202013 SCC 45 (CanLII).
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cOLLecTiVe BARgAining
Low wages and poor working conditions prompted workers to band together in the 19th century in an effort to improve their lot. The resulting trade unions were initially resisted, sometimes violently, but throughout the 20th century they managed to achieve respecta-bility and acceptance. The passage of the U.S. National Labor Relations Act (the Wagner Act) of 1935 (after which Canadian labour legislation was patterned) was designed to put an end to labour strife. The Act recognized the employees’ right to organize collectively, but required the union to show they had the support of a majority of the workers. Once majority support was established, the union was certified as the exclusive bargaining agent for the employees, and the employer could then deal only with the union and not make special arrangements with individual employees. In all jurisdictions in Canada labour relations boards have been established to handle disputes arising with respect to collective bargaining and related labour matters. See Table 6.2 for a summary of the types of disputes and their consequences.
Organization
All Canadian jurisdictions recognize that there is a general right for employees to be members of a trade union and to bargain collectively through a bargaining agent. The Supreme Court of Canada has confirmed this as a right under the Charter of Rights and Freedoms.21 Management, usually defined as anyone who has supervisory or disciplinary responsibilities, is normally excluded from the bargaining unit, and some categories of
LO 6
Certification process reduces confrontation
Canada follows American approach
for Guay for a period of six months. This later became full employment with no specified duration. The employment contract also contained the five-year non-competition and non-solicitation clauses. Several years later, Payette was dismissed without cause. After several months he obtained a job with a competitive crane operation business, and Guay brought this application for an injunction to enforce the restrictive covenants against him.
The Court held that the non-competition clause did not apply since there was no reasonable geographical limitation as required. However, the Court did find the non-solicitation clause valid and binding and issued the injunction. Given that today in our global economy busi-ness can take place all over the world, and the non-solicitation clause was targeted specifically at clients of his former employer, the non-solicitation clause was appropriate and not too broad. Also, the five-year limitation was rea-sonable because of the specialized nature of the services provided.
This is a Quebec case, and there is a unique provision in the Civil Code of Quebec providing that such restrictive covenants will not apply to employment contracts where the employee has been dismissed without cause. The Court, however, found that the restrictive covenants were associ-ated with the sale of the business rather than the employ-ment contract. They were therefore commercial in nature and the Civil Code provision did not apply. Although that specific provision does not apply in the other provinces of Canada, it is clear that such restrictive covenants in employment are given a much more limited application because of the inequality of the bargaining relationship between employer and employee.
We learn from this case that a non-solicitation clause, while needing a reasonable time limitation, need not have any geographical limitation. This is a significant change in the law. Also where the sale of the business involves the seller becoming an employee of the purchaser or the business the court will be more likely to apply such a restrictive covenant.
21Health Services and Support-Facilities Subsector Bargaining Assn. v. British Columbia, [2007] 2 SCR 391; (2007), 283 D.L.R. (4th) 40.
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employees such as police, firefighters, and health workers, who provide essential services, will usually have only limited rights to take job action.
A trade union seeking recognition as the bargaining agent for a group of employees must make application to the labour relations board for certification. It must show that it has a certain portion of the designated workforce signed up as members of the union; for example, 45 percent in British Columbia and 40 percent in Ontario, and similar percent-ages in other provinces. The process usually begins with disgruntled employees approach-ing a union such as the Teamsters, or union organizers approachapproach-ing the employees to sign them up as members. In most cases this won’t take place on the employer’s premises or during working hours, although an employer will sometimes allow it to keep on good terms with the union and to be aware of what is happening. Note that some jurisdictions have specifically recognized the right of dependent contractors, including those who work through their own companies, to be certified under their legislation, including the federal government, British Columbia, and Ontario.
