulated in the Alberta Reference
 Agricultural workers right to strike – question which is left for legislature.

*** Probably a tough argument to convince courts that the Charter should protect a right to strike! This
will likely not happen!

Fin.

				
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