Historically, most of the violence took place when the union first tried to deal with the employer. This is known as a recognition dispute. The current certification process largely eliminates such confrontation. Often a company will have several different catego-ries of employees, and different unions will represent them. Disputes can arise between the different trade unions as to which body should represent a particular group of workers or which union’s members ought to be doing a particular job. For example, should the member of the carpenters’ union install the new metal studs in a building or should a steelworker? This is called a jurisdictional dispute and is also resolved as part of the certi-fication process or by subsequent application to the labour relations board.
Once the particular bargaining unit has been identified and the requisite number of employees signed up, an application is made to the board for certification of the union as the bargaining agent for that group of employees. In some jurisdictions, if the union can show they have signed up a large number of employees (over 50 percent federally and 55 percent in Ontario22), the union can be certified without a vote. But in most jurisdic-tions the next step requires that a government-supervised certification vote take place.
Certification requires signing up
Table 6.2 Types of Disputes and the consequences Recognition
dispute
To get the employer to bargain with the union instead of individual employees
Certification process
Jurisdictional dispute
Rival unions contend over who should do what job or who should represent workers
Certification process or application to board
Rights dispute Disagreement over the meaning of terms in the collective agreement
Grievance procedure and ultimately arbitration Interest dispute Disagreement over what should be
included in the next collective agreement
Mediation and ultimately strike, lockout, and picketing
22Canada Labour Code, RSC 1985, c. L-2, ss. 28–29. And the Ontario Labour Relations Act, 1995, S.O. 1995 ch. 1 Sch. A, s. 128.1 (13).
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There are some jurisdictional differences, but normally if a majority of those voting sup-port union representation, the union is then certified as the official bargaining agent for those employees. The result is that the employer from that point on must deal with the union exclusively, and can no longer make separate deals with individual workers.
Even though it is a right for employees to be represented by a union and to bargain collectively, some employers will attempt to interfere with the process. Trying to intimi-date or threaten employees, creating employer-dominated bargaining units, or even changing pay or conditions of work to undermine the certification drive are usually con-sidered unfair labour practices and prohibited. Firing employees for their union activities is not only a violation of labour legislation but under section 425 of the Criminal Code, it is a criminal offence for an employer to fire or refuse to hire someone because of his or her trade union activity or to threaten or otherwise intimidate employees to keep them from joining a trade union. It is also a criminal offence for employers to conspire together to do those things. This refers to the past practice of creating a blacklist of employees in a par-ticular industry. These acts are punishable as summary conviction offences with the potential of up to a two-year prison term. In the face of such unfair labour practices, in some jurisdictions (including federally), the board can certify the union without a vote if it is convinced that it is no longer possible to determine the true feelings of the workforce through a representative vote.
Still, freedom of speech is guaranteed in the Charter of Rights and Freedoms and the employer retains the right to make comments and express opinions with respect to the organization process and its effect on the business, providing those comments don’t amount to threats or intimidation. But there are limits. An employer who played messages on loudspeakers repeatedly throughout the workday requiring employees to listen went too far — it amounted to intimidation and interference with an employee’s free choice about union representation.23
While it may be a criminal offence to fire a worker because of union activities, it is interesting that in Quebec at least it is not an offence to close down a whole plant because the workers have chosen to join a union. A Wal-Mart store in Jonquiére, Quebec was closed down five months after certification of the union and on the same day as the matter was referred to an arbitrator for the imposition of a first contract. The Supreme Court of Canada held that the closure was within the rights of the Wal-Mart chain and did not violate the Quebec Labour Code. The same result can be expected in jurisdictions that have similar statutes in the rest of Canada.
In some jurisdictions it is possible for a group of employers to band together and be certified as an association for bargaining purposes. An example in British Columbia is the Forest Industrial Relations (FIR), an association of forest companies that bargain with the forestry unions through a common bargaining agent.
Bargaining
Once certified, the process of collective bargaining begins. Either party can serve notice on the other to commence bargaining. Then representatives from both parties meet and nego-tiate with the object of reaching a collective agreement. When they do reach an agreement, it must be presented to the members of the union—the employees—for ratification. If
Certification granted with majority vote
Intimidation and coercion prohibited
But employer free to express honest opinions
23RMH Teleservices International Inc. (Re) ([2003] B.C. L.R.B.D. No. 345); 2003 CanLII 62921 (BC LRB).
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there is an employer association involved, they too must ratify the contract, and once ratified there is a binding collective agreement in place. Often, however, there is a deadlock. One of the important developments in Canadian law has been the imposition of mediation, sometimes referred to as conciliation, into the process. Either party or the government can request the intervention of a mediator who will assist the parties in their efforts to reach an agreement. The mediator acts as a go-between, trying to find common ground between the parties. During this mediation process neither party can take any further job action. If mediation is successful, a collective agreement will result, but if the mediator feels that his or her efforts are no longer helpful, the mediator will
“book out” of the dispute. The parties are then free to take further job action. An impor-tant requirement is that the parties bargain in good faith, but that does not mean that either party must compromise their position to reach an agreement. An Alberta Court of Appeal case illustrates this good faith requirement. Essentially, there should not be a change in working conditions during the bargaining process. In Finning v. International Association of Machinists and Aerospace Workers, Local Lodge No. 99,24 even before the old collective agreement expired, the employer made arrangements to contract out some of its warehousing operation without informing the union, even though they were bargaining for a new contract. When the contract came into force, there were immedi-ate layoffs, and the court found this to be a change in the terms of employment and a breach of the good faith requirement.
If the parties do reach an agreement, there are some mandatory provisions that must be included. For example, any dispute that arises after the agreement is in place (called a rights dispute) must be handled through a grievance process set out in the contract itself and culminate in arbitration of the dispute. Strikes and lockouts are not permitted to resolve disputes with respect to current collective agreements, and in most cases individual employees must submit complaints to arbitration rather than seek a remedy in a civil action. When such a strike does take place, it is illegal and the court has little hesitation in issuing an injunction to bring it to an end. A collective agreement must last for a period of at least one year. Normally, a prior agreement will expire before serious bargaining takes place. As a result, when a new agreement is finally reached, it will normally be applied retroactively to the expiration of the prior agreement. Thus, even with the minimum one-year requirement, the parties can find themselves back into bargaining almost immediately, which makes contracts of longer duration much more attractive.
Once an agreement is in place and the parties have become used to bargaining with each other, subsequent collective bargaining will often be accomplished in a more orderly fashion. However, often reaching the first agreement poses difficult, if not insurmounta-ble, obstacles. Because of this, in most jurisdictions the labour relations board retains the right to impose a first contract. Often, just the threat of imposing a contract will encour-age the parties to be reasonable and conclude an agreement without the need for such intervention.
Unions will often insist that a union shop clause, which requires any future employ-ees to join the union, be included in their agreements. Note that an exception is made for individuals who have religious objections. Sometimes the contract will require hiring
Parties must bargain in good faith
Contract must provide for arbitration of rights dispute
Agreement must last at least one year
First contract can be imposed
Employees can be required to join a union, with the employer collecting dues
Mediation available to assist bargaining
24Finning v. International Association of Machinists and Aerospace Workers, Local Lodge No. 99, 2009 ABCA 55 (CanLII); 2009 AB C.A. 55.
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union members only. This is called a closed shop agreement. Dockworkers, who are sent out to a job from a union hiring hall, are an example of this arrangement. A compromise where employees do not have to join the union is referred to as a Rand Formula agree-ment. In this form of collective agreement employees need not join the union, but they must pay dues and are subject to the terms of the collective agreement negotiated. Most collective agreements will also have a clause requiring the employer to deduct union dues directly off the employees’ pay (a check-off provision). This has the advantage of saving the union from the trouble of collecting dues directly from their members, some of whom may not be enthusiastic about contributing.